Navigating the omnichannel universe is a challenge for many retailers. Whether they started out online or as physical business, knowing which channels to leverage can be tricky. This article explores strategies for building an omnichannel business that makes sense to the reader’s unique business. Stefan Sjostrand, the president of Ikea Canada, recently cautioned businesses about in-store sales cannibalization and shared how Ikea will lead the way in succeeding both offline and online.
Stefan Sjostrand, Ikea Canada President, recently shared his views on multi-channel retailing and how many businesses are doing it “wrong”. As a result, companies today are experiencing cannibalization of storefront sales at the expense of online channels.
According to an HRC Advisory survey, cannibalization is so strong, that nearly 75% of survey respondents are finding that e-commerce transactions are stealing sales that would have otherwise happened in stores. With e-commerce growth rates surpassing brick-and-mortar store sales by 10-15%, 70% of retailers are struggling to formulate a profitable balance between in-store and online sales.
With e-commerce sales rising rapidly, there are a few key recommendations to consider so that your in-store sales remain healthy. At Elastic Path we work with leading B2C and B2B organizations to help them deliver enterprise e-commerce that is flexible and open. Our Gartner rated e-commerce technology has enabled companies like Virgin Media to transact with customers in new and disruptive ways.
Here is what our team of experts recommend when navigating the complexities of an omnichannel strategy.
Develop Customer Personas that Focus on Buying Behavior
Understanding the behaviour of your buyer personas is key for selecting the right technology to boost sales both online and offline. Focusing in on behaviour from discovery through to decision, you want to outline where, when and how the persona is interacting with your product/service both in-store and online.
Take a millennial that is looking for furnishings for her first place for example. Where, aside from your online catalog, is she looking to weigh her options online? Is she looking on social networking sites such as Instagram and Pinterest to pull inspiration? What about offline? Is she walking into competitor stores to pull ideas from show-room type settings? What about your own stores?
Having a complete-view of your target markets’ behavior online and offline will assist you in selecting technology that will engage them with your product at every step of the buyer's journey.
Implement Technology that Promotes Online Transactions
Now that you have a solid grasp of how your different personas purchase, you can begin to plan out your omnichannel approach, online. Choose technology that is relevant to your personas. Take a baby boomer for example, who is looking for a luxury vacation for her and her husband. Her youngest has finally left the nest and this is the first solo trip they have had in years. Where will her vacation search begin? Perhaps she saw a colleague’s photos on Instagram who has been touring Monte Carlo. Assuming she double tapped, is your company targeting Instagram ads so your resort’s photos are placed in her feed? Can she link to a mobile-optimized website and view an interactive library of aspirational vacation photos and video?
It will be important to first, utilize marketing channels on these social networking apps and second, to have a simple mobile experience that will allow the prospect to purchase product right from his or her phone.
Taking your e-commerce store into account, you will then want to look into how you’re creating content to bring the user deeper into your site. What applications do you have in place to provide smart recommendations based on the vacation spots she is showcasing interest in? How simple is your checkout process? Are there possibly steps that could be removed to enable the transaction to occur quicker and with less friction?
As technology continues to advance, it is important to work with a flexible e-commerce platform that will allow your organization to be leaders in how people purchase online. In online spaces, ensure that your e-commerce consultant builds in tracking measures so you can continuously innovate with data-driven metrics.
Implement Technology that Promotes In-store Transactions
Mobile technology is also a powerful resource to facilitate sales in-store. Coupled with beacons, your organization can communicate with your online app on the shopper’s smartphone. Based on previous online activity, the shopper will receive personalized in-store offers when he or she walks by strategically placed beacons.
In-store, the cost-conscious millennial will be enticed with offers that could be backed with potentially months of search history. Knowing exactly what she is looking for, beacon technology will allow you to target the right offers to her at just the right time. In 2015 alone, experts estimated that US$4.1-billion of total U.S. sales were driven by beacon-triggered technology. The potential of these types of tech to drive in-store sales is huge considering that beacon technology is currently being utilized by only a fraction of retailers.
Take a moment to consider your omnichannel strategy. What strategies do you have in place to drive people to both your online and offline channels? Now reflect on how you can take it one step further.