This post was originally published on March 11, 2019 and has been updated for accuracy and relevancy in the market.
Why a Hybrid Customer Experience is Essential for Today’s Consumer
There are 2.14 billion digital shoppers today. Having an eCommerce strategy has become not just a nice-to-have, but a vital component of any business’s long-term success; And the recent expansion of IoT, proliferation of smart devices, global crises like COVID-19, and trending mobile apps like TikTok, have forced businesses to shift their focus, expand their online presence, and accelerate their digital strategy.
After all, that’s where the customers are, right?
While yes, many consumers today do prefer shop online as it can be more accessible and cater to personal preferences, it’s not the end of the brick-and-mortar store. As it turns out, based on a 2019 study, many customers actually prefer a hybrid experience over one that is entirely online or in-person.
In fact, customers that shop using more than one channel have a 30% higher lifetime value than those that only use one.
What exactly is a hybrid customer experience?
The hybrid experience is a commerce experience that combines elements of both eCommerce and in-person shopping experiences, whether that’s in-store, at an event, or over the phone.
A good example in understanding the hybrid experience is how many companies now let customers order products online and pick them up at one of their local stores. Many businesses also now allow customers to return items they ordered online to a local store to receive a refund or even cash. We’ve even recently seen the adoption of in-store mobile self-checkout and COVID-19 introduced the concept of curbside pickup.
These hybrid experiences are driven by an integrated ecommerce strategy and solution that allows companies to carry not only brand messaging, marketing tactics, and product information across channels, but also customer data. This means businesses can give customers a more seamless, frictionless experience.
Their account information can be accessed by in-store representatives or pulled up on different devices, and shoppers can hunt for product data such as pricing or in-store availability.
At the end of the day, consumers can take that next step of their journey when and how they want. That level of convenience is one of the core underlying behaviors that drive all shoppers today.
Why all businesses should consider a hybrid approach
In 2016 and 2017, customer experiences that were fully online experienced a one percent decline, while customer experiences that were hybrid actually increased by one percent. For large companies, a one percent change in either direction can represent either a loss or gain of hundreds of millions in revenue.
Today, in 2021, companies that can build and deliver strong multi-channel engagement for their customers can actually see a 9.5% year-over-year increase in annual revenue.
Here are a few additional compelling trends and stats that highlight the importance of leveraging a hybrid customer experience:
- Consumers of all ages – including 62% of Baby Boomers and 58% of Gen Zers, still prefer buying from a physical store (Source)
- 63% of shopping occasions begin online (Source)
- 45% of brick-and-mortar buyers check online reviews before buying (Source)
- 50% of Consumers Expect to Buy Online and Be Able to Pick Up In-Store (Source)
- 39% of consumers are unlikely or very unlikely to visit a retailer’s store if the online store does not provide physical store inventory information (Source)
- 71% of in-store shoppers who use smartphones for research say their device has become more important to their in-store experience (Source)
- 56% of consumers have used their mobile device to research products at home with 38% having used their mobile device to check inventory availability while on their way to a store and 34% who have used their mobile device to research products while in a store. (Source)
Given some of the stats above, it apparent that in-store moments matter to customers, whether they’re stand alone or augmented by a digital concept.
The reason why the hybrid experience was deemed better than online or traditional experiences is mainly about convenience. Customers aren’t necessarily looking for a specific shopping experience. Instead, they are looking for the best overall shopping experience for their wants and needs. Customers today demand shopping experiences that are simple, lack any friction, and can cater to their preferences and timeline.
The emotional response to the shopping experience is another important factor. Less friction, more personalization, and better convenience will satisfy consumers, and a positive emotional response increases brand affiliation and can result in positive reviews, word-of-mouth, more revenue and less churn.
When a company’s overall shopping experience is pleasant, customers tend to remember that and often become repeat customers as a result.
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Hybrid Customer Experience Example 1: Carvana
Carvana for example, is typically an online-only car company founded in 2012 that embraced the hybrid experience in a creatively big way. The company’s business model involves selling slightly used vehicles online for less than what traditional car dealers sell them for. Customers can order cars online and have them shipped to their homes. They then have seven days to decide whether to keep them or return them for a full refund.
But Carvana customers also have another option. They can travel to a Carvana location and pick up their new vehicles in person if they want. And to make things interesting, the company has created what it calls a “car vending machine,” which is a five-story automated car storage and retrieval system.
Carvana customers are given a large token. When placed in a token receptacle, the system is activated and the vehicle they selected is pulled from inventory and placed right in front of them – just like a vending machine In the Carvana example, and with other companies that have embraced the hybrid experience, the important takeaway is customers aren’t necessarily looking for a traditional retail experience or an online experience.
They are looking for a shopping experience that makes them feel like a valued customer. It’s about offering customers a superior shopping experience, and it’s a strategy you can embrace with your eCommerce business to take it to the next level, win over more customers, and close more sales.
Hybrid Customer Experience Example 2: Birchbox
Birchbox is another prime example of a brand that that took their mastery of online ecommerce and expanded to physical locations. Birchbox, founded in 2010, is a global online monthly subscription service for beauty products and cosmetics. They offer a wide variety of skin care products, makeup, perfumes, and other organic-based beauty lines to consumers in the US, the UK, France, Spain, Belgium, and Ireland.
In 2014, four years after launching their online-only business, BirchBox dove head-first into in-person retail and opened their first brick-and-mortar shop in New York City’s Soho neighborhood. Consumer data showed that shoppers in New York had a 3x higher lifetime value than any other customer. In an attempt to cater to their most loyal customers, they wanted to offer a personalized, in-person experience.
Customers can build custom boxes, in-person, just like they might online, but they’re also able to get the knowledge and expertise of the BirchBox representatives, ask questions, and get an even more personalized experience.
Where Birchbox excelled was how they carried their online brand experience and messaging to an in-person experience. Consumers could still pick-and-mix while choosing from the top 100 products and brands that Birchbox had to offer. Even the store coloring and concepts matched their digital store, from the color and styling to the packaging.
Developing your hybrid experience strategy
If you want to cash in on the benefits of the hybrid shopping experience, you’ll need to develop a strategy to implement hybrid solutions in your own eCommerce business.
There are many different ways you can do this, and a strategy that works for one company isn’t necessarily going to work for another. Still, there is a general approach to developing a strategy that does work well for most businesses.
The first thing you want to do is to brainstorm ways you can transform your eCommerce business from a solely online or in-person venture into a hybrid business. What are some ways you can improve the customer experience by adding a physical or digital element to your business? Write down everything that comes to mind and then carefully consider each idea to see if it makes sense financially for you to pursue.
The next thing is to implement your idea to see if you see an increase in customer loyalty and repeat business.
If you do come up with more than one idea, it’s important to experiment with only one idea at a time. That way you will be able to easily determine the things that work and those that don’t. Consider split testing your ideas. Measure shopping outcomes prior to implementing ideas and after so you can have a clear comparison of the results.
You also want to consider investing in the latest technologies if a technological solution will be a part of your strategy. How long has a particular technology been around? You don’t want to run into a situation where you invest in a technology only to find out something better and/or more affordable is about to be released.
Which companies offer the technology you are interested in? Take the time to evaluate different options to see which company offers the best solution for your needs. Other factors to consider when evaluating options include how much customer support is offered, availability of product training, and overall ease of use.
Finally, when developing your hybrid experience strategy, it’s vitally important to always remember what customers are looking for. It isn’t an issue of online versus offline. Rather, it’s about the overall shopping experience.
The purpose of developing a hybrid strategy is to increase brand loyalty. Anything that takes away from that goal should be discarded.
Do’s and Don’ts of Building a Hybrid Customer Experience
- Do Ensure Your Messaging is Consistent Both Online and In-store
- You want your customers to have the same brand experience walking around your brick-and-mortar shop as they do when browsing online. This can include your graphics, copy, sinage, and even product labeling or packaging. They don’t need be identical, but should give your customers the vibe they know and love.
- Don’t Try to Make the In-Store Experience the Exact Same as Your Digital Experience
- In fact, you don’t want it to be. In-store shopping is a much more sensory experience than a digital one and should be treated as such. People shop in-person still because they like to see, smell, feel, or try on the products they’re evaluating, and this is something brands should take advantage of.
Take Sephora, the retail beauty giant. The brand look and feel and messaging is the same across the website and in-store experience, but when you go in person, you can smell the perfume when you walk in. You can get physical free samples and even get your makeup done at the counter.
- Imagine Sephora decided to remove all that, but you could still use their digital app in-store to virtually ‘try on’ the newest lipstick color. Doesn’t quite make sense, does it?
- Do Offer the Same Level of Communication and Education as You Do Online
- Customers want to feel like they’re getting the same value as they do when hunting for product information online. You’ll want to ensure your ground staff has been trained on company branding, messaging, and are knowledge on product information. Having one-on-one recommendations come from an in-store representative feels personal, one of the other core trends consumers crave today.
The bottom line
At the end of the day, you could just continue doing the things that have already made you successful and not bother with embracing the hybrid experience. Why rock the boat? But ignoring the power of the hybrid experience is leaving money on the table.
Making the hybrid experience a part of your strategy is really about increasing customer loyalty, brand recognition, and revenue. It’s about scaling your business and growing the bottom line.