By Marc Janssens, Fujitsu America, Inc.
Holiday shopping is top of mind for consumers this time of year, but in order for retailers to capitalize on this hectic holiday season, they’ll need to make sure that the shopping experiences they deliver are competitive and keep customers engaged and interested their products.
Critical to making the most out of this season — and every day of the year, in fact — is an omnichannel retail strategy or, as I call it, the seamless shopping experience. The omnichannel approach to sales provides customers with a consistent experience whether they are shopping online from a desktop or mobile device, by telephone, or in a brick-and-mortar store. While this sounds simple enough, many retailers can tell you that implementing a seamless shopping experience is the furthest thing from easy.
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Retailers that are implementing a seamless shopping experience know that it’s very complex to develop, customize and deploy omnichannel technology, and they will tell you that the most difficult part is often the design and legwork required to achieve true integration, where inventory is constantly available and up-to-date on multiple channels at any given time. Faulty integration is perhaps the biggest pitfall in managing an omnichannel environment because something as simple as having inaccurate inventory information can tarnish a retailer’s brand and customer service reputation.
Imagine this scenario: A customer is shopping online and adds an item to the shopping cart, but at checkout he or she discovers that the product isn’t actually available. Disappointed but not deterred, this same customer checks the inventory of the item online and discovers it is in stock at a nearby brick-and-mortar store. But upon arriving at the store, the customer finds out that the product isn’t there either. And to top it all off, the sales associate in the store doesn’t know anything more than the customer, which leaves the shopper annoyed and empty handed.
This scenario represents a real threat to a retailers’ ability to stay in business, where growing and retaining customers over the long run is difficult in the best of circumstances, but next to impossible in the face of fierce competitors that can offer an easier, more reliable and consistent shopping experience.
This all-too-familiar example actually costs retailers billions every year, and studies into the issue consistently reveal an average out-of-stock rate of 8%. In other words, one out of every 13 items that a customer wants to buy won’t be on the shelf when they’re ready to buy it.
Other challenges that come with applying a seamless shopping experience include the evolving role of the sales associate. With multiple channels empowering today’s shopper, consumers are more independent than ever before and, armed with online coupons and product suggestions on their ever-present mobile devices, they don’t require much help from the sales associate.
The “new” sales associate must, therefore, be even more connected and up-to-date than their customers, and able to fulfill Internet orders and identify items in danger of going out of stock before they run out both online and in-store. Perhaps most importantly, this new sales associate must be more customer-focused and sophisticated, with a greater ability to build and deepen relationships and grow sales.
Finally, if a retailer does not correctly implement a seamless shopping program, they will find themselves competing with nearly-impossible-to-beat online pricing. For large purchases, such as electronics, many shoppers nowadays visit a store to see and try a product firsthand, and then go home and make the purchase online for significantly less.
Consumers today can even use an app on their mobile device to scan the barcode of a product in-store and locate 10 different retailers selling the same product at often lower prices. Online pricing crushed retail giants like Circuit City, the former number two electronics retailer in the U.S. Circuit City neglected to improve its web presence just as online retailers like Amazon.com were hitting their stride, causing the company to shutter its doors permanently.
At the end of the day, brick-and-mortar stores will remain highly relevant because they have the most knowledge of retail, and their branding trumps online-only stores. But in order to prosper with their seamless shopping experience, retailers must start to embrace, rather than compete with, the online world.
To do this effectively, retailers must focus on integration of the retail channel, enhance the skills of their sales staff, and optimize their store space and layout to drive convenience, order fulfillment, showrooming and personalized services. Tools like electronic and biometric payments, such as Apple Pay, also play a key role in effectively managing a seamless cross-channel shopping experience.
To be sure, online retailers do have a leg up on brick-and-mortar stores without an omnichannel program. They have access to and collect copious amounts of data from online shoppers, enabling them to selectively target consumers with the right products and prices at any given time, so employing in-store analytics such as gaze tracking can level the playing field for brick-and-mortar retailers.
The holiday shopping madness comes and goes every year, but omnichannel retailing is here to stay, and retailers that fail to get on board will be left with nothing but a lump of coal in their stocking.
Marc Janssens is Executive Vice President of the Retail and Platform Products businesses of Fujitsu America. Mr. Janssens is responsible for driving the growth and profitability of Fujitsu’s retail business, delivering the full spectrum of the retail portfolio to clients in this industry. He also leads the company’s platform products business including enterprise, mobile and software products as well as Fujitsu solutions.
