The cyber tipping point has toppled. The digital die is cast. The virtual realm has insinuated itself into the physical retailscape, sweeping the consumer into the catbird seat.
Or, as the chairman of British retailer John Lewis put it during a recent a visit to New York, “The age of multichannel is over.”
Welcome to retail 3.Omnichannel.
The combined effect of store, online and mobile integration is having a comprehensive effect on retail, driving billions of investment dollars from major retailers in the United States including Wal-Mart, Macy’s and Williams-Sonoma, among others. Those investments include not only digital operations, but also new store concepts.
What is perhaps most interesting about the electronically charged change that is whirling through retail is that digital isn’t vanquishing the brick-and-mortar store. Rather, because of the exploding influence of mobile shopping, the online dimension is fusing with the brick-and-mortar sphere. In part, that is because retailers have adopted past learning into present circumstances. Brick-and-mortar-based omnichannel retailers have been learning to leverage their strengths and reinforce their relationships with their best and most interested shoppers.
Walmart’s Evolving Customer Engagement
Take Walmart, for example. Walmart director, public relations, Ravi Jariwala, told HOMEWORLD BUSINESS® that Walmart is in the midst of an essential transformation but not at the cost of store operations. Rather, Walmart is integrating stores into an evolving system of constant engagement with its customers. Right now, central to Walmart’s omnichannel advancement is an online grocery ordering and store pick-up program, offered as a cost-free convenience that complements and expands on its e-commerce ship-to-store service.
As it shifts to becoming an omnichannel operation, Walmart is less concerned about where, how and even what a customer shops.
“It’s going to be a combination of in-store and online driving incremental sales,” Jariwala said. “Issues like conversion become less important. What takes its place and becomes the priority and focus is serving the customer when it is most convenient. We have stores close to the customer, we have a website with seven million plus items and mobile access. We view our role as building an experience that is seamless for the customers and lets them choose what’s easiest for them.”
John Lewis Navigates Path To Store, Online Integration
The recent National Retail Federation Big Show became a forum for addressing what is essentially a metamorphosis of the retail sector.
Sir Charlie Mayfield, the chairman of the John Lewis Partnership, declared at the Big Show, “The age of multichannel is over.”
At the same time, as part of a seminar dubbed “Physical or Digital? The Choice is Both!,” he detailed how digital has become an increasingly critical element.
“Now we are able to take an order from a customer at eight o’clock in the evening, and the customer can collect it from any one of our Waitrose or John Lewis shops from around 2 o’clock the following day. It’s an incredibly convenient and popular proposition. It requires a whole different level of investment in the supply chain, in systems and in technology to enable that kind of customer service, but it’s driven an enormous amount of growth,” he said.
In fact, that growth has been transformative for John Lewis and has, Mayfield indicated, informed his thinking about the eclipse of multichannel ideology.
Mayfield said, “Not only do we have 40% of our sales online, but 80% of our best customers, of the most valuable customers, shop across both channels. We know from our data that 75% of all transactions in John Lewis include some component of online and shops. It can be browsing in the shop and buying online. It can be browsing online and buying in the shop. So this is completely integrated. The notion of two different channels is actually incredibly unhelpful in thinking about how you develop your business when you have those kinds of things going on.”
Mayfield said retailers have to develop a different broader mindset. “What it involves, of course, is a whole organization learning to speak ‘customer,’” he said.
Williams-Sonoma Invests In Personalization
Williams-Sonoma has proven adept at reaching consumers in the omnichannel marketplace and has boosted its direct business to half its retail sales. The retailer has won praise for its ability to provide a unified online, mobile and store proposition.
Williams-Sonoma also is a leader in a critical aspect of digital integration, the ability to capture and apply information across the entire operation in a market where retailers are looking to use such notions as curation, customization and personalization to reinforce relationships with shoppers.
Sameer Hassan, vp/e-commerce and marketing, Williams-Sonoma, told HomeWorld Business that personalization has been a major, long-term digital priority.
“With personalization, it’s not just a small shift,” he said. “At Williams-Sonoma, we’ve made huge leaps forward. With a lot of the technology platform investment we made two or three years ago, now we’re reaping the benefits.”
Hassan said, “Personalization is ultimately going to be the future of e-commerce. It’s going to be the way through which growth and success is determined in the digital space and, frankly, in retail in general. We put a big investment into the ability for us to personalize that web experience. So when you come to the Pottery Barn site, or the West Elm site or the Williams-Sonoma site, what you’re seeing can be very, very different from what someone else is seeing, and it’s based on the things you’ve been doing, the things that you’ve been telling us, and, ultimately, it’s about creating a frictionless, improved customer experience.”
For more on the Omniconsumer, see the cover story of the March 1, 2016, issue of HOMEWORLD BUSINESS®. This issue also features coverage of the International Home + Housewares Show.