3 Industries Where Omni-Channel Sales Are Thriving
Brick-and-mortar-first industries are facing unique challenges in the eCommerce evolution.
For most industries, online-first startups have forced businesses into the eCommerce space by precipitating the change in consumer shopping habits. According to Statista, 43 percent of US consumers are searching for and buying products and services online, which means if brands are not online they are at a serious competitive disadvantage.
Brick-and-mortar-first companies are having to rework business models that have been successful to this point and change marketing strategies to meet consumer expectations for online shopping.
And many of these companies are proving that they know their consumers and can make a successful transition to online retail in a way that complements their physical store locations, not detracts from them.
How are they doing this? By reinventing the shopping experience — using both eCommerce and physical stores in tandem to create seamless consumer experiences.
Joe Megibow, former President of Joyus, offers insights into how consumers expect to use brick-and-mortar stores and eCommerce stores in conjunction with each other. He explains that consumers like to touch, feel and experience products firsthand, which is an in-store experience. At the same time, consumers use online stores to research product information, makes comparisons and read reviews, which can all be done anytime, anywhere.
Successful brands are creating customer experiences that allow consumers to flow seamlessly between the different shopping channels — a goal that remains one of the biggest challenges for many companies.
As Roelant Prins, the chief commercial officer at Adyen, explains, it’s not that easy. “It’s about creating a unified experience, where the best parts of online are merged with the best parts of in-store to give shoppers exactly what they’re looking for,” he says.
Some industries have excelled at creating omni-channel experiences. This includes industries such as apparel, shoe and electronics. But there are also some surprising industries that are perfecting the art of the omni-channel experience by creating a synergy between their online and offline stores.
Below is an exploration of three such industries — grocery, automotive, cosmetics — that are proving they know their customers and can be successful both online and off.
Online grocery shopping is growing at a quick pace. A 2017 study by the Food Marketing Institute and Nielsen, “Digitally Engaged Food Shopper,” indicates that in as few as five to seven years, 70 percent of consumers will be grocery shopping online.
To keep up with this trend, the industry has made great strides in creating new grocery shopping experiences that provide the convenience of both online and in-store shopping. That convenience has been the key to success for grocers in their eCommerce efforts.
Frank Kochenash, global SVP of commerce at POSSIBLE, explains the two most impactful changes grocers have made to meet demand for eCommerce:
- Home delivery. Consumers order products from the grocery store to be delivered to their homes.
- Click-and-collect service. Consumers order products to be picked up at the grocery store at a time most convenient for them.
But that doesn’t mean grocery stores are packing up the brick-and-mortar locations. Quite the opposite because, at this point, the grocery brands that are incorporating online with brick-and-mortar are doing better than online-only grocery stores, says Tina Mulqueen, CEO of Kindred Marketing Company.
Those in the grocery industry expect that people still want to be able to go to the grocery store. “We think the rise of eCommerce, of people ordering groceries or having home delivery will increase, but we don’t think the relevance of a grocery store done right is going to go away,” says H-E-B President Scott McClelland.
People are just using stores differently, which is why grocery stores are adding services like gas stations, banks and flower shops.
Grocery companies have a finger on the pulse of their industry and customer expectations, and have listened closely to what their consumers want and expect. eCommerce and in-store experiences in the grocery industry reflect that understanding.
Consumer expectations for car shopping are changing, and dealerships are rising to the occasion to meet those expectations.
Cox Automotive’s Future of Digital Retail Study shows that consumers want to complete a majority of the car-buying process before they enter the dealership:
- 71 percent of consumers want to get accurate, detailed information online.
- 83 percent of consumers want to complete at least one purchase activity online.
- A growing number of people are interested in completing the entire purchase online in the future.
To create an experience that satisfies these expectations, dealerships have started to create connected stores that take customers on a seamless journey. According to a National Automobile Dealers Association study, 70 percent of US car dealers manage some sales transactions entirely online, except for payment and delivery.
The car buyer goes online, builds the car they want or selects one from dealership inventory, then negotiates a price online. Once they choose a vehicle, they walk into the dealership and find the car they want for the price they expect. From there, they can test drive and purchase the car.
This process can reduce total customer time in the dealership from two or three hours to 30 minutes or less, says Bill Wittenmeyer, VP of sales and operations at ELEAD CRM.
The new technologies available to dealerships have allowed them to streamline and improve the car-buying experience for people who prefer to do more of the process online while still maintaining the experience in-store for buyers who prefer to do their shopping at the dealership.
In other words, dealers are creating a journey that allows customers to make a smooth transition between online and offline, notes Michael Eggerling, product marketer at CDK Global.
Another industry where omni-channel journeys are thriving is in the cosmetics industry.
The results of a 2016 survey by A.T. Kearney showed that 67 percent of consumers use four or more websites to fulfill beauty product browsing and shopping needs. Cosmetics companies have taken note of this evolution in consumer shopping habits, and they are creating new experiences for consumers both online and in stores.
Those new experiences marry online and offline shopping in ways that overcome the disadvantages of both channels to create an optimized omni-channel experience. Sean Singleton, managing partner at Your Favourite Story, explains some ways online and offline complement each other in this industry:
- Shoppers can read product reviews online before buying online or in store.
- Consumers are not limited to in-store shopping hours to complete their purchases.
- In-store shopping gives consumers the opportunity to test products before purchasing online or in store.
- Brands can promote loyalty by being available both online and in store.
The single biggest eCommerce hurdle for beauty products is the inability for consumers to try products before purchasing when shopping online. Cosmetics brands and resellers are overcoming this issue in a big way with online videos and social media influencers who educate consumers on how products work, notes NBC News’ Nicole Spector.
Ula Lachowicz, VP of marketing at Neufund, goes on to explain that eCommerce enhances the beauty experience by providing content for consumers before they make a purchase. That content has become an essential part of the customer shopping journey in almost every industry.
The cosmetics industry understands this shift in shopping habits, and most brands and resellers have made strides to create a truly seamless shopping experience where customers can start or end their shopping journey either online or in store, and have the same satisfied experience.
It’s About Blurring the Line Between Online and In-Store
On the surface, these industries don’t seem very conducive to eCommerce success. But they have been able to incorporate online shopping into the customer journey in ways that complement brick-and-mortar shopping. Brands in these industries have created omni-channel experiences where each channel informs the other, which lets shoppers complete their journeys however they choose.
Neither channel is obstructing the success of the other; they are working together to meet and exceed customer expectations.
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