Retailers preparing to plough £5bn into omnichannelby
The UK’s non-food retail sector is set to invest almost £5bn in omnichannel over the next five years, according to a new set of predictions.
LCP Consulting’s latest report forecast that the ‘omnichannel revolution’ will accelerate within the next two years and is likely to radically alter the future of retail.
Whilst the report cites sales and margin as two major benefits to deploying an omnichannel strategy, it also claims omnichannel can provide real motivation to design and deliver enhanced business operating models.
Phil Streatfield from LCP Consulting, said: “In our experience, regardless of cost, omnichannel is becoming the ‘need to have’ model for the retail industry. It has almost reached the tipping-point of change or fail.”
So how should retailers adopt this new model? Retailers need to implement a truly integrated brand experience, using the whole organisation to deliver uniformity of service through a deep understanding of the customer, optimised assortment, re-aligned store operations and integrated IT systems, said LCP.
Additionally, more than a third of board directors surveyed for the study said that an aligned board was essential in delivering a truly omnibrand to the market with many agreeing that functions such as operations, supply chain and IT need to become more influential in the boardroom.
Omnichannel does not come without its challenges, however. Offering a uniformity of service through the behaviour of staff, managing partners effectively, balancing the role of the store against the ever-increasing online demand and fulfilling the needs of all will require a revolution in end-to-end supply chain operations and management, said the report.
Additionally, the report suggested that measuring ROI on omnichannel investment is still unclear, given the relative immaturity of the omnichannel model, and retailers must not invest in omnichannel simply to compete.
John Oswald from service design consultancy Fjord said of the findings: “Increasing retail investment in so-called 'omnichannel' provides further evidence for the ‘revolution in retail’ we are witnessing as online and offline continue to merge. While many retailers are or course concerned with increasing sales in the short term, they need to look at long term customer needs and preferences if they want to deliver a truly immersive and superior customer experience that builds brand loyalty in the long run.
“As people access information across a variety of touchpoints, from email, social media, mobile, brick and mortar to the web and popup stores, retailers must take into consideration the need for a blended online/offline experience in order to offer excellent service, no matter what the channel. The future of retail is going to be guided by real people and their behaviours: those retailers that realise this and place people at the heart of their strategy will be able to stand out from the competition by delivering real value to real individuals.”
This month MyCustomer.com is taking a deeper look at omnichannel, recently listing the strategic actions brands need to develop and implement to give themselves the best possible chance for success.