Why omnichannel is a must and how to make it successful
As any retailer knows, in today's society, the customer is always right; and is increasingly more demanding in terms of what they expect when making purchase decisions. The customer now wants to be able to start, continue and complete their purchases anytime, anywhere and anyhow. Our online society facilitates purchase decisions being made, verified, reconsidered, amended or reversed, in any situation and through any possible channel, or indeed a mixture of many. As a result, providing a seamless payment experience that can follow the customer along their journey across the plethora of touch points is essential for a merchant to succeed in the marketplace.
In response to this demand for a range of purchasing options, hardly any merchants continue to be focused on just one channel and instead opt for the omnichannel approach. However, it is not enough to establish autonomous and unconnected e-commerce and in-store channels, as this approach is likely to result in a fragmented customer experience, which in turn can lead to a loss in sales. With e-commerce continuing to grow at the expense of in-store business, it is more vital than ever to consider all channels and touch points, and for retailers to invest into a unique, smooth and brand-defining customer experience.
At SIX Payment Services, we have noticed that merchants are creating additional touch points to connect with their customers in order to expand on existing relationships, as well as to reach out to new customers. As part of this, we have seen an increased demand in three services in particular:
- Click and collect: Where the customer orders and pays for the goods online, before collecting them in store.
- Click and return: The customer orders and pays for a product online and this will be delivered to their home. The product can then be exchanged or returned at the store, with the payment refunded, without physically needing the card originally used for payment.
- Endless aisle: A product may be sold out in store, but can be ordered on mobile devices or at an info-booth in the merchant's shop.
On top of simply ‘following' a customer along their journey, in order to really harness the opportunities facilitated by omnichannel, a successful merchant also needs to be able to link additional services to these many touch points. These include loyalty schemes and bonus points which accumulate irrelevant of the nature of the transaction, special offers which can be tailored to the individual and automatic retrieval of the customer's personal details. Not only do these extra services help boost sales, they also help increase customer satisfaction and as a result their loyalty to a specific brand.
However, while it is vital for merchants to focus on meeting the needs of their customers across a range of channels, it is just as important that they do not lose sight of operational efficiency. Processes do not only need to be integrated at the 'front of house.' the customer's journey must also be reflected in the back office. Gone are the days where in-store returns generate a host of manual interventions — written receipts, reallocation of payment, return of goods to main warehouse for stock processing etc. The advent of omnichannel means that this level of manual work simply wouldn't work. For a merchant to be truly successful in the ‘new world' all systems must be fully integrated.
This means that one scan of the original receipt should be enough to reimburse the customer, automatically amend any loyalty points, update the merchant's sales statistics and, crucially, for the item to immediately be added to the store inventory for another customer to purchase, either in person or online. Further to this, merchants can also monitor customers who 'click and return' regularly — perhaps excluding them from certain offers such as ‘pay later.' In this way, not only does the merchant save on many man hours, but they can also speed up the stock re-allocation process to help facilitate further sales.
A recent study which SIX Payment Services conducted with ibi research, interviewing nearly 300 merchants in Germany, Austria and Switzerland on the topic of omnichannel, revealed that 40 percent already use omnichannel practices and nearly a third (32 percent) are planning to invest in this area in the next three years. Moreover, 50 percent of those surveyed expected higher sales as a result of a successful omnichannel implementation program.
In order for merchants to respond and get to the market quickly, a viable first step may be to provide a good cross-channel solution, which is one where certain actions are included and others are still manual and non-integrated. Such a gradual development will allow a fast go-to-market as well as an opportunity to learn and adapt. However, in order for an omnichannel solution to be long-term and sustainable, it is of utmost importance that it is based on a fully integrated, seamless real-time technology that extends across all business areas and functions, including as stock management, CRM, ERP, web shop, ECR and payment solutions. The future of purchase and payment is here, and the customer expects to be able to use it.