A woman enjoying digital shopping while riding in a grocery cart past a mobile device stylized as a physical store surrounded by likes and other social icons

Why Omnichannel Ecommerce is a Must for Businesses

author

Anastasiya Haritonova

10 min read

Omnichannel eCommerce is redefining the way businesses harness and channelize data to offer consumers a seamless experience. Tech experts believe that now is the right time to invest in technology and achieve omnichannel success.

In today’s dynamic business environment, businesses and customers connect and communicate at multiple touchpoints. From websites to brick-and-mortar stores, customers expect retailers to be available everywhere, all the time!

Businesses have to be excessively vigilant to deliver a favorable and unified experience to customers, thereby making them brand loyal. The process involves using myriad sales channels and integrating their approach across all these channels to deliver a consolidated experience.

The secret to successfully delivering such an interwoven experience lies in implementing an omnichannel strategy that connects a never-ending loop of touchpoints without deviating from the crux.

What is an omnichannel strategy?

An omnichannel strategy involves varied individual customer touchpoints spread across multiple channels that seamlessly connect into a unified front-end. It allows customers to pick up where they left off, and continue their experience from one channel to another.

Omnichannel eCommerce is all about developing integrated and consistent service channels so that when customers reach out to one’s business, they view a unified support service instead of separate departments. Traditionally, retailers used the sales funnel strategy to persuade customers at the physical stores. However, the multiple touchpoints of the eCommerce omnichannel have now replaced the sales funnel strategy. These touchpoints include social media, websites, digital marketspaces, native apps, and many more.

The main idea behind omnichannel retail is for the business to ensure that information available at every touchpoint is identical, thereby avoiding any confusion. The purpose of an omnichannel strategy is to design and deliver a flawless user experience at any given touchpoint. This approach goes beyond optimizing individual channels as separate entities in themselves. In reality, it removes all boundaries between online and offline sales and marketing channels to create a unified whole.

As experts have said, omnichannel strategies are successful only when they focus on converting customers on any channel.

Single-channel vs multichannel vs omnichannel

Single channel commerce showing a woman walking to a store, multichannel showing her using mobile experiences in addition to a physical store, Omnichannel showing all these elements interconnected

We hear businesses using the terms multichannel and omnichannel interchangeably. But are they really the same? Let’s understand all these terms one by one.

Single-channel commerce

Under this concept, retailers choose to sell via a single marketing channel. For example, some retailers sell only through their physical store or solely on an eCommerce website, whereas some register and sell via an online marketplace like Amazon or eBay.

Such a standalone strategy works well for small business owners. However, if you are looking at delivering a refined shopping experience for your customers, you must look at additional resources and channels to reach them.

Multichannel commerce

In this strategy, a single retailer chooses to sell using various different marketing channels. These include offline stores, websites, native applications, e-marketplaces, and social media. Such a strategy offers opportunities for the business to keep engaging with their customers via various platforms, making them brand loyal.

It becomes easier for customers to reach a retailer present on all channels. However, the strategies and communications on the different platforms are disparate. For example, the brand’s social media platform would not be aware that someone is also an offline customer of the same brand. Therefore, we see a gap in the retailer’s communication and business intelligence. An omnichannel strategy promises to fill this gap.

Omnichannel commerce

What is Multichannel vs Omnichannel? That’s a good question.

Omnichannel is an extension of the multichannel retail strategy. Here, retailers optimize different channels to provide a seamless experience to customers. Data and systems across all channels are freely exchanged, thereby eliminating all silos. Retailers can communicate with customers without boundaries while still diversifying across all channels.

An excellent example is the “buy online pick up in-store” (BOPIS) facility. Integration of the business back-end allows customers to place orders online and collect their goods from physical stores.

Find out how this grocery store chain underwent a digital transformation in just 8 weeks

Why should businesses adopt omnichannel eCommerce?

A study by the Harvard Business Review revealed that close to 73% of all online customers use multiple channels before making purchase decisions. Another report disclosed that almost 44% of B2C buyers and 58% of B2B buyers research products online before visiting a physical store to purchase them.

Omnichannel eCommerce focuses on delivering a unified customer experience, no matter which online platform they are using. Broadly, adopting omnichannel eCommerce benefits both customers and the business.

Customer-related benefits include:

  • Customers’ convenience as a priority

Unlike traditional marketing strategies, which were product-centric, omnichannel eCommerce strategies are customer-centric. Given that the business environment is highly competitive with multiple alternative options, it is crucial for brands to reach the customers instead of waiting for customers to reach out to the brands.

The omnichannel strategy focuses on easing the consumer’s journey while shopping for the brand, thereby adding value and enhancing their experience. According to UC today, 9 out of 10 customers expect an omnichannel experience with seamless communication.

  • Increased brand loyalty

Customers make purchase decisions based on their experiences with brands. An omnichannel eCommerce strategy joins the dots between all platforms, thereby delivering a seamless, memorable, and lasting experience.

In addition, businesses get the opportunity to understand the journey and preferences of their customers. Thus, this strategy offers higher rewards for acquiring more customers for these brands.

  • Communications become cohesive

Multichannel commerce focuses on optimizing every channel separately without considering the bigger picture. It often leads to a gap in communication across the various channels.

In contrast, omnichannel eCommerce focuses on conveying the same messages and reputation across all channels. This strategy promotes clarity and strengthens the brand’s image in the minds of its customers.

Let’s also answer the question, why is omnichannel important for retailers? Well, there are several business-related benefits:

  • Centralized customer data

Adopting an omnichannel approach (as opposed to a multichannel approach) helps consolidate data pouring in from various sources and eCommerce channels. Over time, it enriches business intelligence reports by offering enhanced sorting and analysis of data.

Insights into such information improve the decision-making ability of brands and provide better personalization opportunities for customers.

  • Growth in sales and traffic

The Harvard Business Review study established that omnichannel customers spent 4% more money in physical stores and 10% more online. Simply put, with every additional channel used, omnichannel customers spent more money, either online or offline. Also, customers who used 4 or more channels spent 9% more money on average.

Therefore, every business should consider adopting an omnichannel eCommerce approach for the mutual benefit of their customers and the business itself.

What points to consider before developing omnichannel eCommerce?

Two analysts, a man and a woman, pointing to graphs on a laptop and tablet with a store in the background

Omnichannel eCommerce helps businesses grow and flourish, but not without thorough research and cost-benefit analysis. Along with all the opportunities, there are a few downsides that retailers need to be careful about to prevent any damage or losses. Some common challenges that retailers need to analyze before making the final call are as follows.

Choosing the wrong channels

Business diversification is undoubtedly the key to growth and expansion. However, in the process of diversification, launching an inconsequential channel could prove disadvantageous to the business.

The right decisions about channels require in-depth research related to the target audience, logistics, technological requirements, human resources, cost-benefit analysis, and so on. An irrelevant or outdated choice could do more harm than good. Therefore, retailers should invest only after thoroughly analyzing the niche, marketplace, and business environment.

Stock decisions for online vs offline stores

If retailers display the physical store’s stock online, it could lead to overlapping sales, resulting in shortages. Such overlap is an example of one channel cannibalizing another.

To avoid such errors, retailers must maintain a centralized inventory statement that is reflected in the displayed stock levels. The inventory system must also notify retailers for restocking as soon as the reorder level is reached.

Infrastructure related concerns

As the business begins to grow, new pains may crop up. Higher sales call for better management, automation of processes, advanced software requirements, a larger workforce, and digital solutions for repetitive tasks. As well as these, website or application maintenance and customer service also require effort and cost. A growth phase like this needs to be managed swiftly.

The solution to this challenge lies in expanding the team or using automation tools as support. If things go wrong, it can inevitably lead to a backlog of orders, tasks, processes, and refunds, causing damage to the reputation of the business.

Therefore, conducting thorough research, making fair and calculated decisions, hiring the right team, and choosing the most reliable technology are crucial considerations before adopting an omnichannel eCommerce approach.

What technologies are steering omnichannel eCommerce?

Switching your marketing strategy from single or multi-channel to omnichannel is a daunting task that will demand a lot of time, effort, and resources. When taken wisely, this decision can result in outperformance of current business results. Thus, while implementing this change, the retailer needs to focus on leveraging the right technologies that power the omnichannel strategy.

Let’s look at some groundbreaking technology tools that shape an omnichannel eCommerce strategy.

Internet of things (IoT)

The IoT, the technology responsible for bringing paradigm shifts in almost every industry, can result in exponential growth when incorporated into eCommerce strategies. Research suggests that the total number of IoT-connected consumer devices will grow to 125 billion in 2030, and every consumer will own 15 connected devices, on average. This indicates insane growth potential for omnichannel eCommerce in the near future.

By running targeted ads or developing PWAs for IoT devices like smartwatches, smartphones, smart speakers, and other wearables, omnichannel retailers can increase the visibility of their offerings and collect detailed data with real-time verification. Insights from such data can aid in the design of personalized feeds and marketing suggestions.

About 74% of online buyers get frustrated when websites or applications suggest options that do not match the buyer’s interests. Personalization is a luxury tool no more. It is now an essential feature for all eCommerce retailers.

Apart from personalization, IoT also throws open the door to global markets through connected, audio-video-capable smartphones and other devices. IoT promises tremendous growth potential for omnichannel eCommerce. However, it also brings the challenge of processing and analyzing heaps of data to gain actionable insights.

Check out this IoT solution for BMW employees, dealers, showroom visitors, and car owners

AI-powered recommendation engine

Artificial Intelligence is another disruptive technology that can significantly improve an omnichannel eCommerce strategy. AI plays a crucial role in designing algorithms that form the basis of a recommendation engine. Simply put, when customers sort, filter, and search items, the AI algorithms predict and recommend the most relevant products based on their previous purchases and preferences.

This technology can be very fruitful in an omnichannel strategy, given customer data is collected from both online and offline channels. A good recommendation engine can make or break an eCommerce business. The best example of an eCommerce business that has flourished because of a brilliant recommendation engine is Amazon. Along with personalization, AI helps keep customers hooked on the platform for a long time.

Chatbots

With robotized customer service becoming an essential component of retail eCommerce operations, chatbots are the new buzzword in the industry. More and more eCommerce platforms are opting for chatbots to answer initial questions that customers have. Chatbots free the workforce to handle more complex customer problems.

Trends predict that close to 85% of customer interactions can be managed by chatbots, as they do not need human interaction. Oracle found that 80% of entrepreneurs are using or planning to install a customer service chatbot on their website. Thus, chatbots are a vital omnichannel eCommerce tool that provides personalized, on-demand customer service, available 24/7.

Augmented Reality

A hand holding a mobile phone using an augmented reality app to see how a home theater system fits into a house setting

With Augmented Reality technology, customers can digitally superimpose elements in their physical surroundings using their smartphone cameras. AR helps to bridge the gap between online and offline shopping experiences. Popular e-retailers like IKEA and Converse have adopted AR technology in their native applications and websites.

IKEA allows customers to use their smartphones and virtually place furniture in their physical spaces to get a feel for them and visualize them. Similarly, Converse lets customers virtually try on shoes using their smartphones.

AR offers unparalleled opportunities for omnichannel retailers to design well-informed, personalized customer experiences.

Mobile applications, PWAs and POS

Native mobile applications and websites are not a new technology. However, keeping them up to date is a crucial aspect of omnichannel eCommerce. To blur the lines between physical stores and online platforms, retailers offer digital payment solutions and AI-powered point-of-sale terminals, even in offline stores. Proximity payment solutions are also gaining acceptance among retailers.

Another modern technology is “Progressive Web Applications” (PWAs), which allow smooth, personalized cross-channel experiences on mobile browsers. PWAs are also easier on the pocket compared to native applications. They have the potential to replace major POS applications and other retail associate platforms by providing a faster, more efficient, and cost-effective way for store employees to locate products online and in-store, allow self-checkout and service returns and save the sale directly from their smartphone.

ECommerce giant AliExpress saw a 104% jump in conversion rates since making the switch to a PWA. PWAs can therefore prove to be a disruptive technology for omnichannel eCommerce retailers.

Headless content management system

Personalization has shown a growth of 15% in the revenue of omnichannel eCommerce. However, personalization requires continuous data collection and analysis. Brands need to continually put this personalized content into action across all digital channels. Content creation and management is an endless journey. A headless content management system (CMS) forms a bridge between the front end (where content is displayed) and the back end (where content is created and stored).

Once the content is created and labeled by the personalization engine, a headless CMS uses an application programming interface (API) to optimize, publish and re-publish content, over and over again, across all digital platforms. It enables the retailer to unite the marketing team, campaigns, and assets with a single source from which personalized content experiences are delivered.

Other technology tools

Other modern technologies that ease omnichannel eCommerce include:

  • Marketing automation

This tool tailors marketing campaigns based on the customer’s activities on-site. It then communicates personalized offers or messages in the form of automated emails or targeted SMSs.

  • Virtual reality gadgets

VR gadgets enable customers to digitally immerse themselves in a physical store and make purchases through the device.

  • Cashierless checkout

Physical stores can allow customers to pay directly via mobile applications, self-checkout shopping carts, or AI-enabled smart cameras and shelf sensors that automatically deduct money from linked wallets at the store exit.

Implementing an omnichannel retail eCommerce strategy can become a taxing activity with all the data floating around. Therefore, retailers should adopt modern technologies in line with their brand’s purpose to deliver a frictionless customer experience.

This article will help you choose the best eCommerce CMS for your business

Companies that capitalize on omnichannel eCommerce

Many adopters of omnichannel eCommerce have successfully delivered seamless customer experiences, resulting in recurring sales and business growth. Below are some examples of companies that can boast of the success of their omnichannel eCommerce strategy.

Amazon

Is Amazon an omnichannel? Yes, it is. Initially established as an online-only bookselling platform, today Amazon is the best example of a successful e-retail giant using an omnichannel eCommerce strategy. Amazon allows customers to access their profile through all platforms: website, mobile applications, Alexa devices, smartwatches, and physical stores.

The brand’s omnichannel approach enables customers to place orders online, schedule pick-ups or order doorstep delivery, repeat previous orders, and even get all of this done through Alexa. They also provide numerous payment options for the maximum convenience of their customers.

Amazon recorded a 29% jump in sales immediately after implementing the recommendation engine in 2012.

Walgreens

Hands holding a smart phone and wearing a smart watch with an eCommerce app launched, a Walgreens store in the background

Walgreens, the second-largest pharmacy store chain in the US, is a remarkable example of a creative omnichannel eCommerce strategy. Walgreens has extended the omnichannel approach to the brand’s rewards program. Customers earn rewards for multiple activities, such as:

  • Online and in-store purchases
  • Tracking activity by connecting fitness applications to their Walgreens profile
  • Filling out health information surveys
  • Getting vaccinations in-store.

Rewards earned can be redeemed on purchases, both online or in-store. The system also allows customers to select products, find the nearest outlet, and check the inventory and location of the required products in-store. Overall, Walgreens uses technology to offer maximum convenience to customers, thereby ensuring and safeguarding brand loyalty.

Value City Furniture

Another unique example of the omnichannel eCommerce strategy is that implemented by Value City Furniture. Last year they introduced an “easy access” pass for their shoppers. The pass enables offline customers to access the same deals and merchandise they have chosen on their visit on their application as well. It gives shoppers time to think before they invest in the furniture.

Similarly, online shoppers can add merchandise to their in-app wish list. Using the easy access pass, employees in-store can look up shoppers’ preferences and guide them accordingly. In this way, Value City Furniture has harnessed its omnichannel strategy to improve customers’ experiences.

Emirates

Emirates, one of the world’s largest airline companies, has also implemented an omnichannel eCommerce strategy. Emirates is known for its luxury and concierge-level service and has focused on every touchpoint by:

  • Making bookings easy from their website
  • Integrating the application with smartphones, tablets, and even Apple Watch
  • Updating essential details like flight number, status, seat upgrade, etc. on every connected device.

In this way, they have designed an omnichannel approach that helps their business grow, keeps communication consistent, stabilizes the brand’s image, and enhances the customer’s overall experience.

We can see from the above that there are no binding rules on how brands can implement a successful omnichannel eCommerce strategy. As the decisions are crucial for any business, retailers need to be creative and unique. With the right technology, retailers can simplify this otherwise complex journey.

Conclusion

Omnichannel eCommerce promises immense potential. Customers desire improved experiences, both online and offline. Therefore, retailers should constantly adapt to consumers’ ever-changing needs and behavior, and recalibrate their understanding of the target consumer.

The implementation of a comprehensive and holistic omnichannel eCommerce strategy requires a strong foundation. The pillars that make this foundation strong include choice of channels, the back-end data collection and analysis system, marketing and advertising, operations and logistical support, and above all, unique disruptive technology!

The latter is one of the most important but at the same time the most challenging elements. You can delegate it to seasoned specialists from PixelPlex and thus greatly simplify the task of finding the most suitable technology.

If you believe your business is ready to grow with a customized omnichannel eCommerce strategy and platforms, we can help you implement technological solutions. Our team of professional web developers will support you through every step of the process, solving all your technology-related challenges.

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author

Anastasiya Haritonova

Copywriter

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