In just a few years, since the IoT has empowered consumers and transformed their shopping habits, digital platforms have changed the internal workings of many businesses. The digital influence factor has brought to the table new ways in which consumers can make decisions and has created new digital expectations regarding how retailers present information and service their customers through the buyer’s journey.
The Store’s Front Door is no Longer Physical, It’s Digital
More than 71% of brick & mortar sales start with an online experience with $ 0.56 of every dollar spent in store influenced by a digital interaction. So far, people who engage online have:
● looked up product information
● checked and compared prices online
● subscribed to a product’s or store’s email list
● clicked an email advertisement to find out more
● searched for promotional coupons and
● liked/ tweeted/commented on a product or store on social media
However, out of that 71%, only 1.6% convert online and most of the consumers who end up making a purchase are dissatisfied with their experience and don’t intend to go through the process again. More often than not retailers fail to apply even the most basic digital features and metrics. Only 20% of overall customers intend to return and buy again.
Omnichannel Drives Revenue
The Millennial Mind-set
Millenials are the demographic group most likely to embrace new digital marketplace features, but this generation gap has been rapidly closing as the older generations have adopted this new mind-set and increased the usage of digital before, during and after a shopping trip. Top retailers have leveraged this knowledge and optimized their operations for omnichannel growth for both digital-savvy prospects and the less digitally sophisticated customer base.
For instance, Nordstrom, Best Buy, Kohl’s and Abercrombie & Fitch earn on average 20% of their revenue online. Retailers like Walmart and Nordstrom have rolled the income from various mergers and acquisitions and grown their omnichannel capabilities by 29% and 20.2% respectively.
The strongest players invest wisely in new omnichannel technologies and align their digital strategy with their brand and business model. For example, Walmart focuses on price, convenience, and minimizing the human intervention during the transaction while Nordstrom highlights a superior in-store customer service and uses technology to empower associates.
Case Study : Nordstrom needed a PIM/MDM Solution with state-of- the-art capabilities to improve multi- channel business results. The key objective was to have a scalable system that could cater to volumes more than 30 M SKUs and 1000 users. Read their story.
Developing a digital strategy grounded in data and technologies that select and measure the right indicators as well as connecting with your customers on their preferred shopping platform can be the key to unearthing new business opportunities.
On average, the top 250 retailers convert only 2.7% of their online visitors, with the best in class converting up to 3.9%. Before spending more resources on driving traffic, companies should focus on getting more sales from their existing customers and maximizing the current revenue streams such as product page and cart conversions.
Lack of digitization is one of the leading sales deterrents. On websites with poor user experiences, converting and closing can take over 10 steps (from ‘Homepage’ to the final ‘Choose Payment’) as opposed to their counterparts which got it down to two (VUDU – Walmart), or even one like Amazon’s 1-Click Ordering.
Given the complexity of the transaction process, it’s no wonder certain customers find it difficult to navigate a website and exit. Others might not be able to find the goods they are looking for. Sometimes the product is out of stock and the company has no immediate way to supply it from another warehouse.
More so, if the checkout process is too complicated and the customer gets errors or cannot complete the transaction, then they will probably never return for another purchase. Similarly, if the company is charging too much for shipping or if it takes too long to get the package, then it is very likely that the clients will look for a better alternative.
Technology Change Necessary, not Sufficient
Product Information Management (PIM) represents one of those fundamental technological pieces that help retailers close the gap between what they offer and the digital expectations of their customers. PIM has a measurable impact on the digital experience and simplifies the shopping process for all the parties involved.
Through PIM, retailers can streamline the product search and increase discoverability and the perception of variety. Compelling product content will attract interest and engage the visitors. PIM will influence the customer’s journey from the top of the funnel to the bottom:
● Acquisition: Top of the Funnel – Displays accurate and complete product information that enhances the firm’s ability to attract people towards the digital channels;
● Consideration: Researching products – Showcases compelling content and multimedia to build a 360º view of the product and encourage the guests to make a purchase;
● Purchase: Checkout – Product information is fed into the shopping basket to easily and quickly complete the transaction process;
● Post-Purchase: Buy again – Helps the marketing department to design attractive product bundles that will entice customers to return and make another purchase;
Brands are no longer siloes, but channels which benefit from unlocking the cross-brand supply chain. PIM represents the backbone of a solid omnichannel architecture which allows consumers to engage seamlessly online and on mobile and opens up the door to new digital possibilities:
● Improves Product Page Conversion – PIM makes it easier for customers to discover and learn more about a company’s products and offers the technical support to compel more people to start the cart/purchase process from the product page. Products feature expert details with several high-quality images from multiple angles (and zoom), detailed product specs and a size comparison for scale (or at least the measurements).
● Achieve Higher Cart Conversion – Helps the most qualified guests to finish the purchasing process successfully.
● Post Purchase Experience – Ensures that those few individuals who buy have a great experience and are more inclined to come back. Companies can meet their promises, surgically manage the buying experience from start to finish and offer help when needed.
● Empowers customers to transact where and how they want – in-store, online or purchase online and collect in-store.
● Displays more alternatives to get the product – PIM clearly labels in-store delivery options, showcases other product versions like ‘Collectors’ and displays the shipping policy upfront.
● Click and Collect – Gives consumers the choice and convenience in how they choose to receive their products. PIM supports a ‘stores as distribution points’ policy for faster shipping and a better experience at a lower cost. Research has shown that ‘Ship from Store’ packages already arrive 50% faster than warehouse shipments due to local sourcing.
● Personalization – Allows firms to know their customers and create a consistent experience across channels. They can fit in rewards programs and competitive differentiators to provide a unique experience that showcases the best of their channels.
● Omnichannel – Creates a consistent brand experience across all the digital channels. Works to connect the in-store customer experience to the online brand experience to maximize the engagement, loyalty, and revenue.