The lines between what we do in real life and online continue to blur the further technological advances. And as people’s behavior changes, so too must retailers and their suppliers, removing barriers between physical and digital channels to simplify the shopping experience. This is where omnichannel comes into play, offering a more holistic approach that customers can access from anywhere and at any time. Here we explain more omnichannel, what it is, how it works and more.

Omnichannel Explained

Omnichannel is designed to create a seamless shopping experience for customers by integrating all supply channels to support retailers who can sell products across multiple touch points.

At its core, the omnichannel experience places the customer at the center of the strategy, built on an understanding of why and how each channel is accessed and used and their position in the customer life cycle.

This is done in collaboration with omnichannel marketing, which engages with customers in different channels as they move from one to the other. It creates fluidity between each channel, integrating physical retail with online shopping, so there is no delay in crossing over. Essentially, it breaks down walls and barriers that may have previously existed (between website, mobile, social media, physical stores etc.) so they align with customer demands and expectations.

How does omnichannel work?

In a sense, omnichannel has always existed, but the modern variation is more streamlined and designed to lessen the stress placed on the customer. Before the arrival of ecommerce, customers would undertake long journeys to shop in stores that provided a good experience. Shoppers will always look for a channel that works best for them and provides the value they need.

In the modern internet age, convenience is everything and omnichannel adapts to that ideal by streamlining and combining channels so goods are easier to buy from a variety of touch points. The goal is to create a positive and seamless shopping experience that feels the same in any of the channels they use, whether it’s online or via a physical outlet.

As a result, there are two main types of distribution:

Forward distribution

Forward distribution involves cutting out a ‘middleman’ or another business that is usually in place to aid delivery to the end consumer. For example, a goods manufacturer may have a distribution network or regional warehouses that enable them to sell directly to customers, rather than via retail outlets.

Backwards distribution

As you may assume, this works in the opposite way to forward distribution. It focuses on the shipment of goods between customers and stores, covering the physical flow of return products and their location.

In practice, these models can be divided into 7 basic types based on how customers interact with products:

Buy online, pick-up in store

This is where a customer makes an online purchase before collecting in person in the physical store.

Buy online, drop-shipping

Once a customer buys a product online, then the item is set to a location where the customer collects it.

In-store purchase, home delivery

If an item is purchased in-store, rather than take it with them due to size (large furniture/appliances) it is sent to their home address.

Ship from store

When goods are transferred from a physical store to another location.

Drop shipping

This is when a product is transferred from the warehouse to another store or home address for collection or delivery.

Buy online, return in-store

Customers may buy an item online but if they do not want to keep it they return it to a physical store rather than sending it back via courier

Same-day or on-demand delivery

Goods purchased online are picked up immediately and sent for delivery on the same day of the order or on a scheduled date.

What are the benefits of an omnichannel strategy?

The customer comes first

You can improve customer lifetime value with an omnichannel strategy, as the customer always comes first, encouraging loyalty to your brand. Long-term goals are critically important to retailers and ensuring their customer base can access their goods no matter their location, time of day or point of access makes it easier to increase the average customer value.

Engage with new customer segments

Businesses are supported in reaching new customer segments by using an omnichannel strategy. Where a company may already have a strong physical presence, omnichannel enables them to strengthen its digital position to increase sales and enable new and existing customers to engage through multiple channels.

Boost sales

Some studies have shown that omnichannel consumers spend considerably more online than single-channel customers. Omnichannel is both structural and strategic, positioning your business to see a strong return on investment. When combined with a well-executed marketing strategy, it opens up more queries and opportunities to boost conversion rates.

Improved operation efficiency

There is also a good chance that your business could enjoy increased operational efficiency and reduced costs due to implementing an omnichannel strategy. Businesses only need to collect data once, instead of at every touch point, which means individual strategies are no longer needed for every individual channel.

How to improve the omnichannel customer experience

A few ways you can improve the omnichannel experience for your customers includes:

  • Mobile and social media support

Bad word about your brand can spread like wildfire on social media.  You should have strong customer support mechanisms in place to provide help when needed. Easy access and fast responses will ensure the customer feels valued and accept the resolution you can offer, rather than going elsewhere.

  • Live inventories

There is nothing more frustrating than ordering an item only to be told it is not in stock after the purchase. Providing real-time information about stock levels should be high priority for your business, especially online. You stand a better chance of retaining a customer even if the item isn’t in stock, rather than misinforming them and potentially affecting your reputation.

  • Personalise the experience

Personalisation goes a long way to making each customer feel valued, rather than just another in a long line of shoppers. Self-service makes it easy for customers to find their own solutions, demonstrating the value you place on inconvenience. Omnichannel systems that offer high-quality support after hours, on weekends or during similar peak periods will also go a long way.

  • Integrate offline and online stores

Customers are drawn towards flexible solutions, and there are ways you can make in-person shopping more valuable for them. For example, ‘Click and Collect’ ensures they can order online and simply head to the store for collection without hassle. ‘Click and Reserve’ also values the customer’s time, showing that you value it too, while demonstrating your own confidence in your own products.