What is the retail omni-channel?

I saw an interesting news story this week in the New York Times on a retailer in the US that is refusing to stock the Amazon Kindle. The reason? Because customers are coming into stores, asking questions about the Kindle, getting expert advice from the in-store sales team, then walking away without purchasing and ordering online – usually direct from Amazon.

I don’t want to comment on the right or wrong of the actions of an individual retailer, but I do think that we are seeing an evolution in what customers expect from shops. Analysts are calling this the ‘omni-channel’ retail experience where a retailer can use many ways to reach customers, but they each support the other so the customer feels equally supported – however they choose to make the final purchase.

Lets explore the real problem. Customers have the right to spend their money as they choose. You are never forced to spend just because you walk into a store and take a look around. High street retailers know this and they have had to fight off low-cost online competition for years. The example of electronic products being cheaper online is not a new one.

But, if price is the only determining factor in deciding where to purchase a product then nobody would buy anything from stores. We would all use price comparison tools to search for the best deal and then order online – regardless of where the product is coming from.

There are still shops. And presumably some people still use them.

In some cases, this is because people may want something quickly – they can’t wait for it to be delivered. But on the whole it is because people enjoy the experiential nature of shopping, being able to touch and play with a product before purchasing it.

Experience and customer service has a value.

However, retailers cannot charge too much of a premium for that experience alone because then every shopper will just go to the online channel. What they need to focus on is connecting together the in-store experience with their own online offering and the follow-up customer service.

This is particularly true for electronic products that may need some customer support. If you know that by purchasing from a well-known retailer they will support you should anything go wrong in future then that small premium on the price will be worth it.

Imagine checking out a new TV in a department store, finding the one you like, then browsing the web on your phone and finding it 20% cheaper at an unknown discount retailer.

You could walk away and buy it from the unknown online store, but you know and trust the retailer where you found the TV. Perhaps if they offered a 10% discount for you to buy from their website it would be enough to keep you loyal?

It will be this kind of joined-up multi-channel retail service that allows stores to compete and succeed in future – not product bans.


Photo by Kevin Simpson licensed under Creative Commons

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