Multichannel Retail Requires Smart Use Of Enterprise Mobile Information Technologies

86% Of Shoppers Use At Least Two Devices

Industry News, Mobile Devices, Mobile Strategy Comments (0)

Many retailers today have both a physical location and a presence on the Internet, and consumers often want to move seamlessly from one environment to the other with the same retailer. Oracle’s John Foley says,

“…the once sharp line between in-store retail and e-commerce is blurring as on-the-go, tech-savvy shoppers research, browse, try on, and transact wherever and whenever they please. That, in turn, is causing retailers to become much more sophisticated in how they predict demand, manage and move inventory, and integrate their physical, virtual, and mobile selling channels.”

But, it is even more complicated than a division between online and physical stores, as consumers engage with retailers on multiple devices, including phones, tablets, laptops, smart TVs, kiosks, point-of-sale terminals, and interactive digital signage. Soon, in-car purchases will be possible, as screens invade the interior of automobiles. So, what is the value proposition for store owners to provide facilities for multichannel retailing?

Already two-thirds of all American shoppers are multichannel, but this is highly correlated with age. The peak is the age group between 22 and 30, according to a study by the Verde Group and the Wharton School at the University of Pennsylvania. A global study by PriceWaterhouse Coopers, shows “eighty-six percent of our global respondents and 65% of US-based respondents currently shop across at least two channels, while 25% of global respondents and 21% of US respondents are using four or five channels to shop.” Another study by IDC found that multichannel shoppers are more profitable compared with one-channel customers, with a 30% higher lifetime value.

Managing multichannel (sometimes called “omnichannel”) shopping is tricky, but needs to be so easy for customers that they hardly notice when they move from one channel to another. With multiple devices, people may use their mobile phones in the morning to check their mail, work on a project on their laptop during the day, and turn to their tablet while simultaneously watching their smart television in the evening. If they want to buy something, it can often be a spur-of-the-moment decision, and an agile retailer will have ways of buying on any of the devices that a person is using at the time they feel the desire to make a purchase. Actual delivery of the item ordered may well be through a different channel; for example, in 2015 in the US, 34% of Thanksgiving and Black Friday online orders were picked up in a store.

Traditionally, each retail environment has been managed separately, with discrete information systems for each channel. And, there has been the assumption of linearity, whereby each step of the process follows the other in order. However, the rise of the mobility paradigm and the transformations made possible with new digital technologies means that information has become fluid, interconnected, multidirectional, and available anywhere and anytime, as needed by the stakeholders involved at different points of the entire operation. If a customer is dealing with the same retailer in multiple channels, the expectation is now that the information connection between the retailer and the customer will be maintained and secure in all channels at the same time. Shoppers may do their research on a product in one channel, switch to another channel for their purchase, and expect delivery by courier or in store. And, as multichannel shopping catches on, it will also be necessary for retailers to set up multichannel customer support and service.

Building a multichannel shopping solution requires a layered technology architecture that separates the interface from the e-commerce and information layers, as a recent paper from IBM outlined. The authors note,

“[M]ultichannel offers innovative retailers the ability to rethink the shopping experience and craft a new service that better meets the needs of their customers. Technology can help by offering new ways for customers to browse, compare, check, reserve and purchase products, handle returns and receive after-sales service. Good multichannel retailers realise these separate services need to be merged into a single integrated customer experience and their operating models are starting to reflect these as new interactions independent of business department or channel.”

Multichannel retailing requires an investment in time and money, and a talented technical partner to make it all happen seamlessly. At Float, we design and develop for multiple devices, building data bridges among multiple channels, and designing multichannel retail solutions for major American and global brands. Contact us to discuss your needs for multichannel retailing.

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Gary Woodill is a senior analyst with Float, as well as CEO of i5 Research. Gary conducts research and market analyses, as well as assessments and forecasting for emerging technologies. Gary is the co-editor of "Mastering Mobile Learning," author of “The Mobile Learning Edge,” and the co-author of “Training and Collaboration with Virtual Worlds.” He also presents at conferences and is the author of numerous articles and research reports on emerging learning technologies. Gary holds a doctor of education degree from the University of Toronto.

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On June 29, 2016
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