What Is Omnichannel Retail? Key Components and How It Works (Guide)

Because numbers speak for themselves.

According to the latest customer experience statistics, businesses with an omnichannel strategy retain 91% more customers than single-channel businesses.

So, if you want to be ahead of your competitors, you must expand your strategy across multiple channels.

But that’s not enough: you must ensure your channels are connected to each other, increasing customer engagement.

In this article, you’ll learn how to implement a strong omnichannel retail strategy, its benefits, and some examples from which you can take inspiration.

What is omnichannel retail?

Omnichannel retail represents a seamless and integrated approach to commerce.

This strategy helps brands create a more connected shopping experience for customers, regardless of their shopping method.

Its goal is to provide customers with a unified shopping experience across various channels, like physical stores, social media platforms, and mobile devices.

Imagine a customer shopping for shoes.

They browse online first, find the right model, and want to try them on to choose the correct size.

The perfect omnichannel experience lets your customers check if one of your stores has them in stock and order them online for in-store pickup.

After that, they go to the store, try on the shoes and buy them.

Implementing an omnichannel strategy will provide shoppers with a unified experience and increase customer satisfaction.

That’s why this business model is crucial if you want to boost your brand experience.

How does omnichannel retail work?

To make shopping nice and easy, omnichannel retail connects all the ways you can buy things. 

This means a store, the website, social media, and mobile apps all work together. 

After the pandemic, we changed how we shop.

63% of shopping journeys start online, so you can’t rely on just one channel.

Now, let’s make a practical example.

Here’s how an omnichannel customer experience might look:

• A customer discovers through an Instagram ad you sell drones
• They visit your website and browse the different models through the interactive 3D feature.
• Unsure of a specific model, they use the mobile app to schedule a test flight at their nearest store.
• In-store, they receive personalized recommendations from a staff member based on their online browsing history and needs. They’re ready to offer them practical solutions.
• They purchase the drone and choose in-store pickup to save on delivery time.
• After purchase, they receive follow-up emails with tutorials and helpful tips on using their new drone. Once subscribed to your email list, you can nurture them more effectively than relying on cold emails.

As you can see, each step is complementary to the next. All channels are connected to each other, so you can improve your customer experience and increase your brand awareness.

What is the difference with multichannel retailing?

In omnichannel retail, the focus is on making a shopper’s journey seamless across all platforms.

Whether customers shop online from a mobile device or in a physical store, their experience is consistent and connected. 

The goal is to offer unified customer service.

On the other hand, multichannel marketing operates the different channels independently.

This means it doesn’t focus on integrating all the channels together and providing a unified customer experience.

For example, a customer might find an item in-store but can’t get the same help or price online.

This strategy offers multiple choices but is less efficient than omnichannel retail.

What are the benefits of omnichannel retail?

Improved customer experience and more satisfied customers

As you already know, shoppers today want everything fast and easy.

Recent statistics indicate that 20% of adults admit to being chronic procrastinators.

So,if they don’t find a quick and easy solution, they will say, “ I’ll check another time”, and never return to your site.

People use many ways to check out products, look for deals, or see prices.

And you can’t rely anymore on just one sales channel.

With an omnichannel approach, you ensure the process is quick and simple, whether someone buys something on their phone or picks it up in a physical place.

The results?

You will meet customer needs, improving customer loyalty.

Better Inventory Management

An omnichannel approach can reduce the risk of stockouts.

That’s because it provides a holistic view of inventory across all sales channels, reducing the risk of stockouts.

When all sales channels are connected to each other, you can fulfill orders from anywhere, improving your inventory turnover.

This is one of the biggest advantages of this strategy.

Increased sales

Omnichannel retail will increase your sales because it lets customers shop online and offline.

As a result, you will attract more customers, increasing your sales.

Customers expect to navigate across platforms and get the same in-store experience.

This way, you’ll meet your consumer expectations and drive more sales.

Better data collection

Data collection is a must for every business. 

When your customers can shop online and offline, you can get more data than just one channel.

You can gather information at each point, like what pages they looked at or what items they added to their cart.

By doing so, you can analyze your consumer behavior and collect all the data you need.

You’ll be able to gain insights into individual customer needs, shopping habits, and preferences, leading to higher engagement and sales.

How to implement a successful omnichannel retail strategy

Ready to implement your omnichannel retail strategy?

Here’s what you need to do.

Analyze your customers and their pain points

You don’t sell digital and physical products.

You sell solutions to your customer’s problems and needs.

This means you must understand how they shop, what troubles they experience, and why they choose one product over another. 

Use surveys, social media feedback, and sales data to get this information.

Knowing these details helps create a seamless shopping experience that meets their needs.

Make sure to split your customers into groups based on their habits and preferences.

Each group might have different likes or dislikes.

For example, some people love shopping online instead of going to a shop.

Others might prefer buying in-store to feel the product before they buy it.

By analyzing your customers, you’ll ensure every shopper feels understood and valued.

Split them into segments

As mentioned before, divide your customers into groups to make your omnichannel retail strategy work best. 

This means examining what they buy, how they shop, and what they like. 

Understanding these different habits allows you to tailor your offers and messages to fit each group.

Using tools like data analytics is essential because they let you see patterns in shopping behavior across all your channels.

This way, you can create a personalized shopping adventure for every type of customer.

Ensuring everyone gets what they need will improve the customer’s journey and satisfaction.

Create a customer journey map

A customer journey map shows every step shoppers take with your brand.

It represents how customers interact and experience your business across multiple touchpoints.

These steps include visiting a website, talking to customer service, and buying products.

This map helps you see things from the customers’ perspective.

You find out what they like and don’t like.

Then, you can make their shopping smoother.

First, look at data from sales and feedback.

See where people have problems or enjoy things most.

Use this info to determine how they interact with your social media, stores, and online sites.

By doing so, you can understand how your customers go from the awareness phase to purchase and beyond.

The result?

You’ll boost overall satisfaction and loyalty because you’re making adjustment based on your customer needs.

Conduct Regular Testing

Every strategy needs to be tested and improved many times.

You can conduct tests using chatbots, emails, SMS, and customer satisfaction surveys.

Every time you put in place something new, you should test your strategy again to understand if is working.

This way, collecting data is an essential part of an omnichannel strategy that works.

Only after analyzing your customers’ pain points and needs and mapping their journey you can implement new ideas and test everything again.Make sure to use the right customer satisfaction tool to get all the data you need in the simplest way.

Examples of successful omnichannel retail

Here are some examples of great brands from which you can take inspiration to develop an effective omnichannel strategy.

Zara

Zara is one of the most important clothing brands. 

Over the years, it has focused heavily on maximizing the customer experience. 

In particular, Zara is focused on the following aspects:

• Developing a comprehensive App: One of the strengths of Zara’s strategy is the app, designed to bridge the gap between online and in-store experiences. It gives customers a real-time 360º view of Zara’s inventory, so they can see what’s available online and in-store at any moment.
  
• Implementing innovative In-Store Features: The app includes functionalities that improve the in-store experience, like:
  
  – Scanning Items: Customers can scan item codes in-store to check size and color availability, either in the store, online, or nearby locations.
  – Click & Go: Users can purchase items from a specific store’s stock via the app and collect them within 30 minutes using a QR code.
  – Click & Find: This feature helps customers locate items within a store, guiding them directly to the products.
  
• Global Implementation: After the success in Spain, Zara has been rolling out this omnichannel strategy globally, with plans to introduce it in the UK, Japan, the rest of Europe, and the US.

PetSmart

Another big brand you can take inspiration from is PetSmart, one of the largest pet food and accessories chains, with over 1600 stores in the US, Canada, and Portorico.

Here are the key points that Petsmart has focused on:

1. Online to Offline Integration: PetSmart allows customers to choose products online and pick them up in person, driving more traffic to their physical stores.
   
2. Unified Inventory System: Customers can search for products available in-store through PetSmart’s online platform. This makes the customer journey smarter and more efficient.
   
3. Seamless Shopping Experience: PetSmart provides a shared cart functionality across devices. This means that a customer can add items to their shopping cart on one device and continue their shopping or checkout process on another device without losing any information.
   
4. Price Consistency: Ensuring price stability across channels is crucial and will build trust with customers. This way, they’ll be confident they get the best possible deal regardless of how they shop.
   

Flexible Returns: The functionality for receiving returned goods is well-integrated, providing customers with the flexibility to return items either online or in physical stores.

How do you measure the success of your omnichannel retail strategy?

You measure the success of your omnichannel retail strategy by looking at important KPIs, such as:

• Conversion Rates: Track conversion rates across your different channels and touchpoints to understand how your omnichannel strategy is driving customer actions like purchases, sign-ups, or inquiries
• Customer Retention and Loyalty: Monitor customer retention rates, repeat purchase rates, and customer lifetime value (CLV) to assess the long-term impact of your omnichannel strategy on customer loyalty
• Brand Awareness: Analyze metrics like website traffic, social media following, and direct brand searches to understand the reach and awareness of your brand
• ROI: A positive Return On Investment indicates that your omnichannel marketing strategy is reaching more customers and driving them to make purchases
• Customer Satisfaction Score (CSAT)

These are the most important KPIs you should consider.

But keep an eye on other indicators such as:

• Social Media Engagement
• Net Promotor Score (NPS)
• New Customer Registration
• Content Page Engagement

Conclusion

Customer satisfaction is one of the most important factors for every brand.

Nowadays, the only way to guarantee it is to focus on a solid omnichannel strategy.

You’ll increase your sales, understand your customers better, and collect useful data to improve your strategy.

Take inspiration from big brands, and remember that you must provide simple solutions to your customers, not complicate things.

Don’t fall behind your competitors; start developing your omnichannel strategy now!