Omni Channel Social Potential

The greatest potential opportunities in store for omni channel retail market lie in the collaboration potential across the entire supply chain.  At them same time though, the greatest threat to the individual retailers will be realized by ignoring the collaboration desires of the consumer.  This is a very real threat to the retailers because of the technology and tools available to the average consumer.  The consumers now have embraced technology and mobile technology is exploding in the market now.  Mobile technology will have the greatest impact in the next few years will come from consumers’ expansion and use of mobile tools and technology.

This will be an especially large hurdle for retailers to overcome due to the inertia that many established retailers fall into almost as a result of established practices.  This also is influenced by the concept of ‘if its not broken don’t fix it’ which also tends to establish inertia in retailers. We’ve all seen this and even been part of this practice, change is hard and when retailers have established a brand and identity there is a great risk to fiddling with the brand and identity.  Inertia however is probably the worst practice to fall into from a retailer’s perspective.  The challenge with inertia is that you must take steps and plan to avoid, inertia is what happens when you do nothing, so in a very real way this is a natural progression for established retailers and established companies in general.

When a retailer embraces the omni channel retail marketing and fulfillment concepts and practices the retailer is inherently embracing a continuous change, or improvement model.  Omni channel retail is driven by the consumer rather than by the desires or direction of the retailer. The consumer is directing the actions of the retailer based on their shopping needs and more importantly their shopping availability.  As I have previously discussed, the consumer shopping practices are continuously changing based on personal and professional pressures and needs.  These changes are manifested in the consumers’ use of omni channel retailing.  Remember though, the consumer does not think of the channel in which they are shopping, the consumer is simply shopping.

The growth of the omni channel market outlet will increase exponentially as the mobile technology improves and expands in acceptance.  The successful retailers will re-invent themselves on a continual basis to meet the consumers’ needs and practices.  When the retailer embraces the change model that is behind the omni channel outlet they are embracing a challenging path of continuous change and revisions.  This can be a challenge for some retailers because this model also inherently changes the project initiative model from large initiatives that in many cases require a long time to complete to an agile model of continuous smaller initiatives that deliver and revise initiatives in quick time.  

And now for the audience participation portion of the show…

What types of cross channel services and offerings would you like to see to enhance your shopping experience?  Retailers are focused on maintaining sales volumes through reductions in pricing rather than expansion of sales, or even maintaining sales through creative utilization of eCommerce services. Did you shop over the Gray Thursday / Black Friday period?  What was your experience in stores and malls?

Omni Channel Social Future

As social networking concepts influence and integrate with omni channel retailing practices and the omni channel retail market these concepts will change the channel to a true omni channel retail experience.  Social network practices are influencing all aspects of interaction to humanize the technology and allow the integration of human of interaction and omni channel retailing is not immune to this influence.  The challenge for retailers in this future is to embrace the social networking concepts and release their current practice of trying to control the market place.  Consumers are beginning to exert their influence in the shopping method and history has shown that fighting this movement only ends in failure.  Technology has opened a Pandora’s box of influence on the retail market and the omni channel shopping practice is the beginning of convergence between social networking and eCommerce retailing.

The early winners in this changing market will be the retailers that eliminate friction between the purchase and the delivery and acceptance of the product by the consumer.  What I mean by this is that the retailers that make it easy to not only purchase, any time and any place, but also make it easy to return unwanted purchases will be the retailers that retain and even grow their customer base.  A great example of a retailer focused on removing the friction is Amazon and the Prime service that they offer.  Amazon already provides a great return policy and the addition of the Prime service eliminates a key hurdle to eCommerce, namely the shipping charges.  In addition the implementation of the Prime service with the annual fee also increases the likelihood that the customer will return over and over for purchases to increase the overall value of the customer.

I think the greatest hurdle for retailers to accept is the concept of window shopping, where the consumer goes to a brick and mortar store to touch and try products and then orders online.  This is viewed by most retailers as a potential lost sale to a competitor.  This practice has been fought by the retailers by offering to match the cost.  I think this is the wrong approach and should be addressed from two perspectives; the cost and the convenience of immediate purchase.  A cost war between pure eCommerce and omni channel retailers is a bad idea for the omni channel retailers because of their operating cost model.  The omni channel retailers can however combat the advantages with service.  

The future of the shopping experience will require focus on the consumer needs and desires rather than the consumers adjusting to the methods and practices that benefit the retailer.  Consumers have reached a level of technical capabilities that will drive the future of shopping and the retailer must embrace these methods to succeed in this environment. Consumers will be driving and even developing these capabilities through their acceptance and experimentation with new technology.  To be successful this means that the retailer must continuously re-invent their own practices and capabilities.

And now for the audience participation portion of the show…

What types of cross channel services and offerings would you like to see to enhance your shopping experience?  Retailers are focused on maintaining sales volumes through reductions in pricing rather than expansion of sales, or even maintaining sales through creative utilization of eCommerce services. Did you shop over the Gray Thursday / Black Friday period?  What was your experience in stores and malls?

Omni Channel Social Promise

The omni channel retail market is an intersection between the desires of the retailer to sell merchandise and the desires of the consumer to simplify and improve the shopping experience.  Let’s be honest about these objectives because they are in some ways at odds with each other and they converge with the sale.  This is important to understand because while the success on either side of the equation ends with the sale, the objectives and steps leading to the sale come about through different a different execution model.  There is a constant battle between the retailer and the consumer in the objectives and steps that lead to the sale.  The retailers that succeed in the future will be the ones that embrace the consumer model.

Retailers throughout history have strived to identify and deliver products that the consumer desires in a manner that is cost efficient.  The challenge of the retailer is to identify the products that the consumer desires and in order to do this they create products based on one of two methods; designers who produce the products and then market these products to generate consumer desire; produce and deliver consumable products that consumers require to live and maintain their lifestyles.  As you can see these two methods really don’t take into account the consumer desires.  They do however respond to the consumer feedback through the actual sales figures.  In this model retailers are constantly chasing the sale through actual sales and the forecast of the future sales based on complicated algorithms.

Next you take into account the interaction with the consumer who is reacting to the products offered by the retailers.  Historically the interaction between the consumer and the retailer has been through the consumer purchases, as I mention above.  Technology and social networking provide a means now for the retailer to interact more directly with the consumer to develop products and provide more efficient delivery of consumables.  These technology capabilities also provide a means for the consumer to cut through the middleman of the retailer to deal directly with the manufacturer. This interaction with the manufacturers provides an opportunity for mass customization of the products that is cost effective and can be efficiently executed.

The promise of omni channel social capabilities is focused on the consumer taking more control over their product selection and purchasing methods.  This can provide a direct interaction between the retailer and the consumer that was not available prior to the advances in technology.  The interesting thing about these implementation of these capabilities is that they have been embraced by the small merchants and artisans and farmers to gain access to the consumer that they could not easily achieve prior to these advances.

And now for the audience participation portion of the show…

What types of cross channel services and offerings would you like to see to enhance your shopping experience?  Retailers are focused on maintaining sales volumes through reductions in pricing rather than expansion of sales, or even maintaining sales through creative utilization of eCommerce services. Did you shop over the Gray Thursday / Black Friday period?  What was your experience in stores and malls?