Tag Archives: omnichannel retail

Fast Adapting Customers Leave Inert Retailers Behind

Fast adapting customers are leaving obstinate retailers in droves. Hence the headlines dominating retail news portals are about thousands of retail stores closing their doors. That’s happening because retail customers are adapting quickly and easily to the digital world of today.

Many retailers, on the other hand, aren’t keeping up with the changing buying habits of their customers. Indeed, they are ignorant at best and stubborn to keep on doing what they did for decades…

The sad result is that retail brands are disappearing. The Centre of Retail Research reports that during the first eight months of 2017, 35 companies failed in the UK, closing 1,194 stores and affecting 10,611 workers.

There may be many reasons for retailers closing down. However, it may be because the retailers fail to react to the opportunities and threats of the digitized world…

How fast adapting customers are on top of the world

Tech savvy retail customers have never had it better. It doesn’t matter whether they are shopping online or at their favourite Bricks and Mortar store. They can do either shopping effortlessly. In fact, retail customers can shop how and wherever they want in the omni-retail channel. The benefits for adapting retail customers in the omni-retail channel are:

  • Omni-channel retail is customer focused. It is a powerful strategy adopted by retailers for improving customer experience, says Brad Arsenault (FithQuadrant).
  • Retail customers expect the same basic brand experience across all channels. Omni-channel retail allows customers to buy from any channel.
  • The fast adapting customers feel more valued. They have a seamless journey from online to offline and is more likely to return to the brand who they feel gives them a fully personalised experience.

Retail customers in the digital world expect every retailer to offer them the greatest shopping experience they’ve ever had. If retailers can’t achieve that, they’ll probably soon close their doors (if they haven’t already done so). As result thereof, retailers should change the way they’re doing business to keep up with their fast adapting customers, or perish…

How can retailers keep up with their fast adapting customers?

Start right now to change the direction of your business, a turnaround – 180 degrees. Yes, you should get out of that box (the one you’ve been hiding in for decades…), and think out of the box! More importantly, you should be the revolutionary leader (or at least appoint one). Disrupt and destroy the old culture of your business. Burn your vision and mission statements. Therefore, appoint leaders that are humble, adaptable, visionary and engaged. Let go of the rest…

Then, find out what shopping experience your customers most want. And give it to them!

Concluding

Do what you have to do now! Oh, and good luck!

Read also:

  1. Success in the Digital Age Requires Extraordinary Retail Leaders
  2. How successful are Retailers in the Omnichannel?

Image:

Bricks2Clicks

 

Webrooming and Showrooming – Buying Behaviors of Retail Customers in Virtual and Physical Environments

Webrooming and showrooming are popular jargons that describe how retail customers use different combinations of online and physical channels to search for information about products, corroborate this information and make the purchase 4. These customers are tech savvy and they use their mobile phones to great effect to help them to decide what to buy where and at what price.

Both Bricks and Mortar retailers and Clicks Only retailers were slow to react to the changes in the buying behavior of their customers. However, Bricks and Mortar retailers are now adding the online channel to their business and Clicks Only retailers are opening physical stores. The adoption of the omnichannel by retailers couldn’t happened sooner. Hence Bricks and Clicks retailers…

Brain Eisenberg, quoted by ClickZ said that “Retail does not exist without an online component and online retail isn’t as cost-effective if you don’t have a brick-and-mortar component.” “We’re connected all the time through the phones in our pockets, but we live in a physical world”, said Eisenberg.

Webrooming and showrooming

Showrooming

Most of us has done showrooming at least once before. Showrooming is when you visit a store, saw a product you like, but then purchase it online instead of from the store 1. According to Douw G Steyn, author at Bricks2Clicks, the advent the internet has led to the adoption of innovative digital technology and the rolling out of broadband mobile connectivity.

At the same time, consumers quickly learned how to use mobile devices to compare products and prices when shopping 2.  These tech-savvy consumers are changing the fundamental consumer-retailer relationship and showrooming is fast becoming a problem plaguing the retail industry.  In the past few years, as online shopping exploded and smartphones became the norm, the showrooming phenomenon — consumers using their phones to comparison shop in stores — seemed poised to gut the revenue of offline retailers.

The real hurdle, though, is pricing writes Ann Zimmerman in the Wall Street Journal 5. “Lower prices are one of the main reasons people pick Amazon and other internet-only emporiums over traditional retailers” said Ann.

Machavolu and Raju, 2014 6 advice retailers to do the following to counter showrooming:
  1. Adopt a Collaborate-and-Coordinate business model. In today’s business set-up, manufacturers and retailers, both are working in different silos and eventually end up contending against each other. But it will be fine if both operates together to offer customized solutions that exactly suits their shoppers’ needs.
  2. Treat customization as the mantra for success. Customization programs can only be successful when retailers believe they are a key areas of focus for all their staff. Treating the programs as only a ‘side task’ may result in mediocrity and leave the retailers worst off than before.
  3. Lay emphasis on customer experience. The new age customers want themselves to be part of the process while the product is being planned, developed or delivered, hence companies must focus on getting their customers involved in doing so.

Luo, et al (2014) 2 have identified two measures that retailers can take to influence shoppers’ intention to showroom, namely 1) to reduce the online-offline price difference and 2) to improve the level of employee knowledge competency. Webrooming is nowadays recognized as an opportunity that retailers can use to counter the showrooming phenomenon.

Webrooming, which is similar (but opposite) to showrooming is a manner which customers use to help them in making their buying decisions.

Webrooming

Webrooming is the opposite of showrooming.  Showrooming is when you’re standing in a store, and you pull out your smartphone to see if you can get a better price online. However, webrooming is when you’re searching online, check what item you like and go to the store to pick it up 3.

“Webrooming is actually nothing new. Since the early days of online shopping, more people have researched their shopping online than have actually bought there”, says Emily Adler in Business Insider. Emily highlighted results from a recent report from BI Intelligence:

  • Webrooming is more common than showrooming. In the U.S., 69% of people practice webrooming, while 46% do showrooming.
  • The data shows that millennials prefer webrooming. For electronics, shoes, sports equipment, and cosmetics, more millennials say they prefer to webroom, rather than research in store and then buy online.
  • Amazon remains the No. 1 place where showroomers end up making their purchases. But it’s an even more popular destination for webroomers who ultimately buy elsewhere.
  • Only recently have Bricks and Mortar retailers begun to capitalize on webrooming. They’re using tactics like knowledgeable sales staff, in-store pick-up of online orders, in-store Wi-Fi, and smartphone discounts that nudge showroomers to buy in-store.
  • New initiatives for the connected in-store experience keep popping up: tablets and mobile phones used as register systems. Also robotic arms that deliver clothing into dressing rooms, and beacon hardware, which powers in-store maps and automatic hands-free payments.

Concluding

It seems that retailers are starting to catch up with the buying behavior of their tech savvy customers. Whether their customers are webrooming and showrooming , the retailer’s main goal should be to get the sales through their businesses.

Notes:

1 Quint, M., Rogers, D. and Ferguson, R. 2013. Showrooming and the rise of the mobile-assisted shopper, Columbia Business School, Center on Global Brand Leadership.

2 Luo, Q., Oh, L.B., Zhang, L. and Chen, J. 2014. Examining the Showrooming Intention of Mobile-Assisted Shoppers in a multichannel Retailing Environment, In PACIS (p. 141).

3 Nesar, S. and Sabir, L.B. 2016. Evaluation of Customer Preferences on Showrooming and Webrooming: An Empirical Study, Al-Barkaat Journal of Finance & Management, 8(1):50-67.

4 Flavián, C., Gurrea, R. and Orús, C. 2016. Choice confidence in the webrooming purchase process: The impact of online positive reviews and the motivation to touch, Journal of Consumer Behaviour, 15(5):459-476.

5 Zimmerman, A., 2012. Can retailers halt ‘showrooming’, The Wall Street Journal, 259:B1-B8.

6 Machavolu, M.S.K. and Raju, K.V.V. 2014. Showrooming: The Next Threat to Indian Retail, MITS International Journal of Business Research, 1(1):1701.

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