It’s been a few years since we started to hear this new buzzword in the domain of retailing.
Mostly, it’s been understood as being available for the consumer in a consistent and coherent form in all channels, whether it is a physical storefront or a digital store on the web. More often than not, it has also been misunderstood as introducing digital devices of all sorts in the physical store where consumers can query the products, LCD screen running videos about the product or simply the latest TVC, greatly satisfying the agency and the marketers behind it. In this article, I wish to offer some clarity on what is Omnichannel in retailing and give some examples of simple executions across common experiences that can perhaps be done with great ease not requiring big budgets or timelines and more importantly, make an impact on the your consumer as well as profits.
The Wikipedia defines Omnichannel retailing as a business model that implies using variety of channels in a customer's shopping experience including research before a purchase.
The key phrase for me here is “business model” – this means it is not a short term promotion or a gimmick. It is a sustenable way of doing business that is a win-win ie the consumer loves it, the operations team can execute it and the CFO loves it too because it helps drive revenue, customer satisfaction, productivity and profits.
Now, let us view some common shopping experiences in different sectors and see how opening a new channel could do all of this.
QSR / Food Retail : Have you seen the long queues at a McD or KFC on a weekend where both sides are sweating it out to get/ give a good consumer experience ? Now, imagine we had table numbers marked on each table in a KFC and all what a consumer had to do was log into the store on a Airgrub.com kind of app and place his order for the Zinger and a Mojito, pay via wallet and patiently wait for his name to be called out while enjoying the free time with the family or friends not having to stand in the queue.
Wouldn’t that be a better experience and open doors for more orders to be serviced by the staff at the cash-till vs taking them manually through voice trying to confirm and repeat the order to every customer? I would imagine store operations would be very happy to change their back end processes and focus more staff in cooking the food quickly and delivering it with a bigger smile.
Hotel services: I link hotel services to a retailing experience because once you have walked into a department store, you are basically viewing, selecting and shopping from the products it has on the shelf. I find that the least amount of evolution has taken place in the way customers can consume hotel services while everything prior and post has opened up to many more channels.
Today’s traveller books her flights, hotel and taxi on a website or a smartphone app but that’s where it ends. From the moment you get out of the taxi and step into the hotel, everything is painfully manual and requires you to speak to someone for querying or consuming every little hotel service and :
a. Be near a hotel phone either in your room or elsewhere
b. Be inside the hotel
Even asking for a bottle of water requires you to stop what you are doing to pickup the phone and speak to someone. On the operations side, the attendant who takes your call then transfers the same instruction to someone else by voice who actually executes it. Most hotels don’t have a way of closing a “ ticket” or a request. It takes a crisis and a complaint to actually get it closed !
What if you opened a new channel on the smartphone where a consumer can login while enroute from the airport and :
a. Send you his ID electronically so it is ready for signatures when he arrives
b. Tell you he will be requiring help for baggage or not
c. Order for a meal in his room and even pay for it registering his e-wallet or credit card
d. Ask for extra towels
e. Place an order for laundry to be picked up at 630 am next morning
f. Book a foot massage at the spa at 630pm same day
g. Book the business center for an 1130 meeting
h. Ask for his bills on email and view them and pay them off using his credit card or e-wallet skipping the wait time at the front desk
Isnt that going to be an aha for at least 10-15% of hotel guests especially in business hotels and isn’t this going to dramatically increase productivity of staff who don’t have to talk to these guests or to each other to understand exactly what the instruction is ? Imagine all the hotel staff carrying the staff app on their phones receiving and closing requests like an Uber driver and the GM being able to view real time dashboards on Turnaround time and who did what ? I would reckon that usage of services may also go up as guests become more aware as well of all that is available and don’t need to call the front desk for knowing simple things like buffet timings J .
In the US and in Europe, a few service delivery platforms like Aliceapp have sprung up while in India, a platform called Valletto is doing the rounds – lets hope we can experience it soon and stop all the voice traffic in the hotel !
The big ROI from each of the examples above is a virtual goldmine of consumer data like name, email addresses and linking these to purchase history that can be analysed and used to drive repeat visits and revenues.
We all know that current business models in all of the above retailing sectors are under margin and profit pressure and I truly feel that creating new win-win channels for customers and operations around solving real consumer problems will create value that will show up in the bottomline.
Omnichannel retailing is actually all about having all channels switched on but in a business model that works to deliver both delight and profit.
Anup Jain has over two decades of experience in consumer goods across different sectors including retail in India , Asia and Australia. He has recently founded Redback Advisory which consults and invests in midsize and early stage companies which are keen to challenge the status quo.