A Study of 46,000 Shoppers Shows That Omnichannel Retailing Works
Traditional retailers are feeling the heat. Even as competition intensifies, shoppers’ visits to retail stores are declining every year, leading one industry veteran to ominously ask his peers, “Is anyone not seeing large traffic declines?” Online retail, on the other hand, is thriving. Retail sales through digital channels (including mobile sales) increased by a massive 23% in 2015. Much of these gains have gone to online retailers. Amazon is the biggest beneficiary, now accounting for 26% of all online retail sales. What is more, as it continues to expand aggressively into new categories like grocery and fashion, Amazon’s existential threat to traditional retailers is greater than ever. Just ask Alexa. Under these hostile conditions, traditional retailers have staked their futures on omnichannel retailing. The omnichannel strategy hinges on the idea that providing a seamless shopping experience in brick-and-mortar stores and through a variety of digital channels not only differentiates retailers from their peers, but also gives them a competitive edge over online-only retailers by leveraging their store assets. Such thinking assumes that despite its costs, there is significant economic value to be gained from providing digital channels to traditional store shoppers, and fusing the shopping experience across channels. Retailers are counting on an omnichannel strategy to be their “killer app.” But is this true? Are omnichannel shoppers more valuable to retailers? Read more at Harvard Business Review.
