Your competitor is boasting about a 24% increase in digital sales through their brilliant omnichannel initiatives. Concerned? One claims their mobile app has 26 million downloads, and another claims 40% improvement on mobile sales. Worried? Don’t be.
The common denominator is that they are all about retailers who faced a rocky road in comp sales or earnings last year.
Add these claims to same-sounding, countless swells about digital success since the century began, before we called it “omnichannel.” C’mon, admit it. Aren’t you tired of the continuum of sensational omnichannel success stories that lack direct attribution to incremental revenue, new customer acquisition, improved net income, or share of customer. Aren’t we searching for the numbers on how those retailers’ omnichannel initiatives correlate to shareholder wealth or P&L improvement? I’m dying for a smidgeon of how they contribute to what is unique, admirable, incredible and different than competitors. Honestly, I’m not quite sure what “omnichannel” means, entails or includes.
No incremental retail sales? Why you still have to invest in omnichannel
Retailers may ask, “Should I pay for those omnichannel projects?” My answer is yes, because you’ll lose customers if you don’t. Most omnichannel features are now considered table stakes by shoppers. Try talking to your friends about omnichannel “experiences,” and you’ll probably get the same response I do. “So what?”
Customers assume retailers have a wide variety of features that retailers themselves may consider premium: short queues; fast, instant or free delivery; various sizes and colors in stock; inventory accuracy; good service; deals; and quick fixes. As a result, these things are no longer industry differentiators. Shoppers don’t switch brands because a retailer has these, but leave quickly when they don’t. Except Starbucks, Apple Stores, and Target: because their products are the differentiators.
Consider Apple. Their omnichannel experience might leave you wanting to unfriend Siri, yet in July they reported a 38% profit increase. When I cracked my iPhone screen, I had to wait five days for an appointment. Omnichannel matters far less for Apple because they are an aspirational brand with coveted products. When they have serious competition and a better smart device is on the market, my bet is that the fix-it Apple geek will be at my door in five minutes begging to fix it. So, why aren’t we using technology to continually integrate, iterate and offer the world’s most desirable products and services at the same time as managing those must-haves?
Instead of “omnichannel,” which tends to obsess on channels and reinforce corporate silos, tech investment should be centered about people, and fitting into why they buy and what they do (NOT shopping).
What to do? Figure out what’s the right thing to build first, then build it right
Before spending big bucks on technology under the omnichannel umbrella (which now includes almost everything), how about if the business and IT folk sat down together to review the business case linking incremental corporate (not channel) revenue or net income.
What I’ve found is that retailers with significant year-on-year revenue growth, rather than digital switching or damned statistics, have something in common — speed. They research, strategize, build, deploy and pivot in weeks to stay way ahead of their competitors. They are building an omnichannel solution and superior core consumer offering that is better than what their competitors will have next year.
Intuitive mobile apps, buy-online-pick-up-in-store, endless aisle, super fast delivery. But so what? It’s all relative. Retailers and industry problem solvers need to shift from the ambiguity of “omnichannel” and it’s equally ambiguous meanings to get back to what really matters—that is, how can we enrich the lives of people, including shareholders and employees, by offering what no one else does while continually improving P&L.
I’m off now to do some Christmas shopping. Let’s compare. Reply below with which omnichannel experiences were “so what” and which ones really channeled into making life merrier.