­­­­Mastering the Challenges of Omnichannel Retailing

Omnichannel retail comes with challenges, from channel conflict, data silos, and inventory issues, to brand inconsistency. However, overcoming these key issues is pivotal to growing a successful online business.

More than 60% of consumers participate in omnichannel shopping. With that in mind, it’s no surprise that eCommerce businesses with a robust omnichannel customer experience report a 9.5% year-on-year increase in annual revenue.  So, it’s more important than ever to streamline the brick-and-mortar shopping experience with your online sales channels. It’s a tall order, but the results speak for themselves.

Cohesive shopping experiences must balance online sales channels with physical shopping aisles to succeed. With the proper infrastructure, training, and technology in place, your business will grow from strength to strength.

In this blog, we unpack the definition of omnichannel retailing. Then, we look at why omnichannel is failing in retail, providing actionable solutions to overcome common omnichannel retail challenges. Finally, we take a look at Pimberly customer Footasylum to see how they’ve successfully implemented an omnichannel approach.

Whether you’re a retail business owner, eCommerce strategist, or director of eCommerce, this blog will equip you with insights to navigate the challenges of omnichannel retailing.

To skip ahead for a round-up of the blog’s key points, click here.

The Rise of Omnichannel

If you’ve ever asked, ‘what is omnichannel retail?’ you’re not alone.

Although the concept is a cornerstone of modern retail, it’s still hard to pinpoint what it means.

At its core, omnichannel retail refers to the integration of various shopping channels (both offline and online) into a single, unified shopping experience. It goes above and beyond single-channel shopping (such as a brick-and-mortar store). Single-channel shopping is now considered a thing of the past, with customer expectations demanding more and more.

As technology advances, so does retail. Online stores, digital marketplaces, and mobile apps have proliferated as technology has developed. However, these channels often exist in isolation. Instead of providing a streamlined shopping experience, each channel offers a siloed customer experience without harmony. This fragmentary shopping experience results in frustrated shoppers, a need for brand identity, and operational efficiencies for businesses. This brings us to why omnichannel retail needs to improve for some eCommerce businesses.

So – why is omnichannel failing in retail?

Despite much promise, eCommerce businesses need help to implement integrated shopping experiences. Pain points include technological drawbacks, data inefficiencies, and getting key stakeholders on board with change. In fact, 64% of eCommerce marketers described a need for more resources and investment as the top barriers to implementing a successful omnichannel strategy.

For eCommerce businesses, an integrated approach results in streamlined business operations and (ultimately) increased sales. From a customer point of view, frictionless shopping experiences are convenient, as they easily shop across any touchpoint (online, in-store, or mobile apps). A well-developed, customer-centric omnichannel approach to retail means the difference between a one-off shopper and a lifetime customer.

Ultimately, the shift from single-channel to multi-channel and omnichannel retailing is not just a result of technological advancement. Instead, it also signals how customers prefer to interact with retailers. Nevertheless, despite having challenges, the payoffs make omnichannel an essential strategy for any business aiming to grow.

Core Challenges in Omnichannel Retailing

Listed below, we break down some common omnichannel retail challenges:

Bridging the Gap Between Online and Offline

‘Omnichannel retailing has many potential advantages, but it also has challenges; what are they?’ The answer is that blending the digital and physical worlds is easier said than done!

The problem

Retailers need help to offer a seamless experience, blending digital and physical shopping and their benefits.

Why it matters

A disjoined experience leads to customer confusion, making it difficult to engage customers and capitalize on sales opportunities.

Data Fragmentation

One of the most common omnichannel retail challenges is data fragmentation across channels and platforms.

The problem

Lack of seamless data integration leads to inconsistent customer experiences.

Why it matters

When data exists in silos, you cannot offer personalized shopping experiences. This negatively impacts the customer experience, leading to fewer repeat visits.

Poor infrastructure and technology

Why omnichannel is failing in retail often boils down to technological limitations. Coupled with poor strategic vision, this is frequently damaging for eCommerce brands.

The problem

Technology not fit for purpose makes it difficult to offer a seamless transition between online store, mobile app, and brick-and-mortar storefront.

Why it matters

This will result in more frustrated customers and missed sales opportunities.

Inventory Management

When it comes to inventory management, keeping your apples and oranges across all channels aligned is crucial.

The problem

Keeping real-time and consistent inventory data aligned (across all channels!) is a common problem for omnichannel retailers.

Why it matters

Mistakes in inventory data can lead to stockouts or overstocks, resulting in lost sales and increased costs.

Competitive Pricing

‘In omnichannel retailing, what visible element must often be adjusted because of competition?’ It’s the pricing strategy, a frequent thorn in the side for many eCommerce managers and directors alike.

The problem

Retailers face pressure to maintain pricing consistency while responding to competitive online and offline pricing.

Why it matters

Failing to adjust pricing results in lost sales to competitors or lashed profit margins if prices are lowered too much.

5 Omnichannel Retailing Strategies

Every omnichannel retail challenge needs a solution. To succeed, you need to embrace various omnichannel retail strategies.

So, what is omnichannel retail strategy? Simply put, it’s an integrated approach to retail, offering a unified customer experience across all sales channels and touchpoints. Below are some critical omnichannel marketing strategies to help solve your problems:

1. Respond to customer feedback

Customer feedback is vital to any successful omnichannel retail strategy. Implement real-time feedback mechanisms across all channels to capture customer sentiment.

This should include regular customer surveys, questionnaires, live chat support, social media monitoring, or email follow-ups.

This approach will provide key insights you should leverage to refine the customer journey.

2. Adopt a best-of-breed headless tech stack

Technology plays a crucial role. And a headless eCommerce ecosystem allows for more flexibility and quicker adaptation to market trends. By opting for a best-of-breed headless tech stack, you set yourself up for innovation and can easily integrate new cutting-edge technologies as they emerge.

3. Regular Staff Training

Regular training is essential to ensure your team understands how to interact with customers across various channels.

Offering consistent and high-quality customer service is crucial for the success of your omnichannel strategy across all sales channels. Not to mention, your staff will thank you, too!

4. Offer Personalization with AI

Artificial Intelligence (AI) is becoming integral to effective omnichannel retail strategies. You can provide a holistic and bespoke shopping experience by utilizing AI algorithms to analyze customer data.

The level of personalization AI offers will increase customer engagement, driving conversion rates and customer loyalty.

5. Optimized Checkout Process

The checkout process is an often overlooked aspect of omnichannel retail strategy. 17% of US online shoppers have said they’ve abandoned their cart due to a ‘too long/complicated checkout process.’

Nevertheless, a streamlined, efficient, consistent checkout process across all touchpoints will dramatically reduce cart abandonment rates. In turn, this will enhance the overall customer experience.

Omnichannel Strategy Success: Footasylum

Pimberly customer Footasylum is a streetwear and sportswear retailer based in the United Kingdom. They offer a variety of new and established brands across footwear and fashion.

In addition, Footasylum has made huge strides into omnichannel retail, growing from strength to strength as a result. Let’s dive into some of the omnichannel retail strategies they’ve leveraged.

Online and In-store Integration

Footasylum provides a seamless shopping experience by integrating online and in-store platforms. Customers can check product availability across stores, buy online and pick up in-store, or make returns to their local Footasylum store (even if you buy online!).

Product data? Not a problem

By leveraging best-of-breed technologies such as PIM, they ensure accurate product data across all sales channels (mobile app, marketplaces, in-store, and eCommerce website). This way, they offer a seamless product experience across all channels, resulting in more happy customers (and more sales!).

Social Media Engagement

Footasylum has an active presence across social media platforms. They use their presence to advertise products and engage with their customer base. These platforms function as a valuable touchpoint in a customer’s journey, guiding them from discovery to purchase.

Mobile App Functionality

Footasylum’s mobile app is a cornerstone of its cross-channel approach. As well as being able to purchase products, the app offers deals, a social feed, access to customer service, register for events at their local store, and browse their wishlist – all from their mobile device!

Footasylum’s Loyalty Scheme: FA UNLCKDimage of Footasylum's reward scheme webpage

FA UNLCKD is Footasylum’s loyalty program. Customers can earn and redeem points whether shopping online, in-store, or via the mobile app. Ultimately, this encourages repeat business, drives customer satisfaction, and benefits both the company and its customers!

Key Points

  • Mastering the challenges of omnichannel retail means embracing change. Over time, retail has shifted from single-channel to multi-channel, into omnichannel.
  • More customers than ever expect omnichannel shopping experiences. A successful omnichannel approach to retail will ensure more loyal customers and sustainable growth.
  • Omnichannel retail strategies focus on delivering a seamless and integrated shopping experience. Customers should expect a seamless shopping experience. It shouldn’t matter whether they’re shopping online or in your physical store.
  • When it comes to omnichannel, it’s important to be consistent. Branding, messaging, and pricing must be consistent across all channels. You don’t want to give customers any nasty surprises.
  • Challenges such as data fragmentation, inventory management, and the right technology in place are common obstacles to omnichannel retail.
  • To be a successful omnichannel retailer, you must gather and react to real-time feedback, adopt a headless tech stack, and provide regular staff training.
  • AI-driven personalization and frictionless checkout processes will also get your omnichannel business on track to success! Embracing these technologies is no longer optional. Instead, they’re a must-have for ambitious modern omnichannel retailers.
  • Taking Pimberly customer Footasylum as an example, retailers should embrace mobile app functionality, loyalty schemes, best-of-breed technology, and online and offline integration to be a successful omnichannel retailer.