A Retail Evolution: From Omnipotent to Omnichannel and Onto Omnipresent

Ray Hartjen
Ray Hartjen
Director, Marketing

Tomorrow’s retailers of choice will meet shoppers where they’re going, not join them after they’ve arrived, and to those who dare to lead change, strong, trusting customer relationships and a sustainable competitive advantage awaits.

Once upon a time, in a retail environment kept alive only in the distant memories of the most tenured professionals, the industry’s chief merchants wielded omnipotent power. Collectively, chief merchants determined what products consumers could buy; where, when and how they could buy those products; and, of course, for how much they could buy those products. The entire retailing process was in their control – they dictated every facet of the retailing experience. Sure, they dictated within the parameters of a competitive environment, but dictate to consumers they most certainly did.

Did. Past tense.

Enter the internet, the widespread availability of broadband services and the ubiquitous proliferation of hand-held mobile devices. The result was a complete reversal of fortune – power shifted, dramatically and decisively, from chief merchant to consumer.

It changed the game forevermore. Shoppers now have control over the retailing experience, for the first time ever, and they’re thriving in this new environment. Consumers now ‘pull’ from retailers what they want, need and value, as opposed to being ‘pushed’ upon in the past. They look for meaningful, personalized and inspiring shopping experiences, and as a result retailers are forced to better understand what shoppers truly desire as they navigate through their shopping journeys, online, offline or both.

On the back foot

We’ve all heard it. “If there’s one constant in retail, it’s change.”

As a soundbite, it’s effective, if a bit trite. But, as a descriptor of the retail industry, I’ll argue it’s less than accurate.

Up until the internet revolution, retail was a fairly staid and predictable industry, with well-established business models and operational paradigms. Generally speaking, retail wasn’t about the early adoption of new technologies and processes, but rather more of a game of fast following. In a nod to “imitation is the greatest form of flattery,” if a new concept was proven to be effective, it was, in time, copied by others.

Over the past decade or two, shoppers have forced retail to change, and I’d suggest more disruptive change has occurred in the industry during that time period than all the change that preceded it. Ever.

After being in control for generations, retailers became rather lax in creating proactive, transformative change. They became reactive in nature, and a great example can be found in how retailing enterprises reacted to the onset of online e-commerce.

When it first hit the scene, e-commerce was considered another sales channel, brimming with untapped potential. And, as it was adopted by established retail brands, it was adopted in much the same manner as previous channels that had arrived before it, like catalogs and call centers.

E-commerce wasn’t initially integrated into the business; it was added on to the business, often times with completely autonomous business units to accompany it – separate IT infrastructures, product assortments, supply chains, inventories and even pricing.

Shopper-centric it wasn’t, and many in the industry paid for their arrogance with costly organizational restructures and, worst of all, damaged shopper relationships. The fix? Welcome to the omnichannel era.

Struggling up a steep learning curve

In hindsight, it becomes clear the entire omnichannel movement in retail was off target from almost the start. Conceptually, retailers attempted to converge all their disparate channels together into a single, comprehensive shopping experience. Conceptually, it was great. In practice, not so much.

Omnichannel was the industry talking to itself, believing the old retailing paradigms still applied. It comes from the foundation that retail is what you do, what you create and provide to shoppers – it’s a push by retailers, not a pull by shoppers. Try an experiment. Walk out into a mall and ask shoppers what “omnichannel” means.

Shoppers don’t know what “omnichannel” means. To shoppers, it’s all just … “shopping.”

Omnichannel is about retailing. Today’s shoppers are about shopping. There’s a difference.

A retail-centric brand centers its strategies and tactics around itself – you know, the old way of doing things. A shopper-centric brand, however, centers its strategies and tactics around shoppers. And, if there’s one universal truth in retail, it’s what’s good for shoppers is good for business.

Leaping forward

Today’s shopping journeys are less and less vertical journeys, adhering to the rigid parameters of any particular channel – it’s rather odd for a consumer to think, “I’m going to do some online shopping today.” Rather, shoppers tend to bounce around indiscriminately from one touchpoint to another, both digital and physical, and often at the same time. A proof point can be found in most any store at most any time of the day – just stop and watch shoppers who view their mobile phones while in the store.

Shoppers research products on the web, compare prices and products in-store, and reference product reviews on social media before making purchase decisions. In turn, they create more touchpoints and generate more data, resulting in the expansion of even more opportunities for shopper journeys to branch off and explore.

There’s no one single touchpoint that attracts a shopper’s attention and subsequently converts the shopper into a customer, but rather a convergence of touchpoints, both online and offline, all of which makes the shopper’s connected journey a tricky one for brands to track and to keep up with. If a brand can’t identify its customers and their actions in real time, there’s no way it can proactively engage with them to influence their buying behaviors in the moment.

With today’s newly empowered shoppers and their connected journeys, brands are often lucky to be brought into the buying process in the first place. However, the industry would be wise to remember the sage words of the Roman philosopher Seneca, who wrote, “Luck is what happens when preparation meets opportunity.

Retail’s greatest opportunity lies in the ability to be present and actively engaged with shoppers at every touchpoint along their connected journeys, delivering at or beyond shoppers’ expectations. It’s the omnipresent retail era.

The devil’s in the detail, of course, but to get a retail brand actively engaged in the 24x7x365 shopping environment, the high-level approach to omnipresent retail includes the following:

Curate a singular brand experience. There are a multitude of strategic value propositions among retailers, and they all have proven successful, from off-price, discount and outlet all the way up to exclusive luxury. The key going forward is to present a singular branded experience at each and every shopper touchpoint, both digital and physical. It’s one brand, one brand ethos and mission, and one branded experience. What happens online should feel very similar to shoppers as to what they experience offline, and it’s not just in the purchase cycle either. Ensure post-sale service and follow-up is consistent with the interactions that took place during shoppers’ pre-purchase consideration phases.  

Embrace technology. The lines between retail and technology have blurred, with the best performing retail companies integrating technology advancements in nearly every functional area, so much so that the term “retail technologist” is being worked out of the vocabulary due to its redundancy. Many shopper-facing solutions are done completely through digital technologies, and those that aren’t, are empowered by technology. For many retailers, however, technical literacy will need to be addressed by hiring, training and developing skills sets, and redefining the entire workplace culture.

Create an agile culture of innovation and responsiveness. Organizational change frequently excels at the ideation phase. Where it falls apart is in execution, and leadership has an accountability in reinforcing change strategies and tactics continuously throughout the entire organization, from boardroom to stockroom. Communicate the vision, build the processes and provide the tools for everyone to be working toward the common good – shoppers! Test, measure, learn, improve and repeat. Quickly.

Activate all channels for two-way engagement. Today’s shoppers want to share, not just read and listen. Stop using communication channels as broadcasting platforms, inundating shoppers with what you think is important, ala promotions, etc. Rather, engage with shoppers along the lines of what they think is important, with the intent to listen and better understand shoppers, and then respond appropriately. Brands should use the communication channels and tools at their disposal to truly communicate – it’s a two-way dialogue that needs to be cultivated and fostered.

Create compelling content. Earned media, paid media, and owned media might mean something to retailing marketing departments, but to shoppers, it’s all just media, and if it’s good – relevant, compelling, engaging and shareable – it’s hungrily consumed. Content is key to engaging shoppers along their entire shopping journey, from awareness through to purchase and post-purchase, and it’s absolutely critical on social media platforms, particularly those with e-commerce applications, whether created by the brand or its associated influencers and brand evangelists. Measure performance and attribution as possible, and place bigger bets where there is greater return on investment.

Troubleshoot your own opportunities. Forget fast following; brands should never blindly adopt another company’s solution, for that solution likely won’t address its own particular challenges and primary root causes. Amazon Go’s cashierless checkout might be great for its clientele in a convenient store setting, but it’s probably much ado – and a very expensive to do – about nothing for retailers in many other segments. Rather, brands need to audit the shopping experience from its shoppers’ perspectives, and tirelessly eliminate all friction and pain-points in the shopping journey. Shoppers are busy, and they seek value and seamlessness. If they get tripped up, even for a moment, they’re likely lost, certainly for now, and oftentimes forever.

Measure what you want to achieve. It’s simple: you get what you measure. If you want to lose weight, use a scale. If you want to lose inches, use a tape measure. They’re different goals, requiring different measurements.. Sales per square foot for brick-and-mortar stores has long been a staple, and retailers certainly want to measure sales. But, in the omnipresent world of retail, what is the role of the store? For each brand, it might be different. Where appropriate, brands should consider new metrics, such as “experiences per square foot,” measuring display dwell time, sales associate interactions and engagement, and social media sharing.

Avoid death by a thousand paper cuts. As any gardener will tell you, sometimes you have to prune to what might appear an excess in order to make way for new, healthy growth. Sometimes a business has to get smaller before it can get better positioned to grow. Too many brands have slowly and ineffectively pruned away at their businesses, doing nothing really than eroding valuation and continuing a slow, winding – and seemingly inevitable – death spiral. Out of kindness, I’ll avoid mentioning a couple of department store brands as prime examples, but I think you already have several examples – including the ones I’m thinking about – that have popped into your head. Shoppers will tell you want they want, what works and what doesn’t. It might be a bitter pill to swallow, but swallow it nonetheless. Learn from shoppers how they’ve changed and where they’re going. Then, meet them there. What doesn’t fit with any new model to appeal to shoppers needs to go away as quickly as possible.

Today’s new era of retail is here, and it’s here to stay. While retailers have struggled to keep pace with newly empowered shoppers and their new shopping journeys, many have made steady gains as they scramble to respond to the changing environment. Now’s the time for retail’s most forward-thinking leaders to make a bold jump forward, ahead of where shoppers currently are, and establish the exceptional, world-class shopping experiences all consumers expect, value and deserve. Tomorrow’s retailers of choice will meet shoppers where they’re going, not join them after they’ve arrived, and to those who dare to lead change, strong, trusting customer relationships and a sustainable competitive advantage awaits.

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