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Study: Retailers in Canada Struggle to Implement Omnichannel Experience Due to Customer Data Conundrum

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A new report says about 85 percent of B2C businesses are lagging behind because they’re incapable of extracting actionable insights from their customer data.

“The new normal demands physical and digital excellence. While the shifts of the previous year required digital transformation across the board, successful marketing strategies of the future are not all digital or all in-person; rather, the best marketing strategies bring both worlds together seamlessly into a comprehensive omnichannel experience. However, 85 percent of organizations today lack a seamless omnichannel experience,” says the report by Forrester Consulting which was commissioned by Toronto-based DAC Group, a digital performance agency, with 12 offices in North America and Europe.

“B2C organizations face a complex conundrum — in a world that’s becoming increasingly digital, building a truly seamless omnichannel experience becomes increasingly difficult. Underscoring this tension is the belief that a 100 percent digital world is the only future, which is not the case. The future reality is an omnichannel world that brings together physical and digital experiences. CMOs and their marketing teams will only be successful in this new world if they are able to combine both digital and physical into a cohesive experience that resonates with customers throughout their entire journey.”

Nasser Sahlool, Vice President, Client Strategy at DAC Group, said there has been a huge jump in digital adoption by brands, supercharged by the pandemic.

“There is a broad consensus that things will be increasingly and in fact exclusively digital moving forward. We wanted to determine whether or not that was a fact because we certainly saw the brands that did the best during the pandemic — beyond the giant digital native brands like an Amazon or Netflix — but the ones that enacted a true omnichannel experience which is incredibly difficult to do in a pandemic with things being open and closed and limited, but those who were able from a retail perspective to do this really well had insanely outcomes in terms of growth,” said Sahlool.

Nasser Sahlool

“(The study) validated that point and it also said moving forward what people are looking for is not 100 percent digital. They are craving these omnichannel experiences and brands that do this are able to build differentiation and the ability to build market share. We’ve certainly seen it in our client base. This certainly shouldn’t be a surprise because there’s a reason we’re all sitting at home depressed. The idea that once the post-pandemic economy opens up we’re all just going to do things digitally is ludicrous. So we wanted to see how well prepared brands are for that post-pandemic omnichannel boom that’s coming.”

Forrester defined an omnichannel experience as one that is a seamless, cohesive, and contextual experience between digital and physical touch points across the entire customer journey.

Sahlool said that retail is at 92 percent in terms of struggling with this which was surprising because retail is typically at the forefront in being able to innovate and building these types of experiences primarily because they have to.

Why is this happening? Why do 92 percent of retailers say they lack any decent cohesive omnichannel experience given that that’s what they need to do?

“The core failure is they don’t know their customers. They cannot build around customer data,” said Sahlool.

The report found that 77 percent of businesses have difficulty maintaining a unified customer profile across channels; 72 percent have difficulty working with disparate data and tech tools; and 74 percent are unable to deliver consistently on the brand promise across the customer journey.

“What is most alarming about this is that retailers and brands have had years and years and years to do this. They’ve invested an enormous amount of money in enterprise tools and platforms and yet this is still the situation,” said Sahlool.

“There’s a further complication in this in that there’s big changes coming in the regulatory and data privacy landscape. Google has made big announcements about changing access to third party data — the death of the third party cookie. That’s not coming for a while but the simple fact that if we in Q2 of 2021 have all of these brands saying we can’t do this today imagine how much more difficult it’s going to be when they don’t have access to that data in a few months’ time.”

If companies don’t figure this out, there will be further consolidation, especially in the retail sector, amongst the giant pure play digital players.

The report cited three key activities for companies to bolster their omnichannel success:

  • Promote their brick-and-mortar locations: “Don’t write off physical stores in favor of digital strategies. Omnichannel is here to stay. 75 percent of decision-makers say their brick-and-mortar stores will be important or critical to overall business performance over the next three years. This includes maximizing the value physical experiences can provide (e.g. ability to interact with a product, have the product immediately available, and the advantage of human interaction in the sales experience), establishing trust and connection by investing in a local presence, and utilizing localized media for a more personalized touch. Brands must address the seamless customer experience now to remain profitable — but understanding where to start can be just as intimidating as addressing challenges.”;
  • Value both quantitative and qualitative benefits from an omnichannel strategy: “Most firms that prioritize creating an omnichannel experience generally do so because it provides a consistent customer experience (71 percent) and drives customer retention and engagement (64 percent). These reasons vary by region and industry, but the underlying motivation is the same: supporting the customer. The benefits go beyond those two goals, though, and are more qualitative than quantitative. In fact, marketers that have built their omnichannel presence cite improvements in customer satisfaction and brand awareness as the top benefits, aligning almost exactly with their priorities for the year ahead. In time, these improvements promote organizational growth by way of differentiation and a strengthened brand, further benefiting both to the organization’s bottom line and its end customers.”;
  • Prioritize insights generation: “Brands need greater insights to inform their omnichannel strategy and a way to effectively connect these insights to multiple data sources. To further bolster their plans, organizations are preparing to implement or expand their implementation of key supporting technology, such as data management platforms and analytics tools. Localization also becomes a critical factor. Integrating digital and physical insights is supported via listings management and reputation management. These tools will help marketers better prepare for a data-deprecated world to understand their customers, while also delivering quality experiences regardless of channel.”

Article Author

Mario Toneguzzi
Mario Toneguzzi
Mario Toneguzzi, based in Calgary, has more than 40 years experience as a daily newspaper writer, columnist, and editor. He worked for 35 years at the Calgary Herald covering sports, crime, politics, health, faith, city and breaking news, and business. He now works on his own as a freelance writer and consultant in communications and media relations/training.

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