Share this article

print logo

They call it ‘omnichannel’ retail: blending stores, phones

Welcome to the future.

Now that we have all have computers in our pockets, retail is evolving every day.

We tap a few buttons on our phones to have whatever we want delivered to our doorsteps. We compare prices across dozens of stores without visiting a single one. And, come Super Bowl Sunday, we will be able to order underwear via our TV remotes directly through the commercials hawking it.

We have been living in the brave new world of e-commerce for decades. But never has it been more clear how much omnichannel retail – buying and selling across multiple platforms such as mobile internet devices, computers and brick-and-mortar stores – will continue changing the way we shop in 2014 and beyond.

“When you think about the number of people who have smartphones, and the fact that smartphones are getting smarter, and how much people love all the ways they make life easier, it’s clearly something that’s never going to go away,” said Bill Martin, founder of ShopperTrak, which tracks consumer and retail data. “The Web is completely woven into retail today.”

Just how thoroughly omnichannel retail has become integrated into our lives became clear during the most recent holiday shopping season.

Online purchasing skyrocketed while in-store traffic levels dropped. Cyber Monday purchases increased 20.6 percent over the previous year, according to IBM’s Digital Analytics Benchmark report, while in-store Black Friday purchases fell by 3 percent. The number of people shopping via cellphone increased 45 percent.

Yet while traffic in physical stores fell, the amount customers spent per visit rose.

“Shoppers are using phones, tablets and laptops to do their research and ‘pre-shop’ before they leave for the store,” said Teresa Burgin, a spokeswoman for Shoppertrak. “Thus the number of shopping visits has decreased, since they aren’t going store to store to do their shopping.”

The rise of comparison shopping via mobile phone apps and websites contributes to that phenomenon, as do the countless apps launched by individual retailers and by Amazon.

The ability to compare prices across multiple retailers also contributes to the showrooming phenomenon – in which customers handle and examine merchandise in a physical store, then buy it elsewhere online.

More than 40 percent of consumers have engaged in showrooming, according to a recent Gallup poll.

Though some retailers have responded negatively to showrooming – an Australian food store charged a $5 “just looking” fee to discourage it – others have acknowledged the threat and embraced it.

Best Buy, which once covered bar codes to discourage showrooming, launched a holiday ad campaign dubbing its stores “the ultimate showroom” and turned its efforts toward converting captive showrooming shoppers into on-the-spot sales.

“Once customers are in our stores, they’re ours to lose,” Best Buy CEO Hubert Joly told the Associated Press.

Stores have begun offering free Wi-Fi to make comparison pricing easier and have instituted price-matching policies to clinch the sale.

Studies have shown stores stand a better chance of closing a sale if their products are priced within $5 of Amazon. As a result, prices are falling in line.

Traditional stores have also ramped up their online efforts – sprucing up websites and online order processes and improving mobile apps – making it easier for folks who want to shop online to continue shopping with them instead of migrating to Internet-only retailers such as Amazon.

Target, for example, has its Cartwheel app, which gives shoppers the ability to nab extra savings on in-store purchases with their mobile phones. It also offers free shipping on orders from made with a Target credit or debit card.

“The smartest ones embracing it are creating this sort of circular reference,” Martin said. “When they’re in the store, they help them get on the Web, and then use the Web to direct them to the store.”

Stores do that by leveraging perhaps their greatest asset – that they’re already situated in consumers’ neighborhoods.

Most department and big box stores offer “ship to store” services that allow consumers to purchase products online and avoid shipping fees by picking them up at a nearby store. Returns can be made at stores, too, no matter where the merchandise was delivered.

Being able to compete on shipping fees and return hassles gives merchants a huge leg up, since those are two of the biggest deterrents consumers cite about shopping online.

Meanwhile, the most successful retailers continue using web technology to customize the consumer experience, remember their likes and dislikes, and tailor product offers according to the consumer’s buying history and predicted future behaviors.

They give customers product information when and where they want it.

Apple is doing that with its iBeacons, which use Bluetooth technology to alert iPhone users when they are near a certain store or product, then broadcast information about it.

IBeacons use a mobile application instead of Wi-Fi, which means shoppers have the choice to activate it or deactivate it based on their preferences.

“It’s a win-win. The customer saves money, and we make an extra sale,” said Garret Cleversley, president of MacSolutions Plus, an Apple store. “If you own a business, it’s a great opportunity.”