By 2026, eCommerce will account for 24% of all global retail sales. Where customers go, retailers must follow. That means merging your brand’s physical and digital storefronts has never been more important.
According to consulting firm Mckinsey& Company’s chief retail analyst Eric Hazan, the world is entering an era of “phygital retail.” The term “phygital” is a combination of the words “physical” and “digital.”
This new world of retail will be dominated by brands that can connect their physical and digital presence to engage & attract customers. So, how can small-scale retail firms undergo this “phygital” transformation? By adopting an omnichannel retail strategy. Here’s why.
What is an Omnichannel Retail Strategy?
An omnichannel retail strategy is a business strategy where retailers engage their target customers through several digital and physical touchpoints. This retail strategy was developed in response to the new demands of modern-day shoppers.
New-age consumers have varied shopping preferences. They shop from both traditional brick-and-mortar stores &eCommerce websites. Adopting an omnichannel retail strategy means providing convenient & personalized shopping experiences to these new-age consumers across both physical & digital platforms.
Adopting an omnichannel retail strategy can enable retailers to protect their brands & retain customer loyalty in a world of fast-changing customer expectations. But, that’s not the only benefit of adopting this flexible channel strategy.
Key reasons why retailers must prioritize the adoption of omnichannel retail strategies in 2023:
Efficient Inventory Management
By being equally present in multiple channels, brands can funnel their products based on customer demand. Take Myntra as an example. The online fashion marketplace is visited by over 33 million users every month. However, Myntra is more than just an eCommerce store.
In the past 5 years, Myntra partnered with multiple offline brands. The company asks small-scale offline stores to promote Myntra& display the eCommerce brand’s lifestyle products. These efforts have allowed the brand to provide its customers with omnichannel experiences.
What does Myntra do when certain products don’t turn over fast enough at their physical retail stores? They direct that inventory to different online channels. What does the brand do when certain products do exceptionally well in their online stores?
They direct that inventory to different offline channels. With multiple avenues, the eCommerce giant has more opportunities to deplete back inventory and maintain strict margins. The brand’s omnichannel strategy also enables it to cut down commodity costs & prevent unnecessary interruptions in its customers’ shopping experiences.
Improved Data Optimization
An omnichannel retail brand receives two forms of customer data: in-store and online data. These two data sources enable them to add value to their services. Take Pepperfry, India’s largest online furniture marketplace as an example.
The brand grew in popularity by serving its customer base via online channels. But, since 2019, the brand has launched 32 franchise stores across 25 cities in India. By leveraging the omnichannel approach, Pepperfry has increased its sales dramatically.
Pepperfry collects vast amounts of user data through its well-established online marketplaces. This data is put to good use in Pepperfry’s offline franchise stores where customers receive direct and personalized shopping experiences.
By creating data-backed shopping experiences for its customers across all channels, Pepperfry has fostered a strong brand presence.
Merging your brand’s digital & physical presence must be expensive, right? Not quite. In the long run, adopting an omnichannel strategy helps retailers cut costs, especially marketing costs. An omnichannel brand will have more conversion tactics at its fingertips.
Such a brand will also have more freedom to be creative with its promotions. For example, physical retailers can only rely on traditional marketing efforts to attract customers. Similarly, a digital retailer can only use digital marketing tactics.
With an omnichannel strategy, brands can do both. They can use every physical or digital interaction they have with their customers to elevate their brands and drive consumer loyalty.
In the post-pandemic world, it doesn’t really matter if a customer is shopping online or in a store – can your brand provide top-quality experiences for the customer across all channels: that’s the question retailers need to ask.
Adopting an integrated omnichannel strategy will allow new-age retailers to provide frictionless & hyper-personalized customer experiences across all platforms. But, going omnichannel isn’t easy: especially for small-scale retail brands.
That’s where VasyERP can be of immense help. We offer 360-degree omnichannel solutions for retailers planning to go omnichannel. So far, we’ve helped over 12,000 retail companies connect with their target customers across multiple physical & digital touchpoints. Our ERP solutions can help your brand go omnichannel as well.