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  • Vanessa Mitchell

Retail technology trends: the convergence of online and offline CX

AZK Media's Director of Content and Communications, Vanessa Mitchell discusses the impact of technology and the pandemic on customer experience in retail, and the new emerging trend of 'online to offline' (O2O) commerce.

Following pandemic-induced restrictions and enforced lockdowns, you’d be forgiven for thinking this is the final nail in the coffin of physical customer experiences forever.

However, the opposite is true. Physical in-store experiences will be more important than ever once consumers are allowed out and about, making a united blending of online and offline brand experience absolutely vital moving forward.

While 2020 may have prompted more people, particularly older generations, to go online, some research shows that 82.5 percent of all retail sales still happened inside physical stores up to and including 2020. Reports also show e-retail sales accounted for 14.1 percent of all retail sales worldwide earlier this year, and these figures are expected to reach around 22 percent in 2023.

The fact is that physical in store experience will still make up an important part of a healthy retail journey for many years to come, and throwing ‘all your eggs in an online basket’ will not best serve brands looking to scale meaningful emotional connections with their customers. This is for a variety of reasons, not the least of which is customer experience (CX).

Marketing-led online-to-offline (O2O) commerce

Online-to-offline (O2O) commerce, or integrating online and offline for a cohesive, complementary customer experience, has been around for a while, and yet few marketers are really achieving it, preferring to instead select one channel, whether online or offline, and see the rest as secondary.

O2O means uniting online and offline touchpoints on the customer journey and making them work together for a cohesive brand and customer experience. In this reality no channel will be secondary – each is as important in the journey as the other.

This ‘omnichannel’ experience recognises and enhances the new customer journey, which is no longer a linear one resulting in purchase at a physical store. Customers now may visit a physical store to try on an item and yet order the item online while they are in store, then enjoy delivery.

Or, they may order an item online and wish to return or exchange it at a physical store, or order online and pick the item up in store the same day. There is no one path to purchase anymore, the marketing funnel is really a ‘loop’. And there is no typical consumer.

A good O2O strategy comes down to making it as easy as possible for all consumers to find and then purchase from a brand in the most convenient way for them.

The benefits of a well-executed O2O are clear. Businesses adopting omnichannel strategies achieve 91 percent greater year-over-year customer retention rates compared to businesses that don’t, according to a survey conducted by Aspect Software, and 90 percent of customers expect consistent interactions across channels. Companies with extremely strong omnichannel customer engagement see a 9.5 percent year-over-year increase in annual revenue, and strong omnichannel companies see a 7.5 percent year-over-year decrease in cost per contact.

These are a lot of consumer dollars that have not yet been leveraged by the majority of brands who still see physical and online as separate.

How marketers will lead O2O

We see it all the time – many traditional brands are still attached to the customer journey being linear resulting in an in store purchase. As a result, those brands have struggled to attract and retain consumers.

However, there are plenty of emerging brands out there who have embraced this new customer journey thanks to clever marketing and cohesive experiences.

Customer experience, whether in store or online, is now digitally-driven. Studies show 81 percent of shoppers research a product online before buying it in a physical store.

More brands are using technology to link online and offline to offer the same feel, regardless of channel. Emerging brands are using technology to offer customers personalised online experiences, with ideas like virtual appointments using video to give fashion consultations, much like they might do in person, and using AR to facilitate online fittings or place a piece of furniture in a home.

Other examples include pushing online purchase history to the salespeople in store, or creating temporary experience-driven ‘pop-up stores’ and immersive experiences to drive foot traffic and educate consumers on product offerings, reinforce their brand’s positioning and support ecommerce sales.

Moving into 2021, a united online and offline customer experience will only become more important as customers embark on a purchase journey in the way to best suit them. Brands taking advantage of this will be the ones to succeed.

Key takeaways: How marketers can unite O2O for better CX

  1. Marketers have a wealth of information on consumers now – so let’s use it. How do your customers like to shop with you? What are their pain points? Where are they churning? What is their feedback? Fix these steps and you will go a long way to uniting your CX.

  2. Ask your customers. So many marketers are afraid of actually asking consumers what they want. And yet, you don’t know what you don’t know. Ask your loyal customers what they want and then act on it.

  3. Detach yourself from the point of purchase. It really doesn’t matter where a consumer actually ends up purchasing a product, so long as they do. If you try to force consumers to purchase in the way you want them to, you will lose them.

  4. Make your in store experience just that – an experience. If you have physical stores, make them a place to surprise and delight. Show your customers you care about them and their needs.

  5. Consider new channels. Try social shopping, try a pop-up, and importantly, ensure your site is optimised for mobile. It was estimated by 2021, 9 percent of all ecommerce sales will happen on mobile devices. However, mobile conversion rates are less than half those of desktop, as research indicates 53 percent of consumers will abandon a site that takes longer than three seconds to load.

Vanessa Mitchell is the Director of Content and Communications at AZK Media.

This article originally published in Marketing Mag.


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