Omnichannel Retailing

In our digital era, businesses offer products and services through a range of channels, including websites, apps, brick-and-mortar stores, marketplaces, distributors, and social media, to name but a few.

Retailers now use omnichannel strategies to create a seamless shopping experience across all channels. This benefits both B2C and B2B environments, with the latter seeing dramatic shifts in how customers interact with businesses.

For example, according to Harvard Business Review, the number of channels utilized by B2B buyers has doubled from 5 in 2016 to 10 in 2021. Some 94% of survey respondents reported this as more or equally effective to previous sales models.

This article provides an in-depth examination of omnichannel retail, including the role of different channels and strategies for adoption.

Exploring Omnichannel Retail.

Omnichannel retail blends multiple sales and marketing channels into a seamless front-end (customer-facing) and back-end (operational) experience.

This represents progress from multichannel retail, which doesn’t offer the same level of integration. Omnichannel isn’t just about adding sales and marketing channels in greater numbers but integrating them behind the scenes.

Let’s explore the main channels that comprise an omnichannel retail experience.

Brick-and-Mortar Stores.

Traditional physical stores offer tangible experiences that anchor businesses in the real world. Many customers value the ability to touch, feel, and try products, particularly if they’re unsure of what they’re looking for, want to try different options, or are interested in high-value items.

Physical stores have adapted to omnichannel retail through services like returns, exchanges, and in-store pickups for online orders. They also offer personal customer service and act as a marker of brand trust and reputation.

Online Stores and eCommerce Platforms.

Online stores and eCommerce platforms are the backbone of modern B2C retail. They’re now becoming more important in B2B sectors. Shopify estimates that a record-breaking 17% of all B2B sales will be generated through eCommerce in 2023.

Distributors.

Distributors connect manufacturers with end markets. With extended supply chain networks, distributors are key players in extending a business's reach to a broader audience.

Mobile and App Commerce.

Smartphones and tablets are now firmly embedded in the omnichannel retail ecosystem.

Mobile-optimized websites and shopping apps offer push notifications and location-based omnichannel marketing. In-app customer loyalty programs can provide discounts and special offers to incentivize repeat business.

Social Media Platforms.

Channels like Facebook, Instagram, and Pinterest offer integrated shopping and access to customer support. You can purchase through business profiles or content like short-form videos.

According to Sprout Social, approximately 68% of people made at least one purchase through social media in 2021.

Marketplaces.

Online marketplaces like Amazon, eBay, and Etsy offer established security, traffic, trust, and convenience. Sellers can also benefit from value-added services such as the Fulfilled By Amazon (FBA) program and managed returns.

B2Bs can leverage Amazon’s business-to-business marketplace, Amazon Business, to purchase things like packaging, janitorial, break room, and maintenance supplies, all with the selection and accessibility of amazon.com.

Virtual and Augmented Reality (VR/AR).

Emerging technologies like VR and AR offer a fresh and immersive digital channel. They allow customers to visualize products in real-life contexts or explore virtual showrooms from anywhere in the world. Buyers no longer need to travel to interact with potential purchases, saving money for everyone involved.

Smart Home Devices.

Omnichannel retailing now encompasses smart home devices, including voice-activated shopping through smart speakers like Amazon Echo and Google Nest.

How to Link Multiple Retail Channels Together.

Simply adopting multiple channels doesn’t constitute an omnichannel experience—you need to link them together.

This has three key advantages: improving the customer experience, reaching more buyers, and gathering data from different channels, all of which contribute to increased profitability over time.

For the Customer: A Seamless Omnichannel Journey.

• Uniform Shopping: Offering customers consistency is the core of an omnichannel strategy. For example, items added to a cart on a website should be accessible in a mobile app. And products purchased online should be returnable in-store.
• Personalization: Omnichannel retailers can personalize customer interactions at each touchpoint by combining data from different channels. For example, customers browsing products online can place an order over the phone without starting from scratch.

For Businesses: A Unified Customer View.

• Comprehensive Customer Insights: Integrating data across channels gives businesses a holistic view and the opportunity to tailor customer service more effectively.
• Strategic Decision Making: Access to data empowers companies to improve sales strategies, inventory management, and product development.
• Automation: Businesses can use data to orchestrate omnichannel marketing strategies, for example, allowing omnichannel customers to browse online, receive targeted emails, and redeem offers both digitally and physically.

Ways to Connect Channels.

Linking channels can be resource-intensive, especially when custom coding is involved. Fortunately, there are several purpose-built platforms and software systems designed to simplify the process.

• Utilizing CX Platforms: For B2C sales, linking channels to customer experience (CX) or customer data platforms (CDP) can provide real-time insights into customer interactions, preferences, and behavior. These platforms are adept at handling large volumes of customer information and presenting them in a way that’s actually useful for strategic decision-making.
• Centralizing Data with CRM and ERP Systems: In B2B contexts, integrating data into customer relationship management (CRM) and enterprise resource planning (ERP) software is a common approach. CRM integrations allow businesses to track cross-channel interactions. ERP integrations automate actions such as purchase and sales orders, invoices, and shipping, whether triggered by a sales rep or online transaction.
• Leveraging CPQ Systems: Configure, price, quote (CPQ) systems enable companies to sell complex configurable products with ease wherever customers interact with sellers. (We explore CPQ in greater detail in the next section.)

Each piece of software above can be implemented in isolation. However, companies often run multiple solutions and integrate them to share customer data and drive automation across touchpoints.

For instance, by pushing CRM data into the CPQ system, suppliers can personalize quotes and improve win rates. In all cases, the goal is to drive efficiency and customer satisfaction.

Omnichannel Integration With Configure, Price, Quote (CPQ) Systems.

Businesses often find uniting different sales channels challenging. As noted, there’s no silver bullet for implementing omnichannel strategies.

However, the most popular solution is to use CPQ. CPQ helps unify sales channels while supporting product customization, real-time pricing, and quotes.

How it Works.

Imagine a business operating multiple sales channels, including physical stores, distributor networks, call centers, and websites. Each channel traditionally functions independently, creating a fragmented customer experience. Now, consider a CPQ system integrating these channels.

In-person, a sales rep assists a customer using a device loaded with the CPQ software. Together, they use a visual configurator to customize product options with real-time pricing adjustments.

Simultaneously, another customer explores the company’s website, interacting with the same (or a similar) visual configurator, downloading an instant quote, and placing an immediate order. CPQ can even leverage augmented and virtual reality to create virtual showrooms, blending the physical and digital worlds.

CPQ functions are controlled by a rules-driven system, ensuring that products are accurately configured, manufactured, and aligned with expectations, however, and wherever they're sold.

Why Integrate CPQ into Omnichannel Retail?.

Whether customers browse products online or visit a brick-and-mortar store, CPQ delivers a uniform experience. As customers interact with CPQ-enabled platforms, the system gathers data on their preferences, choices, and buying patterns, which sales teams can use for follow-up.

Further, CPQ also supports the customization required for complex products, such as in the construction, biotech, or high-tech industries.

It also helps sellers ensure consistent pricing and availability of information across channels.

According to data overviewed by Retail Dive, retailers' greatest focus for omnichannel retail between 2023 and 2024 is ensuring the accurate real-time representation of in-store and online inventory.

CPQ offers a solution by supplying channels with real-time availability, price, and product data.

The Benefits of CPQ in Omnichannel Retail.

1. Continuity: If you sell complex and configurable products through multiple channels, delivering a continuous, high-quality service across each one is essential. CPQ enables precisely that.
2. Real-Time Pricing Adjustments: CPQs update prices in real-time according to the customer's product selections. This ensures that online customers are presented with reliable pricing information without having to contact a salesperson and await a response.
3. Personalized Experience: Besides supporting product continuity, CPQ also enables flexible product options and pricing structures within each channel. This allows businesses to tailor their strategies for different market segments.
4. Efficient User Management: CPQ software allows different distributors, locations, and sales teams to manage their accounts independently, simplifying administrative processes.
5. Accelerated Sales Cycle: CPQ accelerates sales cycles, allowing customers to receive instant quotes for configured products—both online and offline. This supports omnichannel retail in complex sectors where quick and efficient responses improve customer engagement and conversion rates.
6. Dynamic Upselling and Cross-Selling: CPQ systems can use AI to suggest complementary products or upgrades based on customer behavior. This replicates the role of the human sales rep in channels like eCommerce, where only the buyer is present.

In Conclusion.

Adopting a practical and effective omnichannel retail strategy is essential for modern business. This prioritizes consistency and personalization, ensuring customers enjoy a cohesive brand experience regardless of how or where they engage.

While traditionally associated with B2C, omnichannel retail has become increasingly important in B2B environments. B2B retailers face unique challenges when marketing complex, configurable products through multiple channels, which CPQ can solve.

Understanding Omnichannel in Retail FAQ.

What does an omnichannel customer experience mean in retail?

Omnichannel in retail is a strategy that integrates different shopping methods available to consumers, such as online, in-store, or through a mobile app, into a seamless customer journey. The omnichannel approach focuses on the interconnectedness of all channels to ensure a consistent experience wherever customers interact with your brand.

What is the omni-channel retail strategy?

An omnichannel retail strategy creates a seamless customer journey across multiple channels, including physical stores, online platforms, mobile apps, and social media. It aims to provide customers with a convenient, consistent, and personalized shopping experience, regardless of their chosen channel.

What is an example of omnichannel retailing?

A classic example of omnichannel retail is a customer browsing products on a brand's mobile app, adding items to their cart, and completing their purchase in-store or on the brand’s website. The transition across these channels is seamless, with the cart's contents remaining consistent.

What is the difference between omnichannel and multichannel?

While both omnichannel and multichannel retailing involve selling through multiple channels, the key difference lies in integration. Multichannel retail operates channels independently, while omnichannel retail integrates all channels to provide a cohesive customer experience.

Why is an omnichannel retailing strategy better?

Omnichannel is better because it provides a more integrated and cohesive customer experience. It gives retailers and their customers greater flexibility, personalization, and convenience in shopping.

What is an omnichannel mindset?

An omnichannel commerce mindset refers to a business's approach to prioritizing and integrating customer experiences across all available channels.

An omnichannel retail strategy involves thinking about retail from the perspective of the customer's journey and ensuring consistency and connectivity in every interaction.

How do CPQ systems support omnichannel retail strategies?

CPQ (Configure, Price, Quote) systems support omnichannel retail strategies by providing consistent product information, pricing, and customization options across all channels. They enable real-time pricing and product configuration, whether the customer is shopping online, via other parties such as distributors, or in a physical store.