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The $92 Billion In-Store Competitive Advantage and How to Maximise Your Share Of It

Find out how bricks and mortar retailers can procure a significant competitive edge over online-only competitions by creating an integrated omni-channel experience.

Although technology continues to progress and eCommerce sales keep growing, bricks and mortar shops are still the preferred manner of buying Australian and New Zealand consumers. In a study by Adyen:

  • 50 percent of Australian shoppers were found to favor in-store shopping
  • In comparison to 27% who favoured online shopping

This is significantly higher than in the US, where only 37 percent of shoppers prefer shopping in person.

Why? It all comes down to perceived advantage and efficiency. Humans innately seek out the least path of resistance to fulfilling their requirements. At this time, most Australian customers still feel that by visiting a physical store as part of the purchase journey, they could finish the entire procedure and go home with the merchandise they want daily; instead of purchasing online, waiting for it to arrive and having to pay for home delivery — all in the risk that it could not be the ideal match nor meet expectations once it arrives. While important eCommerce players in Australia & New Zealand are closing the gap with practices like same day delivery and free returns to highlight the apparent advantages of price transparency available with a web search, there’s still some way to visit change Foreign customer perceptions that a pure eCommerce buy experience is as easy and instantaneous as one which involves a shop visit.

Make no mistake about it, eCommerce earnings will inevitably continue to grow and occupy a larger share of total transactions in Australia & New Zealand. The identical Adyen report found that retailers expect online purchases will include 30% of all sales within three decades, up from 23 percent today.

References

But while many business commentators turn to trends in developing eCommerce earnings to paint a gloomy picture for bricks and mortar retailers and a promising one for pure eCommerce players, we would argue it’s very likely that the retailers that stand to win the maximum market share are the ones which provide BOTH online and in-store shopping choices with intelligent integration in the core. (It is also worth mentioning that a substantial proportion of the developing eCommerce earnings are actually Click & Collect sales which demands an in-store presence to match ).

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The in-store encounter will continue to play a special role in the majority of shopping purchases, albeit combined with integrated digital channels to provide the best of both worlds. If shops and their employees are empowered with the right product knowledge, inventory & fulfilment management, loyalty and customer service systems this can offer efficiency and value to shoppers that is difficult to match with an internet only buying journey. With the ideal support and cross-selling and up-selling capacities, in-store visits typically drive higher average order values than online purchases and make more engaged, loyal repeat clients.

It follows that bricks and mortar retailers who can accommodate and add an integrated electronic existence to their operations are well positioned to supply a superior omni-channel encounter — but only if they could integrate their stations to provide the easiest, quickest and most pleasurable shopping experience available in their class.

See also

Unified Commerce — Bricks AND Clicks Presence Provides A Competitive Advantage

Shoppers now utilize a combination of in-store and electronic touch-points to complete their purchase travel. Their expectations are ever-growing with respect to how well these channels are incorporated. Two out of five shoppers leave a sale due to a lack of cross-channel alternatives to make a purchase — such as buying online and collecting in-store. This has resulted in $7 billion in lost earnings. At the opposite end of the scale, 51 percent of shoppers purchased an item they did not initially intend to purchase due to the ease of cross-channel shopping.

Known as Unified Commerce, delivering an effectively integrated cross-channel experience can be quite lucrative. Adyen estimates there is a $92 billion chance for retailers at stake. Businesses that embrace omni-channel plans achieve 91% higher year-on-year customer retention rates compared to companies that don’t, according to a survey conducted by Aspect Software.

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Unified Commerce Requires Unified Systems

So what do retailers will need to do to increase their share of the $92 billion chance?

Well, to have an effective Unified Commerce plan, you want to have the ideal business systems in place.

An integral step is combine your stock across your bricks and mortar and online stores — also called an Endless Aisles approach. This pertains to retailers pursuing a business model where all their shops and stations can leverage all inventory across their entire supply chain to increase product availability and choice and optimise the fulfilment experience for clients.

Endless Aisles usually involves a wide range of systems and practices such as Automated Inter-Store Stock Transfers, Click & Collect and In-Store Stock Assess, In-Store Kiosks and Drop Shipping. In addition to supplying product choice and maximising the probability of inventory availability (preventing lost earnings from understocking), an Endless Aisles approach means a broader selection of fulfilment choices are available to increase convenience and speed. Shoppers can select from the buying channels that provide them with the most effective and enriching experience.

As stated by the Australian Retailers Association, Australian shoppers have a high use of Click & Collect; both important drivers being’to prevent home delivery charges (45 percent of shoppers)’, or’more suitable than home delivery (37 percent of shoppers)’. Retailers need live, real time omni-channel systems in place that allow inventory across all of their shops to be current within their eCommerce store and immediately reserved for collection after a Click & Collect purchase is made online. Where inventory isn’t available from the preferred pickup location for your client, the very best systems allow stock to be moved from other local stores. This lowers the risk of internet abandonment due to the client not visiting a nearby place that they can pick up from. The exact systems used for Click & Collect also needs to enable a real time In-Store Stock Checker function to be provided on your eCommerce website. This means that clients who wish to test products before they purchase can go to your store knowing that inventory is available and complete their purchase there.

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Sources

https://www.connectpos.com/knowledgebase/order-operations/

https://www.connectpos.com/knowledgebase/receipt/

https://www.connectpos.com/knowledgebase/fulfilling-orders-with-shipment/

In regards to the in-store experience, systems will need to make certain that shoppers are quickly given a solution to their requirements, that the ideal goods are carried out to take home daily, and there are powerful cross-selling, up-selling and loyalty / repeat purchase procedure systems in place across each of their stores. Employees will need to be equipped with software that enables them to answer questions quickly and acquire the purchase, ideally with cellular tablet compatibility so that they can engage clients anywhere in the store.

Bricks and mortar retailers who could evolve to combine their traditional skills and systems focused on stock availability and customer sales & service with integrated, electronic capabilities to serve clients a truly omni-channel experience will be well positioned to thrive in the future retail arena. Developing these abilities is no walk in park, but it’s made much more achievable with the perfect technology stack. With $92bn up for grabs, it would seem a worthwhile investment.


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