What Is Omnichannel Retail?
Omnichannel retail is an integrated approach to retail that aims to provide a consistent and unified shopping experience across various channels, both online and offline. It recognizes that consumers today interact with brands through multiple touchpoints, such as physical stores, websites, mobile apps, social media platforms, and more. The goal is to create a cohesive and interconnected environment where customers can engage with a brand at any point in their shopping journey.
Omnichannel selling offers several benefits to retailers, brands, and customers. For retailers, it provides a competitive edge by improving customer satisfaction, increasing customer loyalty, and driving sales growth. By leveraging multiple channels, retailers can reach a wider audience and cater to different customer preferences and needs. For brands, it exposes consumers to their products regardless of how they shop and helps them keep pace with demand. For customers, it offers convenience, flexibility, and a seamless shopping experience. They can choose how and when to interact with a brand, whether it’s through a physical store, a website, or a mobile app, and expect consistent service and product availability across channels.
Omnichannel retail is a holistic approach to retail that focuses on delivering a consistent and integrated shopping experience across various channels. By leveraging technology and data, retailers can create personalized and convenient experiences, enhancing customer satisfaction and driving business growth in the increasingly digital and interconnected retail landscape.
How CPG Consumers Are Shopping
According to NIQ Omnishopper data, 2022 brought close to 15 million new online CPG shoppers to the table. Within the US, 86% of CPG dollar sales are represented by “omnichannel shoppers.” This means consumers are buying CPG products through every channel, often at the same time. It gives brands more avenues for getting their foot in the door. But it also complicates marketing efforts and requires a good understanding of consumer behavior to get right. In fact, more than one in five (22%) shoppers now plan an in-store shopping trip combined with a prior online order. So, failing to connect with consumers on every channel means you can easily miss out on sales.
Additionally, more consumers are shifting their spending habits to combat growing economic insecurity, supply costs are high, and war and weather events are ongoing. This is leaving many brands in the dark as they scramble to keep pace and stay on shelf. Understanding how they’re spending and how they aren’t is a key component to maximizing the value of your omnichannel retail strategies.
Are you meeting evolving shopper needs?
In our free eBook, we share some of the most important factors impacting shopper behaviors, how to identify them, and the ways you can overcome them or use them to your advantage.
4 Key Omnichannel Retail Tips for CPG Brands
With so many factors affecting demand and consumers seeking value across channels, omnichannel strategies need to be better than ever. But many brands are still behind the ball.
With that in mind, here are 4 tips for CPG brands to meet omnichannel shopper needs:
1. Embrace a Customer-Centric Approach
Above all else, an effective omnichannel strategy must be built with the customer in mind. This means you need to understand your customers’ preferences, behaviors, and expectations across various channels. Customers want to get their ideal experience regardless of channel, so you need to understand the ins and outs of each. What works in-store may not work online and vice versa.
Looking at your existing and target customers’ behavior individually by channel can be a great way to understand their motivations. For example, online shoppers tend to search by product attribute, not brand. One major area where this is clear is the growing number of customers seeking sustainable products. NIQ data shows that 26% of shoppers find it difficult to find sustainable products on the digital shelf. So, brands that don’t list desired sustainability attributes in product descriptions can easily get lost on the digital shelf.
2. Establish a Unified Brand Presence
A brand is only as good as the market’s perception of it. If you send mixed messages or fail to connect with your target customers, you’re leaving money on the table. Maintaining consistent branding and messaging across all channels can go a long way to building brand loyalty. Ensure that the look, feel, and tone of your brand are cohesive, reflecting a unified identity. When your online and in-person experiences are aligned, you can create a seamless transition for customers between channels.
Many brands mistakenly believe that the eCommerce market requires an entirely different set of tactics to reach their customers. Leaning into social media is often the choice and can pay dividends. In an NIQ and Dash Hudson study, we found that brands that entertained their audience on TikTok grow at a rate 34% faster than those who approach the platform with a traditional marketing mindset. But, if your social media marketing is too dissimilar from your traditional efforts, consumers tend to find brands as dishonest. This pushes them toward the competition and you can lose sales across all channels.
3. Optimize your Product Assortment
Assortment optimization is never an easy task, but managing an omnichannel product assortment is even more complicated. Omnichannel assortment optimization means you need to overcome the challenges faced by both in-store and online products. According to Data Impact by NIQ, there are more than 50k online stores operating in the US alone. Knowing where your customers are shopping and ensuring they see the most effective version of your product assortment can pay dividends.
While maintaining consistency, it’s also important to tailor your assortment to each channel. For example, your online store may offer a larger selection of products than your physical store, while your mobile app may highlight popular items or new arrivals. Identifying the products that work by channel can help you streamline your offerings and maximize your return on shelf, digital or real.
4. Leverage Technology and Data
As shoppers continue to shop in-store and online, new paths to purchase including mobile and social commerce are expanding — and complicating — the omnichannel space. This expansion is challenging for brands to manage their product data — data quality and consistency across all channels can be compromised, leading to missing or out-of-date product information on different channels. Taking the time to review your numbers regularly and look for errors is key.
One of the most common issues with omnichannel assortment management is a lack of accurate and actionable data. With the rise of click-and-collect selling, many sales figures aren’t accurately tracking the actual origin of purchases. They’re either duplicating the numbers or improperly attributing them. To get the full view of your position and opportunity, you need to look at both sales data and panel data. With eCommerce expected to reach $36 billion in 2023 — a 20% projected increase from 2022, every optimization can lead to big gains, but only if it’s based on accurate data.
Unleash the Power of Omnichannel with NIQ
To reach omnichannel shoppers, you need to know where they’re choosing to shop, how, and why. But, that’s only possible if you have access to reliable, up-to-date data.
Emerging brands can start their journey with a free Byzzer subscription, NIQ’s platform built for emerging brands and their budgets. Free access gets you 3 free reports and a weekly alert to get you started with data. Byzzer provides breakdowns of a wide range of attributes and markets in easy-to-digest reports. Best of all, we’ll show you how to leverage this information for your action plan. It’s never too early to start acting on data.
Interested in more valuable insights like these?