Whether they know it or not, the one thing that’s at the top of many consumers’ wish list for the holiday is an omnichannel shopping experience.
Though that’s not the term they would use, consumers today have increasingly high expectations for the ability to shop anytime and anywhere and to pay in any way they wish — with an expectation that merchants will make it happen.
With the holiday season in full swing and the new year right around the corner, Qualpay CEO Craig Gass sat down with Karen Webster to offer some insights into the current state of the omnichannel experience and how merchants can make the purchasing journey that omnishoppers desire a reality.
‘Tis The Season For Omnichannel Consumers
This year’s holiday shopping season is already off to a strong (omnichannel) start.
Industry data has shown that 1.2 billion Black Friday orders were placed via mobile, up 33 percent from last year. Research also revealed that nearly 33 percent of consumers who buy online also pick up in store, and 60 percent of those consumers spend more during that in-store visit.
It’s clear that the opportunity to capitalize on omnichannel is ripe, but that doesn’t mean that merchants are ready (or able) to step up to the plate and deliver.
“Merchants today are clearly looking at omnichannel as a way to not only boost sales but improve the customer experience but, with that, comes a certain level of complexity,” Gass explained.
While the change in consumer behavior has been rapid, the pace of merchants being able to keep up with more omnichannel-focused demands and expectations has taken more time.
Most consumers probably aren’t familiar with the term “omnichannel,” but they do know exactly what they expect when it comes to shopping: a unified experience across channels that is not just seamless but convenient.
But for merchants, the concept of omnichannel may depend on the nature of their business.
Gass explained that many merchants look at omnichannel more from a multichannel perspective, because each channel is different and requires different skill sets to run operations across each one.
“I see a little bit of disconnect between the way consumers look at omnichannel and the way merchants look at it,” he added. But ultimately, Gass pointed out, merchants will get to the point of seeing omnichannel as the “single channel” that consumers do because they also want a seamless experience, consistent branding and a consistent product presentation for their business.
The Mobile Quest
Gass said that mobile is a perfect example of the synergy that can work in an omnichannel environment.
The mobile device is now an integral part of the shopping experience for many consumers. The purchase journey today is about mobile, but it’s also about using mobile in a variety of ways to support the purchase decision. That can include product reviews, in-depth discovery and even searching out better deals.
Shoppers are going mobile, and it may be a mistake for merchants not to accommodate that growing shift.
From the consumer perspective, it’s not always obvious if promotions, deals and prices are consistent across channels, which is where mobile has quickly answered the call.
“I think that’s part of what’s driving the collapse into omnichannel. Omnichannel has become a term of art for the concept that you’re taking various sales channels and collapsing them,” Gass noted.
A key piece of making sense of the omnichannel puzzle is having a clear picture of payments and inventory across channels.
Unfortunately, that’s not necessarily possible today for a lot of merchants.
As Gass explained, each new channel a merchant introduces drives even more complexity in ensuring everything is consistent and seamless for consumers.
The Omnichannel Kickoff
The hardest part of implementing omnichannel, for many merchants, can actually be knowing where to even start.
Gass said that, while this really depends on the nature of a merchant’s business, in many cases, SMBs have the opportunity to be a bit more flexible and nimble in their approach. Many are still new enough in the space that they can essentially start fresh with an omnichannel experience without the burden and complexity of transitioning a longstanding, legacy operation.
By taking the enterprise they have and shifting toward omnichannel, Gass explained, SMBs may have a slight advantage over their big-box competitors in pursuing the omnichannel path.
But no matter how big or small a retailer is, the implementation of omnichannel always seems to be much easier said than done.
In the retail environment, friction comes in many forms, which makes addressing it a significant challenge.
“The key to that, from our perspective, is a centralized payments experience. The key to omnichannel is being able to do all of it in a single merchant account,” Gass said.
This means having all purchase information across all of a merchant’s channels captured in the same business information platform. With everything in a single place, a merchant can then solve many of the complexities that come with omnichannel, such as processing returns and exchanges, as well as optimizing the purchase flow.
A single reporting platform, Gass explained, can also help merchants simplify the purchase process for consumers and resolve problems with consistent communication, no matter which channel a shopper used for a specific transaction.
This information can also be utilized to deliver a more personalized experience for the consumer. When a merchant can recognize a shopper’s purchase history and preferences across channels, this can contribute to a more seamless and convenient shopping experience for the consumer.
“Personalizing the experience for the consumer is where the merchant wants to go,” Gass noted.
The biggest barrier the payments industry will face in doing this will be avoiding the payments stream being broken out across channels.
As Gass pointed out, merchants have long used different payment methodologies for different channels, but he also said this behavior will change over time.
“That’s part of the challenge facing merchants — what’s happening today isn’t going to be what’s happening in a year, and they are going to have to keep up with that curve,” he added.
The Omnichannel Approach To 2017
Qualpay’s trends and predictions for 2017 include: adding more payment options for consumers; keeping friction out of the purchase experience; adopting in-store mobile devices; getting rid of retail pure-plays; investing in more integrated payments, retail management systems, omnichannel and fraud prevention; and making social media options a bigger part of the omnichannel mix.
While the definition of a true omnicommerce experience may change depending on who is being asked — consumer or merchant — Gass said those taking the lead in driving omnichannel will be the merchants that are forward-thinking.
An obvious example is Amazon.
While the eCommerce giant started with an online pure-play approach to retail, the company’s approach to establishing a physical retail presence has essentially changed the function of brick-and-mortar, as well as the future of how online versus offline really looks.
Understanding the predictions for how omnichannel will look next year is one thing but future-proofing solutions to deliver on these requirements is a much more difficult task.
But Gass said this is where merchants can talk to their vendors and ensure that the ones they have in place can handle the forthcoming changes in technology and services.
“This has always been true — merchants have always had to be able to look around the corner a little bit and figure out what’s coming next to ensure they have the support in their supply system and in their distribution system to handle those changes,” he pointed out.
At the end of the day, a merchant’s desire is to turn shoppers into buyers, while also driving out costs and simplifying the retail experience.
This is what payment providers must also keep in mind.
“For the payments industry, our job is, as it has been for a long time, to look ahead to try to figure out how the consumer is going to react, what the consumer will want, how the merchant will react to that and how can we assist the merchant in meeting their goals,” Gass said.