Retailers must embrace the omni-channel approach to customer satisfaction

Our 2015 Innovation Insiders Index combined thousands of industry insiders’ assessments to gauge the effectiveness of UK big business innovation. It also compared how companies from different sectors tend to perform against our six principles of innovation – including the retail sector.

Despite the continuing growth in digital retail, we found that Amazon and Argos (part of Home Retail Group) were the only retailers to make the Index’s Top 30. Retail as an industry didn’t score highly against any of the key innovation principles; in fact it even came last for “purpose” and “customer focus.” This suggests that the growth in this sector only reflects increasing consumer appetites, rather than active improvements from the big players.

Stepping up to capitalise on an omni-channel market
Many retailers are now at home with multi-channel retail, delivering parallel channels that allow consumers to shop how they want. But a true omni-channel approach takes this to the next level, ensuring a seamless, consistent experience across all available platforms. Customers might start in one channel and swap to another as they move towards buying, or even use different channels simultaneously (like googling on their smartphone as they stand in your store).

In a recent survey, 84% of respondents reported using digital before or during their most recent trip to a store* – and many UK retailers have embraced this trend. Argos is the pioneer of “click and collect” stores, while fashion retailer Hobbs shows which stores have which clothing sizes. Meanwhile, Next offers next-day delivery for online orders made as late as 9pm the previous evening, and Amazon has a special two-hour delivery service for London addresses.

How should retailers adjust to omni-channel as the new normal?
The most effective omni-channel approaches are based on understanding what the customer wants at each point in the purchase process.

Thomson’s holiday shop brings the retailer’s digital credentials in-store; it offers interactive maps and tables for customers to research locations, weather and leisure activities, alongside an advice bar with sales assistants. This reflects the findings of the survey* that customers not only tend to research using their smartphones while physically inside stores – but would also love to use unmanned kiosks and digital displays rather than make small talk with sales staff.

This integration flows both ways: previously online-only retailers are looking for a high street presence. For some time, Amazon has offered customers lockers to pick up and return items; this year they will open a store in New York, as has mail subscription beauty box Birchbox.

What’s next in omni-channel advances?
Another 2015 survey** showed that two out of three consumers are interested in virtual shopping, with 63% saying that VR technology would change the way they shopped. And it’s not just a consumer trend: purchasing agents and procurement professionals are also expecting to benefit from the effortless integrated experience of their personal purchases. They’re requesting services such as ship-to-buyer and a high quality in-store pick up solution…

Our take on retail
There’s no end in sight for retail’s rapid changes, with new technological advances and the advent of omni-channel selling for B2B. We say retailers must ensure they’re focused on their customers’ experience with their brand, and have flexible delivery methods to anticipate ever-increasing demand.

Download the index for more commentary on the state of innovation within big UK retailers. And let us know what you think – what else should big retailers be considering in a brave new omni-channel world? Join the conversation on Twitter: #innovatebig #6principles

* The New Digital divide, Deloitte, 2014
** Reinventing Retail: What Businesses need to know for 2015, 2015