E-Commerce & Omnichannel

The Corona crisis was obviously a key driver for customer acceptance of online offerings.

After initial fears of contact, even advocates of stationary retail and the analog generation have made friends with the amenities of digital retail and the new services out of necessity.

The above-average development of retail volumes and the very positive forecast for the coming financial years speak in favor of innovative, customer-centric solutions in online retailing, i.e., a focus on e-commerce. For the stationary business, the forced closures were a disaster. Those companies that were able to rely on an online channel during the forced closures or had system-relevant consumer goods on offer could consider themselves lucky.

The future lies in e-commerce with networked brick-and-mortar stores and hybrid services

E-commerce and e-procurement are areas of e-business or digital business, i.e. the handling of business processes via the Internet. E-commerce (American: eCommerce) encompasses “electronic commerce” and has evolved over time into a global business model for online shopping. The operation of an online store includes the offer, purchase and sale of goods and corresponding digital services. Selected technologies for the digital integration and linking of value chains are used efficiently to manage business processes and relationships within a company. Media discontinuities and organizational boundaries in operations are to be optimized in this way. The development of e-commerce shows how important it is to rely on digital channels at an early stage. It is handed down that on August 11, 1994, the Sting CD “Ten Summoner’s Tales” was registered with the retailer Noteworthy Music via the US marketplace Netmarket as the first purchase in an online store. By comparison, Amazon was founded in 1994 and sold its first book in July 1995. Existing omnichannel business models have developed gradually for most companies and have emerged from classic, stationary retail stores that started with an online store in multichannel operation parallel to the PoS.

It also works the other way around: from online retail to stationary business

Zalando and Amazon are examples of successful digital companies that have opened brick-and-mortar stores in the course of their further development. Multi- or omnichannel commerce is an ongoing development. The 2000s ushered in the e-commerce era. Continuous change, new technologies and innovations accompany digital business models in distance commerce up to the present day. While in the early days a stationary PC was necessary, nowadays smartphones, tablets, IoT and various mobile gadgets open up new possibilities. In addition to PoS and stationary customer contacts, all sales channels can be networked via the various user devices and holistic customer data can be collected. Retailers can thus start sales conversations locally at the PoS, which can be continued via digital channels with the inclusion of customer profiles and concluded with a purchase. Data protection models, especially the DSGVO in Germany, pose a challenge. But Apple is not making it any easier either with an IOS15 and optional cookies.

Connected Commerce stands for various multi-channel retail models. Here, purchases can be made locally on site, online, on TV or, as in the past, with the help of a catalog. The telephone is used for communication. The variants are multichannel, crosschannel and the supreme discipline omnichannel. For companies, it is important to create an attractive and consistent presence for your brand(s) in the right sales channels, addressing your target group, in order to create unique, individual customer experiences and build trusting customer relationships. With the introduction of “multichannel”, previous operational models and business strategies in the areas of data management, branding, targeting, marketing efforts, PIM, promotions and media spends need to be reviewed and realigned.

Multichannel retailing has been established for a long time: Before the development of the Internet, customers had the option of shopping in the store, via catalog or teleshopping

The term multichannel is derived from the Latin multi for many or numerous and describes multi-channel retail sales. In multichannel retailing, the various channels are operated autonomously side by side without exchanging data and information. In cross-channel retailing, on the other hand, information, products, and services are available to the customer across all channels, both digitally and stationary. Since the customer journey crosses different channels, this is referred to as cross-channel commerce. The customer obtains information about a product on the Internet and completes the purchase after receiving additional advice in the store.

Omnichannel retailing is the supreme discipline

The term “omni” comes from Latin and stands for all, everything, the whole or everyone. With omnichannel, products, information and services are also available to the customer across all channels. The fundamental difference is that in omnichannel commerce, the customer can be identified across all touchpoints, as their data is held holistically across all channels. The customer’s paths can be traced and data evaluated. The resulting insights should be incorporated into the development of new products and services, but also for the alignment of corporate strategy, IT measures, sales and marketing.

The linking of the various channels also brings with it technical challenges

Smaller retailers have to overcome greater hurdles here and shy away from implementing corresponding offers. Large, high-revenue big players are usually ahead of the game and have long relied on multi-channel retail models, which have evolved into omnichannel providers against the backdrop of technological change. Return on investment (ROI) cannot always be clearly measured for combined online-to-offline campaigns. To generate store sales from online search, the general question is whether online ads lead to offline conversions? Work is underway to track the impact of digital campaigns on in-store purchases. Google offers the first opportunities to capture sales in brick-and-mortar stores. For a while now, it’s been doing the same with YouTube ads. A bridge to identification can be built via mobile apps and user data, when logged in. CRM data is matched with customer and transaction data in the store via a Google Ads interface. If the values match, the conversion is booked in the Google Ads account under store sales. Other requirements are data releases and data-supported traceable payment methods, i.e. no cash payment. Of course, there are also technical alternatives in the area of near-field communication (NFC), beacons and access points, as well as geolocation.

Would you like to learn more about e-commerce or omnichannel? Then we look forward to hearing from you!