Creating a great digital experience is more critical than ever for retailers, as shopping behavior shifts and the influence of digital on customers’ purchasing decisions grows. But when you get down to the nuts and bolts of improving the digital experience, determining where to start can be difficult.
L2 released today the second annual Intelligence Report on Omnichannel Retail in partnership with RichRelevance, ranking leaders and laggards among luxury, prestige and mass retailers. In an interview with L2, RichRelevance CMO Diane Kegley identifies trailblazers, regional differences, and what can luxury brands learn from mass retailers.
New report quantifies the brands, trends and strategies that most effectively blend the digital and in-store experience to delight shoppers and improve performance
San Francisco, CA – September 14, 2015—Stores are the new black. Retailers have realized that, in order to stay relevant, every aspect of their digital experience – site, mobile, app, email – must have an in-store component. The rewards are phenomenal: omnichannel capabilities boost customer experience while increasing operational efficiencies. Brands excelling at omnichannel are closing unproductive locations, and using technology to facilitate higher performance in well-performing stores.
L2, the global benchmarking firm for digital marketing, today released the Intelligence Report: Omnichannel Retail study. Developed in partnership with RichRelevance, the new report examines the efforts of 116 U.S. retailers and 18 European brands, highlighting the disruptors and innovators in the space. The report quantifies the organizational and technological best practices that enable brands to deliver a true omnichannel experience, while providing a detailed benchmark of online and offline drivers across luxury, prestige and mass pricepoints.
Key Findings & Trends
An excerpt of The Intelligence Report: Omnichannel Retail report is available for download at https://richrelevance.com/insights/l2-omnichannel-report/. Key takeaways include:
Omnichannel Leaders & Laggards
- Luxury: In the ‘luxury’ category, Gucci and Louis Vuitton posted omnichannel gains in 2015 buoyed by ecommerce capabilities.
- Prestige: Nordstrom & Neiman Marcus emerge as omnichannel leaders; J Crew drops back in ‘prestige’ reshuffle.
- Mass: Mass retailers such as Walmart and Best Buy remain all about store incentives (versus the digital slant of luxury retail).
Themes That Will Define Holiday 2015
- The Amazon Prime effect: Penetration, profitability and preferences around free, fast and same-day shipping.
- Flash vs. function: Focusing on sexy one-offs with new technology means missing out on low-hanging fruit.
Strategies: Site, Shipping, Store
- In-store pick-up lags. Only 31% of US retailers offer click-and-collect capabilities for online shoppers (compared to 88% of European retailers who offer this feature).
- Email drives store traffic. The use of email to promote online and in-store sales, store-only sales and hybrid fulfillment all showed gains in 2015, while the amount of emails showcasing online-only sales dropped from 35% to 31%.
- Retailers take back control of free shipping? The number of aspirational and prestige brands offering free shipping by price point continued to dwindle in 2015 (to 66% and 72% respectively.)
- Real-time inventory visibility is at a tipping point. Currently 48% of US retail brands have real-time in-store inventory visibility (up from 36% in 2014) compared to 50% of UK brands and 46% of EU brands. The outlier is luxury with only 8% providing this capability.
Comments on the News
- Brands excelling at omnichannel are providing inventory transparency across channels, leveraging their brick and mortar footprint as fulfillment centers, and using technology to enhance customer engagement. In 2012, only one in seven consumers visiting stores were touched by digital; now it’s every two out of three consumers. The biggest mistake a brand can make is size their digital investment to their eCommerce business. To be successful in omnichannel retail, brands should be scaling their digital investment to the size of the overall business. – Maureen Mullen, Co-founder and Head of Research, L2
- A best-in-class omnichannel experience is ultimately about understanding the shopper very well and using this insight to serve her meaningfully – on time, wherever and however she shops. A retailer’s ability to unify customer and product data across online and store systems is the single greatest factor determining omnichannel success. Achieving a true 360-degree view of the customer allows retailers to expand and strengthen omnichannel capabilities, and go beyond the status quo to develop entirely new experiences that respect the shopper’s goals, behavior, context and moment-to-moment relationship with a brand and its products. – Diane Kegley, CMO, RichRelevance
About L2 Inc.
L2 is a member based business intelligence firm that benchmarks the digital performance of consumer brands. Our research currently spans 16 regions and covers 10 industry verticals including: Luxury, Beauty, CPG, Retail, Sportswear, Food & Drink, Consumer Electronics, Hospitality, and Auto. L2 helps senior leadership assess their digital performance and shape their digital roadmap to achieve greater ROI on human, creative and financial capital.
Download an excerpt of the L2 Intelligence Report: Omnichannel Retail
The Milkman 2.0: A New Model for Groceries as a Service
By Alex Ciorapciu, Solutions Engineer, RichRelevance
Transformation is everywhere we look in ecommerce. While some verticals adapt readily to transformation (like books, electronics and fashion), others resist or struggle with change. One vertical that struggles is online grocery. Online grocers blame difficult delivery, low margins, and lack of adaptation from customers for slow growth.
Essential eCommerce speaks to VP and general manager of EMEA at RichRelevance, Matthieu Chouard, about the importance of personalising the customer journey.
Personalisation is a technology at the top of most retailers’ minds. The ability to provide a bespoke, even boutique-style, service in order to stand out from the competition is clearly a clever move and this starts by simply recommending products online based on a customer’s taste.
“If you want to make your customer happy, you have to make them understand they are unique and not part of a customer segment,” VP and general manager of RichRelevance EMEA, Matthieu Chouard, tells Essential eCommerce.