Retail Times has teamed up with Hitachi Consulting to launch The Retail Barometer, a new column taking the measure of current retailing trends and pressures. Chris Gates, director of retail at Hitachi Consulting UK, sets the barometer and finds the needle pointing to multi-channel
The news that Tesco is planning £1bn in improvements that will span both its online and bricks-and-mortar presence has thrust the idea of multi-channel retailing into the spotlight yet again.
Of course, several of the big supermarket chains have already been bitten by the e-commerce bug, and have launched online services that will no doubt appeal to time-poor customers who are tired of spending their Friday nights in a supermarket queue. However, the interesting thing about the Tesco story is its equal focus on the company’s physical and online stores.
The media is currently awash with stories about companies that are improving their online channels, but Tesco’s vision appears to go much further, not least because the company plans to overhaul its e-commerce facilities alongside a number of in-store improvements. As a result, and along with extra staff and a fresh new look for its stores, Tesco plans to double the number of products available online to a massive 75,000. Interestingly, the company’s new e-commerce site has also been optimised for mobile use, indicating the important role that m-commerce is likely to play in Tesco’s plans for online growth moving forward.
This combination is what multi-channel retailing is all about – or rather it should be. Many retailers make the mistake of thinking that multi-channel retailing is the same thing as online retailing, yet that is simply not true. Multi-channel is really about giving the customers what they want, where and when they want it.
Mothercare is another example of a company that understands the benefits of this multi-channel approach. The retailer has just adopted a multi-channel strategy as part of its new three-year turnaround programme, including the launch of combined online and in-store customer services, a new UK website and 30 overseas websites. The result will be a leaner, more competitive ‘bricks and clicks’ business that is focused on the company’s most profitable stores, and backed up by a state of the art online platform to support more online sales.
Multi-channel trading strategies like these are becoming increasingly popular, since this approach can offer a strong vehicle for growth – even with the current challenges facing the retail sector. Modern retailers increasingly need to refocus their offer around the individual needs of a customer, so that contact, offers, logistics and payment terms can all be personalised across multiple channels and yet maintain one consistent brand message.
The best multi-channel trading strategies help to achieve this goal by making it possible for retailers to deliver customer propositions via email, telephone, catalogues, social media and more, with a clear understanding of how all of these different communication channels work together as a whole. With customers now regularly purchasing goods via their PC, tablet, smartphone or other mobile device, this new approach to multi-channel trading can provide retailers with a great way of extending their presence – and trading capabilities – far beyond the high street.
Multi-channel trading goes much further that the internet alone: it’s about what the technology can achieve for a business, in terms of forming meaningful relationships with customers in a way that will have a positive effect on the bottom line and generate greater customer loyalty.