Omni Channel Retail – Right Here Right Now this Christmas

IBM posted five predictions for the next five years, which is a great New Year’s game – and all credit to them for sticking their necks out.  Everyone should play this game.

Bernie Meyerson, vice president of innovation at IBM, came up with their “5 in 5″.  Apparently, this is the eighth year in a row that IBM has made predictions about future technology.

“We try to get a sense of where the world is going because that focuses where we put our efforts” Meyerson said.  He continued “The harder part is nailing down what you want to focus on. Unless you stick your neck out and say this is where the world is going, it’s hard for you to turn around and say you will get there first. These are seminal shifts. We want to be there, enabling them”.

These are Meyerson’s “5 in 5”:

▪                The classroom will learn you (sic)

▪                Buying local will beat online

▪                Doctors will use your DNA to keep you well

▪                A digital guardian will protect you online

▪                The city will help you live in it.

I’m not sure what this means for grammar in the future, but Meyerson says some very interesting things, and I would judge predictions 1, 3, 4 and 5 to be pretty much on the money.

However, I do have experience in online selling and retail, and so I would take issue with his second proposition:

“In five years, buying local will beat online as you get online data at your fingertips in the store.”

Meyerson argues that “retailers will use the immediacy of the store and proximity to customers to create experiences that online-only retail can’t replicate”.

I would agree with that – but this is not, in my view, something for five years in the future.  Meyerson says that “the Web can make sales associates smarter, and augmented reality can deliver more information to the store shelves”.  He suggests “the store will ask if you would like to see a certain camera and have a salesperson meet you in a certain aisle where it is located”.

This is not, in my view, a future issue but is in many respects with us here and now.  What many – perhaps most – shoppers in the UK wanted to do over Christmas was to shop “omni-channel”.  Many of us when buying gifts or things for the house, or indeed clothes, want to research in-store – to bounce on a mattress, say, or look at a high definition television.  We want to see and test some products and get expert advice. After that, we may decide to buy there and then from the store.  Or we may prefer to go back home and buy online.  Or sometimes it’s the other way round: we want to do our research online first, and to check prices, and then go out and buy the product in our hands in the store.  Increasingly many of us like to order online then “click and collect” to pick up in store, where we may well buy other products too.

So this is not a future thing, but once which is happening here and now; and competition between shops and online – between “bricks and clicks” – is just not the way forward.

At John Lewis we estimate that at least 2/3rds of our customers are already “omni” – that is, they shop in some way (e.g. research) across online, in stores, on the phone and on mobile devices.  This development has helped drive our sales on and in our stores: our like-for-like sales were up 6.9% over the 5 weeks of the  with online up 22.6% and stores also up 1.2%.   The “click and collect” sales jumped 60% compared with 2012.

There have been 3 weeks around Christmas and the New Year when our online sales jumped to c36% of the total we had passed £1billion online sales for the financial year (from 1st Feb) before we got to Christmas.  We know, however, that this is absolutely not  about online shopping – it’s about the ability to shop across all our John Lewis channels.

Human beings sometimes want to get information and advice from other human beings, sometimes they want to pick up the phone, and other times they just want to shop online with simple clicks.  And sometimes they prefer to shop now and then pick up at a time next day that suits them, rather than wait in for a van to deliver.  It’s about us all being different and having different needs when we shop.

“It has been physical against online” Meyerson says, “but in this case, it is combining them.”  So he’s right – not about 5 years in the future, but about the here and now.

The StyleMe Mirror in Oxford Street

Click here for the link to the CISCO case study on the StyleMe “magic mirror in the john Lewis Oxford Street store, which I have talked about earlier on this blog.

Is the Airline Industry becoming like Retail?

In my latest article in Airline Business I examined the increasing convergence between the airline and retail industries as customers become ever more connected and the way in which technology developments will shape both their futures
I thought readers of this blog might be interested:

A popular theme for airline industry conferences and discussions is how the sector is becoming increasingly like retail.

This is perhaps a bit unfair since, in my view, retail itself is in many ways catching up with the air transport industry. In the UK and the USA many retailers are now going through the “between 20% and 30% of revenues online” barrier – in other words, the point when online moves from an interesting additional channel to market to the mainstream.

This is a stage which most airlines reached mid last decade. Nothing surprising here, given the different nature of the product that airlines and retailers sell – one which is simply a permission to fly and the other a physical product in a shop, or ordered online and delivered from the warehouse.

These industries – and arguably most others too – are converging, however. Travellers and shoppers are the same customers, after all. Everyone is connected all the time everywhere these days, through iPads, smartphones or laptops. These devices are increasingly used not just for personal or business use, but for both. Both retailers and airlines understand that a website is not enough. Customers expect the companies they buy from – and interact with – to be present not just online but in the mobile world of tablets and smartphones, and – of course – out there on Twitter and Facebook.

Just as we in 2012 present ourselves seamlessly in multiple channels as individuals, so we expect our preferred airline or shop to be there too. We expect them to communicate with us appropriately, we expect our business relationships to be just as channel-savvy as our personal relationships. So, for a complex transaction like a round-the-world holiday or a complete house redecoration, we expect human interaction and advice in person.

For an update message that our flight is cancelled because of fog or our online order is ready for collection at the store, we expect a message on our mobile device. And, in between, we may be interested in staying in touch with these businesses through Twitter and Facebook, and in looking at their newest products or their newly launched advert on YouTube.

For airlines or retailers that aspire to be brand-leaders, however, even transacting seamlessly across the channels is not going to be enough. You need to be able to engage customers in your product and get them to associate with your brand and its values. No longer is this just about TV advertising – or indeed paying Google to promote your products in its search listings. It is about creating an experience that reinforces customer loyalty and provides your best customers with benefits and privileges they really value.

Some of this will be delivered in-store – or in the lounge, or on board – but increasingly it will be about connecting with them in the periods between shopping or flying.

Airlines – because of the connectivity limitations and long-standing concerns over interference – have been the one place on or above Earth where you could not be connected. In the last few years this has come to an end, and we are seeing wi-fi on board and mobile and internet connectivity increasingly provided or planned. In the same way, we are now starting to see wi-fi provided for free in-store by retailers, with tailored landing pages. This is also being extended into how airlines connect with their customers before and after they fly, such as the Malaysian Facebook for groups application.

Intriguingly, airlines are now looking to retailers for inspiration – John Lewis in London and Tesco in Korea have used matrix barcodes, known as quick response codes, in public places or other stores to sell their online assortment of products. The customer scans the code and then checks out.

These have appeared at several airline retail conferences, presumably because of the potential read-across to airlines which could use onboard connectivity and the entertainment screen to facilitate customers ordering ancillary ranges of products online.

On their websites, airlines and retailers are using the same methods to encourage up-selling and cross-selling across their product ranges. In conclusion, this is what technology has done for business. Increasingly, all businesses – whether selling flights or sofas – are becoming more similar, as customers buy and interact seamlessly with them and each other in the omni-channel world.


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