In a recent article, Jason Rosing (@JasonRosing), a founding partner of Veridian, asked a surprising question, “Is omnichannel dead, dying, or thriving?”[1] Rosing knows his question might surprise some readers. After all, he notes, “Omnichannel is everywhere!” He also observes that some people in supply chain circles insist, “[If your company doesn’t embrace omnichannel operations,] you are going to go bankrupt.” He then asks, “Is it all true?” Rosing goes on to explain why he is asking these questions. He writes, “The omnichannel conversation can be maddening, and supply chain leaders are still struggling to keep up with the demand for omnichannel experiences and deliver on brick-and-mortar promises without adding any extra costs and meeting customer expectations every step of the way. It is a tall order that seems almost impossible to fill. Industry experts are starting to voice concern that omnichannel as a term has created too much strife and is confusing supply chain leaders.”
I’m not sure how confusing the concept of omnichannel operations is. In it’s simplest form, the Oxford Dictionary defines omnichannel as “denoting or relating to a type of retail that integrates the different methods of shopping available to consumers (e.g., online, in a physical store, or by phone).” In other words, omnichannel operations make retailers available to serve consumers regardless of the method they select to make a purchase. Although the concept is simple, omnichannel gets more confusing when you get the fulfillment side of things. Analysts from River Logic note, “The supply chains of omnichannel retailers operating brick-and-mortar and online stores need to simultaneously fulfill multiple, sometimes conflicting, requirements.”[2]
Is omnichannel dead or dying?
Rosing points to an article by Steve Dennis (@StevenPDennis), a strategic advisor and founder of SageBerry Consulting, in which he writes, “I’m calling it. ‘Omnichannel’ is dead. And in my mind it’s long overdue.”[3] Dennis’ beef with omnichannel seems to be with term itself. He writes, “I’ve been bashing the term for quite some time now.” His preferred term is “Harmonized Retail.” He explains, “While I’m loath to add to the over-crowded stable of buzzwords — and admit to being more than a little bit biased — I think harmonized has important advantages over omnichannel, unified commerce, seamless integration or any of the other terms being used to describe and tackle the changing nature of shopping. Moreover, when we look at the retailers that are doing well right now in this age of vast digital disruption, we can see how harmonized retail is more evocative and prescriptive and therefore, I would argue, more useful.”
Rosing is sympathetic to Dennis’ arguments. He writes, “[Omnichannel] is an overused term in an equally over-stretched industry. Yet, it is not really dead; it is amid a transformation and reinvention of seamless experiences. Supply chain leaders need to understand whether omnichannel is dead, dying, or thriving, as well as what it means for their operations today.” Rosing is also a realist and understands once a term is widely used replacing it with a new term is difficult. Therefore, he writes, “Omnichannel is not dead. However, the term as it applies to blending channels and ensuring consumers can get anything online and in-store from the nearest pickup center is dead. Supply chain leaders have become obsessed with the need to go omnichannel, and this level of intense focus presents a problem.”
Omnichannel (or harmonized retail) is all about the customer
Regardless of whether you call the concept omnichannel retail, harmonized retail, or blended retail, the focus should be on consumers. Dennis asserts, “To the extent [omnichannel] was pointing at the right idea, it all got lost in the ‘omni’. Simply stated, a great customer experience has never been about being everywhere and being all things for all people. What matters is showing up for the right customers, where it really matters, in remarkable ways. … The essence of harmonized retail is accepting the truth that all the talk about different channels is not particularly helpful. The customer is the channel.” Rosing agrees. He writes, “Omnichannel is about blending experiences, giving customers what they want. Take that sentence in for a moment. The implication of omnichannel is blending experiences to create something for customers. Therefore, the idea of omnichannel, or making sure you are in every channel, at times devoid of asking your target consumer base if they want or even need every channel, is dead. Some retailers have forgotten about the value of customer experiences in terms of how a channel influences their decisions.”
Most pundits agree customers increasingly find themselves on the digital path to purchase. As result, Rosing writes, “Customers want a harmonized experience that does not detract from their shopping journey with jumps through online and in-store platforms. They want the experience to occur without thinking about it.” The old adage “easier said than done” certainly applies when it comes to omnichannel operations. Analysts from Three Deep Marketing assert, “You’re probably struggling to make that journey a seamless one for your customers and dial into the strategies it takes to step-up your game.”[4] To bolster their assertion, they note, “Only 8% of retailers believe they have achieved a successful omnichannel strategy.” Does it matter? According to the Three Deep analysts, “87% of retailers believe that an omnichannel strategy is critical to success. [And] companies with omnichannel customer engagement strategies retain an average of 89% of their customers — compared with the retention rate of only 33% for companies with weak omnichannel engagement.” They conclude, “It’s a complex problem but can be simply stated: Marketers struggle to tie the touchpoints together. Cliché though it may be, the leaders in an omnichannel world are more customer-centric than those they leave in their wake.”
Concluding thoughts
River Logic analysts conclude, “Offering customers an omnichannel experience means more than simply launching an online store. According to a UPS survey, customers demand better service when using omnichannel retailers. UPS reports that nearly 40 percent of shoppers use more than one channel when making purchases and nearly 18 percent of sales are initiated from mobile devices. This means retailers need to work hard at offering flawless omnichannel shopping experiences to their customers.” Dennis’ point is that consumers don’t think about channels, they think about shopping and purchasing. Three Deep analysts agree with that point of view. They write, “Customers don’t think in channels … but most businesses do. Customers are simply trying to achieve something. The customer is on his or her own unique journey aiming to avoid hassles. Obviously, their journey can span a variety of channels.” Whether or not the term “omnichannel” is dead or dying, providing seamless customer experiences on their digital path to purchase is the only way retailers will thrive.
Footnotes
[1] Jason Rosing, “Is Omnichannel Dead, Dying, or Thriving?” Cerasis Blog, 27 September 2019.
[2] Staff, “10 Things About Omni Channel Supply Chain You May Not Have Known,” The Stream by River Logic, 19 September 2019.
[3] Steve Dennis, “Omnichannel Is Dead. The Future Is Harmonized Retail,” Forbes, 3 June 2019.
[4] Staff, “The Customer Journey Mindset: Your Key to Success in an Omni-Channel World,” Three Deep Marketing, 23 September 2019.
