Gone are the days when retail meant having a chain of stores where customers can walk in and buy what they want. Now, retailing is getting tougher as it has gone online where gaining and keeping customers has become a huge challenge. It is still possible to be successful in retail and there is no mystery to it. Retailers simply need to pay close attention to changing consumer trends and new technology especially in relation to payments.
Why omnichannel is growing
In the first few weeks of 2020, many people seem to have questions related to the development and continuous rise of omnichannel commerce. What is happening is that commerce continues to move towards a customer-centric approach. Some of the key features of that approach include major advances in data collection and analysis and new retail technologies such as voice and augmented reality.
These drive the new omnichannel push, and kindle consumer interest in the new retail experiences. Another reason is that customers tend to own multiple connected devices which forces retailers to keep up by enabling omnichannel purchasing on all those devices.
Now, with cheaper access to clever AI-bots that drive your omnichannel communication strategy and payment processing – tied in with robotic process automation (RPA) – there is little left to restrain an omnichannel growth strategy. (See this article on RPA by Avi Ben Ezra)
Generation Z and millennials
The shift is intensifying as millennials and Generation Z are taking over as the largest combined consumer group in history. These young people were born into technology and know only technology and the internet which they saw advancing over the past few decades. They expect to transact wherever and whenever they are through various digital devices using various platforms. What they want is what now drives, and will continue to drive, most retail and payments in the coming years and decades because of their amazing numbers.
Generation X, millennials and generation Z are not particularly consistent, which makes the job of retailers harder. For example, some of them tend to buy from different stores, meaning that when they want to buy something, they will buy it. At the same time, some of them tend to buy from the same store. This makes it difficult for retailers to know exactly how they are going to behave at any time.
Merchants are not too clear on how much they are trusted. Generally, trust is related to privacy, security and fraud prevention as consumers have to trust merchant or payment services to safeguard their personal data. However, due to the omnichannel experience, trust has become an even more serious issue.
It is easy for a merchant to lose credibility or trust whenever a consumer experiences unwanted or unexpected friction during the shopping or buying experience. Therefore, trust is closely linked to customer experience. The young generations expect instant and seamless experiences. It is now understood that a large percentage of Generation X, millennials and Generation Z believe that if you can purchase something fast, without any friction, then that company or product is better than competing ones. It’s not entirely fair nor is it correct but that is how things are happening in the new omnichannel world of commerce and payments.
Implications for retailers
There are indications that retailers can expect these trends to develop further, intensify and evolve with time and will not be reversed. Armed with this knowledge, the only challenge facing retailers is connected to providing speedy experiences for consumers.
A few ideals and goals can help merchants and payment service providers to find their way through both the seeming and real confusion. They have to plan to provide a complete experience by making sure they have their customers front and center. This implies the need to provide multiple channels. Even state and local governments have to stop using checks for disbursing funds to consumers and adopt technology.
(Suggested reading: Avi Ben Ezra on ecommerce)