Driving Digital Transformation and Customer Engagement: The 2022 Omnichannel Leadership Report

The last two years have been marked by an unprecedented sea change in retail. Brands of all sizes and industries were forced to implement critical omnichannel capabilities, from safe store pickup to contactless payment. When many of these stores reopened, though, they took a step back as quickly as they had taken two steps forward.

This kind of incremental innovation won’t help drive growth. Consumers are demanding intuitive features and functionality that align with their values, and brands must launch a complete transformation to win in the age of digital consumers. Are they succeeding?

NewStore, an AWS Partner and provider of a turnkey omnichannel store solution, set out to answer this question in its 2022 Omnichannel Leadership Report. We have teamed up with NewStore to summarize and share this report.

In the report, NewStore evaluated 250 leading luxury, premium, and lifestyle retail brands. A team of mystery shoppers audited each brand’s website, mobile application, call center, and in-store experience to find out if brands are delivering on what customers expect today by investing in omnichannel solutions.

The report mapped data into four overarching categories:

• Digital Engagement. Solutions that give customers flexibility and choice about how they engage with your brand.
• Omnichannel Convenience. Solutions or features that unify channels, making it easy for consumers to shop across digital, physical, and mobile.
• Customer Experience. Solutions or interactions that have a positive impact on brand perception or the shopping journey.
• Associate Enablement. Solutions or capabilities that make it easier for retail employees to provide omnichannel customer experiences.

In this blog post, we’ll dive into the details of the report and discuss how each of these categories is impacted by brands’ response to their customers.

Differentiating through Digital

Because most buyers now browse and buy online, brands must deploy solutions that seamlessly bridge digital, physical, and mobile shopping to create long-lasting, sticky customer relationships. Digital engagement is the key to creating these relationships, now and in the future. The report shows that 25 percent of brands today are bringing their store associates’ expertise to the digital experience. By scheduling virtual appointments in advance and requiring a questionnaire, associates can get the most out of their one-on-one time with shoppers. NewStore’s research also found that just four percent of brands offer a self-checkout option in-store, a small jump up from three percent in last year’s report and two percent the previous year. Digital payments overall, though, are the second most popular payment method in North America, and 74 percent of brands offer contactless payment options.

Clearly, there is still a big opportunity for brands to digitize their customer engagement strategies. By providing digital experiences such as self-checkout, virtual shopping, and modern payments, brands can differentiate themselves and gain a competitive advantage.

Giving Customers What They Want

Brands know they must deliver a true omnichannel solution combining customer convenience, merchandise, value-added services, and unified channels to succeed in the long term. The research backs this up, with the report showing consistent year-over-year increases in the number of brands offering cornerstone conveniences. In-store pickup is one example of omnichannel convenience, and 53 percent of brands now offer it. This figure was up from 40 percent in 2020 and 25 percent in 2019.

Real-time store inventory visibility is critical for in-store fulfillment, and 44 percent of brands combine the two online, displaying inventory information as part of their store pickup feature. This can build trust with consumers by showing them products are where you say they are.

Still, store pickup alone is not enough. There are likely many other brands doing the same thing, but more efficiently and effectively. To overcome this challenge, brands should invest in the systems and processes that will help them keep up with the evolving nature of convenience.

Delivering Personalization and a Holistic Customer View

When it comes to loyalty in retail, it’s all about the customer experience. In the report, 62 percent of brands say they have a complete picture of their customers, enabling personalized touchpoints and even upsell opportunities.

The report also showed that 83 percent of brands—up from 46 percent in 2020 and 44 percent in 2019—are able to facilitate returns or exchanges without a physical receipt, which is a key consumer demand. Additionally, 73 percent of brands said they offer store-to-door shipping, and 34% of brands have a shoppable mobile app. Mobile apps, specifically, have the potential to be the next ecommerce for brands, so this is an area likely to grow.

Brands know they must go the extra mile to enable the best customer experience, and it all comes down to using data to bring together meaningful customer connections and digital technologies.

“Mobilizing” the Associate Experience

Customers want to engage with knowledgeable retail associates across every channel. That’s why improving the associate experience needs to be a core consideration to improving the customer experience overall. One of the key ways to do this is through mobile devices. The report showed that 48 percent of associates have a mobile device available, but only 19 percent of brands offer mobile checkout. In addition, 70 percent of brands have enterprise-wide inventory visibility from a traditional POS system, yet just 27 percent of brands can see inventory data on mobile.

Because of higher customer expectations, associates are under more pressure to perform each task with greater efficiency. If these associates are equipped with the right mobile technologies, they can give shoppers a more streamlined way to pay and execute more sales.

Closing Expectation Gaps

Overall, the NewStore report showed that many brands are failing to deliver on top customer expectations. Brands in the report lost points on five capabilities that NewStore’s Ideal Associate Profile (IAP) research found to be top consumer expectations: reserve online, buy in-store; mobile checkout; buy in app, pick up in-store; mixed cart; and mobile inventory lookup.

Closing these expectation gaps is a must if enterprises want to get ahead. Brands pivoted quickly to meet their customers’ needs over the last two years, but short-term fixes won’t be enough in the long run. Companies need to keep pushing ahead with digital transformation and omnichannel solutions, which are the bridges to the future of retail.

To learn more, download your copy of the Omnichannel Leadership Report 2022.

AWS Partner Spotlight

NewStore, an AWS Partner, is a turnkey omnichannel store solution for global DTC brands. In over 20 countries, the company delivers Omnichannel-as-a-Service with the first cloud platform that combines POS, order management, inventory, and clienteling.

Connect with NewStore today.