Digital channels key for the future of retailing

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• Share of revenue from store sales expected to fall below 40% by 2014 • Digital sales to account for 45% of revenue over the same period • Integration is the challenge: just 35% of retailers feel their channels are well integrated, a 13% drop compared to 2011 Online and mobile channels will be key for future growth according to multichannel retailers. The latest industry study from Portaltech Reply, eDigitalResearch and IMRG shows that retailers who already sell through multiple channels expect their online and mobile sales to equate to 45% of their total revenue by 2014, whilst their store sales will drop to below 40%.

The results also found that more and more retailers are increasingly becoming multichannel. Of those surveyed, 98% are already running two or more customer touchpoints, a 12% increase compared to 2011, and there has been significant growth in retailers operating online and mobile channels over the past year, +8% combined, as well as some marginal growth in pop up store operations.

However, whilst more and more retailers are introducing new and emerging customer touchpoints, integration of multiple channels remains a key issue. Around just one third (35%) of all retailers feel that their channels are well integrated, a drop of 13% since 2011, while 20% of respondents believe that theirs are not at all integrated. Similarly, current technology systems remain the biggest barrier for retailers to achieve their multichannel vision and therefore multichannel system replacement is still a key investment priority for the majority of retailers in 2013.

Furthermore, surveyed retailers state that understanding the customer journey has become increasingly difficult as the number of channels grows. Just 7% have declared that they are very aware of the typical customer journey, a 9% decrease compared to 2011, while 51% of respondents, a 5% increase compared to last year, have confessed that they do not know how many visits customers make across their channel before purchasing.

Mark Adams, Partner at Portaltech Reply, explains, “Despite of the steady increase in revenue generated by online and mobile channels, the research highlights how retailers are struggling to implement a coherent multichannel strategy that would cater all customers. The positive aspect lies in the growing awareness of this issue as retailers find themselves no longer able to track the customers’ interaction with their brands. To address this challenge, it is important for retailers to accurately define their own multichannel strategy and adopt up-to-date technology solutions able to realise such a vision in an efficient and properly integrated fashion.”

Derek Eccleston, Head of Research at eDigitalResearch, comments, “It is really exciting to see so many retailers trying out new ideas across a growing number of customer channels. Retailers have never had such an opportunity to truly engage with their customers. Our study last year found that integration of technology and marketing across channels was a real issue for retailers and something that needed to be addressed. It is really worrying that this is still an issue for retailers one year on, especially as our consumer studies point out time and time again that people want the same customer experience no matter what channel they are using. Going forward, it is important for suppliers and agencies to work closer together and form tighter partnerships and provide a tailor made solution to help retailers achieve their multichannel vision”.

Andrew McClelland, Managing Director at IMRG, said, “As these figures reveal, achieving a fully integrated multichannel solution poses a significant challenge for retailers due to the sheer range and diversity of channels through which consumers expect to have a high quality, consistent experience. The squeeze on budgets and pace of technological change means that consumers are able to adopt new devices far quicker than they can be accommodated into a retailer’s offering. Each brand has its own specific customer base and inevitably some channels will receive greater focus than others, but each brand also has its own unique identity; ensuring that the essence of that identity is communicated in some way across all touch-points may represent a firm step toward full integration as far as the consumer is concerned.”

Portaltech Reply, eDigitalResearch and IMRG first surveyed retailers on their multichannel operations one year ago to better understand what suppliers and partners needed to be doing to help in making multiple channels more coherent to customers. Now, twelve months, they’ve undertaken the research once again to recognise how the market has changed and what more needs to be done to help retailers to realise their multichannel vision.

To download your copy of the white paper and results, please complete the following short registration survey: https://ecustomeropinions.com/survey/survey.php?sid=922492054.

ENDS

Survey information
Retailers of all size and sectors were asked to complete an online survey between August 18th and September 16th 2011. 152 responses were collected in total.

About Portaltech Reply
Portaltech Reply is the Reply company specialising in the provision of e-commerce implementation and Multichannel consulting services. The company has gained substantial experience in e-commerce since inception in 2000 by working on some of Europe’s largest e-commerce and MultiChannel retailing projects. Portaltech Reply is 100% dedicated to hybris technology and is one of the world’s most experienced and respected implementation partners with Platinum Elite status. Portaltech Reply customers include TUI, Monsoon & Accessorize, LK Bennett, Long Tall Sally, Office Shoes, H3G, O2, Bunzl Group, Thompson & Morgan and the Daily Mail group.

About eDigitalResearch
eDigitalResearch are insight specialists with an expertise in online and multichannel business. We bring passionate researchers, technical experts and art designers together all under one roof to work with clients and create bespoke insight programmes. eDigitalResearch not only offer unrivalled digital research expertise and insight support, but state-of-the-art technology and innovation that works seamlessly with your systems and data across customer touch points.

About IMRG
IMRG (Interactive Media in Retail Group) is the UK’s industry association for e-retail. Formed in 1990, IMRG is setting and maintaining pragmatic and robust e-retail standards to enable fast-track industry growth, and facilitates its community of members with practical help, information, tools, guidance and networking. The strength of IMRG is the collective and cooperative power of its members.

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Lisa Bonczyk