Oct 5, 2020
'Just go online:' Quest for omnichannel retail model falls flat
The Canadian Press,
HALIFAX - When Mark Butler needed a new gasket for his coffee maker, he hopped on his bike and rode to the Mountain Equipment Co-op store in Halifax.
“The guy just said, 'We don't carry them,”' Butler said. “I told him I had bought them there before, and he just told me to look online.”
Amid the economic wreckage of the COVID-19 pandemic, a trend is emerging in which some shoppers at large chains and big box stores are being quietly advised to shop online.
As supply chain issues impact inventory and a second wave threatens more lockdowns, many retailers are upgrading online services to rival the in-store experience.
However, as Butler's experience shows, the results can be hit and miss.
“Some retailers are actually innovating in the online space and trying to connect with their customers in ways that are not just utilitarian but actually create that shopping experience you'd have in store,” said Jenna Jacobson, assistant professor at Ryerson University's Ted Rogers School of Retail Management.
For example, shoppers can schedule virtual meetings with salespeople for personalized help ranging from wardrobe tips to home design.
Online chat boxes connect shoppers to real salespeople rather than “chat bots” programmed with a preset list of questions and answers.
And some grocery stores are connecting customers to personal shoppers to allow for real time grocery list edits.
“The personal shopper who is picking out fruits and veggies can actually correspond with the customers to say, 'We're out of strawberries, would you like blueberries,” Jacobson said.
The aim isn't to eclipse the physical store, but to complement it.
Experts say it's all about what's known in the business as omnichannel retail, which involves the seamless integration of the physical and digital shopping worlds.
When it works, it improves customer service, brand engagement and ultimately sales.
But when it fails, customers can feel confused and discouraged.
In Butler's case, the salesperson could have checked the out-of-stock inventory on a computer and had his gasket shipped to the store or delivered to his home.
“It wasn't particularly encouraging about using the store,” Butler said. “It pretty explicitly sends the message that I should just go online.”
Markus Giesler, associate professor of marketing at York University's Schulich School of Business, said shoppers being told to “just go online” points to a problem with the retail strategy for how online and brick-and-mortar stores will co-exist.
“Omni-channel retail requires tremendous co-ordination between different actors and elements,” he said. “Salespeople on the ground need to be trained and fully on board with the mission or the result is often frustrated consumers.”
Part of the challenge facing retailers is the meteoric growth in online shopping in recent months.
Statistics Canada reported that e-commerce sales soared to an all-time high of $3.9 billion in May, an increase of 110 per cent compared with May 2019.
The acceleration in online shopping has leapfrogged ahead years, leaving some retailers and their salespeople scrambling to keep up.
But Karl Littler with the Retail Council of Canada said it would be the “rare retailer” that would discourage people from shopping in their physical store.
Besides the substantial costs that go into keeping the doors open, he said shoppers tend to buy more in-store.
Still, he said it's “a reasonable proposition that the online offering is going to be broader.”
“There are more products available online than any physical store can conceivably contain,” said Littler, the industry group's senior vice-president of public affairs.
He added that given the rapid growth in e-commerce, retailers are likely evaluating how much of a physical footprint they need.
Ultimately, Littler said the future of retail is about integrating the online shopping world with the physical stores.
It's something retailer Canadian Appliance Source has been refining since before COVID-19.
Terry Robar, director of sales, said the company's strong online platform helped with the transition to a fully online model during the lockdowns.
He said the same salespeople helping customers in the company's physical locations are also available to answer questions through the live chat feature on the company's website.
“Appliances are among the most expensive purchases people will make and we know there's a lot of research that's involved,” Robar said. “We wanted to have knowledgeable in-store staff helping customers online.”
The strategy stands in contrast to the typical online approach, in which companies outsource the live chat function to a call centre, or offer to have a salesperson follow up in the future to answer questions.
Robar said there's an interesting subdivide emerging among his sales staff, with some still preferring the social interaction of a face-to-face sale while others have fully adapted to online sales.
But he said there will always be brick-and-mortar stores.
“There's a strong 'touch and feel' component to buying appliances. We'll always have physical locations.”