Successful execution on an omnichannel strategy is no longer enough for middle market retailers. Yes, it’s important to meet and sell to clients where they are whether it’s in a store or online, but it’s also essential for retailers that these channel efforts be profitable, especially amid this year’s demanding and highly competitive holiday shopping season.
As anticipated, consumers started their holiday shopping earlier this year as seen in the 12.8% increase year over year in retail sales, excluding food services, gas, build material and motor vehicle dealers. And with that early demand we also saw monthly increases in both department sales and nonstore retailers of 2.21% and 3.99%, respectively, highlighting that consumers pushed retailers to provide omnichannel offerings and systems heading into the holiday season.
Even before the holidays, middle market retailers were quick to implement additional omnichannel sales offerings early in the pandemic to capitalize on the shift to what is known as buy online, pick up in store—or BOPIS—and curbside pick-up. While these offerings were new to many retailers, most have continued offering these options to adapt quickly to changes in consumer behavior like we saw in August for back-to-school shopping. Throughout the year, retailers have worked to improve both their processes as well as their systems to be profitable from these enhanced sales channels.
Ben Tickner, retail consulting principal at RSM, underscored this need for channel improvements as companies head into next year.
“Something I find all retailers could and should be doing is a task that involves reviewing their customer experience and looking for ways to solve challenges,” Tickner said. “Some of these challenges might be relieved with a slight adjustment in a business process while others could benefit from adjusting an existing tech solution to provide a better customer journey. It is important to not only provide value in your goods but in the way you deliver the experience in receiving those items.”
The takeaway
While we are only a week away from Black Friday and Cyber Monday, retailers should utilize the data they collect in the coming weeks to find opportunities to improve customer experience and engagement going into next year. Much can be assessed from consumer preferences to sales demographics in the coming weeks. These holiday season lessons learned will help retailers chart a more profitable future.
This is the last installment in our holiday series; get more consumer products industry insights in our Winter 2022 outlook.
