May 21, 2019 - Ginna Hall, Senior Content Writer, Nielsen
This article originally appeared on Chain Store Age
People of all ages and demographics are jumping online to shop for and purchase products ranging from books and clothes to electronics and home appliances. Despite this growth in e-commerce, physical stores will continue to play an important role in the consumer journey for the foreseeable future.
While online sales are growing at a faster rate than offline, online still only accounts for 11.1% of total retail sales in the U.S. And with the majority of online growth driven by pure-play e-commerce brands, most retailers still rely more on in-store purchases than online sales.
The retail industry is at an inflection point. While traditional brick-and-mortar companies such as Sears and Toys “R” Us deflate, digitally native companies such as Amazon and Bonobos have realized the value of storefronts. More and more people are turning to their mobile devices and computers to shop, but that doesn’t mean they are ready to trade bricks for clicks entirely.
This confluence of online and offline is a consequence of modern shoppers who prioritize convenience and choice above all. Consumers want to be able to choose whether to shop online or in-store on any given day, according to a Deloitte study.
The most successful companies in this online versus offline shopping tussle will be those that don’t treat retailing as an either/or scenario. Brands that embrace an omnichannel approach that effectively combines the online and offline experience will be the ones that thrive.
There are pros and cons to both online and offline experiences. Online retail gives consumers the ability to shop wherever and whenever they want. People can browse from the comfort of their own home, comparison shop, and read reviews to inform their decisions before they buy. Retailers also benefit from the reduced overhead costs associated with staffing, rental and/or property taxes, and managing inventory.
On the other hand, physical retail stores offer shoppers the ability to touch, test, and try on products before purchasing. Many consumers also like the instant gratification and experience of walking into a store and leaving with their purchases rather than waiting for a delivery.
A holistic online/offline approach can help ensure retailers never miss the opportunity to convert a sale. Consumers no longer see a distinction between online and offline shopping and will mix and match both to suit their immediate needs. For instance, home improvement retailer Lowe’s has reported that 60% percent of its online orders are collected in-store. Innovative retailers are embracing this new reality and using digital to extend their storefronts, rather than simply choosing one medium over the other.
While the future of retail includes a combination of online and offline, it’s not enough to deliver generic customer experiences. Consumer expectations for relevant and personalized experiences have soared. Winning their business means understanding their unique preferences and behaviors, as well as the marketing messages and offers that influence their decision to buy. Only then can marketers orchestrate the optimal experience across channels and devices and optimize their spend to drive business results.
Advanced measurement approaches, such as multi-touch attribution, can help marketers understand exactly which factors are driving shoppers to convert, both offline and online.
By reconciling all available data points into a single anonymous identifier, multi-touch attribution gives marketers the means to deduplicate individuals across the broadest range of addressable online and offline channels and devices.
Linking this data helps marketers analyze how consumers move through the funnel and reach them on their preferred channels and devices. Multi-touch attribution can also provide insight into which granular-level tactics, such as publisher, placement, creative and keyword, drive online and offline sales.
Since this insight is produced in near-real-time, retailers can capitalize on opportunities to drive engagement and influence purchase decisions at each stage in the consumer journey.
Ultimately, success will depend on retailers’ ability to create optimal customer experiences. It’s not a question of online or offline, but how a brand can best combine and leverage both mediums to meet the ever-changing needs of the modern consumer.
With a true understanding of their customer and the tactics that influence their decision to buy, marketers can deliver a successful omnichannel experience that wins over new customers, and keeps existing ones coming back for more.
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