Invest to win
Invest to win, NOT to not lose. We can conclude that the majority of retail companies are investing to become mediocre. Retailers that continue to think defensive about omnichannel are being overrun.
In recent years, consumer behavior has changed radically. Although most purchases are made in physical stores, we see an increasing trend of purchases beginning online. Consumers have become channel agnostic and for them it doesn’t matter what channel they shop in. In order to meet changing consumer behavior retailers need to embrace change and to meet the consumer in the manner required.
"There is no longer a place in the market for companies with average offerings, explains Jörgen Bertilsson, VP Global Sales at Avensia. Look at many medium sized companies in Sweden that neither niches themselves nor offer innovation, they begin to tremble. You can’t neglect consumer behavior".
It's only a matter of time before Amazon will come to Scandinavia and then it will inflict a lot of pain on those companies that do not understand the importance of omni-channel. It is the combination of physical stores and e-commerce that provide competitive advantage for our retail businesses.
In the survey Omni Channel Retail 2015, Avensia has mapped out which retailers have come the furthest in their omnichannel ventures. It is clear that some companies have started to make substantial investments in the area, but there are still a large number of companies not taking change seriously. Some major retailers in Sweden are absent of e-commerce in general, such as Jula and Hornbach.
"Do not be surprised if several of the companies that find themselves at the bottom of our research will have problems with profitability in the near future. It really is time that Swedish retailers wake up and realize that investing in order not to lose won’t fly, "says Jörgen.
Omnichannel projects must begin from the top of the company. It is as much about change management as it is about the supporting technology. The two companies that has been most successful with their omnichannel ventures are Intersport and SIBA which tops Avensia’s survey.
"For us at Intersport, our omni-channel journey is a lot about finding a formula where e-commerce and physical stores can help each other instead of competing. It has been a great challenge to get everyone in the organization to pull together and it has been a lot of work behind the change. Therefore, it is really fun to get acknowledged that we have come so far."- Daniel Anvell, COO at Intersport
"For us at SIBA, the customer is always in focus, and a way for us to prove that we are responsive to their needs is through our distinctive omni-channel strategy. Our customers do not differentiate between channels but selecting the channel required in a "here and now" perspective and then it's more important that they recognize themselves and are offered the same excellent service in all contact with SIBA regardless of which channel they choose. Some customers plan their purchases via tablet or mobile phone while they are in one of our physical stores, we see that it is important that information and price is always the same in both channels. "-Susanne Ehnbåge CEO at SIBA
The report Omni-Channel Retail 2015 will soon be available at www.avensia.com