Emarketer The State of Omnichannel Retail White Paper

JANUARY 2014
The State of
Omnichannel Retail:
Retailers Playing Catch-
Up with Consumers
“Omnichannel” has become a buzzword in retail
for good reason. New technologies and better data
bring the longtime dream of a unified cross-channel
shopping experience within reach. In practice,
however, most retailers still fall far short of
achieving this vision.
presented by:
Dear eMarketer Reader,
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our readers.
This report is a great example of eMarketer data and insights that focus on how
consumers are using media to shop across channels and how retailers are
overcoming hurdles to create an omnichannel experience.
We invite you to learn more about eMarketer’s approach to research and

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We thank you for your interest in the The State of Omnichannel Retail report
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Crystal Gurin
Vice President and Publisher
eMarketer, Inc. www.emarketer.com

11 Times Square, Floor 14 cgurin@emarketer.com
New York, NY 10036
THE STATE OF
OMNICHANNEL
RETAIL
Retailers Playing Catch-Up
with Consumers
Yory Wurmser
Contributors: Christine Bittar, Rimma Kats, Stephanie Kucinskas, Martin Utreras
EXECUTIVE SUMMARY US Mobile Wi-Fi Users Who Use Their Mobile Device
While Shopping In-Store*, Q1 2012 & Q2 2013
% of respondents
“Omnichannel” has become a buzzword in retail
80%
for good reason. New technologies and better data
bring the longtime dream of a unified cross-channel 64%
shopping experience within reach. In practice,
however, most retailers still fall far short of achieving
this vision.
Consumers, on the other hand, have already embraced

seamless shopping across channels. Armed with
smartphones and tablets, shoppers go back and
forth effortlessly between the real and digital worlds.
They’re using their phones while in stores to research Q1 2012 Q2 2013
products and compare prices. They’re ordering online Note: *to enhance their shopping experience
Source: JiWire, "Mobile Audience Insights Report Q2 2013," Aug 20, 2013
and then picking up in person. And they’re consulting 162656 www.eMarketer.com
friends near and far wherever they may find themselves
contemplating a purchase. Every day, more of them come
to expect an omnichannel experience.
Why are retailers lagging behind consumers? First,

most sales still happen in brick-and-mortar stores, hiding
the revolutionary effect mobile devices are having on
the shopping experience and lulling some retailers into
complacency. Second, omnichannel is hard. Not only does CONTENTS
it require retailers to adjust business operations and link
databases, it’s very difficult to judge which innovations 2 Executive Summary
make a difference. Retailers are far from mastering
3 The State of Omnichannel Retailing
cross-channel attribution.
4 Roadblocks to Omnichannel Integration
This report looks at the current state of omnichannel 7 The Omnichannel Consumer
marketing and the transformation of the consumer into an
omnichannel shopper. It also examines some responses 11 Omnichannel Innovations
to omnichannel shopping that enrich the in-store 14 Conclusions
experience with digital integrations.
KEY QUESTIONS
■■ How close are retailers to providing an
omnichannel experience?
■■ What are some factors inhibiting

omnichannel adoption?
■■ How are consumers using media to shop

across channels?
■■ What are some omnichannel innovations

gaining traction?
THE STATE OF OMNICHANNEL RETAIL: RETAILERS PLAYING CATCH-UP WITH CONSUMERS ©2014 EMARKETER INC. ALL RIGHTS RESERVED 4
THE STATE OF OMNICHANNEL Yet when it comes to implementing this vision, few
retailers are accomplishing it. In the same survey, RSR
RETAILING asked retailers the extent to which they had synchronized
their channels across different areas of omnichannel
Retailers have long reached customers through a strategy. In all 13 areas, less than one in five respondents
variety of sales channels, but digital commerce is reported full synchronization. In no area did more than
making that task more difficult than ever. Today’s half report full synchronization or full synchronization in
challenge is creating a consistent experience across progress. Perhaps most notably, only a third of companies
had or said they would soon have a fully synchronized
these channels—an “omnichannel” experience. More
customer experience across all channels.
revolution than evolution, omnichannel requires a
rethinking of every part of the retail model, which
Aspects of Omnichannel Strategies that Are Currently
may explain why most retailers remain far from Synchronized According to Retailers Worldwide,
achieving it. June 2013
% of respondents
Full synchronization Fully
in progress synchronized
VISION VS. REALITY Fulfillment

Pricing strategies
20%
25%
17%
15%
Nearly all retailers aspire to creating an omnichannel Procurement/assortment 23% 15%
experience for their customers. In a June 2013 survey Customer order visibility 29% 14%
conducted by Retail Systems Research (RSR), 84% across all channels
Traditional advertising 17% 14%
of retailers worldwide said that creating a consistent
Consistent customer 22% 11%
customer experience across channels was very experience across all channels
important, and the remaining 16% described it as Digital marketing 32% 11%
somewhat important. In fact, a clear majority of retailers Inventory visibility across 33% 11%
all channels
found most aspects of an omnichannel strategy
Loyalty management 18% 10%
very important. Customer call center 28% 8%
Store operations 31% 8%
Customer segmentation 28% 7%
Important Aspects of a Company's Omnichannel
Strategy According to Retailers Worldwide, June 2013 Demand forecasting 36% 7%
% of respondents Note: numbers may not add up to 100% due to rounding
Source: Retail Systems Research (RSR), "Omni-Channel 2013: The Long
Very Some Little to no Road to Adoption," June 11, 2013
important importance importance
165898 www.eMarketer.com
Consistent customer 84% 16% 0%
experience across all channels
Inventory visibility across 80% 16% 4%
all channels
Fulfillment 75% 19% 5%
Customer order visibility 73% 21% 6%
across all channels
Digital marketing (ecommerce, 64% 36% 0%
mobile, social media)
Pricing strategies 53% 43% 4%
Loyalty management 52% 41% 7%
Store operations 50% 47% 3%
Customer segmentation 46% 44% 10%
Demand forecasting 44% 49% 7%
Procurement/assortment 42% 55% 3%
Customer call center 33% 48% 19%
Traditional advertising 13% 54% 33%
Note: numbers may not add up to 100% due to rounding
Source: Retail Systems Research (RSR), "Omni-Channel 2013: The Long
Road to Adoption," June 11, 2013
At its core, omnichannel is about bridging online and
offline experiences. In an April 2013 survey of ecommerce
ROADBLOCKS TO
and digital professionals worldwide, IBM Tealeaf and OMNICHANNEL INTEGRATION
Econsultancy found retailers lagging in this area. Some
63% of respondents said they provided online content What has kept retailers from plunging into
about their offline stores, including locations, store hours omnichannel more quickly? A lack of urgency is
and contacts, but far fewer had more advanced ways partially to blame. In-store sales still dominate overall
of linking mobile directly with the in-store shopping retail sales, which may lull some into putting off
experience. Slightly more than a quarter said they were
omnichannel implementation efforts. Compounding
using QR codes and mobile coupons, but fewer were
using other techniques. this, implementation requires a series of difficult
steps, including inventory, data integration and
revamped business operations. Without a sense
Ways in Which Companies Integrate Digital and
Physical Customer Experiences According to Business of urgency and adequate customer intelligence to
Professionals Worldwide, April 2013 guide them, many retailers may hesitate in their
% of respondents
Website information about offline locations, contact details 63%
commitment to make the changes necessary to offer
and opening hours an omnichannel experience.
Social presence for offline products/services 38%
Mobile/local search engine optimization 31%
PHYSICAL STORES STILL GENERATE

QR codes 28%
Coupons/vouchers 26%
Click-to-call
Reserve and collect (in-store)
23%
18%
MOST SALES
In-store or in-branch Wi-Fi 17% Despite ecommerce’s seeming pervasiveness, the vast
Kiosks and tablets for in-store or in-branch ordering 16%
majority of retail sales still happen in the physical world.
Location-based apps 15%
eMarketer estimates that even with the steady growth
Third-party listing sites and apps (e.g., Yelp and Qype) 13%
of ecommerce, the channel will still account for less than
Barcode scanners 12%
Pop-up stores 11%
6% of total US retail sales in 2013.
Personalized digital signage 9%
Near field communications (NFC) 4% US Retail Ecommerce Sales Share, 2009-2013*
Other 6% % of total retail sales
Source: IBM Tealeaf and Econsultancy, "Delivering a seamless experience 5.78%
across every channel," Sep 16, 2013
165899 www.eMarketer.com 5.18%
4.69%
4.33%
3.95%
2009 2010 2011 2012 2013*
Note: excludes financial brokers and dealers, ticket sales agencies and
travel; *estimate
Source: US Department of Commerce; eMarketer calculations, Aug 15,
2013
For many subsectors of retail, such as food and Even so, ecommerce sales growth continues to eclipse
automobiles, the numbers are even smaller. “That’s why sales growth for brick-and-mortar stores. Some industry
the retailers have not felt the need or the necessity to experts go so far as saying that ecommerce represents
change yet,” said Marshal Cohen, chief industry analyst the only growth. Wayne Kulkin, CEO of footwear retailer
at The NPD Group. “They’re exploring with it. They’re Stuart Weitzmann, argues that virtually all retail growth
dabbling with it. They’re recognizing the future of it. But is attributable to online channels. Among multichannel
they’re not rushing to change. That’s OK for the moment, retailers, he said, “I could almost guarantee you that
but very quickly that’s going to become a necessity.” their business [in physical stores] would be flat to down
5 percent.”
Numbers from A.T. Kearney confirm the continued
importance of the physical store—not just in sales but
also in time. The consulting firm found in February 2013
that 61% of the time consumers in the US and UK spent
INTEGRATING AND ANALYZING DATA
shopping occurred in a physical store. REMAINS A CHALLENGE
A second major challenge for companies is tracking the
Share of Time Spent Shopping According to effectiveness of omnichannel strategies, especially in
Consumers in the UK and US, by Channel, Feb 2013
light of the continued dominance of the physical store
% of total
at the end of the purchase path. Bridget Dolan, vice
Mobile president of interactive media at personal care and beauty
Catalog 4% retailer Sephora, said, “You wish that the client walked
4%
around with a barcode on her forehead, but she doesn’t.
So it’s really hard to track a client as she goes through
Online Store
31% 61% different channels.”
Sephora attempts to get around this problem with a

loyalty program called Beauty Insider, which is easy to
join and personalized to the consumer. Sephora has
Source: A.T. Kearney, "Recasting the Retail Store in Today's Omnichannel
World," Oct 14, 2013 integrated the program into its own app and Apple’s
165905 www.eMarketer.com Passbook app. By tagging all of the products it sells from
a list of 25 attributes—“good for dry skin,” for example—
And not only does it account for the most time: The
Sephora can provide very detailed recommendations
experience of physically browsing in a store leads many
and offers. “Beauty Insider really is the glue to our
shoppers to buy more than they planned. Some 40% of
omnichannel strategy,” Dolan said. The company’s clients
consumers in the survey reported making unanticipated
have found the program compelling, having adopted it at
impulse buys while shopping in-store, compared with
very high rates, according to Dolan. Sephora, however, is
25% of online buyers.
the exception rather than the rule.
In-Store vs. Online Spending According to Consumers

in the UK and US, Feb 2013
% of total
Shopping in-store
40% 60%
Shopping online
25% 75%
More than planned The same or less than planned
Source: A.T. Kearney, "Recasting the Retail Store in Today's Omnichannel

World," Oct 14, 2013
In a Q1 2013 survey of marketers worldwide by CMO Level of Integration of Select Digital Marketing
Council and SAS, only 3% of respondents reported Channels with Overall Marketing Activity According
their companies had completely integrated their online to Client-Side Marketers Worldwide, May 2013
% of respondents
and offline analytics capabilities. A further 8% said
their companies were well integrated in either online Website
58% 39% 4%
or offline, but not across all functions. Nearly nine out
Email
of 10 companies were described as having incomplete
55% 37% 8%
integration in either online and offline analytics, let alone
Paid search
having integration across all functions.
44% 45% 11%
SEO (natural search)

Level of Integration of Company's Online and 38% 47% 16%
Offline Analytic Capabilities According to Online display advertising
Marketers Worldwide, Q1 2013 38% 47% 15%
% of respondents
Social media marketing
Well integrated online, 35% 52% 13%
Completely integrated not well integrated offline
across all functions 5% Web retargeting
Well integrated
3% offline, not well- 34% 51% 15%
integrated online Mobile messaging (SMS/MMS)
3%
23% 43% 34%
Not integrated
at any level Mobile web
20% 20% 56% 24%
Struggling to Mobile
integrate online Getting better across
with offline 17% 51% 32%
the board, but still room
23% for improvement Very integrated Quite integrated Not integrated
46%
Note: n=363; numbers may not add up to 100% due to rounding
Source: Econsultancy and Responsys, "Cross-Channel Marketing Report
2013," Aug 28, 2013
Source: CMO Council and SAS, "Aligning the CMO & CIO," March 28, 2013
Right now, according to industry insiders, the biggest The slowness of data integration is in part a result of
bottleneck to such integration is mobile. Scott Zalaznik, the way ecommerce has developed among already-
vice president of digital at Sprint, said, “The hard part is established retailers. “When ecommerce emerged on
going to be attribution from desktop to mobile, and then the scene, most retailers built their online initiatives
from desktop and mobile to retail.” independently from brick-and-mortar stores, setting them
up as separate businesses with separate technology,
In a May 2013 survey of client-side marketers worldwide, sales goals and initiatives,” said Ed Stevens, founder of
Econsultancy and Responsys found only 17% of ecommerce platform Shopatron. “Now, all of a sudden,
marketers reporting that mobile was “very integrated” omnichannel is bringing those channels back together.
into overall marketing strategy, compared with more Closing the loop on the ‘silo effect’ requires merging
than 50% saying the same for their website and email technologies and figuring out how to efficiently execute
channels. This has an effect on the amount of investment fulfillment efforts from stores.”
made in mobile, according to Zalaznik. “It’s really about
proving that media consumption behavior is worth it at In order to create an omnichannel experience, retailers
an impression level for your brand to actually drive both need back-end systems to integrate and manage all
[digital] commerce and retail purchasing,” he said. This types of data, including inventory, customer analytics and
is true both for paid media as well as costly-to-produce fulfillment. “Pulling all of that data together in order to
owned media, such as apps. build a comprehensive consumer profile requires creative
and flexible tools and technology, which most retailers
don’t yet have in place,” Stevens noted.
THE OMNICHANNEL CONSUMER US Mobile Wi-Fi Users Who Use Their Mobile Device
While Shopping In-Store*, Q1 2012 & Q2 2013
% of respondents
Whereas retailers have to overcome a variety of 80%
hurdles to create an omnichannel experience, their
customers already have made the leap. Consumers 64%
still make most purchases in a physical store, but
they’re shopping everywhere and in every way,
hopping from device to device as they gather product
information and recommendations before leaving
home. Moreover, even while in a physical store, many
augment their shopping by looking for information
via mobile devices.
Q1 2012 Q2 2013
More than any other technology, smartphones and tablets Note: *to enhance their shopping experience
are changing the shopping experience for consumers, Source: JiWire, "Mobile Audience Insights Report Q2 2013," Aug 20, 2013
letting them bridge the online and offline experience—
even when stores fail to make it easy for them to do so. The ubiquitous internet access that smart devices
“Consumers are a couple of steps ahead of the brand,” provide has bridged the virtual and physical shopping
said Tony King, founder of luxury retail consultancy King experience. “Mobile is kind of this seamless glue. This
& Partners. “People will check something seven or eight purchase process and consideration has become more
times online before they actually buy … [using] several meandering, and we’re using mobile as the thing that
devices. They are experiencing the brand across all those jumps into those places,” said Johnna Marcus, director of
different channels.” mobile and digital store marketing at Sephora. “The big
thing is not to think of mobile as just shopping on the go.
While King was talking specifically about consumers of Mobile is a tool for in-store.”
luxury goods, his point applies more generally as well.
Consumers of all financial strata increasingly expect a
consistent brand experience as they shop across a variety
of channels. CHANGING BUYING PATTERNS
Consumers are constantly innovating in their uses of
mobile. They already are omnichannel browsers and
MOBILE: THE BRIDGE BETWEEN ONLINE buyers, using a slew of channels to make a single
purchase and rewarding retailers who empower them to
AND BRICK-AND-MORTAR STORES do so.
The relatively small portion of overall retail transactions
JiWire’s survey revealed just how convoluted the
that occur via mobile devices masks mobile’s true impact.
purchase path has become. Out of the 68% of mobile
Consumers are using smartphones throughout the
Wi-Fi users who did retail shopping research on a
shopping experience, and often while in a store. Mobile
smartphone, only 35% went on to make the purchase
advertising and data platform JiWire surveyed US mobile
using that device. In contrast, of the 60% who researched
Wi-Fi users in Q2 2013 and found that 80% used their
in-store, 57% ended up making the purchase in the store.
mobile devices “to enhance their shopping experience”
Furthermore, nearly every combination of research and
while shopping in-store, up from 64% in Q1 2012.
purchase on smartphones, tablets, laptops and in-store
garnered significant responses.
Cross-Device Retail Shopping Research & Purchase US Internet Users Who Have Ever Showroomed*,
Behavior of US Mobile Wi-Fi Users, June 2013 Nov 2012 & April 2013
% of respondents % of respondents
Research on laptop 74% 43%
—Purchase on laptop 52% 40%
—Purchase in-store 37%

—Purchase on tablet 21%
—Purchase on smartphone 16%
Research on smartphone 68%
—Purchase in-store 37%
—Purchase on smartphone 35%
—Purchase on laptop 28%
Research on tablet 67%
—Purchase in-store 33% Nov 2012 April 2013
—Purchase on laptop 32% Note: ages 18+; *visited a brick-and-mortar store to examine a product
—Purchase on smartphone 15% before purchasing it elsewhere online
Source: Harris Interactive, "The Harris Poll" as cited in press release, June 4,
Research in-store 60% 2013
—Purchase in-store 57% 158626 www.eMarketer.com
—Purchase on laptop 29%
—Purchase on smartphone 19% With consumers taking on the responsibility of finding
—Purchase on tablet 18% product information from competing merchants online,
Note: read as among the 68% of US Wi-Fi users who researched on their retailers have lost the ability to win on price alone,
smartphone, 37% purchased in-store
Source: JiWire, "Mobile Audience Insights Report Q2 2013," Aug 20, 2013
industry experts say. “The ability to differentiate yourself
162653 www.eMarketer.com by price has clearly diminished,” The NPD Group’s Cohen
said. “If you’re Wal-Mart, yeah, maybe you are the
Showrooming lowest price. Somebody’s got to be the lowest price, but
there’s always somebody else who may come along and
According to a Harris Interactive survey from April undercut you because they’re hungry for the business.”
2013, 40% of US adult internet users said they had
showroomed—that is, looked at a product in a store Parago, a company that specializes in driving
and then went online to find a better price. This was engagement, breaks showrooming down by retail
statistically unchanged from five months earlier. However, subsector and by shopper income. In a June 2013 study,
as not all respondents in the study were necessarily it found that US smartphone owners were more likely to
smartphone owners, the percentage of US adults who showroom for apparel and entertainment purchases, and
showroomed was likely even higher among smartphone less likely to do so when shopping for appliances, building
owners. eMarketer estimates that smartphone materials and automotive purchases.
penetration among the US population will reach 50.1%
in 2014, so showrooming is likely to continue rising as
a consequence of more shoppers having the ability to Frequency with Which US Smartphone Owners View
Items In-Store and Then Buy Online, by Category,
do so. June 2013
% of respondents
Often Sometimes
Entertainment 54% 40%
Apparel 50% 47%
Electronic & mobile technology 50% 46%
Housewares 42% 51%
Office supplies 39% 50%
Appliances 31% 58%
Building tools & supplies 30% 45%
Automotive 20% 47%
Source: Parago, "Dynamic Pricing in a Smartphone World: A Shopper
Showrooming Study," July 19, 2013
Perhaps reflecting different smartphone ownership Among the 93% of showroomers who said they did not
trends, the more affluent a US internet user is, the more buy on their phone while in a store, showrooming may
likely they are to use a smartphone to check prices while in fact be an opportunity. Nick Hodson, partner at Booz
in a store, according to Parago. & Co., noted: “The key is to kind of try and get away
from price checking and get it … to be a kind of engaging
experience on the smartphone before, during and after
Ways that US Internet Users Look for Deals,
by Income, March 2013 the shopping experience.”
% of respondents in each group
<$50K $50K- $100K- $200K+ Sephora does just that. The cosmetics retailer actively
$100K $200K
encourages consumers to use their phones in-store and
Researches for deals and best 97% 99% 99% 97%
prices before shopping makes it easy by providing free Wi-Fi. “[Our] mantra is
Looks for deals in circulars and 92% 94% 98% 90% that ‘a phone in her hand is worth two in her handbag,’”
print ads Sephora’s Dolan said. “We want her to get that phone out
Search for deals online before 86% 96% 96% 90%
going in-store
… to read reviews, scan products. Having that additional
I shop where I can gain loyalty 54% 66% 78% 73% access to the information that you wouldn’t normally have
and rewards is the true power of omnichannel in my mind, and I do
I use my smartphone to check 30% 51% 81% 76% think it’s the opposite of showrooming.”
prices while in store/shopping
Note: respondents who almost always/sometimes engage in each behavior
Source: Parago, "Shopper Behavior Study 2013: Let's Make a Deal," May 21,
2013 ‘Webrooming’
For many shoppers, online shopping is a prelude to a
In February 2013, market research firm TNS Global store visit. In September 2013, consulting company
delved deeper into what mobile phone owners in North Accenture surveyed US internet users about their
America did when they used their phones in stores. The shopping plans this holiday season and found that 20%
study found 32% were in fact looking at prices from expected to follow an online browsing session by going to
a competitor. An even larger percentage researched a store and buying the product, with a further 45% saying
products in various ways, while only 7% actually went on such a path was somewhat likely. This pattern of buying
to purchase the product via an app or website while still in-store after going online to search for an item has been
in the store. Showrooming, therefore, is a threat, but a dubbed “webrooming,” or “reverse showrooming.”
smaller one than often portrayed.
Likelihood that US Internet Users Will Webroom* This

Ways that Mobile Phone Owners in North America Holiday Season, Sep 2013
and Latin America Use Mobile Devices While % of respondents
Showrooming, Feb 2013
% of respondents Not at
Latin North all likely
America America 14% Very likely
20%
Compare prices with another retailer 23% 32%
Take a photo of the product or note down 24% 22% Unlikely
product details to help me remember it for later 21%
Look up product information or comparisons 13% 18% Somewhat likely

Check product availability at another retailer 15% 18% 45%
Ask my friends or family what they would 26% 16%
recommend buying
Check if it was easier/more convenient to order 12% 15%
Note: *defined as looking online for an item before going in-store to make
the product online a purchase
Check the range of products at another retailer 13% 14% Source: Accenture, "Holiday Shopping Survey 2013," Oct 7, 2013
Receive advice or information from another retailer 14% 8% 165436 www.eMarketer.com
Purchase the product via an app or website 9% 7%

while I was still in the store
Source: TNS Global, "Mobile Life," April 24, 2013
Why do shoppers head to a store after doing research Reasons that US Internet Users Will Webroom* This
online? The most common reason cited in a November Holiday Season, Sep 2013
2012 study by Columbia Business School and Aimia was % of respondents
speed. Some 59% of mobile shoppers querried in the US, Don't want to pay for shipping
UK and Canada who said they didn’t showroom said that 47%
they needed the product right away, while 53% said they Like to go to a store to touch and feel a product before I buy it
didn’t want to wait for online shipping. Moreover, 51% 46%
said they found it more convenient to buy in-store. Want to check online first if the item is available/in-stock before
I go to the store to purchase it
42%
Reasons that Mobile Shoppers in Canada, UK and the Like the option of being able to return the item to the store if I
need to
US Do Not Showroom, Nov 2012
37%
% of respondents
Will ask the store to price match to a better price I found online
Needed the product right away
36%
59%
Don't want to wait for the product to be delivered
Don't want to wait for online shipping
23%
53%
None of these
More convenient to buy in the store
3%
51%
Prefer to buy from local stores Note: among respondents who are "very/somewhat likely" to shop online,
purchase in-store; *defined as looking online for an item before going
19%
in-store to make a purchase
Great customer service at the store Source: Accenture, "Holiday Shopping Survey 2013," Oct 7, 2013
17% 165437 www.eMarketer.com
Better return policies from the store The contrast between the Columbia/Aimia and the
15%
Accenture studies may in part be explained by better
Store membership rewards
same-day or next-day delivery options that have become
14%
available recently through major retailers like Amazon
Trust store more than online retailer
14% and Wal-Mart. But more likely the difference has to do
Personal connection with store staff
with the Accenture study’s focus on holiday shopping.
7% Last-minute shopping notwithstanding, people often
Store had free same-day shipping plan their holiday shopping weeks or months ahead
6% of the season. Their concerns more often revolve
Dislike online shopping experience around affording everything rather than fulfilling an
4% immediate need.
Source: Columbia Business School and Aimia, "Showrooming and the Rise
of the Mobile-Assisted Shopper" conducted by Harris Interactive, Sep 12,
2013
Accenture found a broader set of concerns driving

consumers’ webrooming. In its survey, the leading
response was cost: Among US internet users polled,
47% didn’t want to pay for shipping. Nearly as many,
46%, said they liked the tactile experience of shopping in
a physical store, while 42% said they visited a website to
check on a product’s in-store availability before venturing
out for it. Only 23% said that waiting for delivery was a
major reason for webrooming.
OMNICHANNEL INNOVATIONS In September 2013, a study from MarketLive and the
e-tailing group found that 75% of US digital shoppers
believed perpetual shopping carts were important
Consumers are already using their phones to get
when buying gifts online. In fact, it was one of the
around the constraints of shopping in either the most important customer assistance tools for them. As
physical or the virtual world alone, and they reveal consumers shift between online platforms, they want
an unsatisfied appetite for omnichannel solutions. to be able to add items to their online shopping cart
Some retailers are beginning to provide tools that and use it as a wish list that they can access when they
simplify and replace the workarounds consumers visit a store and want to see items that piqued their
interest online.
already employ.
Most Important Features on a Customer Assistance
WISH LISTS AND PERPETUAL Website When Buying Gifts Digitally According to US
Digital Shoppers, Sep 2013
SHOPPING CARTS % of respondents

Customer service representatives
As consumers move between digital platforms, they 77%
want to keep track of products they may want to buy. In 24/7 customer service access
Bronto Software and Magento polling from August 2013, 77%
71% of US digital buyers indicated that they would use a Accessible contact information (phone, email)
75%
wish list if an ecommerce platform had one. With more
people using smartphones to link to the web quickly, Perpetual shopping cart (ability to add an item to your cart or
view cart contents)
wish lists and perpetual shopping carts are becoming 75%
more important. Jed Paulsen, director of ecommerce 800 or toll-free telephone number
and marketing at bohemian-inspired apparel retailer Free 67%
People, said: “We have a shopping cart that’s integrated Click-to-chat (live text chat help available)
across the mobile site, the app and the site, and a wish 57%
list that’s also integrated. One of our goals was to have Chat on mobile phone
the app that could facilitate transactions online, but then 39%
also be something that was useful for our customers Note: "most" or "somewhat important" features
when they go into stores.” Source: the e-tailing group and MarketLive, "It's the Season... A Practical,
Tactical Guide to a Brighter Holiday Season," Oct 29, 2013
US Digital Buyers Who Would Use Wish Lists or

Shopping Carts if a Brand Offered Both, Aug 2013
% of respondents
Won’t use the Use wish list instead

wish list of shopping cart
29% 24%
Use both the wish list

and shopping cart
47%
Source: Bronto Software and Magento, "Why We Don't Buy: Consumer

Attitudes on Shopping Cart Abandonment" conducted by Ipsos, Oct 8, 2013
STORE AS ONLINE FULFILLMENT CENTER SOCIAL INTEGRATION WITH THE
Better integration of ecommerce platforms with store PHYSICAL STORE
inventory also opens up new possibilities for purchase
Mobile has allowed consumers to reach out to their
fulfillment. A study by Edgell Knowledge Network (EKN)
friends and family for advice while they shop. The social
found that 34% of retailers in North America currently
aspect of shopping, reinvigorated by mobile and social
offer online shoppers the option to pick up their orders in
networking platforms, offers another opportunity for
a store. A further 41% expected to offer that ability within
retailers. “Look at how teenagers shop,” The NPD Group’s
the next two years. This option links a retailer’s inevitably
Cohen said. “Before they make a purchase, they’re taking
more expansive online inventory to the physical store,
a picture and sending it to their friend for approval. So,
giving consumers the certainty of knowing what they
what you’ve got now is a very different dynamic in the
want will be waiting for them when they visit the store.
conversion factor.”
It also enables merchants to satisfy customers who visit
an establishment but find that a product is out of stock.
Retailers are responding by creating store-specific social
The same systems that track products so they can be
media initiatives. More than half of the retailers in EKN’s
delivered to a specific store after an online purchase can
survey said they offered or would offer within 12 months
also tell a store associate whether a particular out-of-stock
store-specific social media initiatives. This was the leading
item remains for sale in another store, or is available in a
digital initiative offered in-store.
warehouse. A consumer can then order it in the store and
have it delivered to their home.
Digital Initiatives Offered In-Store According to
Retailers in North America, 2013
Retailers in North America that Use Their Stores as a % of respondents
Delivery Hub for Online Orders, 2013
% of respondents Store-specific social media initiatives
31% 26% 11% 31%
In-store media content

31% 25% 8% 36%
No plans
25% Currently offer Use of QR codes
34% 31% 13% 16% 39%
In the next Providing digital receipts

12-24 months 18% 33% 15% 34%
15% In the next 12 months
Mobile POS
26%
18% 20% 25% 37%
Endless aisle*
Source: Edgell Knowledge Network (EKN), "State of the Industry Research
Series: The Future of the Store," July 1, 2013 15% 10% 20% 54%
161603 www.eMarketer.com Mobile charging stations
10% 2% 86%
Holly Devine, executive director of planning at apparel 2%
and lifestyle products retailer Urban Outfitters, noted Currently offer In the next 12-24 months
that ominchannel’s benefits are mutual. “We want the In the next 12 months No plans
customer to be able to shop any way they choose to Note: numbers may not add up to 100% due to rounding; *selling items
shop and satisfy them,” she said. “From a business that aren't actually located in the store
perspective, every time we get you to come in the door, Series: The Future of the Store," July 1, 2013
we have another chance to convert you, another chance 161605 www.eMarketer.com
to say, ‘Oh my goodness, this accessory would look so

wonderful with this item that you just bought.’”
Target recently introduced its Cartwheel app, which Consumers seem ready to use apps that ease in-store
allows consumers to save discounts they find as they shopping. Free People added a catalog at its stores’
browse through a menu listing product categories and checkout counters to tout the full assortment of jackets
deals. Once in the store, shoppers can look up the deals, the retailer carries. Each of the jackets in the book has
go to the checkout and get the discounts all by scanning a barcode, which consumers with the app can scan to
a single barcode on their phone. Not only do consumers make a purchase, use to access reviews or to upload
get an easy way to collect and redeem app-specific photos to Instagram. So while the catalog lets customers
coupons, they can also share the coupons with their see the full assortment of jackets at a convenient
social networks. “We knew Target shoppers love finding location, it also leads them to a richer and more social
deals and also sharing those finds with friends, so we shopping experience.
designed Cartwheel so people could share savings with
friends and on social networks,” Target spokesman Eddie Home improvement chain Lowe’s also created an app
Baeb said. that addresses one of its customers’ major challenges:
how to find the right tools and accessories for items
Efforts like Target’s highlight the degree to which mobile that they bought in the past. The app tracks this history
is becoming intrinsically tied to social. “So much of and contains a code that allows associates within a
the reach of social is on mobile,” Sprint’s Zalaznik said. store to pull up a customer’s history and see possible
“People were missing SoLoMo [social-local-mobile]. You complementary products. It’s instant, personalized
know, the definition I think is evolved to not being just customer-relationship management.
about those things in a Venn diagram, but really thinking
they’re all part of this kind of mobile confluence.” “To the extent that we can tie the customer with the
associate, it’s really, really powerful for the overall
relationship,” said Sean Bartlett, director of mobile
IN-STORE APP FUNCTIONALITY strategy and platforms at Lowe’s. “Associates love it

for the interaction in the aisles. So it’s really a win for
Apps such as Cartwheel give retailers new ways to everyone involved.”
deepen the shopping experience and fully integrate
phone functions with that experience. By linking apps
to inventory systems, purchase history and any number
of interactive phone elements, retailers can give richer
information to their customers as they need it. Most
retailers, however, are not taking advantage of this
opportunity. EKN’s study found that only 13% of retailers
had an app with in-store functionality, although a further
48% expected to have one in the next one to two years.
Consumer Mobility Initiatives Offered In-Store by

Retailers in North America, 2013
% of respondents
Free Wi-Fi for customers
22% 25% 12% 42%
Exclusive store-only mobile coupons

17% 19% 21% 43%
Mobile app features useful in the store

13% 25% 23% 38%
Currently offer In the next 12-24 months

In the next 12 months No plans
Note: numbers may not add up to 100% due to rounding

Series: The Future of the Store," July 1, 2013
CONCLUSIONS
Virtually all retailers aspire to providing an
omnichannel experience, but far fewer currently
deliver it. As RSR’s survey on key measures of
omnichannel retailing found, fewer than 20% of retailers
reported full synchronization.
Implementation challenges, the complexity of

attributing effectiveness to cross-channel techniques
and complacency with the status quo have hindered
omnichannel retail adoption. Ecommerce only accounts
for around 6% of total retail sales in the US, so there
may be a false sense that consumer behaviors haven’t
changed enough to make omnichannel seem like a
must-do.
Consumers are ahead of retailers in their

omnichannel behavior. The majority of US consumers
who connect to a store’s Wi-Fi use their devices while
they shop. By giving consumers access to information
and friends, internet-connected mobile devices have
created a purchase path with many side-passages and
feedback loops.
Consumers express strong interest in retailer

innovations that add to the omnichannel experience,
including wish lists, shopping carts, social integration,
variable fulfillment and in-store apps. Apps that
combine simplicity of use and utility add the most to the
shopping experience.
IN-STORE AND OVER-THE-WEB TAKE PLACE ALL AT ONCE.
Delivering an exceptional and secure online experience, independent of device and location, is no longer
a nice-to-have, it’s a damn-well-better-have. And with Akamai as your partner, you get the platform,
experience and expertise to overcome the challenges and embrace the opportunities that come with
providing personalized, impactful and secure user experiences.
To learn more about Forrester’s mobile strategies for new realities, visit akamai.com/mobile

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JANUARY 2014

eMarketer is pleased to make The State of Omnichannel Retail available to

We invite you to learn more about eMarketer’s approach to research and

eMarketer, Inc. www.emarketer.com

Consumers, on the other hand, have already embraced

Why are retailers lagging behind consumers? First,

■■ What are some factors inhibiting

■■ How are consumers using media to shop

■■ What are some omnichannel innovations

VISION VS. REALITY Fulfillment

PHYSICAL STORES STILL GENERATE

2009 2010 2011 2012 2013*

Sephora attempts to get around this problem with a

In-Store vs. Online Spending According to Consumers

More than planned The same or less than planned

Source: A.T. Kearney, "Recasting the Retail Store in Today's Omnichannel

SEO (natural search)

—Purchase in-store 37%

Likelihood that US Internet Users Will Webroom* This

Look up product information or comparisons 13% 18% Somewhat likely

Purchase the product via an app or website 9% 7%

Accenture found a broader set of concerns driving

Most Important Features on a Customer Assistance

SHOPPING CARTS % of respondents

US Digital Buyers Who Would Use Wish Lists or

Won’t use the Use wish list instead

Use both the wish list

Source: Bronto Software and Magento, "Why We Don't Buy: Consumer

In-store media content

In the next Providing digital receipts

to say, ‘Oh my goodness, this accessory would look so

IN-STORE APP FUNCTIONALITY strategy and platforms at Lowe’s. “Associates love it

Consumer Mobility Initiatives Offered In-Store by

Exclusive store-only mobile coupons

Mobile app features useful in the store

Currently offer In the next 12-24 months

Note: numbers may not add up to 100% due to rounding

Implementation challenges, the complexity of

Consumers are ahead of retailers in their

Consumers express strong interest in retailer

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