Omnichannel Retailing - Digital Transformation of a Medium-sized USA Retailer

A well-established USA retail company, with a rich history spanning over 50 years, embarked on a digital transformation journey in 2019 with the ambitious goal of becoming an omnichannel retailer. Renowned for its focus on American design products, the company sought to seamlessly integrate its offline and online channels, unlocking new avenues for growth and customer engagement.

Challenges Faced

Despite its strong brick-and-mortar presence, the company’s web-shop underperformed, accounting for a mere 5% of revenue.
Despite significant marketing investments, the online channel failed to match the success of its physical stores.
This underperformance stemmed from several key challenges.

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Customer Segmentation and Personalization
The company lacked deep insights into customer behavior and preferences, hindering its ability to deliver personalized offerings. The absence of a loyalty program further limited targeted engagement and customer retention.
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Quality of Online Experience
The web-shop lacked experiential features, failing to replicate the exceptional in-store experience. Additionally, issues with product images, videos, and website downtime further compounded the subpar online experience.
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International Exposure
The company missed opportunities to expand its reach beyond the USA, particularly among international visitors, lacking strategies to attract and retain this valuable customer segment.

Solutions Implemented

To address these challenges, we undertook a comprehensive digital transformation strategy,
encompassing strategic, operational, technological, and structural improvements

Digital Strategy Formulation
We launched a "Go Digital" initiative, emphasizing omnichannel integration and recognizing the web-shop as a crucial component for future success.
Improvements in Web-shop
Post-migration website operational issues were resolved, product content quality was enhanced, and experiential features were introduced to provide a similar shopping experience as physical stores.
Enhanced Customer Data Collection
Robust practices were implemented to capture and utilize customer data, enabling the company to gain a deeper understanding of shopping behavior, preferences, and segmentation. This data-driven approach empowered the company to deliver personalized offerings and targeted engagement.
Performance Evaluation Shift
Instead of evaluating store and online managers based on individual channel performance, our team adopted an omnichannel approach, fostering collaboration and aligning efforts to create a seamless customer experience across all channels.

Results

The company’s digital transformation efforts yielded significant and tangible results:

58% Online Sales Surge
A significant leap forward, transforming the once modest 5% web shop into a major revenue driver.
15% International Growth
Streamlined digital operations, including technology, inventory, and payments, facilitated a successful entry into the global market, expanding the customer base and future revenue potential.
Omnichannel Success
The shift to an omnichannel approach facilitated seamless collaboration between physical stores and the online channel, contributing to overall digital success.
25% Customer Satisfaction Boost
Personalized engagement, powered by unified customer data and tailored recommendations, led to a notable increase in satisfaction.

Conclusion:

The case study highlights the challenges faced by a traditional USA retailer in transitioning to an omnichannel approach. Through a well-executed digital strategy, the company successfully addressed these challenges, resulting in improved online performance, enhanced customer insights, and successful omnichannel collaboration. The case underscores the importance of aligning technology, strategy, and organizational structure to achieve a successful digital transformation in the retail industry. The company’s journey serves as an inspiration for other traditional retailers seeking to navigate the ever-evolving digital landscape and embrace the
opportunities presented by omnichannel retailing.