Although many retailers have successfully implemented omnichannel services like same-day shipping, in-store pickup or home delivery, research shows that only a third of retail executives said this was a regular service, while 62% said it was just for the 2021 holiday season, writes John Watling, Managing Director within the Retail business at Accenture in Africa.

Retailers have long-established their operating models to optimise foot traffic and traditional shopping journeys. Only a few were fully prepared for a shift to digital on this scale and at this pace. Online shopping tends to shift the pressure from the consumer but builds higher costs to the retailer in picking, packing, or transporting products to the home. For an industry in which margins are already razor-thin, these additional costs are unsustainable over the long term.

The solution? Go OMO

It is time to commit to fully integrating online and offline channels once and for all. The online-merge-offline (OMO) model calls on retailers to be bold in reimagining how they operate across all retail channels. Imagine being able to pre-purchase some items, quickly ordering your usual essentials via your smartphone when you arrive at the store. It will leave the rest of your visit free for exploring new products for which the sensory experience or hands-on discovery remains essential. This flexible, customer-centred experience is at the heart of what Accenture calls the Store of Tomorrow concept.

To help accelerate the OMO model, Accenture has developed this innovative new concept that applies to all retail sectors, from grocery to beauty to DIY and beyond. Designed to be open, flexible, and adaptable in every respect, the concept combines the speed and simplicity of digital shopping with the automated efficiency of modern warehousing while putting a greater emphasis on the human-centred physical shopping experiences customers still crave.

Six critical ingredients for the store of tomorrow

Each store plan starts with six key ingredients. A retailer then combines these ingredients in different ways depending on its retail sector, its local market, and its customer needs:

  1. Integrated customer experience: Starting with a rich understanding of local customer needs developed from various data sources, a fully integrated OMO model streamlines, simplifies, and speeds up the deployment of customer experiences across online and offline channels. That includes, for example, consistent and personalised promotions, digital payments, easier returns processes, optimised delivery options, and a more precise focus on the product lines customers want to see in store.
  2. Optimised supply chain operations: An OMO model that leverages modern technologies enables optimisation of the retail supply chain for resilience and responsibility and cost and service at the local level. It can also radically improve channel productivity and profitability. With supply chains now a key differentiator and revenue driver for retailers, a shift from a global to a local view allows a more explicit focus on market dynamics, which ultimately translates to more value for customers.
  3. Purposeful and skilled workforce: Retailers need to invest in their crews by offering retraining and upskilling programs while ensuring they build inclusive workplaces and maximise the unique value that each individual brings. It is essential for the OMO model. It will also equip workers with the transferable skills they need in an increasingly digitised and automated economy. Given the war for talent brewing across the retail industry, it can also differentiate the brand as an employer of choice in the market.
  4. Real-time retail data on edge: With edge computing, the OMO model can enable automated decision-making, in real-time, across the retail store. That might mean, for example, transforming the customer experience by providing personalised product recommendations via interactive screens or smartphones as shoppers walk around a store. In particular, edge computing can play a role in unlocking a “dematerialised” shopping experience allowing customers to order specific products by scanning QR codes with a smartphone – and have their purchases served up in minutes by a micro- fulfilment centre.
  5. Enhanced sustainability and social responsibility: All stakeholders, including consumers, now expect companies to contribute to greater sustainability. By developing a new OMO model, retailers can embed ESG (environmental, social, and governance) principles across their end-to-end functions from product sourcing to store experience to fulfilment.
  6. Data-driven decision making: An OMO model relies on retailers putting customers at the heart of the business – which, in practice, means using data, AI and machine learning to generate insights and fuel decisions. Getting the total value from data means harnessing both customer and business outcomes, changing culture, processes and ways of working across the organisation and with partners. A purpose-built data and AI solution, such as Accenture’s ai.RETAIL allows retailers access to proven use cases across marketing, supply chain and merchandising, enable prescriptive recommendations, simulations and what-if scenarios, and accelerate transformation.

A way to realise tangible value from omnichannel growth

What might the Store of Tomorrow look like in practice? Accenture has developed a new, ground-breaking concept that turns the traditional retail layout on its head and divides the store into three complementary parts: The Aisle, the Dark Store and the Promenade.

The Store of Tomorrow promises to radically simplify the omnichannel customer journey while providing shoppers with superb choice and convenience. By enabling more value-adding services and better in-store experiences, the concept promises to boost foot traffic, extend visit durations, and increase basket size per order. While online, an enhanced range of fulfilment options (including mixing and matching online and store shopping and home delivery and store pickup in a single shop) can increase e-commerce conversions and brand affiliation.

Optimising inventory and sharing fulfilment infrastructure more effectively between online and offline channels protects profitability. Store layouts are better optimised for customer and operational needs. With the Dark Store component taking over much of the heavy lifting in operations, hyper-efficient automation reduces handling costs and product wastage on the shelves. Ultimately, it brings fulfilment much closer to customers’ homes, reducing last-mile delivery costs.

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