Retail Trends: The Future of Omnichannel Marketing

Victoria Marshall

Senior Account Director

'Don't be a crap Amazon...'

Earlier in the year we launched our ‘Retail Trends’ event discussing the future of omnichannel marketing. As digital and physical retail become more aligned, brands are investing less in traditional media and more in digital. Our talented speaker line up talked brands through the increasingly important role of digital and ecommerce in the consumer journey. 

 Today, when it comes to purchasing power, consumers have so much at their fingertips. Not only are people able to shop for worldwide, well-known brands easily, but with the rise of B2C e-commerce platforms, marketplaces like Etsy or Alibaba and advancements in global distribution, brands that would have once been considered ‘local’ or ‘niche’ are making their way onto the global stage.

While many companies have embraced omni-channel purchase options (click and collect, e-commerce, mobile commerce), some marketing teams have remained siloed, particularly with regards to wholesale/shopper marketing and e-commerce. Retailers are beginning to innovate – following the likes of Amazon and Walmart – by launching media businesses that allow for the commoditisation of their data and audiences. The rise in technologies such as Criteo Sponsored Products and Hatch are allowing brands to have more control over how consumers are targeted via retail partners.

Despite the growth in e-commerce, physical stores will continue to play an important role in the consumer journey for the foreseeable future, particularly for fast-moving consumer goods (FMCG) where offline sales still represent more than 85% globally.

Omnichannel and the rise of retailer programmes

In 2014, Walmart launched its Walmart Media Exchange (WMX) – a platform that allows brands sold by Walmart to serve online ads in real time, tapping into Walmart’s valuable first-party data. The programme expanded in January 2017 with the launch of WMX for Asda in the UK, primarily for onsite. Tesco, Auchan and others throughout Europe have begun offering similar programmes to brands, which allows big retailers to not only diversify their shopper marketing offering, but also gives brands the opportunity to tap into lucrative data about consumers at the purchase stage.

Additionally, ad-tech products like Criteo Sponsored Products (formerly Hooklogic) give brands more control over how their money is being spent within these programmes. While there are still platform limitations like not being able to segment retailers, it does provide the opportunity to leverage a retailer’s metasearch, offering sponsored products.

Brands/manufacturers have just begun trying to address how retailers are not only media owners within this space, but also wholesale partners. While platforms like Brandwatch allow brands to understand how they are displayed on retail partner sites, much of the transparency needed around how brands are marketed through retailers will ultimately come from trade agreements. Digital programmes that are controlled by the retailer represent an illusion of control, but brands should determine their own data and targeting needs to work best with their retail partners.

Retailers doing it well:

Zalando has seen a meteoric rise in the past 10 years – partly because the e-commerce giant doesn’t just think of itself as a retailer, but also as a tech company. Brands have CMS access to the Zalando site, which allows them to control their brand pages, as well as an expansion of the ZMS platform, where brands can target Zalando’s audience both onsite and through media partners. This enables them to leverage Zalando’s 220M average monthly site visits.

The company has also been forthcoming with some of its audience data. As part of its annual report, Zalando released its primary audience segments and their interests based on consumer purchase history as well as Facebook data.

Zalando has also made strides into how it engages with consumers by purchasing the traditionally B2B tradeshow Bread & Butter, turning it into a B2C show where brands can interact with influencers and consumers.


Why this is important:

As traditional shopper marketing revenue declines – due in part to drops in consumer footfall – retailers must find innovative ways to encourage brands to continue to invest in their marketing programmes. They’ll need to continue to diversify the opportunities they give brands to advertise with them.

Phygital: merging physical and digital

With e-commerce on the rise and the decline of in-store sales, many companies are wondering what to do with existing physical spaces and pondering the role of offline presence in the future. Adidas has said it will close physical stores to focus on its lucrative e-commerce business (or the “most important store” according to CEO Kasper Rørsted) to become a leader in the digital space. While the brand is moving away from physical stores, adidas is testing innovative formats to ensure that it stays top-of-mind by holding events and opening fitness studios to target women more effectively.

Despite the rise in e-commerce, 90% of sales globally still take place offline. Moreover, verticals such as DIY have been slow to adopt e-commerce because of shipping arrangements, and many key growth markets like Brazil still face logistical challenges in addressing how delivery works for consumers in a cost-effective way. The likes of luxury fashion retailer Farfetch envisage that stores will become augmented retail experiences, with little product in-store but still offering consumers the option to try products and connect the physical and digital consumer journeys. Rather than commit to contracts on physical stores, brands are investing in pop-ups to gauge consumer interest.    

Luxury brands have been hesitant to embrace selling online, with Chanel famously refusing to sell anything from its fragrance and beauty collections online to encourage consumers to experience the brand. Burberry has, however, managed to strike a balance by encouraging consumers to shop online while also maintaining flagship stores that offer in-store customers an experience.


Brands doing it well:

It’s hard to find a brand that’s merging their online and offline presence as well as Amazon. While some brands are closing shops, Amazon recognised the importance of reaching consumers in the physical world – particularly in the grocery sector – and purchased Whole Foods to attract consumers and expand its Amazon Fresh programme. Testing Amazon-Go in Seattle also made Amazon the first brand to truly link its online and offline sales mechanisms. Lastly, as an innovative method to encourage daily sales, Amazon has also launched the Amazon Treasure Truck which offers consumers regular deals on a variety of products. As a brand that started digitally, Amazon is not bound to combining customer data across multiple touchpoints on outdated systems, and is able to be much more agile in its approach. And with Amazon’s dedication to growing its fashion offering, companies should take note.

Where is the future of omnichannel? Look at China

China has managed to leap over the West when it comes to consumer behaviour. Whereas consumers were slow to adopt e-commerce, m-commerce in China is much bigger than it is in the US or Europe. This is partly due to ‘super apps’ like WeChat and their ability to allow consumers to go through the entire consumer journey – from discovery to purchase – without leaving the app. Because of China’s strict censorship, apps like WeChat have grown in parallel to global apps like Facebook, Google and Instagram. While we have separate apps and services to serve different purposes, Chinese super apps have offered Western companies a roadmap. Instagram recently launched its shop functionality on the app, whereas in China it’s commonplace for influencers to already have shop buttons during live video feeds. Sites like Tmall and Taobao offer this in their ‘live products’ and streams have become popular amongst consumers: 

This new form of media content allows consumers to simultaneously engage with their content while purchasing products. The streams themselves can also be hosted by brands allowing them to tap into the profitable Generation Z audience directly.

 China is also ahead in the use of marketplaces where brands have more control to sell via platforms like Alibaba and Tmall without being constrained to traditional wholesale agreements. Additionally, marketplaces still give consumers choice of a vast number of products. Amazon offer some of these services to Western companies, but these are not as sophisticated as their Chinese counterparts. When it comes to the phygital world, Chinese shopping centres are more of an experience than your average shopping centre. The Grand Summit in Beijing offers shoppers fitness studios, cafes, art galleries and a number of local shops and design-focussed stores unique to the area.

 China’s fast-growing middle class has allowed for such incredible change to the retail landscape of the country and helped it to become an example for the West rather than a country known for cheap knockoffs. As many companies expand to China, they can pick up techniques and innovative ways to engage consumers in the West.

What should companies be doing now?

Many companies are already beginning to update their approach to omnichannel, but here are a few things to consider:

  • Break the silo – It goes without saying that the wrong internal structures can crush even the best-laid marketing plans. Brands and retailers alike should look to align their internal teams to create synergy and avoid cannibalisation. Beauty retailer Sephora merged their digital, in-store and customer service teams to help create seamless experiences for their customers. To continue to address customer needs, bringing together the roles of internal teams can help support them in not only aligning customer touchpoints but also making teams more agile and adaptive to an ever-changing retail landscape.

  • Build existing partnerships – Despite being intrinsically important to each other, the relationship between retailers and brands can be fraught. Traditional wholesale brands aim to increase D2C sales while still maintaining key retail accounts as, in many cases, they represent a large share of their overall revenue. Brands should look to understand what kinds of consumers are purchasing from their retail partners and pivot their strategies in line with this, while retailers should leverage the brand’s above the line activity to drive customers to convert with them. Brands such as HP and Bose have partnered with retailers, actively pushing consumers to partner websites. Retailers can not only capitalise on audiences that had already been exposed and therefore drive sales, they can also help brands pivot their positioning and drive brand awareness amongst certain demographics.

  • Create experiences – Whether it be in-store, online or event-based, ensure that consumers are experiencing something that will help differentiate your brand from the competition. In an industry that is price-competitive and rife with choice, retailers and brands need to build emotional connections with consumers to gain loyalty and, more importantly, advocacy. Sonos revealed that most people discover its brand in the homes of friends, so it built a small house in its Berlin flagship store to mimic the experience of being at home with Sonos.

  • Embrace change – As tech-native Generation Z’s purchasing power becomes more important, brands will need to pivot to be able to connect with this diverse, social media savvy generation. Embracing technology changes and native purchasing options on social media will be pivotal to the success of marketing strategies. Generation Z have different reasons for using different platforms and companies need to be able to tailor their messaging on each.

At iCrossing UK, we believe that marketing strategies should be led by the consumer, and can help you navigate the ever-changing digital landscape to develop robust multichannel retail strategies. If you are interested in finding out how we can help you make this happen contact us on results@icrossing.co.uk

Continue reading


Are you ready to make a digital step-change?

We believe that moving too slowly in digital is the biggest risk your business faces. If you are ready to move faster in digital, we are here to help.

Get In touch