You have heard it a million times this past year: Intelligent, deal-driven consumers are demanding a better multichannel shopping experience. If 2015 is considered the year of the “smart” consumer, what does 2016 have in store for retailers and brands?
As the world’s leading SaaS platform for distributed order management, Kibo has a unique look into the retail market. Based on more than 15 years of research and industry experience, below are my top omnichannel retailing trends and predictions for 2016. The first two are consumer shopping trends that any competitive business cannot ignore, while the final three are predictions that relate specifically to the technology behind omnichannel order management.
Let’s take a look at what I predict 2016 will bring to the retail market:
Consumer Trend No. 1: Mobile Device Purchasing Will Grab a Larger Market Share
In 2015, online shopping increased its share of the overall revenue stream, with purchases made on smartphones and tablets a small, but growing portion of the online movement. Forrester Research reported that commerce transacted on smartphones today comprises 10 percent of eCommerce, up from 6 percent in 2013 and 3 percent in 2012.* But in 2016, I predict that online shopping will evolve significantly more from computers to “on the go.” Mobile devices that were primarily used as research assistants and price comparison tools will transform into an essential element of a smart consumers’ shopping experience.
In Kibo’s 2015 Cyber Week analysis, mobile accounted for more than 50% of Black Friday traffic, and 40% of Cyber Monday traffic. Intelligent retailers and brands cannot afford to underestimate the power of mobile device in 2016 and should evaluate technology options to help them satisfy consumers’ mobile shopping expectations.
Consumer Trend No. 2: Consumers Will Expect Greater Fulfillment Flexibility
Not only do today’s consumers want fulfillment choice, they want that choice to be fast (drone delivery anyone?). Whether it is two-day home delivery or same-day in-store pickup, I predict that consumer’s fulfillment expectations will be higher than ever in 2016.
To compete with the likes of Amazon next year, retailers and manufacturers will need a sophisticated, flexible order management system (OMS) that allows consumers to order products when they want them and how they want them. Below is a short list of must-have OMS functionality questions that every retailer and brand should ask themselves in order to be prepared for next year:
- Can I offer in-store pickup?
- Can I offer same-day in-store pickup?
- Can I offer in-home delivery?
- Can I offer same-day in-home delivery?
- Can I offer universal returns to any store?
- Can I offer the ability to ship to store?
- Can I offer the ability for the consumer to select their store of choice for in-store pickup or ship to store?
- Can I offer product search functionality that allows my local products to be found online in 20 seconds or less?
Order Management Trend No. 1: Omnichannel Fulfillment Capabilities will be a Key Strategic Priority
More than ever, executives are recognizing the importance of offering consumers a seamless omnichannel shopping experience that includes brick and mortar stores, website, mobile and social media. With that in mind, I expect significant investment in 2016 in omnichannel strategies through enterprise-level OMS solutions.
For some businesses, that means implementing their first OMS. For others, it will be evaluating migration off a legacy OMS to a more modern, flexible solution that offers functionality more in line with current consumer needs. Either way, when companies look forward over the next three years, the number one element they will need to remain in business is seamless omnichannel fulfillment functionality.
Order Management Trend No. 2: The Cloud Will Hit Critical Mass as the Leading Business Model
There is no denying it—the modern world runs in the Cloud. This is good news for businesses, as the Cloud can eliminate expenses and downtime from updates and maintenance of on-premise software. With no maintenance or upgrades required and offering the lowest total cost of ownership, the Cloud has ushered in a new, better way to do business by putting business users in control to optimize profitability.
In 2016, I predict a large increase in the number of retailers and brands that will eschew legacy, on premise OMS programs for modern Cloud-based solutions. And by Cloud-based solutions, I don’t mean single tenant software that was not built natively to run in the Cloud. A hosted on-premise program is not equal in performance or efficiency to a multi-tenant solution designed from the ground up for a Cloud environment.
Order Management Trend No. 3: Local Inventory Search Will Penetrate the Marketplace
Today’s smart shoppers are informed, they’ve done their research (likely through a mobile device), they know which products they want and they want them immediately. But in today’s increasingly fast-paced world, shoppers do not have time to call around to local stores to see if the item is in stock, much less take the time to drive to the store to make the purchase if they aren’t confident that the item is there, available to buy.
To solve this inventory visibility challenge, I predict that services such as Local Product Search will make great strides in the market. By allowing a shopper to go from “find a store” to “pick up now” in 20 seconds or less, businesses can increase sales, drive traffic into their retail stores and delight their customers.
While the future is never certain, I feel confident that the predictions and trends above will have a significant impact on the 2016 retail landscape. Did I miss any trends that you see occurring in the next year? Please feel free to add any additional predictions in the comments below.
* Forrester Research eCommerce Forecast, 2014 To 2019 (US) April 22, 2015