The last ten years have been the equivalent of a lost decade for retail.
As Amazon has risen, traditional retailers were slow to meet the needs of digital customers and they have lost a tremendous amount of market value as a result.
Somewhere along the way “omnichannel” emerged as a silver bullet that would be the key to unlocking a profitable path forward for struggling retailers.
But the hard truth is that the return on the significant investment required to go omnichannel hasn’t matched the hype. And the omnichannel experience sold by the consultant class was nowhere close to how people — especially millennials — actually shop.
As omnichannel began to penetrate the retail consciousness in 2010, the potential for the smartphone to transform the customer experience was still very much theoretical.
The iPhone was common but not ubiquitous. The screen on the iPhone 4 was small compared to later versions, and the mobile shopping experience was less comfortable and intuitive. Despite all this, the smartphone-driven future should have pointed to the future of retail.
The omnichannel model, instead, forecasted a world where customers would funnel through a variety of different channels in order to communicate and shop. But millennials don’t pick up the phone and order from a catalog, and nobody is shopping on Pinterest.
Retailers got lost trying to make sure every channel worked together at the expense of innovating the only two channels that matter: mobile and the store.
A distraction, not a lifeline
In the middle of a challenging period where retail saw minimal to no growth, omnichannel provided a potential lifeline.
Sears, to take one example, attempted to get its market value back on track by investing in omnichannel. While they were considered a leader in omnichannel strategy last year, it is not nearly enough to dig themselves out of the financial hole they are in (In 2016, Sears was down 96% overall since 2006).
Spencer Platt/Getty Images
The omnichannel hype led many retailers to believe they need to be everywhere the customer is. But the customer doesn’t want a brand to be everywhere they are; they just want brands to be convenient. And the customer doesn’t know what omnichannel means; they just want to have a good experience when they decide to shop.