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Omni-channel commerce for retailers: The magnitude, return on investment, and barriers to success

Updated: Mar 8


March 1, 2023 | Digital Transformation | Retail | Omni-channel Commerce | By Kapil Nagpal


In recent years, the retail industry has witnessed a significant shift in the way customers shop, and omni-channel retail has emerged as a game-changer. Omni-channel retail is an integrated approach that combines online and brick-and-mortar shopping channels to provide customers with a seamless shopping experience. In this article, we will discuss the typical investment in omni-channel retail initiatives, and the challenges that retailers face while implementing it.


Omni-channel retail typically involves a significant investment of resources, including technology, infrastructure, vendor contracts, staff, and training.

According to a report by Harvard Business Review, retailers that have successfully implemented omni-channel strategies invest an average of 7% of their revenue on technology, compared to 2% for traditional retailers.
The report also states that companies that implement omni-channel retailing see a 10% increase in revenue, on average.

However, the cost of implementing omni-channel retail can vary significantly depending on the retailer's size and the complexity of the technology required. A report by Gartner estimates that small and midsize retailers can expect to spend between $250,000 and $1 million to implement an omni-channel strategy, while larger retailers may need to invest up to $10 million.


One of the biggest challenges retailers face while implementing omni-channel retail is integrating various systems and technologies.

According to a report by MIT, retailers often struggle to integrate their physical stores, e-commerce platforms, mobile apps, and social media channels, resulting in a disjointed customer experience.

Retailers need to have a comprehensive understanding of their customers' needs and preferences to develop a seamless shopping experience across all channels.


Another significant challenge retailers face while implementing omni-channel retail is providing consistent pricing and promotions across all channels.

According to a report by Forrester, 59% of customers expect consistent pricing and promotions across all channels.

Retailers need to develop pricing and promotion strategies that work for all channels and provide a consistent experience to customers.


To overcome these challenges, retailers need to invest in advanced technology solutions and training for their staff. According to a report by Stanford, retailers should focus on developing a culture of innovation and collaboration to drive omni-channel success. The report also suggests that retailers should adopt a customer-centric approach and use data analytics to gain insights into customer behavior and preferences.


In conclusion, omni-channel retail is a crucial strategy for retailers looking to stay ahead of the competition in today's digital age. While the cost of implementing omni-channel retail can be high, the benefits, including increased revenue and a seamless shopping experience for customers, outweigh the cost. Retailers need to be prepared to overcome the challenges of integrating various systems and technologies and providing a consistent experience across all channels. By investing in advanced technology solutions and training for their staff, retailers can successfully implement an omni-channel strategy and stay ahead of the competition.


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