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Omnichannel retailing integrates the physical store experience with digital shopping capabilities to provide seamless customer experience across various touchpoints. It offers various advantages like single view of customer, personalized engagement, flexibility of choice, and unified buying experience. The model addresses growing customer demand for convenient shopping options by enabling purchases from both online and offline channels. Products associated with omnichannel retailing include point of sale systems, e-commerce platforms, order management systems, customer relationship management tools, and inventory management solutions. These solutions help retailers bridge the gap between online and offline operations to enhance customer service.
The global Omnichannel Retailing Market is estimated to be valued at US$ 1.23 trillion in 2023 and is expected to exhibit a CAGR of 14% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
Advanced technologies are driving the adoption of omnichannel retailing strategies among businesses. AI and machine learning algorithms facilitate personalized recommendations, predictive inventory, and segmentation of customer data. They also help analyze sales trends across channels for informed decision making. Growing smartphone and internet penetration is boosting the availability of digital touchpoints. Customers extensively use mobile apps and websites for online shopping as well as for store locators, delivery tracking, and post-purchase services. Integration of platforms is another key trend. Leading retailers are integrating their websites, POS systems, CRM tools, and marketplaces to offer seamless experiences. This helps sync inventory, pricing, and order details across all sales channels. Another notable trend is direct-to-customer delivery. Online retailers are partnering with logistics companies for fast and reliable delivery of products to attract more customers who prefer the convenience of home delivery over in-store shopping.
Key players operating in the omnichannel retailing market include Walmart, Amazon, Target, IKEA, and Best Buy. Walmart has made significant investments in strengthening its omnichannel capabilities. It has integrated online and physical stores to provide smooth shopping experience to customers. Amazon dominates the e-commerce segment and is expanding fulfillment centers and retail stores globally. Target has partnered with Shipt for same-day delivery and also offers Drive Up contactless service. IKEA is shifting focus towards inner-city stores and digital platforms. Best Buy provides services like curbside pickup and home consultations to engage customers through multiple channels.
Porter’s Analysis
Threat of new entrants: The threat is moderate as new players need to have significant capital to establish supply chains and infrastructure. However, new players can enter through innovative digital platforms.
Bargaining power of buyers: The power is high as buyers have multiple options available and can easily switch between retailers. Omnichannel services increase transparency.
Bargaining power of suppliers: The power is moderate as some suppliers have unique products or technologies. However, retailers can source from multiple suppliers.
Threat of new substitutes: The threat is low as omnichannel retailing offers seamless shopping experience across multiple channels which is not easily replicable.
Competitive rivalry: Competition is intense as retailers compete on pricing, product variety, delivery speed and omnichannel experience.
Key Takeaways
The global Omnichannel Retailing Market is expected to witness high growth. The global Omnichannel Retailing Market is estimated to be valued at US$ 1.23 trillion in 2023 and is expected to exhibit a CAGR of 14% over the forecast period 2024 to 2031.
Regional analysis shows that North America dominates currently due to strong digital infrastructure and spending power. However, Asia Pacific is expected to grow the fastest due to rising middle class and increasing digital adoption in countries like India and China.
*Note:
- Source: Coherent Market Insights, Public sources, Desk research
- We have leveraged AI tools to mine information and compile it
