What is Blended Commerce?Joe McCord - April 11, 2022
Blended commerce or blended retailing is a retail development strategy best exemplified by the co-prioritisation of both online and traditional “in-store” experience in a retail business, with a specific focus on ensuring a seamless customer experience, and back-of-house operating model, between the two realms.
Is that not just Omnichannel?
We don’t think so. To us it differs from Omnichannel as it speaks specifically to the relationship between traditional “bricks and mortar” physical retail and web based channels, as opposed to the more high-level Omnichannel that focuses on all the specific channels any business can sell through. In that way it can be said that it is part of the Omnichannel school, not the other way around.
Can a business be Omnichannel and not Blended or vice versa? Yes. There are many businesses out there that have separation between their digital and physical but still think about the Omnichannel experience deeply, in fact most businesses that understand and have well defined omnichannel strategy are not close to as focused on the Blended because it is quite often considered too difficult to address. Too big of a problem with not enough of a benefit to justify the cost. There are also many Omnichannel retailers that don’t have traditional bricks and mortar stores.
We view TAGR as the newest and best stepping off point for embarking on the Blended Commerce transformation because it really speaks to the vision our founders had in the first place, and the problem statement that we zoomed in on. “How can we connect digital and physical retail in a way that creates less friction for the customer and the business."
A New Way of Doing Retail
A good example of a simple blended tactic, would be a physical retailer placing a QR code on a product label in order for their customers to scan it to find out more information. Another example would be click and collect shopping, buying online to pick up the product in store. Many businesses have been enabling Blended tactics in their businesses for years, but as digital continues to evolve and take up a more prominent piece of the Omnichannel retail experience, it is becoming increasingly important for businesses to take a whole of system view on their Blended piece.
There are two sides to Blended Commerce. Customer Experience ie. the touchpoints where your customers engage with your retail business and the experience that they have with you across both digital and physical, and there are Back-Of-House operations. This is how your inventory is created, managed and distributed to the customers. Things like importing, warehousing, manufacturing and shipping. While we have ideas about where TAGR can go in order to help businesses manage the transformation to Blended on the back-of-house side, we are absolutely focused right now on helping businesses capitalise on the current opportunities presented by physical to digital, on the customer side.
On the customer experience side, solutions for streamlining the digital to physical experience are well established. Discovering and researching new products online to complete your transaction in store is nothing new and some of the world’s best retailers are already using information gathered from the customer’s digital profile to create better in-store experiences for the customer. This January 2020 article from Shopify shows some of the easier ways retail businesses can start doing this right now.
What is less easy is the inverse. When the customer/retailer relationship starts in the physical, how do we start more journeys, and how do we make those journeys more seamless?
How Woolworths Capitalise on the Physical to Digital Customer Experience Opportunity
Ever heard of the Everyday Rewards program? Woolworths use it to recognise every time you shop in store (well not, every time, but at least every time you scan the card) and build a shopper profile on you based on the data they are capturing through their kiosks and the card.
If you have the Woolworths app, and your Everyday Rewards card is linked to it, that data shapes what products and offers you receive through the app and through the Woolworths website when you are logged into it. For Woolworths to achieve their Blended commerce goal of picking up experience at the physical retail point and bringing you into their online one, they had to build a smartphone app, a carded loyalty program, self service kiosks and implement a whole lot of change at the store level. They also had to heavily incentivise shoppers to sign up to the platform. The complexity was mostly caused by having to retrofit Blended concepts into a massive, well established business in the most cost effective way possible, without disrupting regular trade.
If you shop there regularly you’ll know that their checkout operators (when they have them) prompt you nearly 100% of the time to scan your rewards card. They have a prominent scanning device at the checkout that allows you to scan it yourself if you are so inclined. On the self checkout side of things the kiosk will literally tell you both visually and with a loud booming voice to scan your Everyday Rewards card, before you pay for your goods.
Capturing that information is that important to them. They understand the incredible implications of gathering that information for the future of their retail business, and they are good at it. But to calculate the investment they’ve made in this innovation would be impossible and Woolworths themselves probably would only be able to offer an educated guess. We’re talking tens if not hundreds of millions of dollars over a decade. Much more than the average physical retailer could invest. But they are still missing out on a huge amount of potential data. They have far from perfected it. More on this later.
What About Other Retailers?
The rudimentary way that retailers have been trying to close the gap is asking you for your email address to join their mailing list, or for those a little more savvy, to join their loyalty program. But there are so many problems to solve for the average retailer when it comes to even gathering that data (not least of which is relying on a human being to prompt a customer to give it to them), that for many retailers the problem is too hard to solve, so thinking about the possibilities at the next step of the experience, engaging these customers, has no real point. Why develop an amazing digital experience for customers that step from physical into digital if we’re only capturing a small handful of them? So for most retailers, all that ends up really happening is that one of their marketing team members hit them with a promotional email every so often. Or maybe a text. The list fluctuates in size as people opt in or out, and the experience is never really improved upon.
So Where Does TAGR Come In?
Right now, TAGR’s flagship product is a mobile self checkout. The design of our mobile self checkout has been crafted intentionally to do two mission critical things very well.
1. Make it very easy for customers to use it
2. Capture as much data from the customer as possible without disrupting their journey or them needing to use a card or be asked for it and pass that into your existing systems
Below are some insights into the Blended commerce inspired self checkout solutions that three of Australia’s major retailers have implemented. In all three cases you will see that in order to use the self checkout, the customer is required to carry out significant up front steps. In all cases the customer is required to download a smartphone app that they probably do not already have on their phone. In all cases they are required to create an account, and in the case of Bunnings they are actually required to have a trade account to use it.
TAGR works using a QR code reader and web technology. The steps to use it are:
1. Scan a QR code on signage in the store to open the TAGR platform on any browser
2. Use the TAGR platform to scan barcodes of products to add them to your cart
3. Use a range of phone payment options such as Apple Pay, G Pay and credit card facility to pay for the products
4. Show an instore employee that you’ve made the purchase before you leave
When you break down the value of the data you can gather from a solution like TAGR or the aforementioned apps, you find it is a bit like that classic meme.
If a customer downloads an app you’ve got them into your digital ecosystem. It’s a big win for you. You can start to market to the customer in a range of ways as long as they actually sign up for an account after they download it. But your knowledge of who they are is rather limited at that point. In the Woolworths app for example, all you’d really get is the information the customer was willing to give you. Outside of that you would be limited to simply knowing who that customer is in ones and zeros and maybe some details about the hardware and software on the device they used to download it. But we haven’t even actually figured out how we are going to get that person in the physical store to download an app yet. It’s probably actually with a QR code? Or a web URL on signage in store. If that’s the case then your in store signage is directing a customer to the app store, compare that with the customer experience on TAGR.
The way the TAGR journey begins the customer has scanned the QR code and arrived on the merchant’s landing page. At that point you have already got the same ones and zeros as Woollies get when they download an app, but you also have the opportunity to immediately add them to your remarketing audiences on top of that. The customer is also much closer to the actual purchase experience with TAGR than they are with the smartphone device at this point. In reality they are as little as two clicks of a phone button away from actually buying a product. All without needing to download anything.
If you are looking for an amazing way to solve your blended commerce woes get in touch with us today.