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Phygital retail: The contact centre has never been more important

Phygital retail: The contact centre has never been more important
Cédric Dinet
Cédric Dinet Account Manager | Retail

Business leaders know that phygital retail enables a re-imagination of the customer experience (CX) by providing the best of two worlds – physical and digital. But did you know that the contact centre is the key to making this hybrid customer experience work?

September 23, 2020

In July 2020, e-retail sales accounted for 28.1% of all retail sales in the UK and this growth has only been accelerated as a result of COVID-19. The good news is that it is now possible to reap all the benefits of e-commerce (easier product search, speed, inventory visibility, etc.) while maintaining the appeal of in-store purchasing (human contact, testable product, immediate purchase, etc.). How can this be achieved? The answer is phygital.

A contraction of the words “physical” and “digital”, the term phygital refers to a marketing strategy deployed at the physical point of sale to improve the customer experience and increase sales. Phygital is based on innovative tools from the digital world, but also on cutting-edge technologies made available to the general public.

Why should physical commerce emulate online commerce? Because customers’ expectations are often no longer met by customer experience and consumers are likely to switch loyalties if they are dissatisfied with their in-store experience

Phygital retail: Recognising customers across all channels

In the world of retail chains with a network of shops, there are two schools of thought in the field of customer relationship management:

  • Delegating it to each shop,
  • Adopting a centralised approach.

In both cases, the flows are so great that handling both physical and remote customer relations in a shop at the same time is a real challenge without proper organisation. The solution? Rely on the contact centre to decongest customer relations at the counter.

This is especially true in the age of phygital retail. Why is that? Because a phygital strategy only makes sense if a brand knows how to identify customers on all communication channels and provide the same answer in-shop or remotely. To do this, marketing and sales departments know that customer service must rely on a single solution for processing interactions that can integrate all voice and digital channels, the history of interactions and be coupled with its CRM. The contact centre thus becomes the hub of a successful seamless customer experience, whether it was initiated remotely and ends in the shop, or the other way around.

Phygital retail: Which communication channels?

In the age of phygital retail, customers want to interact with brands smoothly and seamlessly. The goal is therefore to initiate a real conversation as they interact in the shop or online, and to be available on channels that accurately reflect consumers’ communication habits.

Though the last years have seen a diversification of channels, the phone, the long-standing remote interaction channel, remains the most popular among consumers, with smartphones generating the largest shares in online retail revenue in the UK in 2018. Moreover, the forecast for 2020 predicts a doubling of 2018 spend estimates. Voice makes it possible to provide a personalised, real-time response to customers, just like in-store. This is not the case with email, chatbot and other messaging tools. This is further proof that the human factor remains key to customer relationship management.

According to Microsoft’s 2018 State of Global Customer Service report, 34% of British consumers say the most important aspect of good customer service is resolving their issue in one interaction, no matter how long it takes. Hence the need for brands to improve service to handle calls more quickly and efficiently.

To this end, brands can adopt two strategies:

  • Set up a unique number for any question which is easy to remember,
  • Assign a separate number to each shop.

In both cases, relying on a contact centre ensures high pick-up rates, reduced waiting times and a limited number of transfers. Brands that opt for the single number strategy typically route all calls to their contact centre. Brands that keep one number per shop usually entrust their contact centre with the task of off-loading shops during peak hours during the day (overflow strategy), but also to answer all calls before opening and after closing, thus extending the opening hours of customer service.

Besides, in this age of phygital, the contact centre can also ensure that emerging uses are taken into account, such as a “click-to-call” functionality, which can increase ROI by an average of 143%, according to Forrester Research. Free, easy to use and timesaving, this channel humanises the website.

The contact centre also allows shops to manage channels such as email, live chat or social media, or even to integrate new channels such as instant messaging or conversational SMS. To provide a seamless and smooth customer experience, the contact centre must be equipped with a true omnichannel solution that can operate across all these channels.

Embedding phygital in a channel-less experience

The e-commerce boom hasn’t killed the shop yet. However, the management teams of both large retailers and convenience shops need to keep in mind that e-commerce has become a familiar practice and that customers are buying differently. Hyper-connected, their consumption habits and behaviours are changing: savvier than before, they are also more informed through comparing offers and gathering different opinions… To continue to attract customers in points of sale, the shop must reinvent itself!

In fashion, shops can hope to achieve success thanks to experiments based on phygital innovations (virtual fitting rooms, 3D applications, geolocation, tactile surfaces, etc.), by offering a personalised greeting, allowing the customer to avoid having to checkout, but also by creating events to present unique offers that raise awareness of the brand. Supermarkets in the UK like Sainsbury’s Chop Chop and Morrisons, for example, are turning to online strategies as a means to cater to changing customer needs.

In other fields, such as DIY, shops need to develop the service offer, as consumers need more advice and therefore support. The salesperson becomes an advisor, who greets, directs and pushes the customer towards new shopping experiences. If the customer relationship begins increasingly at a distance, it must be ensured that it is smooth and seamless towards the phygital shop, the place of the final act of purchase or withdrawal. This remains true afterwards if the customer requests remote after-sales service.

One thing is certain: a successful journey between the web and shops is every brand’s holy grail. The #1 challenge remains: handling every interaction with knowledge of a customer’s history (purchases, requests, etc.), which means answering every call, responding to every email and every request in a shop, along with having the customer information at hand. In-store or remotely, at all times, the customer must be recognised, the reason for the contact identified and an appropriate response given as quickly as possible.

Take for example the “click-and-collect” trend, now Britons’ favourite way to shop, which aims to improve the shopping experience and is one of the essential tools of phygital retail. This selling method coordinates online and offline experiences, allowing a customer to select and order online the products they are interested in and then collect them from the shop nearest them.

However, if the retailer does not use a contact centre solution capable of interfacing with a CRM that natively integrates all channels, its implementation may not improve the customer experience. For example, a brand must be able to send the customer an email or SMS with a collection code as soon as the product is available in the shop. And if the customer encounters an unexpected event, they must be able to easily notify the brand that they would like to reserve this product a few hours/days longer than initially planned.

Phygital retail: Imagining tomorrow’s customer journey

Nowadays, customer journeys are still often disjointed. And while many brands manage to keep track of customer journeys after purchases, the pre-sales journey is more difficult to master…

However, in the age of phygital, retailers know that it is no longer desirable to operate in silos. The company’s organisation must evolve, and customer relations must become channel-less, i.e. go through the customer’s preferred channels, wherever and whenever they want, ensuring that the employee, in-store or remotely, is in contact with the customer and has all the necessary information.

What will tomorrow’s customer journey in phygital retail look like? Imagine the following situation: From your sitting room, you’re looking for a product on your laptop. The website/brand offers you a live chat to help you make your choice. Once you have made your choice, you are sent an SMS with the location of the nearest shop. The product is automatically put aside there. In the shop, you connect to your account to verify your identity. This directs you to a collection point where you present the reference number of the product, which you retrieve. You scan it with your smartphone and pay via your account.

18 months later, your product breaks down. You ask your Google Home speaker to ask the after-sales service to call you back on video. Using your smartphone, you show the malfunction to an adviser, who takes screenshots that will be recorded in the CRM of the company. The adviser tells you the estimated cost of the repair, which you pay over the phone. The retailer sends a deliveryman to collect your product. A week later, it is delivered to you again, as good as new.

The contact centre is a key element in this fictional customer journey. It must be equipped with an omnichannel solution that can interface with the different business tools of a brand to be able to support the customer on multiple channels, whatever the request.

Breaking down physical and digital barriers

Will compartmentalising and opposing the different types of commerce (e-commerce, m-commerce, s-commerce, physical shop) still make sense for long? Tomorrow, it will be possible to talk about a single business that evolves and adapts to technological changes and new customer expectations.

Until then, invest in a Contact Centre as a Service (CCaaS) cloud solution that integrates easily with your CRM to ensure the best customer experience in your phygital shop.

Would you like to find out how Odigo’s cloud solutions can make your contact centre a pillar of your phygital retail strategy ?

Cédric Dinet
Account Manager | Retail

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