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Friday, April 16, 2021

Omnichannel Profitable in Post Pandemic?

 Been asked similar questions in recent interactions.  What will the change be and should retailers react? 

Can omnichannel be as profitable for retailers as in-store sales? in Retailwire  by Yogesh Kulkarni with further expert opinion.

The pandemic has accelerated the growth of online sales three to five times depending on the vertical and, even as in-store comes back, no one expects online to regress to pre-pandemic levels. COVID-19 has hastened digital initiatives by as much as five years, meaning retailers now need to leapfrog their intended technology and process development roadmap just to stay even with customer expectations and competitors.

Target saw its operating margin drop last year even as digital revenues more than doubled. 

“The biggest factor in ’21 was the supply chain and digital pressure, about 110 basis points of pressure on the year from that, but I think that’s actually a good place to illustrate some of how we think about rate because to me, it’s all about the dollar impact, not the rate impact,” said Target CFO Michael Fiddelke on the company’s recent earnings call. “Digital is a perfect example. If you would have told us we could double the digital business and only see 110 basis points of pressure last year, I think we all would have taken that outcome.”..." 

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