Abstract

     The objective of this study is to ascertain the effects of omni-channel retailing on the promotional strategy of retail organisations in order to better understand how to alter the promotional strategy in accordance with the ever-changing needs of customers and ultimately provide the customer with a seamless experience. This research is based on a critical systematic literature review of articles related to the topics of ‘omni-channel retailing’ and ‘promotional strategy’. The analysis made evident that most literature is focused on developing an understanding of omni-channel retailing; uncovering consumer behaviours in omni-channel retailing; and ways to adapt promotional strategies related to merchandising, sales promotion, selling, and word of mouth. Past research is quite fractured and does not represent a holistic picture of the implications of omni-channel retailing for promotional strategy. The analysis provided in this paper provides a general guideline for researchers and practitioners concerning promotional strategies that can be adopted in omni-channel retailing.

Introduction

     The retailing environment is getting increasingly complicated. The rise of technological advances has multiplied customer touchpoints and therefore caused the customer journey to become more complex [1]. Whereas customer journeys in the past could be seen as linear, in the omni-channel environment, those journeys are now highly complex [2]. In addition to this, the amount of retailing channels has rapidly grown; whereas in the past, you were only able to buy a product in a physical store, nowadays, this can also be done online by making use of your phone, tablet, laptop, and even your voice assistant (multiple channels). Furthermore, according to Oracle [3] (p. 3), “more than three-quarters of consumers use two or more channels to browse for, research, and purchase products”. This new omni-channel environment is fading the borders between online and offline retailing [4]. Brynjolfsson, Jeffrey, and Rahman [5] (p. 24) highlight this by stating that omni-channel retailing is “turning the world into a showroom without walls”. As the online and offline worlds are becoming more intertwined, consumers require a seamless experience across channels [4,6]. A way to facilitate this is to integrate promotions across all existing channels [7]. One of the Marketing Science Institute’s [8] five major research priorities for 2020–۲۰۲۲ concerns the rise of the omni-channel environment; specifically, they propose research on the implications of omni-channel retailing for promotional strategies.

Conclusions

     The customer is getting more empowered, and omni-channel retailing is a phenomenon that almost every company nowadays must deal with. It is therefore important to understand how a promotional strategy can be designed in such a way that takes into consideration the needs and preferences of those empowered customers in the omni-channel environment. The main need of the customer is the provision of a seamless customer experience, meaning integration of all channels they use during their shopping journey. However, this is not limited to channel integration only, as it also encompasses brand consistency and promotional alignment. One way of accomplishing this would be to provide personalisation for customers across all channels.

     Furthermore, it is important to understand the types of behaviours that take place in the omni-channel retailing environment. Two phenomena are frequently mentioned in the literature, namely showrooming behaviour and its counterpart, webrooming behaviour. The former states that customers search for information about/to touch a product in store and consequently buy the product online (potentially from a competitor). The rise of mobile phone usage has mainly facilitated showrooming behaviour, and research has shown that customers spend higher amounts when purchasing products via their mobile phones. However, ‘competitive showrooming’ is undesirable behaviour and can be diminished by adapting promotional strategy accordingly. The latter states customers search for information online and consequently buy the product in store. This type of behaviour takes place because customers like to be in control and therefore search for extensive information and confirmation of their judgements online before buying the product in store, where they can touch and see it.