Strategy&: The US and UK lead in omni-channel maturity

23 December 2015 4 min. read
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Omni-channel development has undergone rapid proliferation, particularly in the US, UK and Australia, which score the highest on Strategy&’s Global Omni-channel Retail Index. The index ranks countries’ omni-channel maturity based on consumer behaviour, degree of digitisation, omni-channel potential and infrastructure.

Omni-channel offerings have become the norm in many businesses, with particularly the luxury and retail market in the UK performing well according to recent reports from Salmon and Kurt Salmon. The ability for consumers to hop between channels seamlessly is providing them with the opportunity to have all of their needs met across the various channels, including attractive prices; convenience; great customer service; and quick, if not immediate, gratification. For retailers on the other hand, the omni-channel revolution has created various new avenues through which companies can reach and learn about consumers, as well as create new operating models such as ship-to-store.

In a recent report from Strategy&, titled ‘The 2015 Global Omni-channel Retail Index: The future of shopping has arrived’, the consulting firm considers the wider adoption of omni-channel offerings across 19 countries worldwide. The index sets a rating for each country on a scale of 1 to 100 based on consumer behaviour, degree of digitisation, omni-channel potential and infrastructure.

Omni-channel retail index by country

Global Omni-channel Retail Index
According the results, the US scores the highest on the index at 50, followed by the UK at 49 and Australia at 48. The top performers reflect the prevalence and maturity of e-commerce in English language countries, which tend to be well developed and have broad mobile penetration. Retailers in the regions have also taken to the potential of e-commerce, investing heavily in the technology required to drive the omni-channel.

Europe is generally lagging behind, with France, Italy and Germany scoring 39, 38 and 38 respectively. Belgium and Denmark are doing somewhat better at 46 and 41 respectively. The lack of mechanisation and focus on digital offerings is partly due to a lack of coherent digital strategy on the continent and disinclination to focus on providing superior customer experience. In addition, consumers in many particularly German speaking countries are more interested in engaging personally with staff, which creates a further lack of interest in omni-channel from more conservative retail approaches that focus on personal interactions.

Leaders per category, omni-channel retail index

By the category
In terms of the different sectors using omni-channel engagement, different countries reign supreme. For consumer electronics and appliances, Australia is the most developed market with a score of 66, followed by the US on 64. Denmark shows itself to be a strong contender in the housewares and home furnishing market at number two, as well as the media products market, also at number two.

China comes out on top of two of the categories considered and scores 54 in the apparel and footwear category and 44 in the Grocery category. The county’s large and burgeoning middle class, which has access to the required technology – as well as retailers seeing the value in a variety of propositions – means that the country’s online market is now the largest in the world, according to data from the Chinese Ministry of Commerce and the US Department of Commerce.

By category, omni-channel retail index

Leading kinds
The report highlights that in terms of industry, consumer electronics and applications comes in at number one with a score of 51, followed by media products at 49. Personal accessories and eyewear scores 37 and beauty and personal care 35.

The grocery market is the least developed, with a score of 31, according to the report, because of various fundamentals related to the industry: “The slow development of this category is primarily due to its relative unattractiveness to customers, most of whom want to see and touch an apple or a piece of cheese before they buy it, and the challenges that supermarkets face in implementing an omni-channel strategy — specifically, the complex logistics of shipping perishable products as well as the cost of having numerous facilities located close to consumers.”