The Department Store Industry
Solid omnichannel performance
Since Danske Bank’s financial report relies on publicly available accounts, it has been impossible to gather enough data on this industry to make a financial analysis. Instead, the analysis is based on the industry’s omnichannel score and external reports.
The Department store industry is among the top-performing industries and is one of the industries to improve their omnichannel effort the most in comparison to last year’s Omnichannel Index.
Average score of the Department Store industry
Average score of the best performing industry
THE RESULTS ACROSS NATIONS
DK: 50
SE: 58
NO: 42
DK: 50
SE: 58
NO: 42
DK: 42
SE: 55
NO: 27
DK: 30
SE: 30
NO: 10
DK: 58
SE: 44
NO: 11
Post-Covid-19
In the light of Covid-19, effective omnichannel has become even more important for this industry.
Product categories such as clothing, shoes, home interior and groceries have all increased in online sales after Covid-19’s attack in the spring of 2020, according to According to Danish E-commerce Association (FDIH).
But even though customers have changed their buying patterns, department stores continue to sell products that customers wish to see and touch before purchasing.
Therefore, the industry must invest in omnichannel features to attract customers and convince customers to visit their physical stores.
This industry is battling with a lot of brands and retailers due to their wide product rage. Therefore, the experience when buying something influences where the customers shop. The industry has to step up their game if they wish to stay relevant.
Missing basic omnichannel
In general, the industry has a large potential to improve their effort to connect online and in-store. Services such as click-and-collect, checking if a product is in stock at the customers’ local department store and collect-at-store are areas where the industry should invest if they wish to optimise the buying experience.
Just half of the department stores offer collect-at-store and the opportunity to check if their desired product is in stock at their local department store. Also, as little as 17% advertise for click-and-collect on the product page.
Even though, the industry has improved over the last year, it is still missing out on some of the basic omnichannel features. Features, that today’s customer simply expect.
Use loyalty against Amazon
With Amazon in the horizon, offering the same broad product range as department stores, omnichannel will become even more important for the industry.
Product categories such as ‘health and beauty’, ‘home and kitchen’ and ‘books’ are just some of Amazon’s top selling categories – products that many department stores sell as well.
To beat Amazon, the industry must meet customers’ expectations to see and touch a product before purchasing it.
Another important weapon against Amazon is loyalty. The industry performs best in the awareness phase but is also strong in the loyalty phase. However, there is still room for improvement.
By collecting customer data and communicating directly to your customers, you can offer personalised buying experiences and build rich customer profiles across online and offline touchpoints. This enables you to create both targeted and personalised offers, and it helps you to retain customers.
