What: Anil Patel, CEO of HotWax Commerce, describes how a "store crediting framework" can bolster omnichannel sales.

Why it is important: A majority of retailers still view different shopping channels as completely separate departments in their organization.

As retailers and brands continue to accelerate their digitalization strategies, Anil Patel, CEO of HotWax Commerce, says they’re missing a key component to success: properly crediting and incentivizing physical stores at the unit level. Indeed, Patel found that very few brands have considered changing their store crediting policies to incentivize a company-wide adoption of their omnichannel vision, starting at the associate level.

Associates may view online sales as a threat to their job security and will likely attempt to sabotage the company’s initiatives unless they are brought into the strategy. Instead of reacting to that reality, retailers should anticipate that tension and create frameworks to eliminate it.

Most retailers aren’t deeply aware of their customer’s shopping journeys. Without the right technology in place, you won’t have the visibility into whether your online shoppers browsed in-store and vice versa. Studies also show that brands see an increase in online sales from regions where they’ve recently opened a physical location, which means your stores should be credited for participating in that revenue creation.

A store crediting framework is a policy intended to reward stores and its associates for driving or assisting sales (whether online or in-store). In the past, store crediting frameworks have been very straightforward and based on the assumption that online shoppers shop online and offline shoppers shop in-store. The first step to achieving a truly omnichannel approach is to eliminate channel-based performance reporting. Shopping channels should be irrelevant to compensation because it is ultimately irrelevant to the customer.

Studies have shown that a majority of retailers still view different shopping channels as completely separate departments in their organization, with their own P&Ls. For many retailers, implementing an omnichannel solution requires a paradigm shift and significant organizational change to eliminate or bridge channel silos and unify all staff members around the customer.

Why Store-Level Incentives Can Be Key to Omnichannel Success