Five years have passed since smartphones were introduced. Smartphones have changed the lives of people. The omni-channel has become a general trend in the methods of distribution because of the rapid growth of the mobile market and the popularization of smartphones. Many companies around the world choose an omni-channel as a survival strategy and make a greater effort for satisfying consumptive needs. Let’s look into omni-channels, which are the future strategy in the distribution industry. -Ed.

  Lee Ho-gun(’15, Dept. of Plant Medicine) in CBNU, likes to go to the bookstore. He often goes to Kyobo Book Centre. He began to use an unfamiliar service named Immediately Giving Service. The service lets a person buy a book in a mobile market and immediately take that book from a nearby offline store. He likes this service because of the discounted prices in the mobile market and his habit of reading a bit of a book’s contents in advance.
 
  Hwang Do-sung(’15, Dept. of International Business) in CBNU, likes coffee, so he often goes to a coffee shop. He recently learned about the Siren Order Service in Starbucks from his friend. The Siren Order Service is a service where people can choose a beverage through the Starbucks app, and the beverage is ordered as soon as the consumer comes into a Starbucks offline store. After using this service, he said, “It is a convenient service for choosing a beverage and payment at one time, but it has weaknesses.” The weaknesses he felt are difficulty becoming a member of Starbucks and a lack of necessity in less frequently used stores.

What is an Omni-channel?
  The two examples above are cases of omni-channels. An omni-channel is a service combining many methods of distribution such as online, offline, mobile and call centers. It is a convenient service. The meaning of omni is that companies connect to all channels and access the customers.
  Omni-channels appeared as the baby boom generation, who led the world economy, retired and millennials, who are familiar with digital culture, now lead the world economy. Also, the popularization of smartphones caused the development of Information and Communications Technologies. Now, many companies know that it is hard to attract consumers using only one channel, so they combined the advantages of many channels, such as online, offline, mobile and call centers.
  Before omni-channels appeared, companies used a single channel. The single channel exists only in offline stores. From the late 1990s, the world had an Internet revolution, and another channel appeared at this time. Since then, more channels have appeared. A multi-channel is when one company operates many methods of distribution. The channel is a method which sells goods offline, online and so on. It sells the same goods, but it has a price differential and event differences. Since then, cross-channels have appeared. A cross-channel is similar to a multi-channel. A cross-channel has the same price and event even though the methods of distribution are different.
  Omni-channels have two advantages. First, consumers buy goods economically. If goods that consumers want aren’t in a near offline store, the consumer orders the goods online and receives the goods quickly in a near offline store. Consumers feel vivid commercial value. Goods which are bought online are cheaper than offline because offline stores’ goods include store management expenses, such as electricity, land price and employee salaries. Second, a distribution enterprise can save time and cost by developing a marketing strategy. The enterprise has to analyze consumer buying characteristics, such as consumer buying patterns and consumer interest.

Saving the companies from crisis
  Burberry is one company which uses the omni-channel efficiently. After the 2008 financial crisis, the luxury industry was in danger. At that time, CEO Angela Ahrendts established an omni-channel strategy which combined runway, online and offline. She cooperated with Apple for broadcasting live and made a convenient purchasing method where people could buy goods while watching the runway. Employees also have received I-Pads to help customers in offline stores. Employees have recommended clothes that customers prefer in offline stores. The Art of the Trench website was also started. The site lets customers post pictures of themselves wearing Burberry clothes. Burberry has advertised using SNS and many events have proceeded via SNS.0
  Best Buy also used an omni-channel efficiently. Best Buy was in danger of a massive deficit in 2013. CEO Hubert Joly instituted an omni-channel for solving financial difficulties. Best Buy sells electronic goods, and the goods are relatively expensive, so consumers want to use the goods themselves. Best Buy provides services where offline stores are only exhibition halls and consumers can buy goods on the spot online because of the cheaper prices. The strategy helped customers feel high satisfaction and helped to revive the company.

Implication of Omni-channel
  Omni-channels show that companies that understand consumer consumption patterns hold a dominant position in the market. For consumers who don’t have enough time, companies have to establish a strategy where consumers can shop easily and conveniently. Companies have to take notice of senior consumers who are unfamiliar with IT gadgets and the Internet. Companies also need to make easy and convenient distribution channels because the market for seniors is so big. Omni-channels aren’t done evolving yet. It’s constantly changing now. South Korea also recently became interested in omni-channels. Companies are positively introducing them now, but consumers don’t know for certain about omni-channels. Omni-channels are one of the future key trends and help people to live more easily. Other countries already have popularized omni-channels. This contributed to economic stimulation by promoting consumption. If Korean companies and consumers take note of omni-channels, our economy will rebound.Consumers take note of omni-channels, our economy will rebound.

By Woo Hyun-gi
hg36@cbnu.ac.kr