August seems to have been a month for department stores to expand their omnichannel capabilities. J.C. Penney appointed new omnichannel executives, while Macy’s and Bloomingdale’s expanded same-day delivery service and Neiman Marcus filed an IPO highlighting its commitment to merging e-commerce and physical stores. Digital now influences 75% of luxury spending at the retailer, according to the filing.

These developments point to a major trend. L2’s Digital IQ Index: Department Stores finds that retailers have made significant progress this year in terms of omnichannel capabilities. Only 16% of Department Stores displayed real-time inventory on product pages in 2013. Now, that number has risen to 61%. Similarly, the percentage of retailers enabling customers to buy products online and pick them up in-store has risen from 34% to 50%.

Percentage of Brands Utilizing Omnichannel

However, the study also shows significant variation between regions when it comes to the implementation of “seamless” online-to-offline capabilities. While 95% of North American brands let customers return items purchased online in-store, only 43% support in-store pickup. Their European counterparts are far ahead, with 78% supporting in-store pickup, led by U.K. brands such as Debenhams. In contrast, only one-third of APAC Department Store brands have implemented this capability.

Online Purchase, In-Store Follow-Up

As this suggests, there is a major disconnect between the seamless experience desired by consumers and the reality. While 72% of retailers claim to have “seamless” online-to-offline capabilities, 30% of surveyed consumers say cross-channel handoffs are in need of the most improvement. As department stores continue investing in omnichannel, however, the shopping experience will likely become increasingly smooth.

 

 

L2's Daily Insights in Your Inbox.