Adapting Business Models in the Age of Omnichannel Transformation: Evidence from the Small Retail Businesses in Australia

Due to the advent of digitalization, the retail business has seen major changes in recent decades, including e-commerce and multichannel retailing. Customers have witnessed the development of new and digitized channels, as well as solutions such as digital marketplaces, social media touchpoints, and augmented reality applications. During the COVID-19 pandemic, as most of the physical brick-and-mortar retailers were forced to close, more consumers turned to digital channels such as apps, websites, social media platforms, etc. Small retail businesses, which account for a sizable share of the retail industry, have also faced challenge of seamless retailing in the era of digitization. This concept of seamless retailing is called omnichannel retailing, and it aims to integrate all the retail channels and touchpoints. The goal for small retailers is to make the transformation to omnichannel. The purpose of this study is to investigate how small retail businesses are changing their business models in the age of omnichannel transformation. Through a qualitative study of small retailers, this research provides empirical insights on business model changes and adaptive skills. The findings show that small businesses can implement complex changes in their business models through adaptive behaviors. This study also identifies areas in their business models and adaptive capabilities that require additional consideration and improvement to support the ongoing omnichannel transformation.