What’s Your Multi-Channel Retail Strategy? Time To Connect….
Why is multi-channel retailing the topic of so much discussion ?
Multi-channel retailing is far from new. Retailers have been selling in multiple channels for over a century, originally via mail order catalogs and then via the phone. The Sears catalog was first published in 1888. They understood the benefits of multi-channel retailing. From this point forward, retailing was more than simply brick & mortar. Providing additional channels for your customers, meant opportunity for increased revenues and better customer service
With the internet, e-commerce, and mobile phones; multi-channel retailing has exploded in ways never anticipated. Consumers now have bigger expectations and demand the flexibility multi-channel shopping can provide. For example, if I shop online and provide all of my personal information to a retailer, I should not have to give that information again when I visit an actual store, whether in my own town, across states/provinces, or even in another country. Multi-channel is all about flexibility and service; providing more options for how consumers can shop with you and simpler ways for them to get the products they want.
Seems fairly simple, but many retailers struggle to get this right. In the early days of multi-channel (pre-internet), these channels were largely treated as separate business entities, with its own inventory, and possibly its own distribution centers. With the advent of the internet and the emerging e-commerce channel, retailers initially treated this new channel as a separate entity too, with its own inventory, prices, policies, and distribution methods. So much so, that product selection, prices, and availability could be vastly different between brick & mortar and online. Inventory was not even shared between these two channels. Lost sales ruled!!
As the e-commerce channel began to grow, customers expected a different shopping experience; with more consistency, more flexibility, and greater freedom. Retailers slowly started to adapt to this new on-line world and began to put greater focus on an overall multi-channel strategy. The benefits are clear. According to a recent RSR study, a consumer that shops in a multi-channel environment (unhindered), will spend more money with that retailer. With new channels being added (e.g. mobile, facebook, etc.) and their rapid growth, operating with multiple channels is a requirement for almost every retailer. Having an overall multi-channel strategy is paramount.
While many retailers have come a long way in this area, many retailers still struggle implementing an effective multi-channel strategy. Here are a few things retailers must consider when building their own multi-channel strategy:
- Sharing Data – all data must be shared and consistent across all channels. Effective multi-channel strategies can no longer have the same data created in multiple places. Aside from the amount of extra work you will put on your resources, you will end up with discrepancies, inconsistencies, and missing information, which will in the end frustrate your customers. Items, customers, prices, locations, must all be shared. Data integration must be fluid and seamless across all channels.
- Integrated Systems/Processes – all business processes must appear as one operation to the customer. Shipping, selling, marketing, etc, must be a cohesive unit. A customer really does not want to hear a salesperson in the store say ‘I do not know about the sales on-line, that’s a different division and you will have to contact our online support desk ‘. This will, once again, only frustrate the customer. They are in your store and they want to have a total shopping experience between channels. A fully integrated system across all channels will improve your chance of success.
- BAFA – Buy Anywhere Fulfill Anywhere - This is the ultimate in any multi-channel/cross-channel operation. Customers want to shop where they want, when they want and have it delivered or picked up at a time and place of their choosing. No phone calls, no running from store to store and no sitting around waiting for a package to arrive.This is the ultimate in customer ease and flexibility. This will reduce lost sales. Rena Granofsky, President of RIT Experts, recently wrote an intriguing white paper on this very topic. I would also add one more ‘anywhere’ to this acronym BAFARA - Buy Anywhere Fulfill Anywhere Return Anywhere - and that would complete the cycle from the customer perspective.
It’s time for retailers to connect - connect data, connect systems, and align business processes across all channels. What do you think is important in a multi-channel strategy? Are there other things retailers should be considering/implementing?