For many organizations, omni-channel commerce success still seems like a dim light at the end of a long tunnel. No matter how far removed a company's operations strategies and technology platform are from an optimal e-commerce effort, however, the light continues to gleam. Despite the barriers, retailers know that omni-channel commerce is vital if they expect to thrive in today's digital landscape.
Nearly every company observes barriers
Customer expectations and retailer capacities are often at odds. A recent Forrester report highlighted the presence of hurdles in nearly every company's omni-channel commerce effort. Of the more than 250 retail and manufacturing decision-makers surveyed, an astounding 94 percent described the barriers their companies face to omni-channel integration as "significant." The gap between what consumers desire and what retailers can provide will only widen unless companies can kick their omni-channel commerce development approach into overdrive.
"As customers expect retailers to provide consistent and contextual service across every channel and interaction, retailers need to adopt new technologies that enable this critical transformation to omni-channel customer engagement and service," said omni-channel commerce strategist Brian Walker. "This is going to be vital to meeting customers' expectations and, frankly, survival for retailers."
With those 94 percent in mind, it's worth looking at a few more statistics from this research that highlight the biggest barriers to omni-channel potency. An omni-channel commerce strategy is a step-by-step process with many moving parts. Examining how consumer desires and retailer capabilities are at odds can help illuminate the kinds of strategies that can overcome common hurdles.
A statistical look at omni-channel commerce issues
The stat: Fifty percent of consumers expect to buy online and pick up their purchases in store.
The problem: Most retailers (64 percent) cannot provide in-store pickup for products purchased online.
The solution: With a centralized order management system, organizations can gain the top-to-bottom alignment that they need to facilitate in-store pickup of items bought online. The digital store needs to be connected to a real-time inventory software that indicates whether a specific product is in stock in a warehouse and could be moved to the store in question in the time promised. Satisfying customers all over the country or world likely necessitates either more localized product storage centers or a much enhanced distribution system. A centralized inventory management system can help provide customers with the shopping experience they crave while making the in-store pickup process a clearer and cost-effective effort for the supply chain.
The stat: More than 40 percent of retailers have problems integrating back-end technology.
The problem: Traditional operational silos mean that every organization might be using a different system.
The solution: Organizations have to move to a software solution that can be effectively integrated and used across all channels. It's not as simple as simply installing new software and telling stakeholders to get with the program, as poor usage practices, confusion and system problems can create a slew of new issues. Alongside the implementation of a centralized order management system, enterprises need to deploy technological improvements that can support its interoperability and IT staff who can shepherd a potentially rocky rollout. While this may result in higher up-front costs, the investment should more than pay for itself in no time.
The stat: Of the customers desiring in-store pickups, 47 percent did so to avoid shipping costs.
The problem: Many supply chains are set up so that shipping costs drive customers away or cut into the company's bottom line.
The solution: Organizations must turn shipping capabilities from a point of weakness into a source of strength. Shipping costs are no longer incidental or inevitable for customers, especially at a time in which a company like Amazon can offer free two-day shipping through its Prime feature or Zappos pays shipping for all returns. Customers see flat shipping rates as an extra cost over which enterprises can and should exert control. Many organizations end up going the other way, decreasing shipping costs to the point that it begins to dent their bottom line. A consolidated platform for managing shipping and distribution is the only way to gain the visibility and managerial oversight of the supply chain to make rational decisions about customer shipping costs. The money saved on communications and management costs can be reinvested into enhancing infrastructure.
The stat: Only 46 percent of companies have dedicated omni-channel teams.
The problem: Omni-channel commerce success cannot be done well if it's only done in half measures.
The solution: All contributors, from the call center to the C-suite, need to be on board with company objectives and able to articulate their specific responsibilities as part of the overarching system. In-store training, customer data sharing and institutional transparency can all elevate the ability of stakeholders, thereby lifting the overall capabilities of the organization.
"The reality is that the customer is way ahead of many retailers in defining what competitive shopping patterns are, not only across channels, but within each channel," Walker said. "If retailers are unaware of, or unwilling to acknowledge, these competitive threats then their business will go to other retailers agile enough to plug these gaps, and so provide the omni-channel sales experience customers are demanding."
If you liked this article, check out Lightwell's other great articles about Omnichannel:
- IBM study: Consumers willing to give personal data in exchange for value, experience
- Omnichannel retail and supply chain management lessons from the Sochi Olympics
- Why IT needs to be part of your omnichannel retail strategy
- Keeping up with the 'Omnis': Overcoming challenges in omnichannel retailing
Ready to plan your omnichannel strategy? Learn more with our complimentary guide and follow the conversation on Twitter using #Omnichannel: