Omni-channel commerce: Digital and in-store, rolled into one


iStock_000008866254_XXXLargeThe challenge with omni-channel commerce is giving customers a platform that provides an optimal level of service, no matter where they are, what device they're using or how they're interacting with the company. In practice, this means making brick-and-mortar stores more like digital shops, giving them the flexibility, research capacity and purchasing options that have been the hallmark of the online experience. It also increasingly means giving digital stores more amenities of their physical-world equivalents, with expert customer service and quick turnarounds offering consumers the advantages of going to a store without leaving their couch.

Same-day shipping is one of the manifestations of this shift, and has become something of a holy grail to many retailers, which recognize that if back-end supply chain systems are oriented for maximum efficiency, such a system should be possible in some areas. 

In a recent report, BI Intelligence took stock of the growing market for same-day delivery. According to Business Insider's Cooper Smith, there is already widespread interest in same-day delivery among consumers, with the report finding that 40 percent of shoppers in the U.S. would utilize same-day delivery if they couldn't find time to get a store, while 25 percent of respondents actually said they may think about abandoning their online shopping cart if they weren't able to select same-day delivery.

Of course, the challenge is how far same-day delivery can feasibly spread. The report estimated that just 2 percent of U.S. shoppers who actually live in the 20 or so cities where same-day delivery is possible have exercised the option. Naturally, it's going to be hard to satisfy the same-day delivery desires of customers in rural areas, but there is still a sizeable portion of the population that live in areas where same-day delivery is possible. However, many large retailers, from online giants like Amazon and eBay to traditional retailers like Macy's and Foot Locker, are aggressively pursuing same-day delivery. A successful effort, Smith wrote, will send shock​ waves through the omni-channel retail industry.

"If they manage it, despite the expense and complexities involved in delivering over the 'last mile,' these companies will grow e-commerce's customer base (as well as its share of retail dollars), and siphon off one of offline retail's last real competitive advantages," Smith stated.

Overall, the report projected that the same-day delivery market will rise at a compound annual growth rate of 154 percent between 2013 and 2018, with the total value of merchandise ordered annually using same-day delivery to top $4 billion.

What this means for omni-channel commerce initiatives
Order management and inventory oversight practices will be key to establishing a successful same-day delivery program. The convenience of same-day delivery for customers makes the need to deliver a satisfactory experience even greater for organizations, as consumers are likely to be turned off if the order for something they wanted immediately fails to meet expectations. This means that retailers need to deliver a virtually blemish-free experience, and order management and supply chain procedures have to be effectively aligned. 

With a solution such as the suite of IBM Sterling Order Management services can help businesses build supply chains that can be oriented toward fulfilling lofty goals for product transportation and delivery. Among the features the IBM Sterling Order Management solution offers are end-to-end flexibility, bringing together locations and transportation procedures to satisfy orders, deliveries and returns. In addition, it provides a central repository for managing and tracking orders, allowing personnel to observe and monitor the life cycle of a product's movement in real time. This information can offer accuracy in product availability and delivery times, be used by customer service professionals to answer customers' queries and give the organization more information to make smarter decisions.

Same-day delivery is on the horizon, and will certainly be talked about more as we arrive at the 2014 holiday shopping season. Order management solutions can help omni-channel retailers prepare for this all-important portion of the sales calendar.

Enjoy this article? Read more on the topic from Lightwell:

-Why go omni-channel? For your customers, of course.
-Getting over common hurdles in omni-channel commerce
-A problem-solution approach to a successful omni-channel commerce strategy
-Top ways to improve customer satisfaction through your order management system