The best time for brick & mortar retailers to go omni-channel – Part 2
09 Jan 2018 The best time for brick & mortar retailers to go omni-channel – Part 2
(This article is one of a two-part series of articles on the best time for businesses to go omni-channel. Read the first part here.)
Currently, the challenge between traditional brick-and-mortar (or B&M) stores and online retail seems to be having a clear winner, which is the E-commerce sites, dominated by the likes of Amazon. Online retail in India is estimated to grow from USD 15 billion (in 2016) to over USD 200 billion by the year 2026, according to an industry report published by Morgan Stanley.
The growth of E-commerce retail is not just restricted to India and China, but is expanding to the South-east Asian economies such as Indonesia and Singapore. This is reflected in the flow of capital to this region, including Softbank’s $100 million investment in Tokopedia, the Indonesia-based E-commerce giant, and JD.com partnering with Indonesia’s E-commerce players.
In the current digital age, B&M retail stores are finding it challenging to remain competitive and productive in the retail business. To meet this challenge, physical stores are adopting omni-channel strategies, such as the Pickup Discount program from Walmart for in-store pickups.
Through this article, we shall discuss how omni-channels are benefiting B&M retailers around the world, along with the right approach towards implementing a complete omni-channel solution for your business.
Revitalizing retail business using Omni-channel solutions
Omni-channel retail is the merging of online and offline retail. A prime example of the success of omni channels is the setting up of physical retail stores in the U.S. by menswear e-retailer, Bonobos by partnering with Nordstorm. Closer to Asia is the successful Online-to-Offline (O2O) model, implemented by Matahari Mall in Indonesia.
Deployment of an omni-channel strategy has also enabled Max Fashion Retail in India to allow users across its 10 physical stores to use digital kiosks to place online orders and get their shipments delivered to their homes.
While omni-channel strategies are a relatively new concept in India and Asian countries, U.S.-based retailers have been investing for years in omni-channel solutions, aimed to driving their online retail traffic into their physical stores. U.S.-based retailer, Target declared that more than 80% of its online orders are being fulfilled by its stores during the 2017 Holiday season. Omni-channel investments is also benefiting Kohl’s Corporation, which ships over 30% of its online-ordered products from its physical stores.
How Omni-channel solution provides a consistent customer experience
Omni-channel solutions are a technology-based strategy that retail businesses have adopted to connect multiple and siloed sales channels into one consistent user experience for all shoppers. To deliver a consistent omni-channel experience, a single E-commerce platform that integrates both frontend and backend systems must be implemented, thus providing a central hub for each stage of the omni-channel order lifecycle.
For a complete omni-channel integration, the omni-channel solution must provide technological intervention at each of the following stages:
- Inventory availability, which include a real-time inventory visibility across all channels.
- Order routing, which is implemented through an effective Order management system, and includes critical factors such as dynamic order routing. A centralized order management approach is effective on delivering order fulfilment, purchase, and return.
- Customer care and analytics, which includes visibility to customer information at the point of purchase, along with customer analytic factors including buying behaviour and preferred products & payment methods, to improve the quality of customer care.
- Payment processing, which includes processing of multiple transactions, payment authorization, and fraud detection.
- Order fulfilment, which involves leveraging on the best way of fulfilling customer orders with reduced costs and fast delivery. These options can include physical retail stores, in-store pickups, or through third-party logistics.
- Shipment, which can vary according to the purchased products and shipping distance.
- Integration of all the above stages to achieve success of the overall omni-channel strategy.
An integrated omni-channel platform model is beneficial for retailers to implement and deliver on the “Buy anywhere and Fulfil anywhere” promise for today’s customers. Along with being more affordable and scalable, a unified omni-channel platform model simplifies integration and provides a more seamless and personal shopping experience for shoppers across all sale touch points.
In this digital age, retailers who enable omni-channel experience for its customers will be better placed in the global marketplace, as the E-commerce market continues to expand. Retailers must be ready to imbibe technology at each stage of their sales channels in order to implement a successful omni-channel strategy for their business.
Additionally, by partnering with the right omni-channel solution provider, retailers can manage their investment into omni-channel strategies more seamlessly and scale their platform model according to their business growth.
Planning to go omni-channel this year? We can help.