For many years now it seems, countless headlines, bloggers, analysts—and in the corporate halls of retailers—have touted the glory of the retail panacea often called ‘omnichannel.’ There are also a variety of words and phrases associated with omnichannel: seamless experiences, unified commerce, digital transformation, and so on—these seemingly an attempt to put a new spin on the word to help explain (or understand) it better.
But are you really there?
Omnichannel as a concept is not new, but for many retailers, it’s still just that: a concept. We’ve talked about this in the past, and it’s much more than trying to band-aid your e-commerce, mobile app, and store supporting systems together and telling your store staff, “We have an app.” —then leaving them alone to wrestle with customer returns of items purchased online.
To truly become an omnichannel retailer takes a good amount of planning, the overhaul of processes and systems, management of change, and yes, some pain—particularly for retailers with significant histories and legacy systems. In a Parker Avery point of view, “Five Steps for Omnichannel Success,” we discuss five specific steps every retailer needs to undertake to successfully get to omnichannel. This week, we give you the first two steps outlined in this latest publication.
Define what ‘omnichannel’ is (and is not), and build the roadmap
The definition of what omnichannel means and what is ‘in scope’ can differ widely from one retailer to another. Certain capabilities may be more important than others based on a specific business model or target consumer. For your definition, consider the following:
- Your typical customer journey drives your omnichannel capabilities. Recognize how might this differ across your customer demographic segments as well as how much consumer engagement and shopping are done online, via mobile, and/or in stores (note – the “and” is important).
- Omnichannel done well has significant inventory considerations. Understand your current inventory model and capabilities and what might need to change across vendors, DCs, fulfillment centers, and stores.
- Omnichannel means planning differently. Plan holistically, yes, but also plan by channel. You need to include both forward and reverse supply chains (e.g. plan for returns and consider your partners).
- The state of your transactional data will drive how well some capabilities can be executed. Adjusting the frequency of store-level information updates (POS transactions, purchase orders, receipts, transfers) and the level of accuracy is critical now that customers and store associates expect to see the correct information in real-time. You will need to consider and rethink the level of housecleaning that is necessary and realistic—both with data and processes.
- Associate behavior will likely need to change with new capabilities. These changes are typically thought of in terms of store associates, but should also include buying, planning, supply chain, etc. Organization and staffing models, particularly for customer-facing roles, will probably need review and adjusting.
Build the roadmap based on your value proposition and priorities but consider the reality of your current state and the effort required to implement new capabilities. Also, include consideration of merchandise and seasonal calendars as well as other critical initiatives impacting the organization; given the many tentacles of most omnichannel initiatives, it will likely require a high priority across the enterprise, and other projects may need to pause or be deferred.
Ensure accountability and cross-functional alignment across the enterprise
While some roles may not need significant changes, others may change dramatically during the migration to true omnichannel. Buyers and planners need to think about each commerce channel when they assort. Considerations include:
- What will interactions look like across the selling vehicles?
- How do inventory plans need to change?
- Do other organizations like supply chain need to be involved in those decisions?
Also, other tweaks in metrics and KPIs may require emphasis and clarity and, in some cases, new definitions. Where sales truly originate from may be ‘fuzzy’ and focus on holistic growth is critical. Customer service in the store must also be a focus point, but new services may make it seem like associates must now spend an inordinate amount of time picking and packaging for BOPIS or ship-from-store orders. These additional responsibilities and the corresponding behaviors must be carefully designed to incorporate how in-store customers are handled during new omnichannel activities. Further, such behaviors need to be included in learning materials.
As your needs and processes are defined, ensure everyone understands their role; communicate clearly and at multiple levels. Traditional mindsets will likely need to be challenged and bent. Silos must be broken down to ensure transparency and alignment and to facilitate required collaboration between functions that may not be used to the frequency of required communication and newly integrated processes.
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