With great interest, almost daily I read news stories about how retailers are “winning” with their omnichannel strategies. Rarely do these stories get into too much detail about exactly what those strategies entail, and I’m always curious to understand if it’s really something the retailer has done specifically or if they’re finally beginning to catch up to customer desires and expectations.
It’s a known fact that to survive in retail, being omnichannel is a must. But what does that really mean? It’s more than having physical (brick-and-mortar) and digital (traditional e-commerce, mobile, social) sites. It’s more than claiming to be integrated by fulfilling some orders from stores and offering different customer delivery methods (like buy-online-pick-up-in-store). It’s more than giving your employees a checkout script to obtain customers’ email addresses so they can receive “customized” offers. It’s more than a cool mobile app and digital coupons. It’s more than signs on your front doors touting same-day-pickup.
It’s much more.
Being omnichannel needs to be thoughtfully planned, understood and embraced by every employee – regardless of level – and through every process a retailer performs. It also needs to be supported by policies, systems and tools that enable consistent and flawless performance and which support your customer value proposition.
Easier said than done.
Parker Avery recently published another point of view titled “The New Customer Experience,” and we describe several “real world” retail scenarios that touch on many different elements of omnichannel and the influence these situations have on the customer experience as well as subsequent customer satisfaction and loyalty impacts.
The paper is focused on the customer experience side of the equation, but the undertones highlight a very critical element in determining whether or not the retailer understands or is prepared to be omnichannel. That element is inventory accuracy. Over the past year or so, Parker Avery has blogged about inventory management several times and the crucial role it plays, and our Store Operations practice is placing a great deal of focus on this area with a service called the Store Inventory Diagnostic. Getting your inventory “right” – meaning accuracy of 90% or greater at the store level and enabling visibility down to the location within the store should be an absolute fundamental piece of any omnichannel strategy. This means understanding what’s coming in off the truck, where exactly every piece is going, either in the back room or on the sales floor, and when it needs restocking or replenishing.
Again, easier said than done.
This brings in the other crucial element to a solid omnichannel strategy: your store staff. In Parker Avery’s research study, “New Roles for Retail,” we identified specific changes retailers are making in managing their store staff to accommodate omnichannel (as well as other forces of change). A key outcome of this study was that most retailers seem to be at the beginning of truly understanding how they must change their store staff to address the new retail world. It’s not just about training associates on how to handle customers and understanding the different ways customers can shop their brand – it’s also about teaching them why it’s important to follow standard operating procedures (SOPs) to the tee – particularly when it comes to handling product. Shortcuts in the stock room or on the sales floor by an employee who doesn’t understand the downstream impacts can throw inventory completely out of whack and result in lost sales, shrink and more labor required to remedy the mistake.
It’s definitely exciting to hear about how retailers are continuing to make advances and getting closer to what we believe are true omnichannel models. It’s also exciting when we help transform a retailer into a true omnichannel business. We are diving deeper into the inventory accuracy aspect of the omnichannel equation at the Retail Value Chain Federation’s (RVCF) Fall Conference coming up in November, when Rob Oglesby will be leading a discussion on the logistics of filling orders from physical stores for e-commerce sales.
I do love the continuous change that’s ubiquitous in today’s retail world – so many innovations and developments that are just plain fun to watch and see how they pan out. But the not-so-sexy foundations of solid inventory management practices and staff alignment are absolutely critical for omnichannel success.