Attack on all fronts
Written by Hannah Prevett
The retailers who best leverage their cross channel capabilities today will
be best positioned for success in the future, notes Hannah Prevett
The world is changing fast - probably faster than ever - primarily due to rapid technology innovations. And if businesses don’t keep pace, they’ll quickly be left behind. Retail is no exception, and faces its own challenges. One thing that is for sure is that multi-channel retailing is here to stay. Its importance is no longer even contested: with a quarter of all retail transactions in the next decade due to take place online, even the most traditional of brick and mortar retailers need to become multi-channel and embrace the opportunities that having an
integrated online and offline presence affords. Even if it has its challenges too.
As is already the case today, the retailers who create the best customer experiences, regardless of the channel chosen, are best positioned to thrive in the future. As retail becomes increasingly self-service, thanks to customers’ constant connections to retailers, eachother and general information, it will be the retailers who get customers the right information, in the right format, at the right time, while providing the best overall customer experience who will garner the most loyalty among customers - not to mention the most sales.
Darryl Owen, head of business development for retail at SAP EMEA, says that delivering a seamless customer experience is vital - and moreover, the shopper doesn’t necessarily consider what channel they’re using, as long as it gives them the right result. “Most shoppers do not really understand the concept of ‘channels’, they simply see retailers who can deliver their shopping needs in various ways,” he explains. “Retailers must unify their various channels to deliver a true multi-channel operation to ensure that the shoppers’ expectations are met.” Andy Houstoun, global head of marketing at Venda, agrees that the expectations of the modern customer have evolved: “There’s no such thing as a single channel customer anymore.”
The thinking around multi-channel retailing has certainly shifted in recent years. Traditional brick and mortar retailers would worry that, by introducing an e-commerce offering, they may cannibalise sales on the High Street. But in actual fact, the exact reverse is true. Carpet and soft furnishings retailer Carpetright went live with its multi-channel offering just under a year ago. A brand new website was designed and built specifically to link with store
systems, enabling customers to shop how they wanted, be that in-store, online, on the phone, or across a combination of those. “The result of all this is stores see the website as a sales aid rather than a competitor,” says Ian Woosey, group IT and e-commerce director at Carpetright. “We deliberately set out to create a vehicle to drive traffic into stores.”
And Carpetright isn’t the only retailer to be using its e-commerce offering to give store sales a boost. Aurora Fashions (owner of High Street brands including Oasis, Coast, Warehouse and Karen Millen) went live with its integrated multi-channel offering in September. Its new system means that clothes can be reserved online and then be made available at a store of the customer’s choice. “The project has done really positive things for our stores,” says John Bovill, IT director at Aurora. “Whereas prior to doing this e-commerce may have been perceived as a risk to stores, now we’re bringing the channels together, so it’s a real advantage.”
That’s not to say that a project of this magnitude is ever without setbacks. Bovill says the challenges thus far have been predominantly process-related, rather than down to difficulties with the technology. Stores’ new reserve and collect service have added a new level of complexity. “It’s a big change for our stores,” he says. “Stock management, for example, has to be extremely tight in order not to disappoint our customers. Suddenly you have to up your game.”
Certain technologies can be implemented to make the retailer’s job a bit easier, and also to ensure they get the most out of their new multi-channel operations. Aurora has rolled out a new multi-channel customer relationship management (CRM) solution which takes in transactions from all channels to provide a single view of the customer. “Now, regardless of what channel the customer is using, the information will feed into our CRM database enabling us to have a single view of their transactions across all our channels.”
As ever, technology is evolving, so as retailers get to grips with their e-commerce offering, they have to constantly have an eye to the future. So what is the next big thing? “I think there are three key areas: mobile commerce, personalisation and social media,” says Carpetright’s Woosey. “Customers want to have the freedom to shop wherever they are, whenever they like, to see content relevant to them and to share information with their friends.” And SAP’s Owen agrees: “Online shopping is all about making the experience easy for the consumer, from finding the product they want through to checkout with a minimum number of clicks. Web 2.0 technologies do make it increasingly easy for consumers to navigate and make it easier to buy.”
Personalisation, or mass customisation as it’s sometimes called, looks likely to be one of the next big things, too. At Aurora they are all experimenting with a range at Karen Millen that can be customised according to customers’ specifications. So they can choose different colour buttons on certain garments, for example.
But taking on an extensive new technology project can be a daunting - not to mention expensive - task. That’s one of the reasons Aurora teamed up with shirt retailer Thomas Pink on the roll-out of its BT Expedite integrated store system. “As a fashion retailer, there are always risks associated with being first to
market,” explains Bovill. “We effectively mitigated them by working with Thomas Pink.” There were clear cost benefits too - sharing the development costs in the current economic environment is a big plus. “We’re like-minded companies, with a similar supply chain and similar systems - it’s a no-brainer to work together,” says Bovill.
Collaborating with other retailers may not be up every retailer’s street. But one thing’s for sure: it’s a taste of things to come. There can be no doubt that the retail landscape 15 years from now will be very different from what we see today.