Cross-Channel Retailing Success: Share, Converge, Integrate!

Multi-channel retailing – facilitating sales transactions through a number of independent channels – is relatively easy, but capturing the full benefits of doing business in multi-channels involves a great deal more of sharing product, converging process, people and data and an overall system integration across-channels. Cross-channel retailing yields multiple channels, but multi-channel integration yields myriad more benefits.

One of my favorite sayings about cross-channel is: Customers don’t shop channels, they shop a brand and in most cases they don’t even know what a channel is. Cross-channel isn't just about offering multiple means (channels) for customers to access your brand; it’s about leveraging multiple means (channels) to support the customer experience. True cross-channel convergence is about making all retail channels operate in coordination and collaboration with each other; it's about managing transactions and customer engagement across all channels to support delivery of a uniform, inspiring brand experience to consumers.

But this cross-channel "nirvana" is often difficult to achieve for many reasons. For one, when retailers first started moving from one to multiple channels – each with different customer and operational requirements – they generally had no choice but to deploy different technology systems to address such disparate needs. With these different channels operating as separate, autonomous entities, it becomes difficult to provide customer-centric merchandising and a seamless shopping experience across these channels, and instead retailers are left with inefficiency and lack of operational visibility.

So how then do retailers realign their cross-channel strategy to focus on converging and integrating these channels for improved customer experience – versus merely delivering multiple "routes to market?"

For the answer, let's examine the habits of the highly successful multi-channel shopper. We know that multi-channel shoppers spend more and have a higher lifetime value than single-channel shoppers. But why is that? Multi-channel shoppers utilize multiple channels because each of those channels is differentially effective at satisfying their shopping needs. Offering multiple channels provides multiple ways shoppers can interact with your brand, which provides greater and more varied means of meeting each shopper’s specific needs at specific points in time, which also means it is more likely that overall a shopper will be satisfied that her needs are met.  

But the value of cross-channel retailing isn't just about having multiple means for consumers to connect with your brand; it's about having many different ways of catering to their specific needs – which may change on a daily basis.

Today, you might be a beginner tennis player, shopping at your local sporting goods store so you can pick up some basic tennis apparel. A year or two later, you may have attained the status of intermediate player, and perhaps you’re looking to upgrade your wardrobe, maybe in search of a popular tennis shoes a fellow player or instructor wears. Since you’ve already seen the sneakers in actions, perhaps now your interest is in procuring them online and having them shipped directly to your home – that is, if the price is right and the shipping charges are reasonable (or even better — free!). But what happens when the webstore does not have the shoes in stock and you don’t have another store nearby that does? Or what if you want to use a 20 percent in-store shopping "Friends and Family" discount that you received in the mail?

As the above example shows, multiple channels offer consumers choice in service delivery and support and each channel offers pros and cons, benefits and drawbacks. But by using a combination of channels and converging channels, retailers can better satisfy their customers’ needs by exploiting the benefits and overcoming the deficiencies of each channel. Retailers can prevent you from going to a competitor for your new tennis shoes by opening up their inventory and allowing whichever channel has the product to ship it to you – which may be a store, distribution center or even another one of their brands that sells the same product. It won’t matter where it comes from, as long as you receive your item. Even better: Allow me to use the discounts/coupons in any channel – because remember: people shop brands, not channels.

Once a new and notable tactic, this enterprise selling capability has become mere "table stakes", as consumers both expect and demand a seamless experience in a multi-channel retail environment. This expectation has been fueled by the proliferation of broadband wireless connectivity and consumer use of smart devices, where shoppers now can be seamlessly connected to everything that is important to them—everywhere. In fact, the adoption of wireless devices within the store environment also provides an excellent opportunity to support improved in-store productivity — from locating product to the point of order entry on the retail floor — and to provide more engaged customer service by enabling store associates to untether from the cash wrap, never having to leave the customer.
Enterprise selling system also ease customer data capture, which supports future marketing initiatives. By offering the opportunity for a customer to sign up for a loyalty program on an Apple iPad, for example, the retailer can now continue to engage with this customer in her preferred manner, encouraging her to be a loyal return customer via customized offers delivered in her chosen manner. In this way, retailers have a greater opportunity to develop extensive, propriety information about their customers in order to more effectively target their marketing.

What’s more, the advent of tablet devices, with their rich graphics capability and expanded “real estate,” enables retailers to support a new type of clienteling where sales associates – armed with critical customer insights such as images of items previously purchased – become "personal shoppers," providing a rich, engaging and collaborative purchasing experience.

Multi-channel integration should aim to create operational efficiencies and to reduce the complexity and redundancy of data, processes and business rules so as to allow customers to purchase goods and services through a variety of channels (online, kiosk, mobile, catalog, in-store, etc.) while enjoying a consistent brand experience. Integration points run deeper than exposing inventory to all channels or allowing discounts. They include: routing orders to stores and warehouses for ease of fulfillment, and to a merchandising system so available-to-promise inventory is accurate. Moreover, this means having one promotion engine servicing multiple channels and one CRM system to collect and process shopping and purchase data from all channels so retailers have a better understanding of customer needs and behaviors. The list is endless, but the potential sharing and reuse of people, processes and technology that can be achieved through an integrated channel strategy can significantly help to improve a retailer’s channel cost structure.

At the end of the day, when evaluating winning cross-channel retailing strategies, it’s not how many channels you have, it’s how you make use of them that really matters – to you as a retailer and more important, to the consumer.

Diane Cerulli is director of retail product marketing for Epicor Software.
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