At eTail: Mobile, Social and Personalization, Flexible Fulfillment and Fixing the Basics

3/17/2014
Imagine approaching the check-out counter, excited to buy the armful of merchandise you have selected with the 15-percent-off coupon you hold in your hand. Then imagine that after your purchases are rung up, the sales clerk tells you that your coupon is a fake, and it cannot be accepted.

That is exactly the scenario that played out for one customer, shared Michael Georgoff, vice president of digital coupon marketplace RetailMeNot. The customer ? who had done nothing wrong — was nonetheless terribly embarrassed, reported that she was made to feel like a criminal and simply left her merchandise on the counter and walked out of the store. The store lost that sale and possibly future sales, and the customer left having had a very unpleasant experience.  "Everyone wants to please the customer, but behind the scenes, that is hard stuff, tech-wise," said Georgoff, speaking on a panel earlier this month at the eTail West show in San Antonio, Texas.

Getting all of those tech pieces in place to keep up with increasing customer expectations across a proliferation of devices and channels presents a gargantuan and ever-shifting challenge for retailers and brands as they work to determine the best strategy and tools to maximize customer engagement, security, their own resources, and, of course, profitability.

According to Eric Fineberg, senior director of mobile, media & entertainment, Foresee, 96 percent of visitors leave a site without making a purchase. But sorting through the wondrous maze of possibilities available for collecting and sifting through online data to build out your offerings can be overwhelming and it can also lead your business down unproductive paths. Determining what shoppers do after they visit your site, and understanding how one channel influences what happens next, can be helpful in gaining insight into what your customers are actually looking to do, and where. Today, some companies are "building things that are not necessarily necessary for [their] customers," says Fineberg.

Fixing the basics
At American Eagle Outfitters (AEO) the company is finding what's right for its customers by getting back to the basics. David McBride, senior director of omnichannel analytics at AEO – which expects to see revenue from digital increase from 13 percent of business in 2013, to 25 percent by 2016 – says focus in the mobile and digital realms must focus on "gaps in [its] ability to deliver a seamless experience" to customers. For example, the company offers different coupons for its American Eagle and aerie stores, a scenario that is fine for brick-and-mortar stores, but becomes troublesome by creating confusion online, where the two stores reside on a single online site, with a single checkout.

Similarly, the teen retailer encountered problems with its discount codes  – error codes caused by typos in the information it provided to customers, and in other cases caused by zeros that customers typed as 'O's. These seemingly small problems can add up to lots of customer frustration and lost sales, says McBride. It's important to focus on resolving them, but it's "not as easy as it sounds," he says.

Ship-from-store expands
This sort of attention to the details filters through the entire supply chain. Unified data silos that provide a single view of the customer and of inventory have enabled AEO to move to a flexible fulfillment strategy, shipping from stores as well as from its DC. Currently, AEO is fulfilling from about 20 stores and expects to expand its ship from store to the remainder of its store base of about 1,000 this year, allowing the company to better match consumer demand to supply regardless of channel. But it is a "journey," says McBride, with its own very specific challenges.

Among other hurdles, sales associates must be trained to package things appropriately. At AEO – which sells more jeans to the under-25 crowd than any other company in the world – that means taking care not to stack white denim on top of black (the wash from the latter will rub off), and to wrap undies individually, which the company has found its customers prefer.

Buy online, ship from store has been a "huge win" for DXL Group as well, says Jay Nigrelli, vice president of ecommerce. The company, which started fulfilling from stores about two months ago, previously was fulfilling from a single warehouse in Massachusetts. Today, its system "looks to the closest store," with the result that order fulfillment times have dropped from six days to a single day, for example, and back orders have fallen from a 30-to-60-day wait time to same-day shipping. 

Finding the right blend of consistency and uniqueness
Serving a shopper who wants to constantly retrieve information across a variety of devices and in a variety of forums at all times sounds reasonable but presents huge challenges, and determining how and when and why consumers choose to use engage across various channels is crucial in trying to determine your strategy for each, which will be different for each retailer. Fineberg invokes the "rule of thirds" when thinking about your digital channels, noting that within a year, one third of traffic will come from the desktop, one third from tablets and one third from mobile phones.

As they move from channel to channel, consumers expect to find certain consistencies; for example, they expect a seamless and easy experience as they move across devices and from one channel to the other. They also expect a recognizable face to the brand, consistent pricing across channels, and to be able to have a view into all available product from anywhere.

Today, customers expect you to be able to show them your online inventory at the stores, says Kent Zimmerman, vice president of e-commerce, Shoe Carnival, which heretofore has built much of its technology around supporting its rapidly growing store base. Today, the company is working "feverishly" to offer an endless aisle; if a customer cannot find a size 13 shoe in-store, he can go online immediately to access a wider and deeper inventory. "We are trying to find the hook so we can convert," says Zimmerman. Still, some events do not translate well across channels. For example, the company's "flash sales" – sudden in-store announcements of, for example, 25 percent off everything in a particular aisle for the subsequent 10 minutes, are a challenge to replicate online, he says. 

Social, mobile, personalization
In other areas, customers are looking for uniqueness and customization. Particularly as more consumers rely on their mobile smartphones and social networks – at online outwear retailer Moosejaw, 40 percent of online sales came through mobile, while at Nordstrom, 8 percent of ecommerce orders are driven by a social platform – the need to personalize to their individual tastes is increasingly important, because consumers typically are not searching and browsing on mobile as they may have done on a desktop, which requires a fundamental shift in business models toward feeds and push notifications.

This need to push data out makes it even more important for companies to capture customer data and analyze it in meaningful ways. "We are getting more information about customers so that we can present a better experience – to that customer, and to customers like that customer," says Daniel Neukomm, CEO of La Jolla, parent of boardsport apparel company O'Neill. Neukomm expects the company's greatest growth area to come from mobile, and says social media plays a crucial role as well. The O'Neill customer, in particular, has very specific interests – surfing at exotic beaches, for example – that the company can tap into and serve as an expert for. O'Neill already has a very established social presence, but Neukomm says he'd "like to step it up in terms of how we curate and deploy on mobile."

That mobile experience is particularly key for Millennial consumers, who are savvy, multi-device users with high expectations and a high design aesthetic, says Leah Stigile, vice president of global ebusiness, TOMS Shoes. How do you engage this group, 75 percent of whom like, retweet or share on social media? In 2012, the company launched a mobile app that allows customers to carry TOMS around in their pockets 24/7. The company uses this and other platforms to build community around its products and marketplace and its one-for-one giving mission. Among the benefits of the app are the opportunity to receive alerts about local events – say, a sample sale in Southern California – and a "wall" where people can post their interactions with the brand.

Recently, TOMS opened its first brick-and-mortar store in Los Angeles, and two weeks ago opened a second in Austin, Tex. Like its online face, the wifi-enabled stores foster community building by encouraging customers to hang out, have coffee and share artifacts from their travels – for a lucky few, that includes "giving trips" where TOMS sends winners of its sweepstakes "into the field" to join in its company missions of giving shoes to people and restoring eyesight through surgeries and eyewear to people in need. Its social causes are a perfect fit for social media, as they "empower and inspire action," says Stigile. It's all, of course, good for business, allowing each customer to have a very personal experience with the brand. "We can circle back with a customer and tell them how their purchase made a difference in a child's life … [we're] delivering value without discounting product."

On the topic of social, Gary Penn, director of ecommerce, True Religion, like many who have spoken on this topic, noted that the conversation will happen "with or without you," but Penn also brought this point to bear more emphatically with a slide from Social LUMAscape that provides a visual representation of the number of brands and retailers and social networks and marketers and platforms and consumers that all interconnect to the brand. It's a lot. And you have no control over it. Penn emphasized the importance of finding forums where people are talking about your brand, listening to the conversation and more importantly, responding to it. He also suggested incorporating customer Q&A's.

These crowdsourcing solutions, offered by companies such as Conversant, go beyond reviews, allowing customers to engage with each other . "Q&As help your customer bring real responses onto your site, and also bring your first customer back to your site," says Penn.

Finally, Penn cautioned retailers not to forget brick and mortar when thinking about their social presence. "Brick and mortar is your biggest asset. It's bigger than your social channel. Bigger than Twitter. It has more value over a lifetime." The sales associates in your stores are your biggest brand advocates, your best customers and your best base of knowledge, he says. They're probably younger than you, have larger followings and are more socially engaged, and you should definitely tap into that knowledge as you are developing your social strategy, he concludes.


Jordan K. Speer is editor in chief of Apparel. She can be reached at [email protected].

 
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