Omni-channel - The Next Paradigm in Quintessential Retail
In a nutshell, omni-channel is a robust method that aims at providing a seamless buying experience for customers across channels and devices - be it physical stores, television, telesales or online websites accessed via desktop, laptop, tablet, mobile etc. This entire notion of fulfilling a customer's expectation anytime and everywhere is very powerful indeed and has captured the imagination of every modern day retailer.
Around 52% of the e-business professionals consider omni-channel as a priority item on their to-do list (Forrester). And why not? As per MIT report, almost 80% of brick and mortar shoppers search for price information online before making a buying decision. You would already have observed the concept in practice all around you - be it same day delivery, ship from store/warehouse or even real time inventory update. The impact for such a holistic, all round buying experience is huge and threatens to change the retailing landscape for good.
Even though omni-channel seems like a cryptic process involving a lot of intricate parts, the core target for it remains the same i.e. it is primarily geared to tap into more sales, ensure a seamless customer experience and take the competition to the next level. In fact, companies like Walmart, Nordstrom, Macy's, Staples, Best Buy and others have already started walking down this road due to the immense value lying herewith.
While there are multiple reasons for the rise of the 'Omni-channel' buzzword, some of the core benefits are:
- Enhanced product discoverability:
Retailers can harmoniously implement save the sale mantra as omni-channel solution enhances product discoverability. Online channels can effectively make use of underutilized inventory which is restricted only to brick and mortar space. This enables them to capture the potential lost carts due to out-of-stock product scenarios. Bloomingdale's smart fitting rooms have enabled customers to scan items with wall-mounted tablet. They will be able to view alternate colors and sizes available and recommendations and ratings/ reviews by other customers. It further extends to furnish the customer with call for assistance capability without even leaving the room.
- Reduction in the load of web distribution center
With all the warehouses and drop ship vendors talking to each other, retailers can easily distribute the effective load in the most cost efficient manner. As retailers gather more data on user buying patterns, the distribution centers can be further optimized to match the requirements on ad hoc basis.
- Optimize back end of the returns process:
The focus has now extended well beyond just buying and fulfillment of product, into being able to 'return anywhere'. By optimizing the return process, customers can be assured of a better buying experience. At the same time, the products can be recycled easily, reducing the time lag of product unavailability.
- Improve inventory turns
Order fulfillment requests can be realized faster and store managers can keep a real time check on the inventory levels. Any depletion or abnormality can be easily addressed in sync with the demand, fueling better churn out and valuable time spent on searching inventory can be saved.
- Help stay competitive:
In an ever changing retail landscape, the ability to stay one step ahead of the competition is very crucial. With information flowing without any kind of bottle necks for consumers, it is very hard for a parochial mind set to make inroads into the landscape. While it takes a lot of precise calculation on the implementation side, omni-channel delivery helps a company develop strategic advantages and competitiveness in the long run. Take an example of Warby Parker, a trendsetter in glass industry by offering its home try ons program, which realized the importance of omni-channel presence was amongst the firsts to transition from web only to brick and click model.
- Efficiencies and cost savings:
Depending on the manner omni-channel solution is implemented, it has potential to minimize wasteful practices and creates a lot of value in terms of cost savings in the long run. Better stock management, smarter labor planning and reduced shipping costs can take place within a highly optimized omni-channel company.
- Quicker delivery times
Delivery times for buyers get shorter and omni-channel capability enables the retailers to fulfil the orders from closest fulfilment location. According to Forrester Researcher analyst, Amazon might have "same-day delivery algorithm," solution in place in order to pick fastest and cheapest delivery option by assessing various combinations of its delivery services at a given moment. Its experiment with taxis, aerial drones and patent strategy 'anticipatory shipping' is also continuing to deliver packages same day.
The benefits do not end here and stretch far beyond the conceivable paradigm. With some ingenuity, omni-channel can be revamped to be even more powerful for an organization in the long run. The surface of this disruptive practice is certainly scratched with the solution. As more and more companies come forth and adopt such processes, the customer experience is bound to get a facelift and we are sure of one thing - the customers are in for a treat.