This paper explores what cross-channel transparency looks like through the consumer's eyes, the costs retailers incur by maintaining the status quo, and key steps retailers need to consider as they undertake cross-channel initiatives.
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From MultichannelFragmentation to Cross-ChannelTransparency:
Creating CompetitiveAdvantage in Demanding Retail Environmentspage 1 white paper
From MultichannelFragmentation to Cross-ChannelTransparency:
Creating Competitive Executive Summary Advantage Most retailers today allow their customers to shop via multiple channels, offering somein Demanding Retail combination of traditional stores, catalog/call centers, and ecommerce sites. However,due to the disparate infrastructures that typically underlie these individual channels, con-Environments sumers who "channel hop" as part of their shopping behavior often face an experiencethat is fragmented, inconsistent, and inflexible.
This situation presents a significant opportunity for forward-looking retailers. Those whocan make the transition from their current multichannel infrastructures to a fully inte-grated, cross-channel retail environment stand to gain many rewards. These includegreater visibility into their customers and operations, enhanced revenue, and the customerloyalty that comes from providing time-starved consumers with the convenient, consistentand flexible shopping experience they increasingly expect.
This paper explores what cross-channel transparency looks like through the consumer'seyes, the costs retailers incur by maintaining the status quo, and key steps retailers needto consider as they undertake cross-channel initiatives.
" The Internet boom has morphed into the multichannel phenomenon and that phenomenon has brought new challenges to global retailers. " - Aberdeen Group
The Evolution of Multichannel Retailing: From a Pitched Battle to an Arranged Marriage in Just 10 Years In hindsight, the predictions that online commerce would one day supplant bricks-and-mortarstores and well-established direct merchants now seem laughably naïve. While ecommercecontinues to grow at an annual compounded rate of 25% to 35%, it still only accounts forabout 2.5% of total retail sales; retail stores remain the predominant sales channel.
In fact, what initially looked like a pitched battle between "bricks and clicks" has come toresemble an arranged and sometimes bumpy marriage between the two, with leadingretailers pursuing multichannel strategies that encompass some combination of stores,catalog/call centers, and ecommerce sites. Reflecting this trend, most traditional retailersnow supplement their store locations with an ecommerce site. Leading direct merchants,such as Lands' End and L.L. Bean, were early adopters of ecommerce and more recentlyhave opened or greatly expanded their store locations.
While multichannel selling is not a guarantee of success, it does appear to be a prerequisite.In a study conducted by Aberdeen Group, 64% of respondents who were categorized asbest-in-class retailers reported that they sell through all three channels, and 27% sell instores and on the Internet. Only 9% of those best-in-class retailers sell through storesonly and none of them sell through the Internet only. page 2 white paper
Understanding the Difference Between Multichannel and Cross-Channel Environments Now, the next stage in retail's evolution is under way as retailers strive to make thetransition from today's multichannel environments to fully integrated, cross-channelenvironments. The distinction is a vital one. Multichannel environments typically consistof disparate, channel-specific technology infrastructures and business processes thatwere developed over a number of years. Often, there is extensive focus on processeswithin a channel but minimal integration across channels. As a result of this situation, theretailer has a fragmented view of its customers, limited visibility into its operations, anda lack of flexibility when it comes to implementing customer-friendly policies.
Mirroring this state of affairs, customers who use more than one channel to shop - as millions now do - have an equally fragmented and inflexible experience.
X Though they are ostensibly dealing with one organization, they often encounter dif-ferent inventory, pricing, policies and merchandising, depending on the channel being used.
X The person they speak to at the call center seems to know a great deal about them;the clerk in the store checkout line knows almost nothing about them.
X Over the lifecycle ... [download for more]
