Adapting IT to Meet Omnichannel Demand
The emergence of omnichannel commerce is dramatically changing the retail equation, both in how customers travel the path to purchase and how retailers anticipate and meet customer demand. Mike Webster, senior VP and general manager of Oracle Retail, offered Chain Store Age his perspective on how retailers must alter their approach to both systems and business processes to ensure they deliver a seamless experience across all customer touchpoints, one that both converts sales and builds long-term satisfaction and loyalty.
How are retailers realigning their operations to deliver an omnichannel (or ubiquitous) shopping experience?
There have been changes in both business process and organizational design. In terms of process, retailers are aligning their business processes with the customer, not the four walls of the store. Putting the customer at the center requires centralizing promotions, view of price, inventory and view of order. It also requires connecting digital and physical stores and ‘fulfill anywhere’ capabilities.
In terms of organizational design, companies are evolving positions like chief customer officer and chief marketer. Not just to manage customer acquisition, but also to manage things like customer loyalty and service.
What kind of technologies support omnichannel commerce, on both the front and back ends?
On the front end, retailers need to use digital platforms, and not just for transparent search and promotional capabilities. They also need to provide customer-facing mobile devices for both customer and associate use. The scale and raw processing power of mobile devices put massive capabilities in the hands of the consumer; it gives them access to information on products.
On the back end, it’s not that much different except there needs to be a connection to analytics. Computing power now moves at the speed of thought, so for example, tablets you give to an associate to assist selling can include real-time analytics for targeted offers.
How are retailers ensuring they touch customers on each step of the “consumer journey”?
First, they need to acknowledge the customer — their purchase history and buying preferences — and tailor the individual customer experience to that profile and also to their location. Engaging them through the journey means remembering the journey is not just a sale. The journey includes anywhere the customer buys, picks up, returns or ships a product, and retailers must engage at each step.
How is Oracle supporting retailers in their omnichannel retail efforts?
Oracle is unique in our ability to offer retailers a full range of software and services as part of our Commerce Anywhere strategy. We offer a breadth and depth that is unmatched. There are four specific big areas where we are focusing our new Oracle Retail Release 14 offering.
One is the consumer journey. No matter where a customer picks up, interacts with or ships a product, we enable retailers to connect with them. We’re configuring dashboards to help retailers manage the consumer journey and have developed 25 new dashboards. Another area is targeted assortment. How do retailers deliver more choice to customers, with a tailored experience across all consumer touchpoints with a shared assortment? Oracle provides features like store clustering, customer demand transference and space optimization.
Most critical is inventory transparency. We have aligned all planning decisions to demand. Oracle drives good plans and execution of those plans. There is a new franchise function that extends warehouse management functionality and task management functionality to franchises.
And fourth is right-time integration. How do we help connect different platforms? It requires we help some of our customers on the back end. Integrated architecture takes silos out and lets retailers move very quickly. We have a breadth and depth of capabilities and subject matter expertise to help retailers compete in today’s modern retail economy.
Mobile Retail Ties Up the Loose Ends in Immediate Fashion
The mobile channel by definition extends retailing to an almost limitless range of touchpoints, since mobile devices bring the store to wherever the customer goes. Yet current trends in mobile retailing center on tying disparate touchpoints closer together using mobile technology.
For example, using tablet devices store associates can check inventories of either an e-commerce site or of other stores to order out-of-stock items for customers, avoiding lost sales. Or using their own smartphones, customers can scan a QR code or bar code of an item and pull up its description on the manufacturer’s home page. Using location-sensing technology, retailers can send customers real-time texts with targeted offers for items in a nearby store, personalizing promoted targets based on a shopper’s online purchase and browsing history.
Beyond tying up the “loose ends” of customer interaction, the overarching trend in mobile retail is immediacy. Everything retailers will try to accomplish with mobile technology in 2014, from eliminating long checkout lines by replacing fixed POS terminals with tablet- and smartphone-based payment, to providing discounts based on real-time factors such as weather, takes advantage of the immediate nature of mobile devices. No other technology allows retailers to reach customers at the exact moment of purchase decision.
Even better, the mobile channel allows retailers to make customers aware of potential purchase opportunities, such as proximity to a nearby store or an individually targeted, limited-time promotion. By bringing touchpoints together in a way that reflects real-time opportunities to make sales and enhance the customer experience, the mobile channel promises to be a powerful source of retail profitability in 2014.
Real-Time Retailing Turns the Store into the Network
Ken Morris, principal, Boston Retail Partners, recently took the time to explain how real-time retailing and how the concept of “unified commerce” allows stores themselves to become networks for customer engagement.
What is real-time retailing, and how does it benefit retailers and their customers?
In real-time retailing, the device doesn’t matter. There can be a mobile device or fixed device. Hardware, software and data reside in the cloud. The store becomes the network. There is little hardware in the store to malfunction. You drive all peripherals, like signature capture devices and tills, to the network. You can understand what’s in the customer’s closet, offer them what they want to buy and offer discounts in real time. In the future, there will be real-time markdowns using a rules engine with real-time analytics.
What is unified commerce, and how does it fit into real-time retailing?
For example, if I’m shopping online at a retailer, put items in my cart, hold them there for a while and then abandon my cart and go to the retailer’s store, through Unified Commerce when I walk in and identify myself, the staff can look up my abandoned cart history in real time and know what I was looking at. They can also look up what I’ve ordered through other channels. It unifies all channels into one opportunity in the store so associates can sell to you based on your digital footprint.
How can retailers leverage real-time retailing and unified commerce for customer engagement?
It takes three things — people, process and technology. We have the technology, but what about people and process? It’s using big-screen monitors to browse the Web with customers without violating their personal space. At Apple and Microsoft stores, there’s a lot of conversation behind the scenes. Everyone’s wearing a headset. If there’s a hole in the display, they want to understand who picked up the product and where it is. Customer engagement puts stores on a level with their real competitors, like Amazon, eBay and Google.