Retail Trends

Omnichannel Evolution: from Legacy Systems to Nirvana

Since the beginning of this year, we have seen  how retail CIOs agree that security and digital innovation are top priorities for 2015, probably due to the recent data breaches and the growing need to deliver  unified, seamless and differentiated customer experiences.

According to the 2015 National Retail Federation, managing data security is the most urgent focus area for retail CIOs, and it’s followed by omnichannel initiatives as the second key priority. This is to respond  to the need of winning, serving and retaining customers by providing a seamless experience across touch points. We will talk more about data security in a forthcoming post and let me today focus on the second priority.

To better understand where we are, and where we came from, let me show you the following picture, which illustrates concepts you will probably be familiar with, but let me explain them once again. I insist, as many retailers still struggle and numbers show; according to RIS, $45 million are lost in sales for every billion dollars in revenue because of lack of cross-channel integration.


Photo Courtesy: National Retail Federation “Mobile Retail Initiative” 2011

Looking at the picture, the first step of this evolution would be The Legacy, where retailers and customers can only interact with one touchpoint in a single-channel scenario. If you are a retailer reading this,  you probably overcame that stage a long time ago.

The second is the Multi-channel scenario or we could also call it The Reality. It offers more touchpoints, but still acting independently. Here the retailer’s knowledge and operations exist in technical and functional silos. Therefore they often struggle with consistency regarding the messages sent through each as they may not be aligned. We still detect many retailers in this step of the chain, but decreasing as there are more innovating and embracing change towards more integrated channels. Let’s go on.

The third is cross-channel and often represents the Aspiration, which means that customers can access different channels to interact with the brand, and retailers finally have a single view of the customer but keep operating in functional silos.

In the fourth pillar of this evolution we find the Nirvana with Omni-Channel, where customers experience a brand, not a channel within a brand. In Omnichannel retailers leverage this single view of the customer in coordinated and strategic ways.

And that’s the key really, because customers are social and mobile shoppers, they may choose different channels, different decision journeys, but there is always a single brand and a single view of it.

And this should really be the key for omnichannel retailers: customers should be the center of their strategies, having the rest of the components as satellites around it: product, fulfillment & returns, campaigns, channels, loyalty programs, inventory and technology. But don´t get me wrong, part of the Omnichannel strategy is giving each of these components 100% of your attention. Only in that way will the customer experience be seamless through all the components.

This said, let me share with you this quote from Sam Walton, founder of Wal-Mart stores: “There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else.”

Finally, empower your employees with tools that will help them excel in their daily store operation; invest in mobile technology (it is the first touch-point used by customers to interact with your brand), improve your product merchandising and its management through systems that help you to be efficient and fast. And provide the correct training for your staff.

Let me finish today’s blogpost by mentioning the way Openbravo envisions its product future, and this could not be in any other way than listening to its customers. In fact, they are the ones who motivate the product roadmap and its priorities, based on their needs, which are really driven by market needs. And this is how we close the loop. If you are more interested, listen to this webinar, given by our CTO Ismael Ciordia and Product Director Maarten Tromp. And please let us know what you think, we would love to hear about your experience!

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