Dear Average Retailer,

It’s tough out there. Consider the whole omni-channel thing. Just getting your organization into the mindset, and organizing/allocating your people appropriately, is hard enough.

As it turns out, making omni-channel actually work is even harder than it looks…and it looks pretty hard.

For the average retailer that is built around the traditional silos of “store” and “digital,” establishing internal commitment to going omni-channel can be difficult, despite study after study showing that consumers who interact with retailers through more than one channel are more valuable than those who use a single channel. One example: Macy’s recently reported that their omni-channel customers are eight times more valuable. In recognition of this, Macy’s is re-organizing its whole business to respond.

If you’re not doing the same, you’ll quickly be left behind as these most-valuable consumers gravitate towards retailers putting their omni-channel money where their mouth is, and deliver the desired experience. But simply making organizational change isn’t the same as achieving omni-channel success.

If thinking only made it so…

Take something as seemingly straightforward as buy-online/pickup-in-store (or click-and-collect, or any of the terms used in other regions for this same practice). The Wall Street Journal recently reported on a study suggesting that fully half of consumers who choose to pick up in store encounter problems obtaining their purchases. And that’s for a practice considered table stakes by most consumers.

Imagine what failure rates a similar study might find when it comes to more ambitious omni-channel initiatives like real-time inventory checks, returning orders from one channel in another, and cross-channel promotion reconciliation.

Indeed, Forbes recently noted that, “Omni-channel commerce is driving the most interesting set of logistics challenges the supply chain field has seen in a generation.”

Lest you think consumers primarily experience these troubles at other average retailers like you, consider Walmart. The retail behemoth shocked the market in mid-October when it said that sales and profits would drop through 2017, as it invests in technology and wages to better compete with Amazon.

Part of that involves connecting its store and online operations, a feat it has thus far not managed to pull off. This prompted Morgan Stanley to say that, “Greater than expected investments in F’ 2017 highlight the challenge of moving a big box retail model to be ‘omni-channel ready.’” After its forecast, Walmart stock took its biggest nosedive in 15 years.

Does an average retailer like you even stand a chance of avoiding these omni-channel fumbles and the corresponding negative business consequences?

Yes, for sure. Don’t give up hope. Here are some suggestions:

  • Keep focusing on your organizational structure. Examine cross-departmental incentives. Check out what Pier 1 has done in aligning store and ecommerce incentives to help ensure these teams work together.
  • Don’t lose sight of how technology can help. In particular, a good order management system can be a key enabler of omni-channel success.
  • No matter what you focus on first, take a deliberate, stepwise approach. Need help? Consider reading Enabling the Omni-channel Customer Experience.

Good luck out there. Keep me posted on how you’re doing.

A Friend