2020 turned the world upside down, causing retailers to expand delivery options like curbside pickup, home delivery, and BOPIS (up to 45% from 24% in 2019!) practically overnight.[1] While this pivot was done at record speed, it wasn’t done with an eye on optimization- there wasn’t time for that type of luxury. Instead, it was adapt at any cost to stay viable. Retailers were tasked with creating new ways to serve customers almost instantaneously, and they rose to the challenge.
But, where does that leave retailers today?
Last year brick-and-mortar retailers became agile but to do so successfully, turned a somewhat blind eye to customer experiences, process efficiency, and profitability. The mantra was “deliver at any cost” because that’s what the public needed and how retailers survived.
It turns out, many retailers duct taped their way towards creating omni-channel experiences. Now faced with pervasive demand for the new shopping journeys they created, it’s time to pivot again to embrace these new models as part of a holistic omni-channel strategy with an eye back on the basics of profitable growth and competitive differentiation.
Poor omni-channel execution leaves real money on the table. In fact, just 47% of retailers say they have the right metrics to measure the success of their omnichannel strategy.[2] According to IHL, retailers that haven’t optimized BOPIS are seeing net margins 7.5 points lower than their competitors.[3] They have higher in-store labor needs , especially if associates are using manual processes, and there’s often no efficient way of transferring items from store to store once they leave the distribution center.
When omni-channel isn’t done right, there’s greater risk of disappointing customers in-store and online. Consumers were understandably forgiving last year as the whole world was changing. Today, only 15% of consumers say they were happy with their online shopping experiences, and one poor experience can lose a customer forever[4].
Optimizing omni-channel for the long haul requires a deliberate, integrated technology approach. It’s more important than ever to stop looking at digital commerce as a separate business with separate systems, and instead take a customer-centric view across the retail supply chain. With this platform approach, retailers gain a holistic view of inventory and demand in to better serve customers in the most efficient and cost-effective way possible.
Platforms that serve the whole business are crucial because every part of the retail estate is multi-purpose. Stores are also micro-fulfillment and return centers, digital technologies are used in-store, and virtually any mobile device can become an inventory management tool. In fact, even with the staggering growth in digital commerce, 89% of retail sales involve the physical store.[5]
As these convergences continue, supply chains get more and more complex. It’s time for an integrated platform that’s up to the task. Anything less means ongoing struggles with poor margins, unhappy customers and the inability to pivot when the next big disruption hits.
Luminate™ Commerce delivers responsive, integrated business planning and operations, inventory visibility and orchestration powered by AI/ML insights and forecasting models. With real-time data and intelligent insights, retailers can tailor inventory assortments across any store or channel, optimize store resources, and gain a single source of truth f across all channels. This makes daily operations easier to manage and empowers retailers to instantly pivot and adapt to disruptions before they negatively impact the business.
To learn more about how Luminate™ Commerce can help, please visit blueyonder.com
[1] RIS News, Store Experience Study 2021
[2] Forrester, Omni-channel commerce metrics that matter, 2020
[3] IHL, Unified Commerce: where to start and the customer journeys driving the most profit return, 2021
[4] Retail Dive, 9 retail trends to watch in 2021
[5] IHL, Unified Commerce: where to start and the customer journeys driving the most profit return, 2021
