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The Omni- Channel Challenge

By Chad Ehmke, CIO, Sally Beauty Holdings

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Chad Ehmke, CIO, Sally Beauty Holdings

Retail and the rise of the Omni-Channel Experiencece

It’s difficult to read any article lately regarding the future of retail without coming across the words “Omni- Channel”, or “Multi-Channel”. It’s even more difficult to get a concise definition of exactly what this means to retail companies and their customers. Typically when the term is used, it’s from the customers’ perspective, and it refers to their desire to have a common experience across any interaction they have with companies. This could include brick-andmortar stores, e-commerce sites, mobile sites, sales consultants, or customer service teams.

Over time the capabilities of the devices most often used by retail customers (cellular phones, tablets, and personal computers) have started to converge across a conglomeration of technologies, applications, and possibilities. Once cellular phones were only used for calls; now they are used for texting, email, GPS, reservations, and more. Tablets can now make video calls via FaceTime or Skype. Device capabilities are converging and retail customers want the look and feel during their shopping experience to be much the same no matter which device is being used.

 This movement has caught many retail companies at the crest of the mobility wave, and quite often we are unprepared for the customers’ requests as well as the complicated and demanding infrastructure this capability demands. We have a web site, but is it enabled for mobile use? Did we take into account Android and iOS devices? How does our design respond when we shrink it down to the size of a smart phone? How does our customers’ experience translate across the devices?

It ain’t easy to make things “easy”

The need to deliver a consistent customer experience across multiple touch points seems to be a “no-brainer”; it’s easy to see how a smooth transition from brick-and-mortar store to e-commerce site to mobile site would be the best experience for the customer, but it’s actually quite complicated. Newer retail companies might have an easier time delivering these capabilities because they have no legacy installed base, and the need for clean master data and a “single version of the truth” has probably been around since their company started. For those companies who have been in retail for a while, especially those who have a significant brick-and-mortar presence, this is a big challenge. Often the existing infrastructure was put in place without contemplating e-commerce or mobility needs; adding these after the fact is difficult to do and rarely bubbles to the top of the list as the “most important thing” unless a significant business initiative is driving the need for change.

How do you handle it at your company when a customer buys a product online but wants to return it at the store? Do your loyalty systems and e-commerce sites require different login id’s to use them? When a customer buys something using the mobility application, does the e-commerce data base even know the purchase was made? Do the people in the stores or the people in the customer service department know? How long of a delay is it before they get that information and can assist with issues?

Begin with the Customer Experience in mind

As it is with almost any complex problem, in order to solve this conundrum we must begin with the end in mind, and start with how we want our customers to experience our company. It’s pretty easy to do this if you put yourself in the customers’ shoes, and think about how we all would like to interact with our favorite brands. Come up with how you want them to feel when they interface with you and explode those out to how that looks within your company. Then identify what changes need to be made in your processes and your systems to drive that customer experience. What does “bringing everyday value” mean to from a customer perspective? How do we establish ourselves as a “trusted” partner?

“Omni-channel is not an “if”, but a “when”, and the quicker retailers start the transition process, the quicker they will be able deliver an integrated enterprise”

One example of this might be “convenience”. If a company wants their customers to have a “convenient” shopping experience, there are definite steps to take in order to deliver on this promise. When allowing a customer to be able to buy online and return in the store, are the sales systems equipped to handle where the sale (and return) gets ultimately recorded? Do these systems allow inventory to be moved from one channel to another? Retailers are notorious for letting these internal accounting issues get in the way of delivering a seamless experience to our customers. And I promise your customer doesn’t care about the answer to any of these questions – they just want “convenience”.

An offer we can’t refuse

At the end of the day, the omni-channel tsunami is not something any retailer will be able to avoid. Statistics show an increasingly high rate of adoption and use of smart phones and tablets; online payment services such as PayPal, Google Wallet and Apple Pay make it even easier. Additionally, competitors are going to move in that direction, and customers are becoming even more sophisticated. They will go to the company that takes the best care of them; research shows this to be true over and over again. The best thing any retail CIO can do right now (if it hasn’t been done already) is to force these conversations with the business, and then prioritize the order in which the capabilities will be delivered. Build a roadmap that includes technology and resource requirements to deliver the identified capabilities. Take a good hard look at the IT shop’s abilities, and consider outsourcing the more complicated pieces of the puzzle; it’s entirely possible that existing staff won’t have the capabilities needed to get there. Omni-channel is not an “if”, but a “when”, and the quicker retailers start the transition process, the quicker they will be able deliver on the promise of a truly integrated enterprise and on their way to satisfied customers.

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