3 Hurdles to Overcome Before Endless Aisle is a Reality

At this year’s annual shareholders’ meeting, Walmart CEO Doug McMillon spoke about his plans for the company’s future. McMillon discussed ways the company will use technology to improve the customer experience and “invent the future of shopping.”

One tool McMillon believes will improve Walmart’s customer experience is the availability of virtual endless aisle shopping. The idea of an endless aisle began with Amazon, which grew from humble beginnings selling books and media online to offering anything and everything a consumer might need.

Marketplaces like Amazon, Alibaba and eBay brought this consumer experience into the mainstream, leaving traditional and online retailers to catch up and develop product depth or distinguish themselves in other ways.

Today, Walmart is looking past the limits of what items fit on physical shelves and plans to offer a seemingly unlimited array of products online, accessible via in-store kiosks where customers can shop. In addition to grabbing an item and taking it home, customers will be able to select Walmart products to be shipped to their front doors.

An in-store endless aisle experience would pave the way for Walmart to be a physical and virtual one-stop shop for customers and remove the challenges of storing and stocking products, which are considerations unique to expanding a physical product catalog.

Other retailers have the opportunity to succeed using a similar strategy, but there’s more to it than just installing digital kiosks in physical stores. To create a true endless aisle customer experience, retailers need a system to supply and manage that additional inventory, then get items to consumers quickly and efficiently.

There are 4 key components that retailers must get right in order to turn an endless aisle concept into reality:

Supplier Relationships

Creating a network that includes millions of vendors is not an attainable goal for most retailers. However, growing and managing existing vendors (perhaps not millions, but tens, hundreds or thousands) is fundamental to an endless aisle strategy and involves the following considerations:

  • Supplier onboarding is an important, but often overlooked process. Retailers need to discuss things like sales terms, SLAs for vendors, mapping SKUs to systems and branded packaging. This list is not exhaustive, but it offers some thoughts on onboarding processes.
  • As their vendor networks grow, retailers face administrative challenges. Keeping vendor interactions organized and efficient often requires an automated order management system and vendor portal.
  • Vendor portals and similar tools exist in part to encourage vendor communication, but also to enforce compliance. Managing shipping dates, understanding what purchase orders are fulfilled and even managing vendor performance through scorecards are all ways retailers can ensure the vendor relationship is a positive one. There are many ways to communicate with retailers, but most will require some level of electronic data interchange (EDI) for connectivity.

Speed to Market

Ultimately, product availability hinges on a vendor connecting to the necessary retail infrastructure and channels. This process goes faster if a vendor’s fulfillment solution is compatible with the agreed upon retail compliance SLAs. For vendors, typically the longest piece to implement is connectivity to a retailer via Electronic Data Interchange (EDI) or other method, and understanding the nuances required to achieve retail compliance (such as support for branded packing lists).

Product Visibility

Most vendors sell products through multiple channels: Brick-and-mortar retail, online stores, branded mobile apps and in some cases, through their own stores. If a vendor does not have visibility over their inventory, forecasting and managing inventory is difficult. Inventory management issues can cost you retail sales and have the potential to damage to your brand reputation and customer retention. It’s important to understand how much control your vendors have over their own inventory.

Overcoming Obstacles to Customer Satisfaction

The most seemingly mundane parts of a retailer-vendor relationship can influence customer satisfaction. Missing a target delivery date or failing to send tracking information for an order are common occurrences, but they can damage customer relations quickly. Retailers can build strong endless aisle experiences, but they must partner with vendors that have the ability to meet SLAs and communicate reliably. Endless aisle can drive incremental demand for retailers, but it is imperative that the strategy is carefully developed.

Tony Holbrook is Vice President of Marketing and Commerce for Ingram Micro Commerce & Fulfillment

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