10 Tips for Meeting Cross-channel Customer Expectations

Jun 30, 2012 2:22 AM  By

Today’s savvy consumers expect competitive pricing, in-stock merchandise, fast and free delivery for online purchases, and a consistent brand experience across all channels. Their expectations seemingly grow by the day as new technologies and innovative service offerings continue to raise the benchmark.

The ability to deliver during peak season and beyond hinges on a retailer’s ability to maintain both control and flexibility in its supply chain. These two attributes are often at odds with one another naturally, but effective supply chains harness them through innovative solutions. A consistent and reliable multichannel brand experience will drive customer loyalty and strengthen the retail brand by providing a level of service attuned to the day’s demands.

In light of these changing consumer expectations, here are 10 tips for ecommerce merchants seeking to improve their performance, meet rising consumer demands and profitably manage their business.

Process map the order cycle
This should be the starting point for any delivery time initiative as it can identify existing opportunities without a long-term investment. Examining each element in the process — from staffing and scheduling to cut-off times — allows many retailers to remove days from the order cycle.

Consider adding more distribution nodes in the network
Although this option requires an upfront capital investment, it should be analyzed based on a simple assessment of cost versus service level increase, sales uplift and transportation savings. Adding distribution nodes provides more flexibility and capacity, and in many cases, is focused only on the top moving stock-keeping units (SKUs) to get the most value for the lowest cost.

Make life easier for the customer
To determine what cross-channel services to offer, leading retailers are considering how the brand experience can transfer between channels in both directions, e.g., by offering an “also bought” recommendation service in-store. The retail supply chain, however, must be configured to ensure customers can find the products they want through every location. Being able to leverage inventory between different channels can be challenging, but it makes a big difference on the bottom line for companies that can master the balancing act.

Gain visibility and needed business intelligence tools
The challenge at the supply chain level is how and where to integrate bricks and mortar (offline) stores and e-commerce (online) sites. To solve this issue, you, as a retailer, must have the visibility and business intelligence tools necessary to coordinate interaction.

Build agility into your supply chain
Forecasting unpredictability necessitates supply chain agility, which requires investment in distribution systems and networks. From an agility standpoint, you must manage under-stocking and over-stocking, and be able to “sell through” product.

Engage in intelligent discounting
Through intelligent discounting, you can minimize the risk of dealing with unsalable product. Discounting, however, requires accurate and timely visibility of a range of volume metrics including returns, inventory, fill rate, days-on-hand, etc. All of these must be integrated with marketing and sales data.

Reduce delivery times and/or offer free delivery
Although these drivers are diametrically opposed, they can differentiate your brand and convert sales. Failure to meet a perceived industry standard will reflect negatively on sales.

Provide value-added options
Value-added options such as gift wrapping, kitting and personalization are an excellent way to further differentiate your business and increase top-line revenue and margins.

Collaborate with other retailers
Aligning with other retailers (perhaps those who offer a counter-seasonal product) can help you share the impact of inventory, equipment, labor and distribution capacity fluctuations. Third-party logistics companies can facilitate such collaboration by providing access to shared-use or campus-based assets.

Build flexibility into your structures and processes
Shared-use facilities can provide the flexibility required to support peak management and demand fluctuations. These facilities, however, must be able to offer customizable services that facilitate your ability to meet specific consumer needs.

Fred Takavitz is senior vice president for business development, retail, for supply chain provider Exel.