Real-Time Inventory Visibility Puts the Omni in Agile Commerce

May 01, 2014 5:25 PM  By

Ask a group of retailers how they intend to support omnichannel commerce in the months ahead, and they’re likely to regale you with launch plans for their responsive websites, enabling customers to shop via any connected device. While offering channel-agnostic shopping experiences is, indeed, table stakes for today’s smart brands and retailers, delivering on the full promise of agile commerce requires building best-in-class customer experiences across multiple touch points.

Today’s customers expect you to provide real-time inventory visibility across all channels. Of course, they don’t know that’s what they want. They simply expect to purchase and arrange shipment or pickup of their online orders whether those products are physically located in a foreign distribution center or a mom-and-pop shop down the street. Why? To them, inventory visibility means no more out-of-stock scenarios. It means knowing when their products will be delivered. And it often means being able to pick up their orders in-store.

Satisfying today’s demanding customers (a/k/a so many channels, so little time)

A December 2013 Forrester survey revealed that 83% of multichannel shoppers rate knowing when a package will arrive as the single most important service an online brand or retailer can provide, closely followed by the ability to purchase online and pickup in store.

Satisfying these customer expectations requires the merchant to integrate their supply chain into an inventory management system that offers real-time visibility into product stocking across all channels. And this trend shows no sign of waning. According to a 2013 Forrester report, “[w]ithin the next two years, 50% of all retailers will have offline (store) inventory visible online.”

Providing inventory visibility is no longer is a nice-to-have, it’s a must-have for any company that sells products online. “[V]isibility is the prerequisite to success for an omnichannel selling company, for inventory, customer, and product information,” reports RSR Research. “And for supply chain, it all starts with knowing where inventory is, in something approaching real-time.”

That’s what I sought to address many years ago when I founded Shopatron. Our distributed order management system responds to the growing demand for real-time inventory visibility. Whether a product is sitting in a warehouse halfway around the world or at a local store down the street, our customers know when to expect their products delivered and often have the ability to pick up products in-store the same day.

This sort of system allows brands and retailers “to use stock in stores for the fulfillment of online orders, either through a click-and-collect process, or via home delivery,” reports Gartner. “In doing so, orders can be fulfilled in the shortest possible lead time, placing the store at the heart of multichannel fulfillment.”

Pooling inventory across channels (a/k/a Where’s Waldo?)

In the world of ecommerce, physical location of a product is ephemeral. Remember Where’s Waldo? In the disarming series of children’s books by British illustrator Martin Handford, Waldo could pop up anywhere in the world, disambiguated by an array of colored dots. Young readers (as well as adult fans) were happy to while away the hours to track down the elusive Waldo, who could turn up anywhere from Paris to Timbuktu.

In the marketscape of yesteryear, customers were likewise content to spend hours chasing down the products they wanted, wherever they were hidden — calling up store after store to find out if a product was in stock. Not so anymore. Today’s customers expect to locate the product they want from a merchant’s ecommerce site in an instant and get it delivered, fast, or arrange to pick it up in-store, even faster.

This requires the supply chain to communicate seamlessly through an integrated set of APIs — connecting the warehouse to the distribution center to the retailer to the end customer, all in real time. “Leaders in this area shun the temptation to segregate stock by channel, either physically or systematically,” reports Gartner. “Instead, they make all stock available to all channels, often prioritizing an online, home delivery or wholesale order over a store requirement in their execution processes. Although these are supply chain activities, they are enabled by an organizational structure and mindset that sees fulfillment opportunities where others may see silos.”

Gartner’s recommendation? “Implement a single pool of inventory per product to which all channels have access, and introduce fulfillment prioritization rules among online, home delivery, store requirements and wholesale orders.”

I couldn’t agree more. What’s great about our software is that you can implement rules that dictate where orders should be routed and fulfilled — they can be based upon proximity to the customer or you can add logic that favors specific dealers, say, those you want to incent to stock more of your products. The brand or retailer has the flexibility to develop and alter the rule set to meet their evolving business needs.

The era of agile commerce (a/k/a Mr. Retailer, tear down this wall)

We often talk about how best-in-class ecommerce solutions enable simple and intuitive shopping experiences across multiple touch points. But the truth is that the walls between channels are rapidly dissolving.

Today’s customer is ubiquitous — she may be “showrooming” or researching products on her mobile phone or tablet while visiting a boutique in London, then purchasing a product online from a brand headquartered in Helsinki, then receiving emails or texts about her order delivery status in New York from the warehouse in Beijing and finally picking up her order in her home town of Austin. And, if she doesn’t like the product, she expects to be able to return it at a store when she’s on a business trip to Rome.

Her expectations around customer service are higher than ever before. How can a company deliver on these high expectations? Once again, this requires an integrated inventory management platform that connects with the business’ customer support function.

Today’s customer support agents require real-time product and inventory visibility to provide the kind of service that builds brand retention. For example, our white-label customer support agents can instantly access the ecommerce platform where a product was purchased so they have a holistic view of the order, including any relevant tax logic or promotional data. They also have complete product information at their disposal. They can even edit or cancel an order — or provide a save-the-sale appeasement — resulting in a great customer experience.

This means that when our jet-setting customer waltzes into a branch of a retail store in Rome, the sales associate will have access to information about the purchase order history along with comprehensive customer support tools to deliver a stellar experience, which is likely to result in incremental sales. As Peter Sheldon of Forrester wrote in July 2013, “[t]he store associate will be a massively important hub in this integrated omnichannel world, creating meaning from data with the help of in-store technologies.”

Summing it up (a/k/a everybody into the pool)

Establishing a world-class customer experience in today’s omnichannel retail landscape requires merchants to pool every bit and byte of information — delivering real-time inventory visibility across multiple channels.

Those who develop omnichannel order management systems will build brand equity and gain customer loyalty by instantly connecting customers with the products they want, by providing up-to-date information on delivery and pickup time and by eliminating the frustration of out-of-stock scenarios.

In gauging the value of such a technology investment, manufacturers and retailers should ask themselves one simple question: Can you afford to be part of the 50% that does not enable real-time inventory visibility by 2015?

If so, we invite you to do your own research via dial-up.

Ed Stevens is CEO and founder of Shopatron. Follow Ed on Twitter @eastevens.