In the early days of ecommerce, retailers had to learn a two-step dance that didn’t require a whole lot of coordination. After receiving an order online, the merchant had to pack a box at a distribution center and ship the product to the customer using standard delivery. It was all pretty straightforward, and customers were amazed that the click of a mouse turned into a package on their doorsteps.
While that’s an oversimplification of the logistics process, retailers didn’t have to worry about practicing dozens of new moves to satisfy customer demands. By comparison, today’s retailers must feel like they’re trying to master ballroom dancing.
With the introduction of drop shipping a decade ago, retailers added more complicated steps that required integration with third-party fulfillment sources. The rise of mobile shopping, marketplaces, ship from store, ship to store and pickup in store threw a few more moves into the mix.
The dance has gotten so complex that retailers are at risk of missing a beat and disappointing the consumer. It’s time to embrace a new concept called “omnichannel choreography” that orchestrates all the moving pieces so they work together effortlessly and deliver the perfect customer experience.
Defining omnichannel choreography
If we’ve learned anything from Amazon, it’s that an extended product assortment and rapid delivery are two of the most important revenue drivers in the digital commerce era. And retailers really only have two choices to get there: invest hundreds of millions of dollars in warehouses and inventory, or bring all the pieces together through a network of third-party logistics providers. While the first option requires massive amounts of cash, the second requires omnichannel choreography.
Retailers that can’t afford an investment on par with Amazon – and that includes most brands – should be creating a network of partners that gives them the ability to compete on the same scale. So when a customer makes a purchase online, the retailer can route the order to the closest fulfillment partner and ship the order through any number of delivery methods.
And in the world of omnichannel choreography, the customer won’t know the difference, because every move is closely scripted to provide the same experience.
The three big dance moves
The omnichannel shopping experience includes three parts that must work together to satisfy customer expectations and build loyalty.
Effective Product Discovery
The path to purchase begins when customers search for the products they want on your website, Google or Amazon. In all the channels your product is listed, the descriptions and images must be accurate and consistent. The listings must also reflect your style and voice so the brand experience is the same everywhere.
Whether shopping on a search engine or comparison site, desktop or tablet, consumers must be able to find your products and have a consistent experience that meets your brand standards. That requires a tremendous amount of product content collaboration and systems integration, as well as the optimization of content for search across multiple platforms.
Expanded Product Selection
By analyzing more than 750,000 products added by retailers on the CommerceHub platform last year, we found that when retailers add new products to their websites it directly correlates to growth in gross merchandise value. In fact, the growth contribution from new SKUs is more than double the growth contribution from existing products on retailers’ websites. The bottom line is that new SKUs are essential to maintaining growth in overall product revenue.
Retailers can add products to their physical inventory in distribution centers, through third-party fulfillment using drop shipping and marketplaces, and by tapping into their local inventory in brick-and-mortar stores. With product assortment quickly becoming the new growth metric for retailers, it’s critical for them to rapidly expand their online listings in every way possible.
Multiple Delivery Options
Regardless of where the products come from, consumers expect a fast, inexpensive and consistent delivery service. Thanks to Amazon, two-day shipping has become the norm, but it’s simply not possible financially for traditional retailers to open hundreds of warehouses nationwide to meet these shipping demands.
Retailers can consider traditional distribution from warehouses, drop-shipping and third-party fulfillment, ship-from-store methods using brick-and-mortar stores as mini distribution centers, and the in-store pickup model for online orders. Retailers should have all of these options in their arsenal, and implement systems that automatically select the delivery method based on the customer’s expectations.
The demands of your customers will continue to shift, and your omnichannel strategy will have to keep up. The vision for omnichannel choreography is that every retailer should be connected to every possible point of fulfillment, distribution and delivery for an extended line of products that can be easily found across multiple channels and devices. It’s a dance that has multiple partners, and the routine needs to be completed smoothly and consistently each and every time.
Frank Poore is founder and CEO of CommerceHub