Omnichannel Merchandising
In today’s retail environment, BOPIS—buy online and pick up in-store—has become mainstream. In fact, personalization and BOPIS are among key shopper expectations and drivers of customer satisfaction.
Increasing digitization is opening up newer avenues for personalization. Each one of us is creating our own digital profile with every click or swipe of our phone, tablet, laptop, Glass, Nest, dashboard, or other smart device. Every transaction we make or every “like” we record is building a digital fingerprint of who we are and what makes us tick.
Customers’ digital profiles, based on their likes, reviews, shares, comments and purchases, hold far-reaching potential to drive personalization and enhance the shopper experience.
Omnichannel’s Impact on Traditional Merchandising Practices
Customer demand has altered the breadth and depth of assortments. Customers want a broader assortment of products and sizes to choose from. Their demand is fueled by social media. A posting of a celebrity wearing a particular item can create a sellout within hours.
Customers expect a wider range of available products and services to choose from and flexibility in terms of how they are fulfilled. Product flow may need to be adjusted to meet unexpected changes in demand. Product lifecycle management may need to include what styles, colors, flavors, and product designs are being impacted by social media likes, sharing and reviews.
How can sales be increased during these times of more volatile demand? Retailers need to optimize upsell/cross-sell opportunities when the customer is in the store or shopping online. Retailers need to monitor the source of the social media trends and build “your stylist” suggestions to create a total look. This will increase basket size and complementary purchases.
The customer experience can be enhanced by adding mix-and-match suggestions based on applying predictive analytics to the customers’ historical purchases and offering complementary products and services to meet the customers’ anticipated needs. For example, grocery retailers can suggest recipes based on historical ingredients bought.
Promotions need to be real-time, updated to optimize the most current purchasing trends. Financial planning and open-to-buy need to be proactively evaluated and managed to account for unexpected changes in demand.
Mobile will be a venue to implement and gather information. Based on the customer location in the store, the retailer can push items on promotion and localized cross-sell/upsell options. Space planning will support in-store location-based value-add services.
Imagine walking into a store to pick up a BOPIS order or just to shop and your mobile automatically receives a text with a showroom number where the sales person has your BOPIS ready and your personalized assortment in your size and favorite styles based on your latest likes, shares, reviews, and your shopper history.
What are the retail processes and organizational impacts that need to change to support the future retail experience? How will retailers use code halos? What are the analytics tools needed?
The New Omnichannel Operating Model
Tighter integration across the retail value chain from product lifecycle management and merchandising through supply chain execution will be required to support the next generation of the customer experience.
Improved predictive analytic capabilities and operational process excellence will be required to support more customer-centric planning and execution. Technology will need to be enhanced to support cloud data analysis driven by the exponential increase of future data volumes generated from web sites and mobile devices. More flexible allocation of resources, including assortment and space, will be required to meet ever-changing customer demands. These are just a few of the capabilities retailers looking to thrive in the omnichannel paradigm will need to implement.
Do you have the merchandising capabilities in place to survive and thrive in today’s omnichannel retail environment? Partnering with the Stores Consulting Group, dedicated to helping reimagine the people, processes and technologies to make the retail business more agile, responsive, digital customer friendly, and profitable, can ensure the highest degree of success in today’s omnichannel world.