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Replatforming for Omnichannel Excellence

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Omnichannel has emerged as a major influence in ecommerce, but what does the term actually mean to retailers? Can your existing digital commerce ecosystem support an omnichannel solution? What are the …

Omnichannel has emerged as a major influence in ecommerce, but what does the term actually mean to retailers? Can your existing digital commerce ecosystem support an omnichannel solution? What are the benefits of creating a unified online and offline brand experience?

This white paper answers all of these questions, and also covers the key ecommerce platform features to look for, the benefits of mobile and responsive design optimization, systems integration, and custom applications… all in the context of how it will help you to achieve omnichannel excellence for your brand.

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  • 1. WHITE PAPER Replatforming for Omnichannel Excellence A practical guide to the features, functionality and flexibility required to achieve omnichannel success
  • 2. www.osf-global.com © 2014 by OSF Global Services. All rights Reserved. Pg. 1 INTRODUCTION Omnichannel has emerged as a major influence in ecommerce, but what does the term actually mean to retailers? Can your existing digital commerce ecosystem support an omnichannel solution? What are the benefits of creating a unified online and offline brand experience? This white paper answers all of these questions, and also covers the key ecommerce platform features to look for, the benefits of mobile and responsive design optimization, systems integration, and custom applications… all in the context of how it will help you to achieve omnichannel excellence for your brand. TABLE OF CONTENTS 1. What is omnichannel? 2. Key Features to Look for in a Digital Commerce Platform 3. Mobile Optimization & Responsive Design 4. Systems Integration 5. Custom Applications 6. Conclusion
  • 3. www.osf-global.com © 2014 by OSF Global Services. All rights Reserved. Pg. 2 20% of respondents with omnichannel engagement strategies produced the following aggregate performance metrics as of June 2013:  An average 89% customer retention rate, compared with 33% for the other 80% of respondents  Average 9.5% year-over-year increase in annual revenue, compared with 3.4%  Average 7.5% year-over-year decrease in cost per customer, compared with 0.2% Source: Aberdeen Group, 20131 What is Omnichannel Commerce? Omnichannel is about continuity of a shopper’s experience - enabling customers to connect with your stores through any channel or technology while consistently supporting the brand image. With omnichannel solutions, experiences both offline and online are ideally seamless. Advances in technology have greatly increased the number of sales channels retailers need to address, and today’s shoppers are becoming much more comfortable shopping online and from a mobile device. Web, mobile, in-store, kiosks, and social media are all part of today’s omnichannel strategy. So retailers must maintain unified branding, pricing and offer experiences throughout this increasingly complex shopping journey to remain relevant. Why is Omnichannel so Important? According to a study done by the Aberdeen Group, companies that excel in engaging customers across channels — including web, mobile, social media and in-store — retain more than twice as many customers as companies without effective cross-channel customer care strategies.1 However, to talk only about consumer-facing devices is only half of the discussion. Shoppers equally expect complete flexibility on the fulfillment side of the omnichannel promise. Today’s shoppers demand the flexibility to buy a shirt online, pick up in-store or perhaps go to the mall to return it without having to bring their order details with them or wait days for their transaction to be processed. As more and more consumers do their shopping online, they even want the flexibility to send multiple items within one order to multiple destinations. This requires a high level of communication and coordination from ecommerce, inventory management, order management and CRM systems that was not needed just a few years ago. Modern retailing is built around the habits and demands of the customer, and leveraging the correct technologies to maintain constant engagement.
  • 4. www.osf-global.com © 2014 by OSF Global Services. All rights Reserved. Pg. 3 Key Features to Look for in an Omnichannel Ecommerce Platform How do you know when it’s time to replatform in order to achieve omnichannel excellence? The discussion must begin with an in-depth analysis of the capabilities of your current ecommerce platform. This will not only help you determine if a new platform is needed, but will identify the key features to look for in your next system. There are five key questions to ask that will help your organization make this important decision. 1. Is my current platform easy-to-use and scalable? One of the predominant reasons that retailers replatform is because of scalability. If a retailer’s ecommerce site comes to a grinding halt during peak times there is a good chance their platform has scalability issues. However, it’s not just about how much transaction volume a platform can handle. Many leading cloud-based or hosted ecommerce platforms today handle transactional surges as part of their architecture in a way their hosted predecessors couldn’t. A cloud-based platform allows retailers to centrally manage consumer-facing systems, offload infrastructure maintenance, and provide elastic scalability for peak usage and growth. But scalability also speaks to the ease of on-going operation of the site on a daily basis. You should be asking the question: can my ecommerce site be easily modified to support product or promotion updates required by the business? How long do these changes typically take? And can my digital marketing or ecommerce team make these commercial updates without the support of our IT staff? When it comes to homegrown solutions, all changes need to go through an in-house IT department, which can create a bottleneck and thus be problematic. 2. Can my platform be optimized for mobile channels? A complete omnichannel strategy should be the goal of all retailers, but at a minimum, support of a mobile site or responsively designed site is required to engage today’s mobile shopper. A recent study conducted by Forrester Research found that 20% of all ecommerce sales now come from smartphone and tablet devices, and that number is expected to grow significantly in the near future. The same study found that 62% of US smartphone users expect a mobile-friendly website, highlighting modern consumers’ evolving expectations when it comes to online shopping.2 If your platform does not support mobile-friendly development and design, you will run into problems as customers continue to embrace their smartphones and tablets as devices for browsing, purchasing and engaging with their favorite brands. Mobile and responsive design are covered in more detail later in this document.
  • 5. www.osf-global.com © 2014 by OSF Global Services. All rights Reserved. Pg. 4 3. Can my existing platform be easily integrated with enterprise platforms? One of the major challenges retailers face today is unifying their enterprise, bespoke, and third party systems and applications. Analyst Brian Walker spoke on the importance of integration capabilities in the Forrester Wave B2C Commerce Suites report from 20123 that still holds true: “Today's solutions must enable consistent core platform capabilities to manage products, orders, and customer data, integrating consistently with enterprise systems. At the same time, solutions must be open and flexible to power websites, mobile sites, applications, call center interfaces, and in-store options. This requires solutions frameworks, accelerators, and application programming interfaces, or APIs, that expose the platform in such a way to enable developers to much more easily develop new customer experiences off existing platform capabilities.” If executed correctly, integration can reduce redundancies and significantly improve operational efficiency by enabling uninterrupted exchanges of customer and sales data between systems. Many on-demand ecommerce platforms are flexible enough to support enterprise integrations, add-ons and custom applications that make omnichannel retailing possible. Integration is also is essential for optimizing sales and service. For example, by integrating your CRM and ecommerce platform sales associates gain real-time access to customer information such as past purchases, returns and account information, while customer service reps are able to pull up previous service requests, social media interactions and all website activity. Integration doesn’t just optimize the back-end of your solution, it enables end-to-end customer engagement across all touchpoints. 4. Does my platform offer any in-store digital solutions? In-store digital solutions are an integral part of addressing evolving consumer expectations. They give the bricks-and-mortar retail stores a means to close sales that they might not otherwise have. This is accomplished by providing sales associates with access to available inventory not in their store, detailed product information, complete customer transaction and customer service history, and even customer demographic information such as age, address, shipping preferences and garment size. These in-store digital solutions benefit both the brand and the customers. And today, there are only a few ecommerce platforms that have made the leap into offering in-store digital solutions. 5. Is my platform supported by a robust partner ecosystem? Many businesses that are considering migrating to a new ecommerce platform are currently operating with a platform built internally. This may have been the best approach to take a few years ago when commercially available platforms were not as mature or feature rich, but today this is not a good long-term strategy when you consider the growth and scalability needs of modern day online retailing.
  • 6. www.osf-global.com © 2014 by OSF Global Services. All rights Reserved. Pg. 5 On-demand platforms not only offer scalable performance, but many offer an ecosystem of technology partners, pre-built plugins and add-ons, and knowledge bases designed to give retailers control over the look, feel and functionality of their digital storefronts. Choosing a platform supported by a mature and extensive ecosystem of technologies and services should be a key consideration for a new platform. This is especially important if you consider that the ecommerce platform is for many retailers becoming the technology hub for all of the retailers’ sales. Mobile Optimization & Responsive Design The ability to engage customers across all touchpoints starts with a mobile friendly storefront. According to comScore data, in February of 2014 Americans used smartphones and tablets more than personal computers to access the Internet. This is the first time this has ever happened.5 According to Google’s Think Insights on Mobile, if a user lands on a mobile website and is frustrated or doesn’t see what they are looking for, there’s a 61% chance they will leave immediately and go to another website…most likely a competitor. Conversely, if a shopper has a positive experience with a mobile website they are 67% more likely to purchase a product or use a service.6 Google's Inside AdWords Blog shows 79% of shoppers now use their phone for information while shopping, 70% use their phone in the store, and 77% have directly contacted a business by mobile.7 What is the difference between a mobile site and a responsively designed site? A responsively designed site is a website that is coded to adapt to all screen sizes regardless of the device it’s being displayed on. As the screen size and changes, the storefront automatically adjusts the layout, image sizes and content to reflect the resolution of the device. In contrast, mobile sites are built for each specific device, not screen size. When talking about omnichannel strategies for retail clients, responsive design is the preferred method because it produces just one website to maintain instead of multiple websites for each possible device. One website also means one URL, which is more SEO friendly. Lastly, it is more easily adaptable to future internet-enabled devices we may not even be aware of today. Systems Integration If information systems are siloed it can stifle your ability to respond to market demands and customer expectations, and how you execute growth initiatives. Inaccurate or incomplete customer information can manifest itself in the form of order, payment and service miscues – the opposite of what you want to achieve with customer interactions. Technology must support consumers and operations simultaneously for omnichannel success. It is important to remember that you must consider not only the consumer-facing touchpoints mentioned earlier, but also integration points within the enterprise
  • 7. www.osf-global.com © 2014 by OSF Global Services. All rights Reserved. Pg. 6 to manage customer data to enable omnichannel strategies to be successful. There are several key enterprise systems that are important to unify with your digital commerce platform: Customer Relationship Management By integrating a Customer Relationship Management (CRM) system with the ecommerce platform, customers’ order information and other relevant data is immediately available to Customer Service, Sales, Marketing and any other department which uses the CRM. This integration creates a single view of all customer data, including their preferences, demographics, and shopping and service history, which increases customer visibility and enables retailers to effectively execute dynamic segmentation and personalized interactions. Today’s retailers need a 360-degree view of each individual relationship as a prerequisite to delivering personalized and consistent communication, so that you are reinforcing the brand with every engagement. Omnichannel success requires an underlying platform to facilitate all customer facing processes including Sales, Marketing, and Support. For many medium-to-enterprise size retailers, this will be the CRM system which they already have in place. An integrated, robust CRM like Salesforce or Microsoft Dynamics can provide a single, unified database of customer purchase history, products and channel preferences, campaign segmentation, and warranty and support records. Content Management System The second most common enterprise integration with retailers is the Content Management System, or CMS. By implementing and integrating a CMS with your ecommerce platform, you allow for your non- technical team members to easily update and manage website content and digital campaigns. This can significantly improve efficiency and enable marketing to push out personalized, segmented and up-to-date content across all channels and touchpoints. Sitecore, Sitefinity and e-Spirit are three examples of enterprise-level CMS platforms used by today’s top retailers and B2B firms. Enterprise Resource Planning Enterprise Resource Planning, or ERP, systems process large amounts of internal data across multiple departments. When it comes to digital commerce, accurate, real-time inventory visibility enables key omnichannel capabilities such as in-store pickup. Without a unified ERP/Ecommerce solution, however, the “buy anywhere, ship anywhere” concept is not conceivable. When properly designed and delivered, order sourcing technology that determines the optimal location from which to source inventory for customer orders can lead to faster fulfillment, increased sales and happy customers. Real-time order processing, including updated order status and available inventory, is a must. It is no longer sufficient to have an ecommerce site that gets periodic inventory updates throughout the day or that has inventory allocated to web sales.
  • 8. www.osf-global.com © 2014 by OSF Global Services. All rights Reserved. Pg. 7 Custom Applications If any of your software systems don’t offer the functionality you envision, or if you have an idea for an application that will take your digital experience to the next level but don’t have the technical resources to develop it in-house, a custom application can fill the gap. Custom applications can be developed to sit on top of your ecommerce platform in order to further customize your online store, or can be free standing mobile applications. These applications make shopping from various devices or channels easier or more enjoyable, and ultimately improve conversion rates. The challenge many businesses face is that not all ecommerce platforms readily support custom applications to be integrated into the storefront or back-end. There are, however, several platforms on the market such as Demandware® and Magento® , which are easily integrated with existing and newly-developed applications. Examples of such applications include custom product-building tools, where the customer can create their own unique product using a number of variables such as color, size and accessories. These features create a personalized and engaging shopping experience that meets or exceeds the in-store shopping experience. Conclusion As online commerce continues to steadily grow, and mobile devices are increasingly used by customers to research, purchase and engage with businesses, the need to unify the technologies supporting operations, sales, service and marketing grows even stronger. If you have an ecommerce platform with a small or virtually non-existent partner ecosystem, inflexible customization capability, and/or that doesn’t easily scale with your growth plans, achieving the functionality required to engage customers across all channels, digital and physical, is very difficult. The important take-away here is to find an ecommerce platform on which integrations, mobile solutions and custom applications are supported. These features help retailers extend the functionality of their ecommerce platform and help them to meet shoppers’ unique omnichannel needs.
  • 9. www.osf-global.com © 2014 by OSF Global Services. All rights Reserved. Pg. 8 About OSF OSF Global Services delivers the technology, customization, end-to-end solutions and experiences that help online retailers expand business globally, increase conversion rates and enable their webstore for omnichannel excellence. Our forte is customizing and seamlessly integrating ecommerce environments, from the webstore to legacy applications to front-end and back office systems. Headquartered in Québec, Canada, OSF has offices in the USA, Brazil, France, Germany, Italy, UK, Romania and Ukraine. For information on how OSF Global Services can help with your ecommerce requirements, please contact us at info@osf-global.com, call us at (888) 548-4344, or visit www.osf- global.com. 1 Omnichannel Customer Care, 2013 – via Aberdeen Group http://www.aberdeen.com/Aberdeen-Library/8675/RA-omni-channel-experience.aspx 2 Mobile Moments Transform Customer Experience, 2013 - via Forrester Research http://www.forrester.com/Mobile+Moments+Transform+Customer+Experience/fulltext/-/E- RES113101 3 The Forrester Wave: B2C Commerce Suites Q3 2012, 2012 – via Forrester Research http://www.forrester.com/The+Forrester+Wave+B2C+Commerce+Suites+Q3+2012/fulltext/-/E- RES80141?objectid=RES80141 4 Predictions 2014: US Retail eBusiness - via Forrester Research http://www.forrester.com/Predictions+2014+US+Retail+eBusiness/fulltext/-/E-RES112981 5 comScore Mobile Commerce Report, 2014 – via Internet Retailer http://www.internetretailer.com/2013/10/01/its-official-mobile-devices-surpass-pcs-online-retail 6 Google Think Insights: What Users Want Most from Mobile Sites Today, 2012 http://www.thinkwithgoogle.com/research-studies/what-users-want-most-from-mobile-sites- today.html 7 Google Inside AdWords Blog: Smartphone User Study Shows Mobile Movement Under Way, 2011 http://adwords.blogspot.com/2011/04/smartphone-user-study-shows-mobile.html