The Power of the Store in 2017 Omni-Channel Retail
Many retailers are still wrapping their heads around the full value of implementing OMS (Order Management Systems) within their operations. But as the industry storms into 2017, we’ll see a litany of sweeping changes in this arena that revolutionize the way omni-channel retail operates. All we have to do is look at the momentous shifts over the past few years and the unquestionable benefits that best-of-breed, omni-channel OMS provide, and we can see how and why 2017 will be a banner year for the technology.
Follow the Money
Order management wasn’t front and center three to four years ago, but burst onto the scene in recent years. Investment in order management is growing. Even Forrester predicts that sales, commerce and fulfillment investments will be the single largest investment category in 2017. This will include some implementations replacing existing technology and others bringing it online for the first time.
Industrial Size Changes
We all know that the mobile commerce phenomenon is challenging retailers to meet consumers’ new demands and expectations. The effect of new order placement options has created changes in order management on the retailer side. In 2017, we will see a continued disruption of the traditional warehouse model. This is due not only to automation of inventory visibility and routing, but retailers finding answers to critical questions of balance. An example of the balance consideration is customer convenience and loyalty vs. retailer cost and complexity.
Leveraging Stores to Win
In 2017, retailers will increasingly manage inventory distribution at the store level. This will maintain brick-and-mortar retailers’ essential advantages over their pure-play rivals, even when fulfilling e-commerce orders. As we recently discussed with Retail Dive, a winter storm can knock the inventory of an entire warehouse offline for days. But more localized centers—the stores—decrease the risk of disruption. Similarly, e-commerce stores can only upsell during the initial transaction, but as consumers come into stores to pick up online orders, there is significant potential for additional sales.
A cultural shift is necessary as the industry moves into omni-channel retail, requiring an injection of excitement onto the store floor. In this case, associates will become the frontline champions of omni-channel visibility and flexibility. Retailers must push a mentality among associates to make order flexibility part of the customer experience. They will do this by implementing simple tools, dashboards and solutions that operate on tablets or PCs. To show where the orders are going, where products currently are and what needs to be done to complete transactions. If a customer is coming in asking for a specific item, associates will be trained to leverage the technology and insights to provide the best answer and keep the customer’s business.
Mobile Devices and Barcode Scanning
Today, using mobile devices for picking ship from store orders is still a rarity outside of grocery and larger stores. But we see this changing in 2017, as the speed and accuracy it provides to store associates in stores needs greater depth than in a warehouse, as there are more variable characteristics for each product. Importantly, the device must allow the store associate to confirm they’ve picked up the right item through a barcode scan. Simply put, if fast and efficient retail fulfillment is a priority, then you need to be able to handle these basics.
Omni-Channel Visibility Gains Momentum
To keep up with Amazon’s pressures, not just in commerce but in the supply chain, retailers will be investing in omni-channel retail solutions that provide complete inventory visibility across the enterprise. Furthermore eliminating the silos of years past and allowing them to provide far better customer experiences. They’ll be able to give customers any fulfillment option they want. They will start leveraging their physical stores as distribution centers and will manage returns much more efficiently. This allows customers to shop and receive goods how they want, when they want. To boost business outcomes across the board.
Personalized Commerce and Customer Engagement
As retailers implement loyalty and smart CRM programs in 2017, personalization will be at the forefront of their strategies. Customers expect to be treated as someone special. And retailers need to treat each customer accordingly, making each feel like a VIP. This will, in many cases, simply come down to making the experience as personal as possible. But retailers also need to know who is not their best customer; they will start to acknowledge customers making a lot of returns or who may abuse promotions or discounts, and be less aggressively promotional to that group.
Leveraging OMS, not POS, for Merchandising Strategy
As retailers try to anticipate how much stock to put in each physical location, they often rely on POS data from past seasons. But POS doesn’t necessarily tell you the full story of a true omni-channel retail business. Inbound and outbound logistics processes will start to provide much better operational insights when more data is harvested from order management systems rather than POS systems.
Best of Breed OMS Can Help
In 2017, retailers will look to best-of-breed order management systems to solve this omni-channel challenge. Best-of-breed makes it easy to get the full power and results from established assets. No time wasted playing catch up. And as retail continues to change in 2018 and beyond, the software will grow with the industry to help tackle the next challenge we can’t see quite yet.