Thought Leadership
Top Takeaways from the Retail Systems Research 2012 Benchmark Report: Cross-Channel Comes of Age Mark Fodor, Chief Executive Officer, CrossView
2012 CrossView Whitepaper
Top Takeaways from Retail Systems Research’s (RSR) 2012 Benchmark Report: Cross-Channel Comes of Age
Like any coming of age story, the plot that emerges in RSR’s recently released 2012 benchmark report, Cross-Channel Comes of Age, is layered and nuanced. Intelligence, integration, investment, intimacy, cross-channel inhibitors – they are all key characters in the narrative that RSR tells as it considers the current state of omni-channel retailing. One of the most interesting insights to emerge is revealed in a small, but meaningful shift. More retailers report that they operate online/e-commerce channels than they do traditional stores. While it may be just a three-percent difference from the previous year’s study, this uptick foreshadows the single biggest challenge cross-channel retailer’s face today: integrating digital and physical worlds into one seamless experience that is more compelling than a “digital pure-play.” To a large extent, says RSR, the “digital channel” encompasses catalog, online, mobile, and social media channels, while the store remains the physical channel. It’s no mystery that digital has influenced consumerism in profound ways that couldn’t be imagined a short while ago. But it’s fiction to think that the death knell has sounded for physical stores – or that these bifurcated channels can’t be brought together more closely to create a cohesive experience for consumers. The question is how – and that’s what we consider in the following takeaways. Each key takeaway fuses RSR insights from the study with CrossView’s point of view – insights we’ve gained working with many leading brands and retailers as they define and implement cross-channel strategies and technology.
Think and Act Strategically Think strategically about your customer interaction platforms, says RSR, and prioritize investments based on how customers shop with you. Winners1 and other retailers, for instance, seem to agree that consolidating customer information across all channels is very important – 89 percent of winners surveyed validated this. Consolidating customer data across channels – digital and physical – will help you better understand consumers’ most frequently traveled paths-to-purchase. And, if you don’t know how shoppers are interacting with you – well, find out quickly. Look critically at all of your touchpoints. Consider disconnects across the overall experience, including messaging, nomenclature, pricing, offers, and business rules.
It’s no mystery that digital has influenced consumerism in profound ways that couldn’t be imagined a short while ago. But it’s fiction to think that the death knell has sounded for physical stores – or that these bifurcated channels can’t be brought together more closely to create a cohesive experience for consumers. – Mark Fodor, Chief Executive Officer, CrossView
Benchmark these experiences against customer expectations, your competitors’ offerings, and best practitioners in retail.
Know Your Customers Similarly, winning retailers demonstrate a relentless focus on customers and use technology to understand them, according to RSR. The study shows that winners place a higher value on customerfocused technologies – everything from customer visibility and insights to marketing and promotions. By tracking customer activity and response to marketing campaigns, for instance, you are better positioned to turn data into insight and create more personalized interactions, from greeting Facebook fans with an email to making a relevant offer to a customer phoning a call center. Marketers can benefit by collaborating with IT to strengthen the data collection infrastructure and applying analytics. Today’s data capture and integration technologies make it practical to combine customer activity data from many sources into a single profile. In-store transactions, website and social activity, call center interactions
Copyright © 2012 CrossView Inc. All trademarks belong to their respective holders. All Rights Reserved.
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Top Takeaways from Retail Systems Research’s (RSR) 2012 Benchmark Report: Cross-Channel Comes of Age
and marketing responses can be leveraged to gain critical customer insight, which in turn can be translated into personalized marketing to promote long-term loyalty. The opportunity to connect more closely with customers has never been greater.
Platform is Key Winners, says RSR, are sure of one thing – they need to upgrade their e-commerce platforms with more modern technology. In the dynamic world of e-commerce, even two years makes a significant difference in capabilities. On average, winners have newer platforms and processes than their peers. A full 67 percent of winning retailers surveyed say that replacing their e-commerce systems with modern technology is very important. In our ongoing work with retailers, we continue to see the drag legacy systems can put on a retailer’s ability to give customers what they expect – from
product visibility to loyalty programs to creating a cohesive experience across channels. Yes, a wholesale replacement of a legacy IT portfolio is a big investment and fraught with challenges – so it should be carefully considered. Typically, the average e-commerce implementation project is almost four months delinquent, and one in four retailers settle for a smaller scope than initially planned. But, e-commerce is the fastest growing retail touchpoint. To sustain that growth, the scalability, reliability and flexibility of a proven and agile platform is essential. The return on your investment will follow.
Empower Store Associates According to RSR, today’s consumer carries the store in her purse, and is armed with rich content about a retailer’s products and services that often is better than the corporate-provided information made available in the store to either the consumer
Technology Enablers – “Very Valuable” Winners
Others 88% 81%
Enterprise-wide customer visibility Enterprise-wide customer insights
70% 75% 71%
A single customer interaction platform that crosses channels Enterprise-wide marketing promotions platform
75%
55%
Enterprise content management
73%
52%
69% 76%
Enterprise-wide inventory visibility
63% 67%
Enterprise cross-channel analytics A mobile commerce platform
60%
38%
56% 60%
A more modern eCommerce platform
53% 48%
Distributed order management
50% 43%
Integration to social network tools and sites A more modern POS platform A Call Center solution
87%
33%
50%
25% 24%
Source: RSR Research 2012 Copyright © 2012 CrossView Inc. All trademarks belong to their respective holders. All Rights Reserved.
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Top Takeaways from Retail Systems Research’s (RSR) 2012 Benchmark Report: Cross-Channel Comes of Age
or employees. Pity the poor sales associate pitted against this customer – the consumer with more access to information than the “product expert.” Making matters worse, consider the fact that turnover among sales associates in retail stores is climbing, and fast. According to Hay Group, a global consultancy, the median turnover rate for part-time store workers is 67 percent. This is up 33 percent over the previous year. Add into the mix the fact that the average number of SKUs a store carries grows larger every day.
According to RSR … Winners edge out their peers in implementing inventory visibility, distributed order management, enterprise-wide marketing and promotions, enterprise-wide customer visibility, and a mobile commerce platform.
So, you’re delivering “service” through short-time sales associates who have zero chance of getting up to speed – let alone acquire expertise in your brand or knowledge about your inventory. It’s a perfect storm of conditions that inhibit customer service, diminish the buying experience – and drive shoppers away. The antidote is the mobile point of sale. Mobile point of sale technology levels the playing field where your sales team is competing. Empowering associates with information empowers them to win more sales. And, according to RSR, it’s not clear that a “modern POS platform” will ever pick up again, as retailers increasingly turn to mobile devices to deliver both employee- and customerfacing experiences.2 In-store mobility is the solution.
Get Help Over half of the winners RSR identified indicate a willingness to work with implementation partners –recognition, says RSR, that the IT department may have challenges responding to new requirements. In 2012, 56 percent of winners responded that they consider working with implementation partners to ease the IT personnel burden very important. Last year, only 25 percent of indicated that as a “very important” option. Clearly this underlines the growing awareness of the need to implement changes in both processes and systems.
Winners significantly outpace their peers in implementing cross-channel analytics, a more modern e-commerce platform, enterprise-wide customer insights, enterprise content management, and a single customer interaction platform that cross channels.
Integrating channels is not easy – and winning retailers understand the value of delivering an integrated experience across digital and physical channels. For many, though, achieving this connection remains a challenge. The bottom line is this – don’t be afraid to ask for help. Team with solution providers and managed services partners to help you identify and fill technology gaps in your path to purchase. Identify partners that blend technology leadership, a comprehensive range of services and retail expertise. As cross-channel comes of age, these differentiators will inspire maturity.
Endnotes 1
RSR Research classifies retailers based on their year-over-year comparable store/channel sales improvements. Assuming industry average comparable store/channel sales growth of three percent in 2011, they define those with sales above this hurdle as “Winners.”
2
“The 2012 Retail Store: In Transition,” RSR Research, May 2012.
Copyright © 2012 CrossView Inc. All trademarks belong to their respective holders. All Rights Reserved.
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Top Takeaways from Retail Systems Research’s (RSR) 2012 Benchmark Report: Cross-Channel Comes of Age
About the Author CrossView Chief Executive Officer Mark Fodor has more than 20 years of experience in the IT industry that spans multiple industries, including retail, distribution, manufacturing, and insurance. Before joining CrossView, Mark was a partner at Brulant Inc., where he provided counsel on delivering multi-channel solutions to increase market share by improving customer service, brand loyalty, and market reach. Prior to Brulant, Mark served as Director of eCommerce at Things Remembered, where he was responsible for the strategic business operations and technical infrastructure. He also served as Director of eBusiness for Cole National, establishing cross-functional partnerships between IT and business units across multiple brands including Sears Optical, Pearl Vision, BJ’s Optical and Things Remembered.
About CrossView CrossView is a premier provider of cross-channel commerce solutions and services that enable a smarter, more personalized shopping experience. Our multi-platform solutions and services unify the Web, stores, call centers, mobile devices, and other channels on a single, flexible platform. To learn more about CrossView, visit www.crossview.com.
Copyright © 2012 CrossView Inc. All trademarks belong to their respective holders. All Rights Reserved.
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