Stitching Together Customer Data Is a Bad Fit in Omnichannel Retail
Without a single, unified record, customer experience will be compromised.
Posted Apr 25, 2014
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can undermine customer confidence and loyalty. Yet, this 360-degree view is difficult to achieve with the disparate e-commerce, CRM, POS, inventory management, and order management systems in place at many retailers.

Costly and brittle systems integration can mitigate the issue, but anything less than reliable and real-time updates to the customer record from any channel introduces the risk of failure in service and the overall experience. Once the customer record is broken, it's extremely difficult to stitch it back together, and opportunities are lost.

Leading-edge retailers are taking advantage of technology that delivers a complete omnichannel customer view while connecting all front- and back-office business processes, from e-commerce and POS to inventory and financials. A good example is Hanover Direct, a multichannel, multibrand home fashion and apparel retailer that has transformed its 103-year-old business with a cloud-based business management solution.

Replacing a host of on-premises legacy systems, Hanover Direct has dramatically improved the customer experience as well as internal efficiencies across the Web sites for four of its brands (The Company Store, Company Kids, Scandia Home, and Undergear), with plans to implement a new, integrated POS system across its five physical stores in Wisconsin, Maine, and North Carolina. At the same time, more than 140 call center agents have a unified, real-time customer view for better service.

Hanover Direct and other leading retailers are driving success in this omnichannel world by focusing on three key areas:

Personalization over any channel. Customers expect consistent, personalized engagement at each interaction. Meeting that demand requires a single customer record that reflects purchasing history, interests, channel preference, and more to give individual customers an experience as unique as they are. In my shopping experience with the retailer I mentioned above, I would have been impressed had the associate been able to determine inventory availability and place my order, right over a tablet.

Loyalty-building initiatives. Shoppers value and reward ongoing engagement and meaningful promotions targeted to their interests. With a 360-degree view, retailers are positioned to understand recency, frequency, and spend, thereby anticipating customer needs and responding with the best offer over the best channel at the best time. Customer-centric marketing and service that focus on strengthening loyalty contribute heavily to retention and lifetime customer value.

Intelligent order and inventory orchestration. Buy anywhere, receive anywhere, return anywhere flexibility has become a key ingredient in meeting omnichannel expectations. Order delays and inventory stock-outs that were once tolerable now result in lost business and customer dissatisfaction. Orchestrating across diverse fulfillment points, from warehouses to stores to third-party distributors, is paying big dividends for retailers with integrated systems.

Ibex is another example of a multichannel retailer reaping the rewards of cloud systems geared for omnichannel commerce. The Vermont-based manufacturer of outdoor clothing has a full customer view across its e-commerce storefront, call center, and two physical stores using a single solution. Leveraging cross-channel customer data has helped Ibex grow its order volume by 82 percent since replacing unintegrated on-premises applications.

At the same time, Ibex site conversions have leapt 20 percent, and warehouse efficiency has increased 300 percent. Revenue has grown 37 percent as the company expanded its channel across more than 500 retail partners. As Ibex CFO William Hill put it, "We couldn't have pushed this volume of business through our previous segregated e-commerce and ERP platforms without adding a whole lot of manpower."

And I'll bet that if I visit the flagship Ibex store in downtown Boston and they don't have my size in stock, I won't be holding up the checkout line as inventory availability is manually checked, or reciting my personal details over the phone to an associate at another Ibex store to place my order.

Branden Jenkins is general manager of global retail at NetSuite, a provider of cloud-based omnichannel software.

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