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Retailers Retool for Cross-Channel Shoppers

Forget about online shopping versus brick-and-mortar stores. The new retail environment requires stores to shape their customer experience and their business processes for the cross-channel shopper.

That’s a key takeaway in a new white paper by Manhattan Associates (MA), entitled "Changing Consumer Behaviors are Re-Casting the Role of the Store Associate," and it’s borne out by other studies. Consumers today, the white paper said, “want to surf the Internet, find products they want, read reviews, compare prices and check availability before they drive to a store.”

Inventory Control

This means the physical store now has a different place in the buying sequence than ever before, requiring a shift in retailers’ thinking as consumers expect and reward environments that support the new landscape.

Manhattan Associates, which provides supply chain optimization for retailers, said that the store is no longer “used solely as the end point to consummate sales with walk-in customers,” but, instead, there is an opportunity for the store to become “an operational node for many transactions.”

To operate in this fashion, MA said retail stores need much tighter internal inventory controls for a given store and the entire supply chain, as well as tighter order fulfillment, so that they can act “more like a distribution center.”

shutterstock_92854585.jpgThis places additional responsibilities on the store associates, who now become what MA calls “as much of a supply chain navigator as an aisle navigator” — being able to reach out to the e-commerce website and a kiosk as much as to vendors or distribution centers.

Implications, Approaches

MA notes a recent survey from Forrester Research, which found that over half of consumers who buy in local, physical stores begin their buying research online. Because of this “blended channel experience,” physical shopping is only one step in a process that involves websites, mobile searching, word of mouth and, possibly in the not-too-distant future, TVs that can be searched for product information they have aired.

This “new shopper” trend, is still in its embryonic stages, but several implications are already evident. Customers may know more about a store’s products than the store employees, sales associates must have single-point access to information and inventory control and loyalty programs must take cross-channel use into account.

But, even as retailers are attempting to wrap their minds and their approaches around the new shopper, different approaches to this new environment are already apparent. In particular, MA contends that “programs must be consistent and channel-agnostic,” including in the physical store.

But other retail strategists, while endorsing the “physical store is but one link in the new buying sequence” approach, are emphasizing the importance of making the shopping trip to a physical store an experience that cannot be duplicated elsewhere — particularly not online.

The Future of Retail

In June, for instance, Motorola Solutions released a report entitled "The Future of Retail" that said that three-fourths of brick-and-mortar retailers expect that an engaging in-store customer experience will be essential over the next five years. While it also found that consumers regularly research their purchases online before going out into the real world, it recommended that the omni-channel solution “provide a more seamless experience” between online and in-store where customer needs are well met wherever one shops.

Motorola Solutions’ scenario envisions such enhancements as predictive analysis of shoppers’ needs from customer data or context-aware store systems designed for specific locations and activities — tailored to either online or physical store experiences. For a physical store however, that might mean “geofencing” that recognizes customers’ smartphones when they walk in, offers discounts on the spot and allows customers to do their own, in-store inventory search via kiosk or their own mobile device.

In any case, the Promised Land of online research plus physical pick up is not universally here. A recent report by the Baynote Group, for instance, found that the biggest marketing influencer for shopping in this past holiday season was… paper catalogs. While the customer experience is changing in dramatic ways, some old standbys are still holding on. 

Image courtesy of Rostislav Glinsky / Shutterstock.com

 
 
 
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