A new forecast from Forrester Research credits greater online spending by Canadians, lower shipping costs and more selection for the spending increase.
Many retailers find their multi-channel initiatives hobbled by not having a consistent view of inventory and customer data across all channels, according to a survey by RSR Research.
Retailers recognize the value of multi-channel customers and are anxious to serve them better, for instance by enabling them to order online and pick up in store. But formidable technical and organizational challenges stand in the way of multi-channel initiatives at many retail companies, according to a survey by RSR Research.
50 of the 103 retailers responding to the February survey say multi-channel customers are more profitable than those who only shop in a single channel, up from 41% in a similar RSR survey two years ago. A surprising 33% of respondents could not answer the profitability question, indicating a need for better techniques for measuring customer profitability across channels, writes Brian Kilcourse, author of the report “Finding the Integrated Multi-Channel Retailer.”
Many retailers provide some cross-channel services, the survey shows. 35% allow customers to buy online or through a catalog and pick up in store, including 59% of respondents from retailers with annual sales of more than $5 billion. 36% provide online visibility to in-store inventory, including 47% of the larger retailers.
The top organizational inhibitor to better multi-channel performance was the lack of integration of inventory and order management systems across channels. That was cited as an obstacle by 51% of retailers deemed “winners” by RSR-those whose annual same-store sales grew by more than the industry average of 3%-and by 56% of other respondents. Lack of integrated customer data across channels is an obstacle for 38% of the winners and 37% of the others, the survey shows. (46% of the respondents came from retailers RSR deems winners.)
29% of winners and 46% of others pointed to budgetary constraints as an obstacle to multi-channel efforts, and 38% of winners and 25% of others noted such initiatives are blocked by fears from the dominant channel-the store-that its sales will be cannibalized by web or phone sales. The report notes that under-performing retailers are more likely to be worried about lack of funding to pursue multi-channel initiatives, while more successful retailers are more concerned about cannibalization. Fear of cannibalization can be addressed by compensating executives by the success of the brand, rather than the channel, the report says. But only 16% of retail winners called that an important response to overcoming multi-channel obstacles, suggesting they are more likely to focus on overcoming technical issues, the report says.
The report notes that only 18% of respondents can enter product and customer data one time for all channels, while 27% enter it into one channel system of record and electronically move it into other channels and 55% enter data into separate systems. “Retailers need to move to one process that gets product and customer information into all channels’ systems from a single point of control,” Kilcourse writes in the report. He also advises retailers to make sure that store-level inventory information “is updated in real time, is accurate and is available to all the channels.”