June 29, 2009, 12:00 AM

Meeting the demands of cross-channel retailing

Cross-channel integration enables consumers to buy and take delivery in the ways they prefer.

If retailers have heard it once they’ve heard it a thousand times: It’s best for merchants to operate as a single brand, not as separate web, bricks-and-mortar and catalog units.

So, how can a multichannel retailer do this successfully?

One key to selling in several channels is maintaining an order management system that integrates all channels in which the retailer operates, says Janet Sherlock, a retail analyst at research and advisory firm AMR Research Inc.

Sell and fulfill anywhere

“Every retailer will need to have the capability of taking orders from anywhere and fulfilling from anywhere, if not now, then at some point down the road,” she says.

Consumers today often shop in every channel, and retailers should be ready for this with cross-channel order management systems that provide a universal look at customer interests and shopping behaviors. When retailers combine cross-channel order management with the ability to fulfill orders from any channel, including stores and warehouses dedicated for either stores or web sales, they can better match customer demand with available inventory, Sherlock says.

For example, if a snowstorm hits a major portion of the country, and a retailer sells out of down parkas stored in its web fulfillment center, the merchant should have an order management system that can draw on its store inventory in sunny California to capture an online sale.

However, new research shows many retailers aren’t doing this. A recent study by AMR, finds just 7% of retailers have deployed the infrastructure to provide customers a cross-channel shopping experience.

Experts say the cost of deploying cross-channel technology could be keeping many e-retailers from implementing it. But Sherlock cautions that retailers should not operate in several channels unless they have an order management system that fits the bill.

If a retailer feels pressed to offer in-store pickup of online orders to let customers avoid shipping costs, for example, it would be counter-productive to quickly deploy a stop-gap system that didn’t effectively integrate online order management with a store fulfillment system, she says. In that case, it may be better to promote free shipping instead of in-store pickup until the retailer can afford to deploy an efficient system for in-store pickup.

Cater to the customer

What’s more, a true integrated system does not just let retailers cross channels to fill sales, but lets consumers cross channels, too, says Donny Askin, CEO of Tech/Turn Consulting and a former executive with order management vendors.

“A shopper who buys online should be able to go to the store and return an item,” Askin says. “The system needs to have a 360-degree view of the customer, and complete visibility across all channels.”

That visibility, when shared with a shopper, can save sales, experts say.

Recognizing how time-sensitive its customers are, party supply retailer CenturyNovelty.com has tied together its shopping cart application and order management system so it can provide detailed information about when items will arrive.

On the product detail page resides a box that says “How soon can I get it?/Check product availability.” Visitors click the box to see how many items are in stock and when the product would arrive by various shipping methods. If the product is out of stock, the site displays when it will be available. Shoppers can check availability on the checkout page and via the shopping cart, as well.

Ian MacDonald, vice president and general manager at CenturyNovelty.com, says he has seen customer behavior change since adding the feature a year ago. More customers choose less-expensive shipping options because they can see that even those options will get the product there in time. “Before, people would err on the side of caution,” MacDonald says. “Now they’ll choose three-day delivery or ground over a more expensive express option.”

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