Turning Fulfillment Into Your New Competitive Advantage
The Omnichannel
Fulfillment Blueprint
Sponsored by
The Evolution of
Omnichannel Fulfillment
PART 1
Previously, omnichannel fulfillment was a capability that only the most innovative, leading-edge brands offered. They had the technological infrastructure to support numerous fulfillment options from across the enterprise — and a steady stream of capital to consistently invest in tools and tactics that allowed them to continuously create great experiences. But as consumers embraced more omnichannel browsing and buying patterns, they came to expect more seamless fulfillment experiences from all of their preferred retailers.
Leading-edge brands (most notably, Amazon) placed their stakes in the ground, and shoppers gave every other retailer an ultimatum: keep up or move out of the way.
The Evolution of Omnichannel Fulfillment: From Luxury to Necessity
(Source: 2018 Global Path to Purchase Survey)
More than 90% of shoppers combine digital and physical channels on the path to purchase.
57% of consumers picked up an online order in-store over a 12-month period. Why?
(Source: Internet Retailer)
As a result, we’ve seen retailers strive to create flexible and seamless order fulfillment experiences and to empower customers to get the products they want anywhere, at any time. But still, their ability to keep pace with these expectations is not where it needs to be.
They were going to the store already
22%
Timing / Not wanting to wait for delivery
30%
Convenience / The store was nearby
32%
73%
To avoid shopping fees
It’s Time To Face Facts.
Retailers Have Failed So Far.
Part 2
(Source: RIS News)
63% of retailers believe it’s “extremely important” to deliver omnichannel fulfillment from all sales channels with speed, accuracy and cost effectiveness.
75% say they’ve reached “fulfillment maturity” in stores.
Only 32% said the same for their online and mobile channels.
(Source: Gatepoint Research)
When asked how their omnichannel experiences compared to their competitors’, a mere 17% of retailers said that they were ahead of their competition.
The first step retailers must take is to admit their weaknesses. The second step is to take advantage of this blueprint, which has been designed to help retailers address the many challenges of omnichannel fulfillment.
Read on to learn how to establish a profitable, reliable omnichannel fulfillment strategy that is fueled by a stellar — and differentiating — customer experience.
So, Where Do Retailers Go From Here?
Adoption of omnichannel fulfillment — specifically buy online, pick up in-store (BOPIS) — is rising. But there are clear leaders and laggards in this critical area of the customer experience.
“BOPIS” Around The World
23.5%
Canada
57.5%
Nordics
29.1%
United States
25.5%
Australia
67.0%
United Kingdom
The New KPIs of
Omnichannel Fulfillment
In this era of endless choice, retailers must keep their promises in order to stay relevant. Adding to the challenge, the promises they make have to keep expanding: They must give customers the power to have products whenever, wherever and however they prefer — and they need to find ways to do so without eroding margins. If they don’t, both their relevance and their futures are at stake.
As a result, retailers must rethink the key performance indicators (KPIs) they use to assess the effectiveness of their omnichannel fulfillment strategies. The four most important KPIs to measure success are:
1. What types of promises are you able to make?
4. How much does it cost to create these experiences?
3. How much disruption can you keep pace with?
2. How many promises are you able to keep?
Omnichannel fulfillment has become a necessity. So why is it that so many retailers are still doing it wrong? Read on to investigate common fulfillment and profitability pitfalls.
Unpacking Profitability Pitfalls
Why Retailers Choose Aptos
With Aptos Enterprise Order Management technology, you can optimize every phase of the order lifecycle, from order entry to fulfillment and even through returns.
Turning Fulfillment Into Your New Competitive Advantage
The Omnichannel
Fulfillment Blueprint
Sponsored by
Unpacking Profitability
Pitfalls
PART 2
Omnichannel fulfillment, especially buy online, pick up in-store, has become “table stakes” for most retailers worldwide. Unfortunately, very few retailers have successfully navigated the technological and operational obstacles that run rampant as fulfillment options expand.
Are these common omnichannel fulfillment pitfalls plaguing your profitability?
Unpacking Profitability Pitfalls
Last year, 61% of customers stopped doing business with at least one company because of a poor customer experience, according to Accenture research. Many retailers look at “customer experience” through the lens of customer-facing technologies, marketing campaigns and events, but the reality is fulfillment plays a similarly important role.
The problem lies in how retailers define and execute their fulfillment strategy. Many perceive it purely as an operational necessity; not an experiential opportunity. As a result, we believe that too many retailers are missing out on an opportunity to incorporate assisted selling, product recommendations and other up-selling opportunities into the fulfillment experience.
Lack Of Focus On Experience
Associates are now expected to pick, pack and prep orders that are being shipped from stores to anywhere else — whether it’s a distribution center, another store or a customer’s doorstep. They’re feeling strapped for time and resources, and often don’t have the knowledge or tools required to fulfill orders quickly and efficiently. Associates aren’t the only ones feeling the pain: According to a survey of nearly 2,300 store managers, 29% say order fulfillment is their biggest challenge and 29% say staffing is
an issue.
Managers must be able to staff their stores so neither fulfillment operations nor customer service suffer. Moreover, they must train employees and empower them with the right technology so they can access customer orders and fulfill them quickly and efficiently.
Poor Employee Training
Retail headquarters must have a real-time view of how products are flowing to and from stores. This will help ensure that they’re not promising to fulfill orders from stores that have limited inventory. However, very few retailers say they have reached a high level of maturity in inventory accuracy and reliability (29%), and transparency and visibility (24%). As a result, many promises that depend on store inventory are at a very high risk of being broken.
Data Transparency And Accuracy
Many retailers are still using multiple, disparate systems to manage their orders. As a result, data from their POS isn’t effectively linked with their e-Commerce, merchandising and order-management systems. This often leads to communication breakdowns, especially when it comes time to track store fulfillment progress and to alert consumers of their order progress. Sadly, less than 50% of store managers feel they have access to information needed to fulfill in-store requests, according to Square Root research, inhibiting them from creating the seamless experience customers crave.
System Silos
Can Your Order Management System Handle These Order Journeys?
Store fulfilled order
Order modification
Split order/back orders
Returns/credits
Processing credits
Modify shipping details
Authorize and process payments
Add-Ons
Inventory tracking/reservation
As new commerce and communication touch points have emerged, so too have new ways for customers to complete and fulfill orders.
Check off each leg of the “journey” your current order management system can accommodate, and see how your business stacks up:
Get Your Results
Back To Checklist
The more items you selected, the closer you are to
having a superior fulfillment strategy:
You’re truly best-in-class and are empowered to create seamless, differentiated experiences.
You’re on par with most of the industry (including your competitors), but there’s plenty of room for improvement.
You’re falling far behind
most competitors, risking customer loyalty and hurting revenue results.
8-9
selected
5-7
selected
0-4
selected
Looking for ways to optimize operations and reimagine the fulfillment experience? Look no further! Read on to see the new omnichannel fulfillment blueprint.
Your Omnichannel Fulfillment Blueprint
Why Retailers Choose Aptos
With Aptos Enterprise Order Management technology, you can optimize every phase of the order lifecycle, from order entry to fulfillment and even through returns.
Part 3
Part 1
Turning Fulfillment Into Your New Competitive Advantage
The Omnichannel
Fulfillment Blueprint
Sponsored by
Your Omnichannel Fulfillment Blueprint
PART 3
Want to see greater success with omnichannel fulfillment? The key to success lies in defined and repeatable processes that are tailored to customer
behaviors and preferences in each channel and for each fulfillment option. This is your blueprint to get there:
Your Omnichannel Fulfillment Blueprint
Your plan is the foundation for your omnichannel fulfillment strategy. Take a close look at your customer, how they shop, where they buy and how they expect their purchases to be fulfilled. What order fulfillment options best align with their needs and expectations in each channel? Moreover, which options align best with your brand and your unique value proposition?
For example, a luxury retailer with an immersive and memorable in-store experience will thrive with a “reserve online, try on and buy in-store” offering. Conversely, the traditional “buy online, pick up in-store” may make the most sense for a specialty sports retailer. But don’t think you have to limit yourself to one option; you should implement as many options as make sense for your customers, as long as you can fulfill your customer promises and that each promise reflects the needs of your brand, your business and your buyers.
1. Set Your Plan
Part 2
01
01
Pick up in-store
Buy online
02
02
Ship to store
Buy online
03
03
Ship from store
Buy online
04
04
Sell/Ship from another store
Shop in-store
05
05
Buy in-store
Reserve online
06
06
Return to store
Buy online
07
07
Ship to locker
Buy online
The average retailer has stores, warehouses and distribution centers all over the world. Taking this into account, as well as the variety of different devices consumers use to shop, it is easy to see how critical it is to have a 360-degree view of inventory. These are the different channels retailers must have visibility into in order to optimize their omnichannel fulfillment strategies.
2. Ensure a 360 Degree View
of the Extended Enterprise
MOBILE
SERVICE AGENTS
VENDORS AND
SUPPLIERS
SERVICE AGENTS
Up to 62% of customers say that a representative’s knowledge or resourcefulness was key to their recent positive service experiences, according to American Express research. Arm agents — whether they be people or bots — with unified customer data so they can better serve shoppers. Empower them to see and sell inventory from all areas of the enterprise so they can check order status, change orders, make product recommendations and even complete transactions.
MOBILE
E-COMMERCE
SERVICE AGENTS
MOBILE
Whether through a mobile commerce site or mobile app, shoppers should be able to access local inventory levels and determine whether they can order a product online and pick it up quickly at a nearby store. Retailers should take advantage of GPS and location tracking in order to present local inventory to these on-the-go customers.
STORES
MOBILE
E-COMMERCE
E-COMMERCE
Nearly one in four online shoppers purchase online at least once a week, and this number will only continue to grow. These online shoppers have fingertip access to all of your competitors, and will only buy from retailers that offer the right products at the right prices combined with the most convenient fulfillment options. In order to keep customers in your corner, every piece of inventory needs to be available and accessible. This means all fulfillment locations — vendors, DC’s and stores — will need to have a real-time view of what products are being ordered online and how shoppers expect those orders to be fulfilled.
STORES
E-COMMERCE
DISTRIBUTION
CENTERS
STORES
We all know that the majority of retail transactions still take place in stores, but that doesn’t change the fact that a lot
(if not most) of those transactions are influenced by digital channels. As shoppers browse online, they expect to see in-store availability, so if retailers don’t have
reliable, timely and accurate visibility into inventory going in and out of their store locations, they have a gaping hole in their operations — and a gaping hole in their customer experience.
STORES
DISTRIBUTION CENTERS
VENDORS AND
SUPPLIERS
DISTRIBUTION CENTER
Store managers and associates must have insight into which distribution centers have the products they’re looking for, how many and how quickly they can be delivered to stores. This data transparency is also key to allowing specific stores to quickly process returns and make inventory available for sale again.
SERVICE AGENTS
DISTRIBUTION
CENTERS
VENDORS AND SUPPLIERS
VENDORS AND SUPPLIERS
Are you making inventory from vendors and suppliers available to customers if it isn't available in stores? If so, you need to have real-time data around what products, colors and sizes they
have available.
E-COMMERCE
Nearly one in four online shoppers purchase online at least once a week, and this number will only continue to grow. These online shoppers have fingertip access to all of your competitors, and will only buy from retailers that offer the right products at the right prices combined with the most convenient fulfillment options. In order to keep customers in your corner, every piece of inventory needs to be available and accessible. This means all fulfillment locations — vendors, DC’s and stores — will need to have a real-time view of what products are being ordered online and how shoppers expect those orders to be fulfilled.
Conversational commerce, AI and other disruptive trends are presenting retailers with a slew of new opportunities to ramp up their fulfillment experiences. However, these technologies are moot if retailers don’t have the proper infrastructure in place.
Following this blueprint, you can develop your foundation for omnichannel fulfillment success by:
Get Started With The Blueprint
Understanding shopper needs and preferences
Prioritizing fulfillment offerings
Defining critical processes across the enterprise
Improving transparency across all channels and touch points
Assessing and reassessing offerings and experiences based on new consumer preferences, market conditions and overall performance
Leveraging technology to support and enrich every step of the process
Why Retailers Choose Aptos
With Aptos Enterprise Order Management technology, you can optimize every phase of the order lifecycle, from order entry to fulfillment and even through returns.
3. Empower Your People
A retailer’s customer experience is only as good as the people that deliver the experience — and the same could be said for the fulfillment experience. Your store associates should feel empowered to do their jobs well, whether they’re picking a product from the store floor, venturing to the stock room to pack an order or interacting with a customer who is picking up their online purchase.
Below are critical questions all retailers should ask to ensure they’re equipping their associates with the tools they need to create a stellar fulfillment experience. Click through each section to see if your business has all the right answers.
1. Will we be hiring employees to solely complete fulfillment-related
tasks? Or will we be asking employees to split their time between
serving customers and picking/packing orders?
2. How will we ask associates to split their time between fulfillment
and service activities?
3. Are we staffing our stores to align with omnichannel
fulfillment demands?
4. Are we training employees to work quickly and efficiently and
empowering them with best practices?
OPERATIONS/
STAFFING
1. How can associates access customer orders?
2. How can they access inventory levels in stores and
across all channels?
3. How are they alerted if and when an order comes through?
4. Are they able to complete transactions on shoppers’ behalf?
5. Are they given pick lists that maximize efficiency?
TECHNOLOGY
1. Can associates contact customers directly regarding the status
of their order – even if they’re not yet in the store (i.e. using text,
email, calling)?
2. When shoppers visit a store to pick up their order, can associates
access their data in order to have more relevant and helpful
conversations?
3. Are associates equipped to make product recommendations or
provide exclusive deals based on customers’ purchase behaviors
and preferences?
4. Are associates prepared and empowered to enrich the entire store
visit with convenience, efficiency and information?
5. Can associates add impulse items to existing transactions to
minimize inconvenience?
EXPERIENCE
Transparency is key to a great omnichannel fulfillment experience. And this transparency is best created
via real-time communication delivered to customers,
as well as key stakeholders throughout the
fulfillment process.
Nearly three quarters (73%) of consumers want to be able to track orders across all touch points, according to Boston Retail Partners, however the Retail TouchPoints survey indicates that only 54% of retailers rate their outreach as “good.” These results point to a clear gap between customer expectations and retail realities, indicating that merchants have to work harder to give customers real-time updates on their orders through their preferred channels.
4. Communicate, Communicate, Communicate
According Retail TouchPoints, retailers utilize a variety of communication channels to update customers on order status.
FOR CUSTOMERS:
Email notifications (86%)
Online tracking links (38%)
Text messages (33%)
Phone calls (29%)
In order for omnichannel fulfillment to be executed flawlessly, key stakeholders must stay informed of:
Order status
Customer status
Exception conditions
Inventory levels
Product out-of-stocks
FOR STAKE HOLDERS:
5. Reimagine Fulfillment:
Turn Operations Into An Experience
Foundationally, store fulfillment is beneficial to both retailers and consumers. Retailers can make their entire inventory available to more shoppers, ultimately increasing overall sales and reducing markdowns. Consumers are able to quickly and conveniently get products from their preferred store locations.
However, most retailers tend to look at omnichannel fulfillment as an operational obligation, rather than an opportunity to differentiate. As a result, they’re missing
out on the opportunity to make the experience more valuable for shoppers and, ultimately, more profitable for their businesses.
Moving forward, the most successful retailers will be the ones that use fulfillment as a way to surprise and delight customers — rather than simply fulfill their desire for convenience. What does it take to get there? Marketing and customer experience teams need to have a seat at the table, and they must collaborate to design a fulfillment experience that truly puts the customer at the center of the experience.
It is still in the very early days for this new era of fulfillment, but here are some ideas to spark a bit of inspiration:
Give shoppers the power to reserve a fitting room for their online order on a specific day and time. Alert associates of a shopper’s arrival, so they can pick the product, as well as a size up and down from the size they ordered. Associates can also stage the fitting room with complementary items, such as shoes, accessories or other apparel items.
APPAREL
Have an installation expert greet guests picking up their online orders and provide advice and cross-sell options, as well as detailed tutorials on how to complete their DIY projects when appropriate.
HOME IMPROVEMENT
Allow customers to bundle their most-purchased products into a “care box” that they can pick up every month. Add two “surprise” products to the box that you think they would like based on their preferred brands and products.
BIG BOX
Give cooking class attendees the option to pre-purchase items used during the session, including pots, pans, seasonings and even the cookbook featuring the recipe.
HOME/COOKWARE
Allow customers to reserve items in-store and schedule one-on-one time with a personal stylist. Stylists will prepare for appointments using customer data, including browsing and buying behaviors, so they can have more relevant conversations and even make additional product recommendations. Stylists will lead the entire fulfillment experience — from greeting the customer to wrapping up purchases.
LUXURY
The retail industry is ripe for further disruption. While many retailers view this disruption as a challenge, we see it as an opportunity; an opportunity for retailers to reaffirm their unique value propositions, and to surprise and delight their customers.
For example, there are several trends emerging and on the horizon that will give retailers the opportunity to expand and optimize their fulfillment strategies:
6. Prepare For New Ways To Differentiate
Virtual assistants such as Siri, Alexa and Cortana are becoming extensions of consumers’ everyday lives — and they’re helping them get stuff done. Although few are currently using these devices to shop, we may begin to see traction with conversational commerce, whether people are using their devices to update shopping lists, complete orders or check their delivery status. Brands should consider if and how they can capitalize on this opportunity by offering similar experiences.
Not sure whether your business should join the conversation?
Access exclusive Alexa content to get the scoop.
CONVERSATIONAL COMMERCE
LEARN MORE
Same-day delivery is old news. Now, retailers are considering whether they can offer one-hour delivery or even on-demand delivery by outsourcing to companies like Uber, or even by using drones. However, as you strive to keep pace with Amazon’s one-hour delivery model, consider whether this is something your customer really wants. Understand their behaviors and preferences, and whether the capital investment is worthwhile.
Want to learn how you can better understand your customer? Listen to the Retail Experience Project podcast featuring consumer behaviouralist Ken Hughes.
“UBER-FAST” DELIVERY CHANNELS
LISTEN NOW
There is a lot of controversy surrounding AI and its ability to automate tasks and eliminate jobs. But the consensus has been that the value of AI is augmenting humans, not replacing them. For instance, machine learning could help retailers to understand — and even predict — customer demand, thus improving supply chain efficiencies, inventory allocation and delivery times. Imagine being able to get products to your customers faster than ever before — without eroding margins. Imagine being able to use bots that can understand and respond to fulfillment inquiries. These scenarios merely scratch the surface of AI’s potential.
AI