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Why you need to think of your digital retail strategy as an iceberg

  • Posted on July 19, 2016

digital retail

Everyday I hear from my retail customers in a panic.

“We need to be omni-channel!” they shriek, terrified of what the future will bring if they don’t cash in on the latest digital retail craze and bring their sales to devices of all sizes and shapes. Unfortunately, these companies are looking at it the wrong way. In fact, they are only looking at the tip of the iceberg.

Digital Experience is Just the Tip of the Iceberg

When we talk about digital sales, and in particular the idea of “omni-channel,” a very specific set of solutions usually come to mind. Retailers see their storefronts on mobile webpages, they see text message offers, they see apps, in-store displays and displays, beacons monitoring activities at store and so on.

All of which is very important, and it is an initial step, of course. But it lacks an understanding of what is needed to build a successful and integrated omni-channel experience, one that will stand up to competition from even the most disruptive online players.

What is missing from their picture is an appreciation for the operations and supply chain best practices that the online leaders have mastered. Only when you combine both, the next generation omni-channel experience with all the most modern thinking and solutions of operations, can you have a dependably successful cross-channel, digital retail experience.

Your Focus Depends on the Retail Format

Clearly, not all retail businesses are alike. And, in fact, some formats are actually more focused on the bottom part, beneath the surface, and require more focus on the top-level experience side of things.

Big box retailers, for example, have built up legacies of supply chain and operational excellence. It is the mobile UX, the agility of online players, and the consumer experience where they will need to beef up their skills.

Fashion brands and specialty retailers, on the other hand, are in an industry which is typically heavy on look and feel, and in need of channel and supply mastery.

What is important is that you are addressing both, regardless of where your industry bias lies. If you don’t, you can be sure of two things: 1) your customers will notice, and 2) the moment a competitor comes by with a more rounded out offering, they’ll eat your lunch.

Implementing the 6 Pillars for Digital Retail Success

At Avanade, when we work with clients we help build a robust, complete digital retail strategy for omni-channel execution. To guide our processes, we look to what we call the “six pillars” of Digital Connected Retail:

  1. Unified Commerce - Consistent and seamless omni-channel marketing, shopping and fulfilment activities in both online and offline channels
  2. Streamlined operations – Integrated and optimized supply chain and store operations
  3. Digitalized StoreEngage customers and employees through in-store digital experiences
  4. Service Excellence- Single view of the customer in all touch points and channels (Digital, Store, Contact Center and Social CRM)
  5. Actionable Analytics - Unify, enrich, unlock and enable the use of data across the Retail enterprise
  6. Agile Enterprise - Cloud (and Technology Infrastructure)

Omni channel graphic

The alternative to this approach is fatal. Businesses that don’t adopt a full-fledged approach risk being disrupted by what we call “pure play” online retailers – companies such as Amazon or Zappos (and other that will appear) that have been built from the ground up with these principles in mind.

The choice is yours. Will you master the entire iceberg, or will you ignore what lies beneath?

Elena Martinez

Great messages in your post Marcos! not to mention the IT teams ' nightmare for having to maintain and evolve all the infrastructure of disparate systems required to deliver that unified-commerce experience! What would your retail customers ' reaction be if you tell them that they can deliver all that without having to re-platform? and with a short time to market?

July 31, 2016

Gianluca Marcellino

Thanks Marcos, a great reminder that innovation requires changing core capabilities, as well as adding new ones.

July 27, 2016

Juan Gutierrez

Marcos, congratulations on your article, I think it addresses perfectly well the real challenge retailers are facing, it is not a matter of some simple make-up on their systems but really rethinking how they Want to opérate and what are their priorities for them in terms of Customer service. Thanks for this!

July 26, 2016

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