The Next Generation of Retailing - Cross Channel Operations
The last decade has witnessed massive changes in the retail industry extensively impacting retailers' strategies and operations. The Internet boom forced retailers to focus on e-commerce to leverage the growing significance and usage of websites among consumers. Most retailers festinated to create their web presence and build their online channels to meet growing consumer demands. Retailers initially created independent online business units investing heavily in rudimentary, standalone, and first-generation e-commerce software.
But the retail industry is driven by consumer preferences which are relatively high as compared to any other industries. This fast and furious nature of the retail industry and conflicts between the business strategies of various selling channels like online/e-commerce, traditional store operations, contact centers and direct mailing are again pressurizing retailers to change their business and operations strategies.
Challenges Ahead
Despite all their initial investments in online technologies and multi channel operations, retailers are still struggling to satisfy changing consumer preferences. But the conflicts between the business interests of traditional approach and modern channels have impacted the retailers tremendously leaving them with uneven inventory and supply chain systems.
- eCommerce websites were governed by a conflicting set of performance metrics, incentives, and operating models from their traditional brick-and-mortar peers. Moreover, the growing presence of social computing networks and Web 2.0 technologies also making a strategic shift in retailers' strategies.
- The contact centers and physical store locations have started feeling the brunt of online's gain which is now a significant percentage of overall revenue.
- Consumer preference has changed dramatically. They now expect a seamless cross-channel shopping experience from retailers.
- While much of the cross-channel effort of late has been focused on consumer-facing activities, an area that is severely lacking in maturity is merchandise and inventory planning to support the cross-channel environment.
So with a distinct set of challenges, retailers are facing two major obstacles—a lack of cross-channel operational efficiencies and lingering technical shortfalls.
Cross Channel Integration - The Way Out
While retailers deploy many channels to serve consumers' demands yet managing all these channels is a huge task. This is the area where retailers face tremendous challenges.
For the past few years, online shopping and e-commerce became major revenue earners for retailers with a CAGR of 42% since 2006, its clear that online commerce has reached a critical mass, and consumers are not shy about frequenting this channel.
Space constraints on the sales floor and economical constraints in the supply chain are also forcing retailers to find innovative ways to manage inventory and ensure high conversion rates. To accomplish this, retailers are providing access to virtual inventory for products through Kiosks.
With the growing use of online channels among consumers for their shopping, it is evident that IT will play a major role in managing consumer preferences and web is going to be critical part of retailers' strategies. But companies are now looking beyond the front end of e-commerce and build an operating model that supports the integration of demand planning across channels to deliver more effective assortments and improved customer service.
So a Multi-channel/cross channel integration strategy is required to rope up all these systems and provide an enhanced experience to customers while also providing a single-window to manage the back-end systems of all channels including physical stores, online web portals, contact centers and other sales channels like POS and Kiosks.
Retailers are now focusing on integrating the back-end of all these channels to establish a robust supply chain and inventory control system to achieve higher levels of operational efficiency and ROI.
Unfortunately, the long-term cross-channel implications were often not part of the initial design and investments that were made in the e-commerce and other technologies. Retailers, today, need to look out for newer technology options in the pursuit of an efficient, consistent, superior shopping experience for the cross-channel consumer.
Download our whitepaper on "6 Essentials of Cross-Channel Success"
Next generation retail solutions @ HCL
HCL's Retail and CPG Practice offers some unique propositions and solutions for next generation retailing for the web-savvy generation of buyers. HCL's services not only enable retailers to meet customers' expectations and demands but also allow them to establish cross-channel operations to achieve better operational efficiency and higher Returns on Investments.
HCL has propositioned its services to relieve retailers from their pain points and to provide them an integrated solution for next generation retailing. HCL offers a robust e-commerce strategy to retailers to cater all their need of an integrated back-end eBusiness solution, leveraging Web 2.0 technologies and enhance multi channel buying experience for their customers.
HCL's capability and services can be better understood from the below given table:
| Industry Challenges | Service Capability | Description |
|---|---|---|
| Need for sustained competitive advantage & leveraging the quantum of online user base Meeting end user satisfaction | HCL's Web 2.0 offering called "First 2.0" | Set of collaboration and communication technologies such as Really Simple Syndication (RSS), Representational state transfer (REST), Ajax, blogs and social networking User Interface Optimization B2C Personalization, Live chat, Community, email Marketing B2B Collaboration, Product Information Management, Customer Web Store, Promotions Management |
| Integration of eCommerce System with Enterprise systems & Consolidation of multiple websites (different technology & platform) | Application Development & Integration | Integration Frameworks - Vertex designed to extract executive information Integration with 3rd Party Systems & Search Engines |
| Increased Security Frameworks | IT Infrastructure Management Services | Security processes, PCI Compliance and Managed Hosting Services |
| Need for quick turn around time for skills & Huge initial technology ownership costs | Application Management, Application Testing (Automation & Performance Testing) Application Deployment Application Porting and Migration | HCL has vast experience & are very strong in this area. Our accelerated cost benefit model also ensures the leverage of offshore skills optimally |
| Increased Quantum of Online User Base | eCommerce Functional Components | Content Management, Order Management, Catalog, Portals, Transaction Reporting, Business Intelligence Website response time optimization |
| Need "Always On" facility to maintain the business critical apps | IT Infrastructure Management Services | 24X7 Support, eCommerce Application Platforms, Database/OS and Development Tools |
HCL's next generation retail solution integrates retailers supply chain to the web commerce and customer relationship management solutions. We help retailers integrate their source of supply and point of customer interactions to build a cross-channel platform. The platform acts as a single window for retailers to keep track of:
- Inventory
- Orders
- Services
- Delivery
- Returns
- Information dissemination
- Communities
Our technological capabilities in Web technologies like Ajax, Ruby-on-Rails, DOJO etc help retailers upgrade their first and second generation standalone eCommerce systems and integrate them with the whole retailing operations.
HCL leverages its industry-focused IPs and Frameworks like:
FIRST 2.0 - A suite of end-to-end engineering services that harness the true power of the Web 2.0
E-store - Creates a platform for eCommerce web stores that is scalable and offers pluggable components to plug 'n play over Microsoft Commerce Server
CONNECT - Loyalty Management System - An integration framework designed to cater to retail Specific Loyalty Management requirements
Leveraging its technological expertise and innovative offerings and frameworks HCL's retail and CPG practice brings Operations Transformation to retailers and enable them to get ready for the challenges of next generation retailing.
Click here to download our whitepaper on "Winning eCommerce Strategies"
Did You Know?
- HCL works with 7 of the World's Top 35 Retailers, 4 of the top 5 Retailers in India and 4 of the world's top 10 hardliners and Leisure Good retailers
- AMR has rated HCL a Leader in Retail and ranked higher than other Indian offshoring companies in Retail capability scope, with a leadership status in Supply Chain
- HCL's retail practice is associated with some of the leading Retail associations in the world including ARTS, AAFA, APICS and National Retail Foundation
