Best Practises for Omnichannel Order Management

Order Management in the Omnichannel Era

"The old adage ‘know thy customer’ is a task that is becoming simultaneously easier and more difficult in this day and age of technology.

Difficult, because as new tech innovations make their way into our lives every other day, it results in consumer trends changing at a pace where they are hard to predict. Yet, at the same time, people are increasingly running their lives using technology, and it has never been easier to gather data from connected customers, and gain insights into their lifestyles and consumer patterns.

As the tides of technology turn, ‘online shopping’ and ‘in-store shopping’ might soon be antiquated terms. The lines are becoming blurred as more customers use their mobiles to enhance their brick-and-mortar shopping experience. Shoppers rely on online product information, seek out coupons, and largely prefer looking up online reviews to consulting in-store associates.

The Rise of BOPIS, BORIS & SFS

There is a growing trend of shoppers choosing to buy products online and pick them up in store; a pattern retailers refer to by the acronym ‘BOPIS’. There is almost a frenzy amidst retailers to offer BOPIS as the demand for it has spread like wildfire.

In 2018, the number of retail locations offering BOPIS nearly doubled among leading US grocery retailers. The number of click-and-collect locations for brands like Walmart, Target, Kroger, Ahold and Albertsons went from 2,451 in January 2018 to 5,800 in December 2018. Home improvement company Lowe’s claims that 60% of its online orders are collected in-store--and that number is 36% for Kohl’s and 43% for Home Depot. Retail giant Target announced that their BOPIS programs grew more than 60% year over year in 2018.

Customers are gravitating towards the concept of BOPIS for smart reasons; for one, customers who pick up their order in store avoid shipping fees. Others choose BOPIS because they needed the product the same day, or because the store is close enough for the convenience of picking up their order. For reasons of convenience, a growing number of retailers are also allowing customers to return online purchases at physical locations (BORIS). Other programs like Ship from Store (SFS) offers retailers the capability to use physical stores as distribution centers. All over, there is a movement of companies leaving a one-channel-only approach, presumably because omnichannel captures a wider audience and drives more sales. Digital retailers are branching out into physical stores, as they are hurt by the soaring costs of online ads, which in turn make the cost for acquiring online customers steep.

"By adopting a Brick-and-Clicks business model, companies can integrate their online store (the clicks) and offline store (the bricks) into a single retail strategy.

As brands make the move to Brick-and-Clicks, one of the key challenges they face is supply chain planning. Without real-time inventory tracking across all the different channels available, retailers are going to risk overselling or underselling their products. A well-oiled system can prevent unpleasant situations of delays and back-orders, which are otherwise inevitably. While most customers can forgive one-off incidents, a reputation for delays is catastrophic for brands. Given the dynamic competition in most industries today, Harvard Business Review concludes that the ultimate differentiator for companies comes down to customer experience. Customers who have faced multiple delays, and those who are frustrated with inconsistent experiences on different devices won’t stick for long--but this is where order management can save the day, and help businesses get their act together.