Seven Ways to Merge the Physical and Digital with Order Management

By Mark Troselj | 27 May 2014

Streamlined order management systems and processes can be used to integrate e-commerce sales with shipping and supply, allowing for enhanced omnichannel capability, writes Mark Troselj.

In today’s omnichannel world, tech savvy consumers no longer differentiate between online and in-store experiences. They want convenience – to shop whenever and however they please, through any channel — and they want a great experience every time.

To attract and retain today’s empowered shoppers, retailers must blend the physical and digital worlds into a seamless omnichannel commerce experience that offers buy anywhere, fulfill from anywhere and return anywhere flexibility.

Many retailers aim for that ideal, but are falling short in getting a product into the hands of the consumer where, when and how they want it. Many are struggling to cope with disconnected processes for order and inventory management that obscure visibility into where inventory exists across a diverse back-office network.

Tree of Life is one retailer that is getting it right. The Australian retailer of fair trade clothing and accessories from developing countries integrated its head office, 54 retail stores, wholesale business and a B2C e-commerce site together on one unified commerce solution with an efficient order management system. This has enabled Tree of Life to flawlessly view, analyse and fulfil transactions across webstore, brick-and-mortar and telesales, regardless of where it was originated from or where it will be filled. In an omnichannel commerce environment, these capabilities are especially important to meet the expectations of today’s consumers.

Unless you can offer a product to customers without delay and frustration, you stand to lose customer confidence and drive business to your competitors. A disconnected approach also comes with the risk of critical errors that invite unflattering critiques on outlets like social media, not to mention fulfilment costs soaring because you heavily rely on manual processes.

For years, many retailers left their legacy order management processes intact as “something for the warehouse to worry about.” Instead, they invested in customer-facing initiatives, such as dynamic e-commerce storefronts, smart in-store merchandising, social media and CRM for personalised marketing.

As those elements become virtual commodities, it’s the back-office order and inventory management that’s emerging as a make-or-break factor for retail success. In fact, respondents to a Retail Systems Research survey in November 2013 ranked cost-effective shipping and fulfillment, as well as optimising inventory across all channels, among their top operational challenges (51 percent and 45 percent respectively).

Below are several ways in which retailers can leverage order management to merge the digital with the physical, to deliver a true omnichannel experience to customers.

1. Bridging across channels

Shopping has morphed from the old linear funnel to an unpredictable hopscotch across channels, where customers leverage each channel to serve specific purposes and expect consistency and satisfaction at every touchpoint. The margin for error in order management is diminishing as consumer demands for a superior omnichannel experience rise. Order delays and missteps that were once tolerable are fast becoming glaring weaknesses that penalise the bottom line.

Smart retailers increasingly appreciate the importance of order management as a bridge between e-commerce, physical point of sale (POS) and CRM and its role in driving satisfaction and sales. Leaders are already reaping the rewards of rethinking and optimising how order management works.

2. Orchestrate across diverse fulfillment points

It’s not uncommon for a retailer to have multiple warehouses, with some committed to e-commerce inventory and others dedicated to physical store stock. The retailer may also rely on third-party distribution centres and drop-shipments from manufacturers. Of course, in-store inventory is another resource, but in effect, it often remains locked in a store, unavailable to other channels and even other stores.

An e-commerce site, for instance, might inform a consumer that it’s out of a certain pair of shoes when, in fact, some of the physical stores have plenty of those shoes in stock. An omnichannel approach to retailing requires order management that delivers visibility across internal and partner locations and orchestrates any-to-any fulfillment, enabling the retailer to fulfill the order from a physical store without a hitch.

3. Put all inventory in a sellable position

You’re leaving money on the table unless you can make all inventory available for sale across all channels. Compartmentalised inventory across multiple locations typically leads to costly overstock, markdowns and liquidation of seasonal products, even while some customers were unable to get the goods they wanted from a physical or e-commerce store.

4. Empower store associates to save the sale

Retailers with best-in-class order management equip store associates with on-demand insights into stock availability across multiple locations. If a store is out of a product, an associate can “save the sale” with an on-the-spot order for later in-store pickup or home delivery. That level of service can effectively counter “showroomers” looking for availability and price information.

5. Sharpen customer insights and marketing/CRM

Order management and CRM have traditionally been standalone systems. A converged solution lets you capture customer transactions in a CRM system for deeper insight into customer behavior and interests to drive more effective, personalised marketing. Example: Incenting online-only shoppers to visit your brick-and-mortar store is a proven way to generate new revenue.

6. Excel at fulfillment speed and cost-efficiency

Legacy order management often uses batch processing that hurts fulfillment efficiency. Retailers are shaving hours and days from delivery windows with technology that routes orders in real time to the internal or external warehouse nearest the customer, delighting shoppers with speedy delivery and minimising shipping expenses.

7. Empower customers with self-service

Good order management interoperates seamlessly with your e-commerce site and shipping partners to supply customers with detailed online breakdowns of orders, returns, shipping status and delivery confirmation. By extending order management to your call centres, you ensure your agents have up-to-date information to satisfy customer inquiries.

“Buy online, pick up in store” is yesterday’s news. It should be a pre-requisite for every multi-channel retailer, but it’s hardly the only ingredient to fulfilling the omnichannel brand promise. Retailers that can abandon yesterday’s channel-specific strategies and merge the digital and physical worlds with order management at the centre, will be well positioned for success as omnichannel demands continue to rise.

1 Comment

One thought on “Seven Ways to Merge the Physical and Digital with Order Management”

  1. Jake says:

    Nice approach towards & insights for order management will be looking to integrate some of them in Handicrunch as we now offering worldwide free shipping with the relaunch of our site.

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