One of the biggest trends in the world of logistics involves the concept of omnichannel retailing. In its most simple definition, omnichannel retailing allows a customer to shop online at a store primarily known for their brick and mortar presence and have their purchase available for pick up at a nearby store location. The converse is also possible, allowing you to purchase something at a store and have it delivered directly to your home.
Interested supply chain professionals need take a closer look at this growing industry movement. A future article goes into more detail about how omnichannel affects logistics. This time out, let’s take a closer look at what omnichannel retailing is.
Trying to Compete with the Amazons of the Retail World
In the last decade, traditional big box retailers, like Walmart, Best Buy, and Target, were increasingly faced with competing against the massive online retail giant, Amazon.com. Originally, merely an Internet-based bookseller, Amazon now sells everything from music synthesizers to food products, in addition to becoming a growing force in providing streaming digital content, like movies, TV shows, music, and eBooks.
As consumers became more accustomed to eCommerce and online shopping – paralleling Amazon’s growth in the 21st century – those traditional brick and mortar stores needed to look at different methods to retain customers and keep their market share. Some companies, like Circuit City, weren’t able to change their business models in time and went out of business. Enter omnichannel retailing.
For companies with large supply chain networks, omnichannel retailing offers those firms the option to ship a customer’s item directly from the store or out of one of their warehouses. Similar choices apply when a customer needs to return an item. The growth of data analytics in logistics gives companies the meaningful business insight to make the right choices benefiting their overall efficiency and ultimately their bottom line.
Retailers Need to Offer Superior Customer Service
Providing superior customer service is a prime differentiator between the top retailers and also-rans – that fact hasn’t changed in generations. The evolution of omnichannel retailing in the industry now means that companies need to invest in state-of-the-art inventory management and distributed order management systems to ensure their logistics staff are able to make the right decisions to ensure their customers get their product – or their money back in the case of a return – as quickly as possible.
In the retail industry, where the customer is always right, a company’s failure to embrace the concepts of omnichannel retailing might put them on a path to becoming the next Borders instead of the next Amazon.
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