Multichannel Retailers Struggle To Create A Seamless Brand Experience

The “seamless brand experience” across channels is an ideal among multichannel retailers, but one that is hard won, according to [download page] RSR Research in a November 2012 report. Asked to name their top 3 operational challenges, 59% of retailers surveyed pointed to coordination with other channels to create a seamless brand experience. Next most-common (52%) was optimizing inventory deployment across all channels, while understanding and accommodating how different consumer segments engage was third (49%). 

Interestingly, the most successful multichannel retailers suffer the most pain in this area, reveals “The Multi-Channel Retailer’s Reality in a Post-Amazon World.” 71% of “Double-digit Winners,” whose annual year-over-year growth is 10% or higher, identified channel coordination as their leading challenge. By comparison, only 47% of laggards (growth under 3%) cited the same challenge. As the researchers posit, “this dramatically underlines how much Winners understand their multiple channels can be leveraged as a real and differentiating strength from online-only powerhouses – providing they can one day execute.”

The data suggests that laggards’ priorities are far out of step with those of Double-digit Winners, and possibly misguided. 40% of laggards cite coordinating e-commerce prices and promotions across channels as a challenge, versus 29% of Winners. This suggests that Winners have more successfully integrated e-commerce operations across the enterprise while laggards keep e-commerce siloed.

Laggards should be wary of underestimating the opportunity in e-commerce, and consumers’ demand for it. US online retail spending reached $41.9 billion during Q3 2012, a 15% increase over Q3 2011, found comScore. That marks the 12th consecutive quarter of positive year-over-year growth and 8th consecutive quarter of double-digit growth rates.

Budgets, Human Resources Key Inhibitors

Laggards lack the budgets for e-commerce that Double-digit Winners have, finds RSR. 54% of laggards cited budgeting challenges as a top 3 organizational challenge, compared to just 14% of Double-digit Winners. The smallest retailers are more challenged than larger retailers, with 60% versus 14% citing overall budgetary constraints to e-commerce.

Other top-3 organizational challenges relate to technology and ROI: 53% of all respondents feel that their existing technology infrastructures prevent them from moving forward in e-commerce, and 48% cite difficulty in quantifying return on investment (ROI). 27% report that brick-and-mortar stores are a higher investment priority.

Leadership, Technology Key Enablers

How to overcome these organizational inhibitors? The need appears to be one dedicated leader to spearhead e-commerce, using a strong technology platform. Asked to indicate the top-3 ways to overcome their organizational inhibitors, 57% named investment in a streamlined technology platform or infrastructure. 51% also named an executive tasked with managing and improving the overall customer experience.

Tied for a distant third place (each cited by 36%) are more coordination with marketing, and more coordination with stores.

Large retailers put more of a priority on an improved infrastructure than do small retailers (67% vs. 47%). Similarly, small retailers place a higher priority upon solutions that don’t burden their information technology (IT) departments (32% vs. 12% among larger retailers).

Other Findings:

  • 50% of Double-digit Winners operate more than 4 brands or sites online today, but no retailers with more than $1 Billion in annual revenue are using more than 4 sites or brands.
  • About 7 in 10 Double-digit Winners operate mobile websites, and 57% sell on social sites like Facebook. These are higher figures in both instances than the laggards.
  • Laggards overwhelmingly cite uncertain consumer demand as their top business challenge at 73%, versus 32% for retailers overall.
  • Just 40% of laggards named keeping up with evolving consumer shopping patterns (social networks, mobile, etc.) as a business challenge, while it was the leading challenge named by all respondents (56%).

About The Data: RSR conducted an online survey from August – October 2012 and received answers from 97 qualified retail respondents across an array of products sold, and at all scales of revenue.

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