Wednesday, October 1, 2008

The Practicalities of Multi-Channel Retail - Part 1 - A few fundamentals

The Practicalities of Multi-Channel

The “multi-channelness” of a retailer is only really determined by the ultimate ambition of the organisation coupled with the appetite for some serious change. Those early trail blazers that managed a seemingly coherent multi-channel offering often got there by smashing various legacy systems together by brute force in the pursuit of an integrated solution. Often, this meant some behind the scenes issues in customer service, delivery and order processing that failed to provide a single view of the history of an individual customer over multiple channels. The impact of this ultimately hit the customer at some point in preventing them from switching channels for returns, combining deliveries or tracking the statuses of orders. Ultimately, these legacy “smash-ups” present longevity issues by their very nature in that they are difficult to maintain, extend and above all, have problems scaling as demand for their services grow.

These issues are only resolved by initiating substantial change in the backbone of a retailer’s information system so that there is one source of the truth for critical product and process data such as:

  • Catalogue
  • Inventory (stock)
  • Orders and Order History
  • Returns
  • Customer
  • Delivery
  • Payment

Providing this coherent and centrally managed view on both data and processes gears the organisation for efficiency. Consistent product information and management forms one part of Catalogue management but there is also a distinct need to better manage the whole product lifecycle from birth to grave with particular reference to performance across channels. This can only be achieved by having a single strategy in information systems, product induction, categorisation and reporting. As an end goal, this is a tough challenge to resolve as any major change in catalogue management is often unpalatable with the more established areas or channels. Legacy systems in these areas rule the roost and require substantial re-engineering to accommodate the demands of the newer routes to market. However, those retailers who endeavour to undertake this challenge and implement a successful solution can reap the benefits.

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