Seamless Shopping Experiences Require Singular Commerce Platforms: An Aptos Q&A with Dave Bruno, Director of Marketing

Digital's influence is changing the pace of retail — so much so that traditional retailing methods are slowly becoming a distant memory. the new retailing paradigm is increasingly web-based, and retailers that don't keep up with the pace will fall by the wayside. the biggest stumbling blocks on the road to retailing nirvana are cumbersome legacy systems that hinder rather than help retailers stay ahead of the pack.

In this Aptos Q&A, Dave Bruno, Director of Marketing for Aptos, discusses his experiences with clients as they have implemented singular commerce platforms in the Cloud...

Q: Why is it important for retailers to view distributed order management as playing a key role in an effective omni-channel commerce environment?

DAVE BRUNO: As shopper expectations for choice and flexibility continue to escalate, retailers are facing ever-increasing pressure to not only offer the omni-channel shopping, shipping, pick-up and delivery options that shoppers desire, but to do so in a manner that preserves profits. Too many times, retailers' short-term reactions to competitive pressure for new fulfillment options become long-term "solutions" as other issues capture their attention and priority. Months, or even years later, they realize that many services that have become an essential part of their brand experience are built upon processes that have been cobbled together with little regard for scalability, reliability or profitability.

With e-commerce sales often reaching 10% -15% of total sales, and average order fulfillment cost estimates typically falling between 3% - 5% of those sales (depending, of course upon selling market, the role of stores in the fulfillment model, shipping zones and the products being fulfilled), distributed order management programs are quickly becoming mission-critical to profitable omni-channel strategies.

With e-commerce sales often reaching 10% -15% of total sales, and average order fulfillment cost estimates typically falling between 3% - 5% of those sales, distributed order management programs are quickly becoming mission-critical to profitable omni-channel strategies.

Distributed order management programs, when designed to account for and optimize inventory, technology and people, can have a significant impact on the profitability of an omni-channel enterprise. Well-designed programs expose every piece of inventory to shoppers in every channel, while simultaneously ensuring that all options presented to each shopper account for desired delivery date, shipping costs, labor costs, anticipated demand by fulfillment location, and even customer lifetime value/status. Effective monitoring, reporting and escalation tools ensure the efficacy of order management programs so that fulfillment promises are consistently met. In the most comprehensive order management programs, forecasting tools provide insight into location-based demand for inventory that may be used to fulfill sales from other channels.

When thoughtfully designed and properly executed, distributed order management programs that carefully balance profits with service standards can ensure that every shopping experience serves both the customer and the bottom line appropriately.

Q: What are the chief struggles retailers face as they adopt a single commerce platform that supports a seamless experience for shoppers?

BRUNO: The benefits of adopting a single commerce platform across all channels are well documented, and there is strong momentum among retailers to migrate to a unified platform.

A recent study from NRF estimates that in 10 years, almost 86% of retailers plan to implement a unified commerce platform. And as more retailers adopt unified platforms, we are learning lessons from their experiences. One challenge that we often see retailers underestimate has been around since the early days of omni-channel commerce: fully integrating the store into the omni-channel experience. Between "traditional" store experiences, showrooming, webrooming, "endless aisle" and the numerous store fulfillment options now offered to shoppers, too many shopping journeys travel through the store for retailers to leave any element of integration to chance.

And yet, most retailers still rely upon loose "connections" between the store and the digital channels built upon batch interfaces, dated processes, minimal integration between digital and physical channels, and sub-optimized store fulfillment practices.

In order to offer integrated and flexible shopping experiences that meet shopper expectations, deliver competitive advantage and preserve profits, there are three critical operations that require near real-time integration in order to fully leverage each store as a selling, service, and fulfillment location:

-Seamless interactions: As mobile devices take on ever-larger roles in the shopping journey, customers have minimal tolerance for disconnected interactions. They expect to transition seamlessly from desktop to tablet to smartphone to store, often utilizing three or even four devices and channels in a single shopping journey. Integrating interactions that take place in often far-flung stores is now more important than ever.

-Inventory visibility and reservation: Near real-time inventory within every location in the enterprise is critical to both retailers and shoppers. Retailers benefit from the opportunity to offer and sell every piece of inventory to any customer in any channel and shoppers continue to look to websites to inform them of availability before they head to the store.

- Order management: Just as it is critical to integrate store interactions into the digital enterprise, it is equally important to integrate digital interactions into the store. Shoppers look to stores as service centers, and they have zero tolerance for stores that don't have real-time visibility into their orders.

Q: How can a cloud-based platform offer important benefits to omni-channel retailers both today and in the future?

BRUNO: There are well established financial benefits derived from cloud deployments, and from giving internal resources more time to focus on business issues rather than technology. However, we think the biggest, and perhaps most under-served benefit of cloud deployment is, in a word, agility. In an omni-channel environment, where consumers dictate their terms for doing business, retailers must be able to quickly roll out new capabilities across stores and channels; create, adapt and evolve processes quickly; and leverage innovation throughout the entire ecosystem.

However, we think the biggest, and perhaps most under-served benefit of cloud deployment is, in a word, agility.

Retailers living in the cloud have the ability to adjust to the relentless changes in market and business conditions much more rapidly than those who are running legacy applications on premise. Within a relatively short period of time, cloud solutions have already been shown to improve time to market, accelerate innovation, and improve enterprise management for many retailers.

Q: How does the evolving omni-channel business model lead to a new approach to "engaging customers differently?"

BRUNO: Certainly, omni-channel changes everything, from product design to consumer purchase. But without question, the greatest changes — as well as the greatest opportunities for differentiation — lie in customer engagement. As shopper expectations for flexibility and empowered shopping continue to expand, the retailers we see winning the hearts and minds of shoppers are those that have embraced the idea of giving up control of the shopping journey.

Rather than resisting change and attempting to wrest control of the journey back from hyper-connected and ever-more demanding shoppers, we are beginning to see more retailers make investments that empower shoppers with flexibility and choice, and they are encouraging shoppers to take charge.

Rather than resisting change and attempting to wrest control of the journey back from hyper-connected and ever-more demanding shoppers, we are beginning to see more retailers make investments that empower shoppers with flexibility and choice, and they are encouraging shoppers to take charge.

More and more, retailers are committing to transparency, from sourcing to availability. They are moving away from mobile apps in favor of more open and agile mobile sites. They are investing in technologies — from CRM to analytics to beacons — that work together to allow their interactions to be more personalized and more relevant to every shopper, on every page, in every location, and in every aisle.

Editor's Note: This Q&A is excerpted from "Next-Gen e-Com: Unifying the Retail Enterprise" a recent RIS News retail IQ Report, sponsored by Aptos. To download the full report, click here (free registration required).