Retailers that deliver a strong and cohesive eCommerce and store framework that support each other have a formidable advantage over retailer without both frameworks.  The issue, and challenge, for retailers is to maintain a balance between the two platforms to support a robust omni channel experience.  Omni channel must maintain this balance in order to take advantage of the strengths provided by each platform.  The omni channel retailer must blend the channels into a cohesive shopping and purchasing experience for the consumer.  The focus must be maintained on the shopping and purchasing experience and not on the channel.  This focus aligns with consumer expectations and demands for the experience that crosses channels and platforms.

 

The online channel is an extremely cost effective method for the retailer to support the shopping and purchasing demands of the consumer.  The retailer, however, must not focus simply on the cost benefits of each channel, the retailer must focus on the cost benefits of the shopping and purchasing experience.  In other words, the retailer should not reduce the staff in stores simply because online sales increase.  The retailer must maintain a staffing level in the store to support the demands of the consumer.  If the retailer does not support the consumer demands it will cause a drop in the sales, initially for the store channel, however the reduction will bleed over to the online channel because of the connection the consumer makes between channels.

 

As an example of this impact Macy's has announced reductions in store staffing levels due to reductions in sales.  Macy’s has done a great job of expanding their online capabilities to develop an omni channel presence where the consumer can purchase any time and from any channel and this has resulted in an increase in online sales. If not careful, though, this can turn into a self fulfilling prophecy where the staff is reduced due to a reduction in sales and then sales decline again because there is no sales staff to support the consumer.  The consumer is demanding the blending of channels into a shopping and purchasing experience which translates into a requirement to maintain the staff in the stores to support the potential demands of the consumer. 

 

The blending of the channels will include filling eCommerce orders from the retail brick and mortar store.  The retailer must take into account an additional requirement in the stores to pick, pack and ship product for customer eCommerce orders.  This will add to the level of effort of the store store staffing and must be taken into account with staffing plans.  The additional staffing requirements can be measured by assigning the eCommerce orders to the store sales and if possible as a new category to allow the store management to measure and determine the staffing requirements.  In other words, even if the store consumer purchases may drop due to eCommerce purchases, the actual staffing requirements may remain the same, or even increase to support the pick, pack and ship requirements.  These are new staffing measurements and will require a bit a trial and error to come to an understanding of the effort required to support eCommerce purchases in the store.

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?