Tuesday, 13 May 2008

Shifting towards Multi-Channel - Changes to expect

A successful shift to multi-channel retailing requires a number of changes to the way any traditional retail business functions, primarily in the areas of commercial capability, technical capability, and organization and processes.

Commercial Capability

  • Retailers must develop the ability to differentiate between offering attributes across different channels because they vary in effectiveness and efficiency.
  • Modelling capability will be crucial in enabling a deep understanding of the target audience’s channel preferences and their perceptions of service
  • Pricing, brand impact and route to market will have to evolve to ensure a seamless customer experience.
  • The organisation will have to shift towards developing multi-channel value propositions and commercial strategies.

Technical Capability

  • The core capability needed is a single customer information view, ideally via a single platform for enterprise wide customer relationship management and proposition development.
  • This requires full integration of database and management systems across channels and also with supply chain activities.
  • Multi-channel IT architecture requires a channel independent, service oriented and scalable integration of different front-end and back-end legacy systems and 3rd party services. The front-end should support open industry standards like XML and web-services.
  • Measurement capability will be vital for monitoring and review channel integration

Organisation and Process

  • There may be need for a culture change programme to shift from a product or function focused approach to a customer focused approach
  • Where separate channels have their own objectives, management, staff and systems, these may need to be synchronised or even merged if necessary
  • Organisational restructure may require a new model that adapts people, processes and technology to meet the coordinated approach to channel management. Strong support from CEO and Management will be required.
  • Multi-channel trend analysis on the industry in question will need to play a larger role in the corporate strategy formulation process
  • Channel strategy and associated business propositions must be embedded into the basic processes of the organization

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