Omnichannel Retail Digital First Strategy
Okay, so you're a leader in retail, and you want to start an omnichannel strategy with your brand, but you have no idea where to start. Well, it's your lucky day. I'll show you how you can get started even without a technology team. (However, if you do have a technology team, stay tuned for our eBook later this summer.) What do I mean by "without a technology team"? Well, omnichannel is a technology-driven strategy, and if your retail or restaurant brand doesn't have an internal software development team, you need to pay close attention. Even without internal resources, when it comes to omnichannel strategy, you must always think like a technologist.
Flexibility First Mindset
If you've read Part 1 of our omnichannel blog series, you know that modern omnichannel means investing in flexible technology. So, when your team evaluates possible vendors, you must look for good technology that doesn't lock you into a single way of doing things. The cost of picking the wrong Point of Sale, Kitchen Display, Inventory Management, or shipping platform can be career-ruining. You will risk your brand, company, and team if you pick software or hardware without scrutinizing key features. You need to make an informed decision; If things don't work out, you can't just roll back a Point-of-Sale solution.
Remember, omnichannel is about accepting that you cannot guess the future. Things can change in the blink of an eye. Who knows the effect that rising inflation or skyrocketing interest rates might have on the modern consumer? Even new forms of payment or customer interaction channels can pop up at any time. If you cannot predict the future, you must invest in flexibility first. So go to the bathroom, look yourself in the mirror, and repeat, "omnichannel means flexibility first." This mentality will guide you in picking your company's best strategy and vendor.
Vendor Support and Customization
A common obstacle for businesses with limited internal IT resources is software vendors' lack of support and customization. Ensure your chosen vendor offers thorough onboarding, excellent customer service, and ongoing technical support at a minimum. Customization is the critical factor. While you might not have a team of developers, your omnichannel software should still meet your unique business needs. Look for a vendor that can customize their solution to fit your specific requirements.
When exploring the avenue of software customization, it's essential to consider the potential costs involved. Customization, while offering flexibility and tailoring to your specific needs, can be expensive. Often, the final invoice for these services can extend well beyond the initial estimates due to unforeseen complexities that arise during implementation. Omnichannel software vendors are aware of this demand for flexibility and may initially propose competitive pricing for their base solutions. However, the cost of customization can rapidly inflate the total expense.
To mitigate this risk, ensure you comprehensively discuss customization costs during the negotiation phase. Be very specific about your needs - the more precise, the better. Ask pointed questions about the vendor's experience and their procedures for customization, like "What is the turnaround time for adding a new discount program to a region of stores for a certain holiday sale?", "How much lead time do small customization to menu items take?" and "Can you give me an example where customization missed your client's needs and how did you handle it?". These questions will give you a clearer picture of the vendor's approach and ability to meet your unique business requirements.
Moreover, it's vital to negotiate terms that account for future change costs, such as adding new fields or integrations. Your omnichannel software will need to evolve as your business evolves. Therefore, your contract should stipulate the conditions under which modifications can be made and the associated cost structure. This will help protect you from future financial surprises, allowing for a healthier, more predictable business relationship with your software vendor.
Mentorship
In the whirlwind of the ever-evolving omnichannel world, leaders are continually faced with the challenge of keeping up with modern trends. With constant innovations, new integrations, and shifting customer behavior patterns, keeping abreast of every change can be an uphill task. Every decision, whether it's a worthwhile investment, a necessary upgrade, or an avoidable expense, can have significant implications for your omnichannel strategy.
Thankfully, you don't have to navigate this rocky terrain alone. Many resources can help guide your omnichannel journey. Various forums and podcasts are available where industry experts share their insights and latest developments. For example, RetailWire, Insider Intelligence Retail and ECommerce, and NRF's Big Show supply invaluable information and resources. Other significant events include IRCE (Internet Retailer Conference + Exhibition) and ShopTalk, which bring together thousands of retail professionals for in-depth learning and networking. I've included some more relevant resources below.
Consultation
- Chad the POS Guy on YouTube runs a regularly updated review of Point-of-Sale systems, the good, the ugly, the recommended or not recommended.
- Audi Rowe is a Partner at EY is a major influence for enterprises looking to implement omnichannel Strategies
Articles and Studies
- Omnichannel Retail Strategy: The What, Why, and How of “In-Store” Shopping by Shopify
- The Future of Omnichannel Retail by InfoTech
- How an Omnichannel Strategy Benefits Businesses and Customers by Salesforce
- The definitive guide to omnichannel retail by Adobe
Podcasts
- Rethink Retail
- The Retail Industry Podcast by RetailWire
- The Restaurant Business Podcast by Nation's Restaurant News
Conferences
Several consultancies and firms also specialize in omnichannel strategies. Companies like Ernst & Young, McKinsey, Deloitte Digital, and Accenture offer consulting services tailored to omnichannel retail. These firms leverage their wide industry exposure and in-depth research to provide actionable insights, strategic advice, and mentoring.
These mentors and consultants can also aid in crafting compelling narratives to secure budgets for your omnichannel initiatives. As technology and customer expectations change, you'll need to justify new investments continually. By presenting robust arguments based on industry trends, customer data, and potential ROI, you will have an easier time convincing your executives that these are necessary investments. These experts can also help establish key performance indicators (KPIs) and devise strategies to track and measure the success of your omnichannel initiatives, making the case for future investments more straightforward and data backed.
The omnichannel landscape is complex, but with the right guidance and resources, you can steer your brand towards success. Whether it be it staying updated on the latest developments, making strategic decisions, or securing necessary budgets, leveraging the expertise of omnichannel consultants and mentors can give you a considerable advantage in the competitive retail world.
Hiring
While it's true that you may not need an internal software development team, human resources still play a crucial role in successful omnichannel implementation. Specifically, building a team of knowledgeable project managers and procurement professionals can dramatically enhance your ability to manage vendor relationships and ensure the smooth integration of different systems.
Project managers act as the bridge between your organization and software vendors. They manage the scope, budget, and schedule of your software integration projects. They're the ones ensuring that the tasks are on track, issues are promptly addressed, and project goals are met. Moreover, they play a critical role in monitoring and documenting any additional costs that may come up during the customization process. With multiple vendors in the picture, having a diligent project management team becomes even more crucial to keep track of all vendor interactions, manage expectations, and avoid any misunderstandings that could lead to unnecessary costs.
In addition to project managers, you'll need to invest in procurement talent. Since your job will primarily revolve around buying software, not building it, having a team experienced in software procurement is invaluable. These experts should have an extensive background in large-scale, long-term product integration. They'll handle evaluating vendors, negotiating contracts, and managing procurement processes. They should also understand cybersecurity to protect your company's digital assets and help set up clear indemnification clauses to mitigate the impact of potential software failures or breaches.
Investing in these key roles can save your organization from costly mistakes and missed opportunities. While it may seem like an extra expense at the onset, these professionals can end up saving your company significant time, money, and resources in the long run. They'll also provide the expertise and guidance needed to navigate the complex omnichannel landscape, helping you avoid common pitfalls and achieve your objectives.
Buy vs Build - Navigating the Dilemma
In the realm of omnichannel strategy, the 'Buy vs Build' debate is a critical decision point.
The 'Buy' approach could be the right fit if you need to get started immediately. The speed of implementation that comes with buying off-the-shelf software can provide a competitive edge in the fast-paced omnichannel landscape. Moreover, if you don't already have a robust technology team, it may not be feasible or efficient to start recruiting software developers. Hiring without a solid understanding of the skill sets required could lead to unfruitful outcomes and unnecessary expenses. In these cases, relying on experienced vendors may be your best bet.
However, buying is not without its drawbacks. Customization of software, even minor tweaks, can prove to be exorbitantly expensive. Additionally, integration with other software isn't always straightforward. Some vendors may not offer integrations with key payment platforms like Apple Pay or Stripe. When you choose to buy, remember that you're inextricably tied to the vendor's strategic decisions regarding feature requests and releases.
There is a middle ground. While you lean on vendors for most of your omnichannel needs, you can simultaneously start building a small in-house software team. A sensible starting point might be to develop a fulfillment system, like a kitchen display system or a fulfillment screen system. These projects typically offer high value and provide a manageable starting point, despite their potential to grow more complex over time.
Above all, choosing to buy means picking a vendor - and you need to make sure it's the right decision. The market is rife with cautionary tales of vendor relationships going sour, causing disruptions and significant financial losses.
When it comes to omnichannel software, the guiding principle is flexibility. In an ever-changing world, the ability to adapt quickly is critical. Whether you decide to buy or build, ensure your technology can evolve with changing needs and circumstances. Remember, the end goal isn't just to implement software - it's to enable a seamless, unified customer experience that drives your business's success.