Omni-Channel Retailing: Enriching Customers' Shopping Experience

Omni-Channel Retailing: Enriching Customers' Shopping Experience

Saikiran Pollamarasetty (JDA Software, India) and Ravi Potti (JDA, India)
DOI: 10.4018/978-1-4666-9894-9.ch013
OnDemand PDF Download:
List Price: $37.50
10% Discount:-$3.75


Omni-channel can be defined as a synchronized operating model in which all of the retailer's channels are aligned and present a single face to the customer, along with one consistent way of doing business. In this model, companies replace the many views of the customer they often hold today with one unified view of the customer—enabling them to respond in a consistent way to the customer's constantly evolving needs. This paper concentrates on various challenges faced by retailers in implementing the omni-channel and strategies implemented by them to achieve highest customer satisfaction. Also this chapter talks about future outlook for the Omni-channel retailing in terms of challenges and opportunities for the players in this industry. As part of our research, this chapter covers some of the well known companies' strategies from their annual reports, earnings call and other company presentations. Other articles from top supply chain magazines/websites have also been referred for the study. A mix of both qualitative and quantitative methods have been used for analysis.
Chapter Preview


Becoming truly customer-centric is at the top of every retail company agenda, as the buying behaviour of the customer is changing as well as the retailer’s relationship with the customer. In today’s world, the customer has become a gadget-savvy and always explores the channels to figure out the right product at the right time at the right price to derive the best value for their money. As retailers are facing with eroding customer loyalty, they are trying to attract the customers with offerings which are innovative in nature and more personalized to the end customers. Like most of the retailers diversified their businesses to span across various areas such as grocery, general merchandise, electronics, fuel and entertainment similarly, they are now interacting with their customers through multiple channels such as in-store, online, social media, mobile, direct mail and kiosks. Creating a unified view of the customer is recognized as a fundamental pre-requisite for customer centricity and personalized engagement.

Close to 70% of retailers cited a customer service strategy as a leading priority, a 13% increase over 2010, according to the National Retail Federation (NRF) in its 2011 Retail Horizons report. The traditional customer lifecycle, as shown in Figure 1 followed a sequential path is being replaced by a non-linear shopper journey spanning multiple touch-points. Customers interact with retailers across touch points for purposes ranging from product searches, price comparisons, information gathering, reviews, to purchases, ratings, and sharing feedback.

Figure 1.

Customer lifecycle


Recently, there has been significant interest in expanding customer databases to make them integrated analytical repositories that also hold relatively dynamic and derived information about customers. For example, integrated information may provide insights into a customer’s last three months’ purchase volume, product preferences, preferred store location, loyalty points, contact preferences, social influence, and so on. This enables the analytical use of more accurate granular-level data.

Omnichannel can be defined as a synchronized operating model in which all of the company’s channels are aligned and present a single face to the customer, without moving away from the current mode of operating the business. In this model, companies replace the many views of the customer, as shown in Figure 2, they often hold today with one unified view of the customer—enabling them to respond in a consistent way to the customer’s constantly evolving needs. Facilitating data consistency across all channels will allow retailers to facilitate product fulfilment, including order/delivery if items are out-of-stock, or other shipping/delivery/pickup options.

Figure 2.

Customer data repository


Key Terms in this Chapter

Analytics: The systematic computational analysis of data or statistics or information resulting from the systematic analysis of data or statistics.

Assortment: Assortment is the number of SKUs within a category. It is also called depth.

Stock Keeping Unit: A stock keeping unit (SKU) is the smallest unit available for keeping inventory control. In soft goods retailer, for instance, a SKU usually means size, color, and style. For example, a pair of boys’ size 10, navy blue color, boot-cut Levis is one SKU. In some cases, a buyer is responsible for several classifications.

Channel: A touch point that a consumer experiences when being in unique contact with a brand, such as a physical retail shop, a website, a mobile site, social media.

Under Stock: Under stocking is to have a lesser stock of something needed. Usually for an Indian fashion retailer, if the store is not carrying inventory which can cater to 3 to 4 months of demand is referred under stocking. This is very critical in fashion retail, as under stocking is a direct sales loss.

Omnichannel: Omnichannel is a multichannel approach to sales that seeks to provide the customer with a seamless shopping experience whether the customer is shopping online from a desktop or mobile device, by telephone or in a bricks and mortar store.

Fulfillment: Process of taking an order and executing it by making it ready for delivery to its intended customer. It may involve warehouse pickup, packaging, labeling, etc.

Merchandise: Merchandise is nothing but the inventory of finished goods.

QR code: (Abbreviated from Quick Response Code) is the trademark for a type of matrix barcode (or two-dimensional barcode). A barcode is a machine-readable optical label that contains information about the item to which it is attached. A QR code uses four standardized encoding modes (numeric, alphanumeric, byte / binary, and kanji) to efficiently store data; extensions may also be used.

Point of Sale (POS): A point-of-sale (POS) terminal is a computerized replacement for a cash register. The POS system can include the ability to record and track customer orders, process credit and debit cards, connect to other systems in a network, and manage inventory.

Out of Stock (OOS): Also known as Stockout. It is a situation where the retailer does not physically possess a particular product category, on its shelf, to sell to the customer. It can be estimated from store inventory data.

Point of Sale (POS): POS refers to materials, brochures, signs at point of sale, or can refer to point of sale or cash register.

Big Data: Extremely large data sets that may be analyzed computationally to reveal patterns, trends, and associations, especially relating to human behavior and interactions.

Over Stock: Over stocking is to have a bigger stock of something than is needed. Usually for an Indian fashion retailer, if the store is carrying inventory which can cater to more than 3 to 4 months of demand is referred over stocking.

Multi-Channel Retailer: The retailer who responds to the demand of consumers throughout offline and online stores (Clark, 1997 AU78: The in-text citation "Clark, 1997" is not in the reference list. Please correct the citation, add the reference to the list, or delete the citation. ). Bricks-and-clicks retailers are one example of a multichannel retailer.

Complete Chapter List

Search this Book: