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Comment: What’s In-store in the Next Phase of Ecommerce?

Moving beyond its role as display or click and collect service, Ian Jindal heralds the renaissance of the store within multichannel and considers the new demands placed upon ecommerce professionals.

The rapid growth of ecommerce has seen a development from geeky, experimental sideline, via engine of growth, to accepted part of of the channel mix. Independently the online channel delivers some third or more of sales, but with the impact of click and collect (driving digital purchasers instore to collect) and “ROPO” (research online, purchase offline) ecommerce can be said to effect up to 80% of purchases, depending upon sector and the survey in question.

The stores have been to a degree the ‘poor cousin’, with slowing growth, painfully-evident fixed costs and all of the operational challenges of complex, real-world organisms. “Agility” and “test and optimise” are less easy modes of operation across hundreds of stores, physical fittings, thousands of store colleagues and the demands of stock movements and display.

The store, however, is currently making much of the running in terms of innovation and customer impact, and this is for a number of reasons.

The first, of course, is that customers like shops and the shopping experience. The store is ideal to stimulate new ideas and desires, to understand products and in some circumstances more convenient. To date it’s been difficult to asses the ‘seen in store, bought on web’ level. However there is early evidence of customers looking at products in a store and then buying via their mobiles for home delivery, rather than carrying the product home. This insight is made possible by the increase of in-store WiFi, as well as by asking better questions of our analytics systems, and providing ‘links’ to digital within the store.

As the investment and renewal cycle for stores comes round we’re seeing that there’s a more fundamental reworking of the store than just barcodes and a few Wi-Fi points. M&S’ recent Cheshire Oaks store points both to the retailer’s cross-channel ambitions and to the state of the art in online/offline digital integration. Digital signage, customer order and information points (once known as ‘kiosks’), outfit builders, guided selling, order management and point of sale systems all work together. House of Fraser’s digital-only store in Aberdeen points the way to the new generation of click-and-collect meets order point – an updated Argos model for the digital age.

These moves are to be applauded and will soon educate all of our customers to expect true cross-channel integration in all stores. However, they create some new challenges for ecommerce leaders.

Where now is the ‘heart’ of ecommerce? As we move from a channel-focused world to a customercentric one, there’s a need for increased collaboration, planning and responsibility across all touchpoints whether stimulating a sale, fulfilling it, or developing long-lasting profitable relationships. We also need to consider our store colleagues even more than before. While we may be able to update the website by dint of behindthe-scenes work, some testing and keeping 30 people in the ecommerce team abreast of changes, we now have to brief, consult, train and support scores of store colleagues on their iPads, kiosks, recommendation engines, new processes and questions.

We also have some more fundamental challenges around systems and ecosystems. While the ecommerce platform has lived quite happily within the ecommerce domain for years, calmly accepting feeds and sending orders to other business systems, in the new world we need to find a balance between all-channel order management and orchestration, 360-degree real-time views of inventory (whether in-store, at a supplier or on a van), and move from a static view of CRM as a big database to run loyalty cards to full integration with email, contact centres, clientelling, geodemographic planning and product recommendation – online, on the phone and at point of sale. Who owns the architecture for this ecosystem technical, operational and peoplebased? Finally we have the opportunities of digital signage, to integrate store circulation with individual marketing and TV-style programming…

The divide between physical and digital was always a false one – the question was rather one of consistency under our brand promise. Digital technology and renewal cycles in-store now open up opportunities for enhanced consistency and service opportunities for ambitious digital leaders to play an enhanced role delivering customer value.

Both at IRC2012 (where we examine ‘The Mantle of Leadership’) and at IRX2013 next March (where we introduce our new thread of IRIS Internet Retailing In Store), we will be mapping the challenges and opportunities to ecommerce professionals of the welcome renaissance of the store.

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