Online Retail Today
delivery and fulfillment options for order management system

Order Management System: The Brain of Your Omnichannel Retail Enterprise

By Keith Blankenship, Regional Vice President of Sales, Kibo

 

Retail technology has evolved markedly in the last 10 – 15 years.  In the 1990s and 2000s, the Point of Sales (POS) was the focal point of an enterprise’s commerce strategy.  The POS handled all activities surrounding how customers interacted with retailers.  During this time, eCommerce became a viable option for consumers and offered an alternative to crowded stores with substandard shopping experiences.  This trend led to a rise in mobile POS which allowed retailers line-busting and save-the-sale functionality. Subsequently, multi-channel retail strategies began to evolve when eCommerce platforms began to integrate with POS systems.  While fulfillment options expanded, these systems were often installed on servers in retailers’ offices and required patches and maintenance resulting in cost escalation for the retailer.  These new features also came with a high price tag.

Today’s retail technology landscape has drastically changed to the advantage of retailers.   Retailers can now implement systems that provide instant access to features without the heavy upgrade costs associated with legacy on-premise systems.  By offloading the strain of supporting these systems in favor of multi-tenant SasS applications, retailers can now focus more on customers and their store experience.  With this renewed focus, retailers are able to offer intelligent fulfillment options that satisfy customer demands and control costs.  Modern systems must also shoulder the burden of communicating with other critical business applications such as ERP and CRM.  More and more retailers are turning toward an Order Management System (OMS).

An OMS allows retailers to provide a robust and satisfying experience for their customers.  By allowing your customers to fulfill in a manner of their choosing, you are actually increasing sales.  76% of buyers indicate that multiple fulfillment options influence them to complete a purchase, according to Kibo’s 2018 Consumer Trends Report. This is up from 64% the year before — an 18.75% increase.

An OMS doesn’t just enable fulfillment options, it also leverages a retailer’s most valuable asset, it’s inventory, in two distinct manners.  First, an OMS can give customers visibility into what inventory is available at certain stores and online.  68% of consumers are less likely to order from a site that doesn’t show in-stock store inventory availability, and 78% of consumers have looked up store inventory before a store visit.  Secondly, it allows retailers to optimize their existing inventory through intelligent, rules-based order routing and the ship-from-store function.

Customer expectations and demands have certainly changed, and retailers must adjust quickly to ensure a sound costumer experience in the most cost-effective manner.  Providing a customer experience that aligns with evolving expectations ensures market relevance and ability to thrive in the modern world. While POS and eCommerce platforms are important pieces in the life of a retailer, an OMS is the critical element that drives all of the enterprise.

Click here for more information on the Kibo OMS or to schedule a demo.

3 eCommerce platform Best Practices to Make the Most of Customer Reviews

The eCommerce Platform Agility Test: Can Your Brand Jump These Conversion Hurdles?

Despite double-digit growth, eCommerce still accounts for a small percentage of total retail sales, and new research reveals that the preference for store purchasing is actually growing. To counteract this trend, online merchants must pass the agility test — providing the eCommerce software and omnichannel fulfillment features that can boost online conversion and sales.

Low conversion rates are nothing new for online sellers. Just 3.5% of eCommerce site visitors using a desktop or laptop computer go on to complete orders, according to technology researcher Forrester — and mobile eCommerce conversion rates are lower still.

Furthermore, new data from the 2018 Kibo Consumer Trends Report reveals that the percentage of shoppers saying they prefer to purchase in stores jumped 330% from 2016 to 2017. While this may be welcome news for brick-and-mortar retailers, it also represents a lost opportunity to earn immediate orders from the 84% of consumers who research online prior to a store visit.

Thankfully, the Kibo data also points to a remedy — in a word, agility. From eCommerce software that integrates seamlessly with inventory and the order management system to omnichannel fulfillment capabilities that offer shoppers maximum flexibility, to responsive mobile eCommerce software, consumers are increasingly demanding that retailers adapt nimbly to their changing needs in the moment.

To overcome online conversion hurdles along the path to purchase, merchants should limber up and test their capabilities against this list of agile commerce must-haves:

 

☑ Dynamic promotions and pricing.
Price is still shoppers’ primary purchase factor, even as the shopping experience is gaining in importance, the Kibo study found. The ability to offer relevant promotions and competitive pricing is key: some 86% of shoppers said loyalty discounts were an important purchase factor, while 81% said they’d used a promotion emailed or texted to them in the past six months. Merchants with outdated enterprise eCommerce software platforms lack capabilities when it comes to linking discounts and merchandising tools with customer data culled from multiple systems and sources — one reason that eCommerce software replatforming is the top priority for merchants in 2018, Forrester found.

 

☑ Flexible order fulfillment software.
Increasingly, shoppers expect online order fulfillment to be both free and fast, with 40% saying delivery that takes more than two days would detract from online ordering. Thankfully, free shipping isn’t the only option shoppers will consider: fully 76% of Kibo survey respondents said it was important to have multiple omnichannel fulfillment choices, such as Buy Online, Pick up In-Store (BOPIS) and ship-to-store. To meet these expectations, merchants need comprehensive integration of store inventory and order management systems with eCommerce software. Not only do such solutions give merchants the capability to offer fast and free fulfillment to customers, but services such as ship-from-store make the most of local inventory, reducing costs associated with excess stock.

 

☑ Full-featured mobile eCommerce software.
Mobile devices now command the majority of minutes shoppers spend with retail brands, generating 49% of all online shopping traffic, Forrester found — but with less than a third of online revenues attributed to mobile, merchants must work harder to deliver a compelling experience. Responsive design enables merchants to deliver robust product content and merchandising regardless of screen size using a single set of code, ensuring consistency across touchpoints while eliminating the need to duplicate efforts. Merchants should also integrate eCommerce personalization solutions with mobile offerings so they can serve promotions specifically oriented to shoppers on the go.

 

Kibo merchant Bluefly.com saw mobile conversion jump 39% and online revenues increase 14% after deploying a responsive site that enabled the designer fashion retailer’s merchandising team to set  a trend-setting pace with fresh product assortments, lookbooks, and visuals for shoppers across touchpoints. The site also offers a streamlined checkout process, which is critical for 78% of shoppers in Kibo’s study and especially important on mobile devices, as smartphone keyboards are difficult to use for filling out long forms.

 

bluefly case study ecommerce platform    

 

☑ Personalized products and content.
Increasingly, shoppers recognize the value of personalization: 64% of Kibo survey participants said personalized recommendations on the eCommerce site product page would influence their purchase decisions — a 45% increase compared with the prior year. The ability to adjust products, content, and offers as shoppers move along the path to purchase is not only critical for product discovery and consideration; by showcasing unique brand assets and proving relevance at every turn, real-time personalization can help brands establish the credibility and trust that are crucial to boosting order completion. Furthermore, by integrating personalization techniques into post-purchase communications to deliver follow-up offers, replenishment reminders, and invitations to submit reviews, merchants can re-engage shoppers and begin building long-term loyalty.

 

What agile commerce techniques are you instituting this year to help boost conversion?

upgrade technology stack to saas solutions

Why SaaS Is The Right Answer To Upgrade Your Commerce Technology Platform

We are all reading the headlines of the retail apocalypse and it is causing retailers and branded manufacturers to rethink their digital and in-store strategies.  A significant portion of these strategic plans involve modernizing the omnichannel technology stack.

 

If you are one of these merchants looking to upgrade your eCommerce software, order management system, in-store associate platform, personalization engine, or some other commerce software solution, you should be looking at multi-tenant, software-as-a-service (SaaS) solutions to help provide a sustainable competitive advantage.

 

However, many organizations still struggle making the case for cloud technology due to legacy internal processes, IT’s perception of on-premise solutions providing more control, and assumptions that in-house proprietary solutions are more cost-effective.  Below are a few examples to illustrate the advantages of multi-tenant SaaS over on-premise software as it pertains to the commerce industry.

 

Speed of Innovation

 

With traditional on-premise solutions, organizations typically must wait for IT to install updates or upgrades, which can cause lengthy delays for business users, and not to mention the additional software or implementation fees from the vendor.  These hurdles create a situation where business users are not enabled with the latest and greatest capabilities, features, and tools that can help them drive revenue for their respective organizations.

 

Alternatively, SaaS solutions typically include continuous updates, upgrades, and software releases as part of the annual subscription.  Rollout of new features can happen automatically, enabling business users with the most current capabilities to fuel innovation.

 

In a commerce world dominated by Amazon, it is imperative that organizations empower their business users to stay ahead of consumer expectations to the best of their ability — and multi-tenant SaaS is one such way.

 

Total Cost of Ownership

 

On the surface, software owned and managed internally by your organization might seem like it could have a better cost structure.  Why not? You get to control when you upgrade, what to upgrade, and which internal resources get to do the work — all of which are assumed to be cost-efficient.  What these assumptions do not include are hardware costs, training fees, customization support fees, integration complexity, and most importantly, opportunity cost.  When you do the math, SaaS options more often than not have a lower total cost of ownership (TCO) when all factors are considered. Business users get what they want and IT can focus on more strategic projects versus low-value maintenance and upgrade projects.

 

Extensibility and Unique Brand Experiences

 

A common misconception is that on-premise applications provide more opportunities to create unique brand experiences because they allow for customization.  What most do not realize is that these customizations can cause significant challenges down the line when it comes time to update or upgrade — especially when one considers brittle integrations to a myriad of commerce systems.

 

Modern SaaS platforms are developed with an API-first architecture with built-in extensibility layers to allow development of unique experiences on top of the multi-tenant platform, without breaking the integration or update path.  This provides the best of both worlds — marketers and merchandisers can ensure customers are delivered unique brand experiences and IT is comfortable updates and upgrades from the vendor will not break their integrations and put critical selling channels in jeopardy of going “lines down.”  

 

Predictability

 

Commerce is currently going through some major transformations, causing significant chaos and pressures on retailers and branded manufacturers.  Lack of predictability has the potential to derail strategic omnichannel initiatives like your buy online pickup in-store (BOPIS) program or your ship-from-store fulfillment plans.  

 

When organizations move to SaaS solutions, they get an inherent level of predictability with costs, uptime, software updates and upgrades, and scalability that allows the entire organization to focus on moving forward — and not on the technology.  Having predictability in the current state of commerce can enable the focus required for some merchants to exceed their growth expectations.

 

Multi-Tenant SaaS for the Win

 

As your organization looks to have a success and growth year in 2018, investing in multi-tenant SaaS solutions will be at the top of the list as an enabler for achieving those goals. While each organization has to look at their specific needs, when compared side-by-side SaaS commerce solutions will typically have more business benefits over on-premise solutions — allowing you to grow faster than your competitors in this ever-changing and competitive world of commerce.

To see the ROI of SaaS, download a copy of our Total Economic Impact Report and put some real numbers behind the benefits of SaaS.

consumer trends report, ecommerce success

New Survey Data Reveals the Unique Assets to Leverage for eCommerce Success

Proliferating touchpoints and the meteoric rise of online-only merchants have forced the retail industry into a race to the bottom. But the 2018 Kibo Consumer Trends Survey suggests that the tide is turning, and retailers and branded manufacturers can differentiate themselves in a crowded marketplace by showcasing their most unique assets.

As we’ve discussed previously, competition has been fierce to offer the lowest prices, the steepest discounts, and the fastest free shipping — often to the detriment of small- to mid-sized merchants whose lower order volume can’t make up losses in margins. Furthermore, the dominance of mass merchants has steepened the challenge when it comes to attracting shoppers in the first place: when asked what sources they use to research potential purchases, 69% of participants said they turned to search engines — the top pick — while 61% said they used Amazon.com. Visiting a retailer’s Web site trailed the Amazon option by some 10 percentage points, while just 38% of shoppers said they researched on branded manufacturer Web sites.

On the other hand, the survey also suggested that shoppers hunger for experiences richer and more personal than what mass merchants can deliver. Indeed, while 61% of survey participants named price as the top factor influencing purchase decisions, indicating that it’s still their primary consideration, that percentage is down by more than 12.8% year over year.

By contrast, the importance of the shopping experience doubled, and the percentage of participants naming the variety and speed of fulfillment options as deciding factors grew by 1.3x and 3x, respectively. Furthermore, shoppers are less brand-conscious than previously, with the percentage seeking out products and merchants by brand name dropping — a finding that holds out hope to sellers when it comes to winning over new customers.

Purchase Factor

In short, in a world where sales and discounts are ubiquitous year-round, shoppers are increasingly cognizant of what sets merchants apart — and are willing to explore the possibilities with sellers who are new to them. To win them over:

 

Branded manufacturers should showcase deep content.
Whether or not they have a specific brand in mind, the Kibo survey found that shoppers primarily turn to retailers, both online and offline, to make purchases. But the availability of deep content, including inventory information, can counteract this tendency and encourage direct connection with branded manufacturers.

Indeed, more than half of survey respondents said they expect extensive content on branded manufacturer Web sites, suggesting that product images, videos, detailed specifications, comparison guides, and other consideration tools are all apt investments. More than 61% said they expect to see product reviews on manufacturer Web sites, a finding that reflects an overall preoccupation with authentic recommendations and ratings from shoppers, which a whopping 91% of survey participants have consulted in the past six months.

Another type of product information is also key for branded manufacturers: where and how to order products, and how many are available. Inventory access and availability are crucial: more than half of survey participants said they expect a manufacturer to have items in-stock, while 45% believe they’ll find a greater variety of products available, and 40% believe manufacturers will have more items than retailers. Similarly, a third of respondents said that a greater array of potential fulfillment options is a reason to seek out a branded manufacturer Web sites — suggesting that manufacturers need to implement accurate inventory visibility for items not only within their own direct-shipping operations, but for partner retail outlets as well.

 

Retailers should view stores as valuable assets — not relics.
The recent news about Toys “R” Us notwithstanding, headlines about the end of stores couldn’t be further from the truth. The Kibo survey found that shoppers increasingly recognize and value physical outlets not only as fulfillment depots that can offer a viable alternative to free home delivery, but also as valuable resources offering one-to-one assistance.

Buy Online, Pickup In-Store (BOPIS) is now considered a mainstream offering, with 67% of survey participants having used it in the past six months. Furthermore, shoppers widely recognize that BOPIS offers not only free order fulfillment, but also a degree of flexibility and control not available via home delivery.

Indeed, the ability to inspect items in the store before taking them home was the BOPIS benefit whose importance grew the most year over year — suggesting that stores’ tactile experiences are important brand assets. Substantiating this finding is shoppers’ increasing willingness to engage store associates for assistance finding items; 57% of survey respondents said they’ve done so, an 18.75% increase from 2017. More than two-thirds of respondents said they expected those associates to have access to their order histories, suggesting expectations are high for knowledgeable interactions that draw on shoppers’ past interactions across touchpoints.

On the other end of the spectrum, stores also hold appeal for high-efficiency shoppers. Not only is a dedicated BOPIS pickup counter perceived as a potential time saver, but curbside service is increasingly popular, with 13% of respondents reporting having used it — a jump of nearly 86% compared with last year. Similarly, half of survey participants have taken advantage of store associates’ “line busting” capabilities via mobile point-of-sale — and the percentage doubled of those who’d used the service more than seven times in six months, suggesting its appeal and adoption are growing.

 

Download the complete survey for many more data points on topics ranging from personalization to loyalty discounts to live chat usage. How are you maximizing your unique assets to survive and thrive in 2018?

customer experience with omnichannel

Looking Forward In 2018: The Technology That Will Save The Customer Experience

What is the technology that will save the customer experience? Is it face recognition? Is it virtual assistants?

Nope.

It’s not the newest and flashiest technology of 2018 that will save the customer experience. The truth lies in what we’ve been talking about for years: omnichannel. Omnichannel allows retailers to deliver on what customers are already expecting. 

In order to provide a seamless omnichannel experience to consumers, retailers must have a complete  picture of all consumer activities, regardless of buying channel. Nothing is more frustrating to a consumer than a  retailer who has  blind spots of their activity. For example, if the consumer is in a store, and a retailer cannot look up their online activity; or if a consumer calls into a call center to add more to their online order they just placed, but the call center agent cannot modify that order or doesn’t have access to the website promotions.

Personalization is a leading initiative for retailers, however if retailers don’t account for all in-store, online, or call center activity, they cannot accurately individualize the experience for the consumer. This all leads to a disjointed experience that makes consumers look for better shopping experiences elsewhere.

In a recent study, we found that 58 percent of retailers say they don’t have in-store technology to view customer information across touchpoints. The in-store devices that typically enable access to this type of cross-channel view of the customer are mobile apps, tablets, or scanning devices. The technology behind them such as the ecommerce platform, order management system, and personalization solution all need to work together to gain a true understanding across touchpoints.

A simple solution is to empower in-store associates with mobile devices that connect into these systems — thereby providing the much needed consumer data to drive an individualized experience when face-to-face with a buyer.  Improving in-store experiences is at the top of many retailer’s lists because a majority of sales still take place through physical buyer touchpoints.  It is critical for retailers to leverage the use of technology with their store associates to deliver the experiences consumers are not only craving, but demanding of retailers.

Unfortunately it is a matter of reality that companies still have siloed data. It really can be a mix of situations that lead to retailers having siloed customer data and consumer experiences across channels. Some retailers are on older versions of technology that won’t allow easy integration with new systems. Those that are looking to upgrade their commerce platform are faced with a plethora of vendor and technology choices that mainly fall into one of three camps:

Home Grown.
They create a homegrown system to their exact specifications, however it will be extremely expensive and any future development or maintenance are completely dependent on the  retailer’s IT team.

OR

On Premise.
They can go with an on-premise solution, which also allows for exacting specifications, however are typically very expensive to deploy with a very long launch time. The retailers are also then faced to pay for future upgrades – increasing their total cost of ownership (TCO).  

OR

The Cloud.
The technology with the most flexibility and cost-effectiveness are multi-tenant, cloud-based solutions. The retailer can launch faster than homegrown or on-premise, still have their needs met, always be on the latest version of the technology — future proofing their investment and driving their TCO lower than traditional technology approaches.  

 

Here at Kibo we believe the Cloud is the best place to build, particularly for retailers and manufacturers who are growing and changing as the market changes. The Cloud allows for more flexibility than on premise solutions, and allows for a robust order management system. A robust  (OMS) is key to enable enterprise-wide inventory visibility, intelligent order routing, and a streamlined interface for store associates to use when preparing the order to ship or for pickup. As this study indicates, retailers are using a variety of technologies from warehouse management systems (WMS) to enterprise resource planning (ERP) to OMS. Those that are using WMS or ERP without OMS are limiting their abilities in omnichannel fulfillment, as those systems lack robust functionality to provide accurate inventory visibility and be a retailer’s single version of truth for their inventory.

Using our OMS, we have seen customers with significant uplift after deploying ship-from-store and in-store pickup. Ship-from-store allows retailers to expand the number and assortment of items available for online purchase, and reduces the need to discount slow moving items that are sitting in stores. In-store pickup has the added benefit of uplift in additional sales during in-store visits; retailers who provide best-in-class in-store pickup experiences are seeing up to 40% of their customers purchase additional items while picking up online orders — resulting in true ROI of their omnichannel strategies.

 

Discover more omnichannel technologies that are changing how we think of brick and mortar here.

holiday strategies for year round success

Holiday strategies to adopt year-round for 2018 success

The close of the holiday season brought plenty to celebrate, with sales outpacing predictions and eCommerce once again fueling overall growth with double-digit gains. But that doesn’t mean sellers can take success for granted in 2018. Rather, to remain competitive they must continue to implement the holiday strategies that showed success and focus relentlessly on the customer’s point of view — ensuring their brand experience stands out.

Holiday retail sales overall rose 4.9 percent year-over-year, the biggest increase since 2011, according to preliminary results from Mastercard SpendingPulse. The strong showing beat the National Retail Federation’s prediction of a 3.6 to 4 percent gain.

As in previous years, online commerce was the engine driving overall growth: eCommerce revenues jumped 18 percent, according to Mastercard. Mobile commerce demonstrated its worth, with fully a third of sales on Cyber Monday originating on mobile devices, according to Adobe Data. Mobile traffic and revenues spiked still higher on Christmas Day and New Year’s Day, when consumers were away from their computers but still at leisure to browse and buy.

While the rising holiday tide lifted all boats, giving retailers respite from doom-and-gloom forecasts, there were clear standouts. Those who outpaced the pack went well beyond simply offering standalone eCommerce, mobile, and store “channels” to creating integrated, alluring experiences.

The principles behind the leaders’ winning strategies are worthy of consideration. As we’ve written previously, merchants of all stripes must contend with Amazon, which captured 44% of all online sales in 2017; by learning from the holiday highlights, merchants stand a better chance of differentiating their brands and earning sales in 2018. Among the principles to consider:

 

Reimagine brand offerings as experiences, not commodities.

 

Most merchants can’t afford to compete with the likes of Amazon on price alone. So to appeal to shoppers, sellers must create value in the brand experience itself — shifting the focus from a pure calculus of products, order costs, and discounts toward something more ineffable. Rich online content, customer communities, savvy apps, and immersive store environments must work in concert to create a connection with the brand that goes beyond the price tag. Personalization can further enrich the experience by delivering only the most relevant products, store events, how-to content, and recommendations.

For retailers, the experience imperative means rethinking store space to accommodate consultative sales, interactive displays, and signage and shelf tags that connect shoppers to online resources. For manufacturers, definitive and robust online content about products, apps that serve essential needs for customers, and stellar customer support can go a long way toward delivering a standout experience; popup stores within retail outlets or at key events can boost visibility in the physical world.  

Lululemon Athletica, which saw sales jump 15% year over year during the fourth quarter, has built community both via an online hub and in physical stores, where customers can not only shop for athletic apparel, but take yoga classes and get recommendations for local fitness classes to try.

 

Don’t let customers see you sweat the details.

 

Part of creating a rich brand experience means eliminating distractions and barriers, especially when it comes to purchasing and fulfillment. By easing logistics so they can essentially be taken for granted, merchants can help maintain the focus on the products and services that inspire and delight.

Of course, a seamless customer experience is the result of complex technology integrations behind the scenes. Manufacturers must quell concerns about channel conflict and ease connections with products, whether by seamlessly displaying inventory availability through retail partners, by offering “buy now” capabilities for direct-to-consumer sales, or both.

For retailers, real-time inventory visibility is by now essential. Indeed, 81% of consumers have used inventory lookup tools before visiting stores, and 80% said they’d be less likely to patronize brands that didn’t offer the capability, according to Kibo data.

And enterprise-wide inventory visibility can help merchants serve customers whose expectations for flexible, fast delivery continue to rise. During the holiday season, mass merchant Target used store outlets to fulfill some 70% of online orders, thereby leveraging its nationwide network to draw on existing inventory and deliver efficiently to customers. Target reported overall sales gains of 3.4% for November and December, with online sales growing 25% for 2017.

 

Know when to set loose the machines — and be transparent about it.

 

There’s no question that artificial intelligence is on the rise. In 2018, one in 10 purchase decisions are forecast to be mediated by intelligent agents such as Amazon’s Alexa, according to technology researcher Forrester. To compete, sellers must stay at the forefront of AI offerings, and understand the benefits and drawbacks. While attempting to replicate the complex interaction of a store associate helping a shopper — with all the intuition, body language, spoken intonation, and visual cues that entails — is a long ways off, simple AI applications can now handle the straightforward requests that comprise the bulk of customer service inquiries.

Direct-messaging chatbots can deliver store locations and hours, book in-store appointments, locate assembly instructions or how-to videos, and update delivery status for orders — thereby freeing human live chat and phone service agents to tackle the truly complex interactions that call for nuance and higher decision making. Such partitioning of labor delivers superior service to customers: chatbots can quickly handle volumes of simple requests, thereby fulfilling expectations for quick response, while in-depth human interactions for complex questions demonstrate brand know-how and commitment to service.

During the holidays, Best Buy’s chatbot delivered order status information and fulfilled other simple requests. The service identified itself as an automated response system, rather than attempting to pass itself off as a human — thereby clearly setting expectations for its capabilities. The system used verification questions to maintain privacy and security when accessing order information.

 

Which successful holiday strategies will you carry into 2018 to drive sales and loyalty?

bopis, personalization amazons shortcomings

Amazon’s Secret Shortcomings and How to Capitalize on Them

By multiple measures, online is surpassing in-store as the growth driver for the 2017 holiday season — and Amazon is leading the way. With the online giant poised to make even greater gains in 2018, merchants must act now to heighten and promote their unique advantages.

Once again, online shopping is powering retail growth during the holiday season. eCommerce revenues represented 57.6% of the total retail sales growth for the period from Black Friday through Cyber Monday, and accounted for one in five dollars spent overall, according to Internet Retailer. Cyber Monday alone brought in close to $6.6 billion in online revenues, making it the largest eCommerce sales day to date.

Meanwhile, foot traffic retail outlets decreased by just under a percentage point on Black Friday compared with the prior year, according to ShopperTrak, and Internet Retailer estimates in-store sales growth of around 2.5% — healthy, but nowhere near the rocketing increase in online activity.

The online growth is driven by consumers who increasingly express a preference for online shopping during the holidays. Fully 50% of participants in Deloitte’s pre-season survey said they favored going online for gifts, while participants in Kibo’s holiday survey named convenience, the lack of crowds, competitive prices, and wide selection as the top reasons they preferred shopping online.

The single brand benefiting most from this changing sentiment is, not surprisingly, Amazon.com. Amazon generated more than 56% of online shopping sales over the Thanksgiving-to-Cyber-Monday period now dubbed The Cyber Five, according to Internet Retailer. Hitwise reported that on Cyber Monday itself, some 60% of all online transactions were conducted on Amazon.

As Amazon’s juggernaut plows through the season, there’s a ripple effect for merchants in the form of rising shopper expectations. Amazon’s Prime service, which offers free two-day shipping to its 90 million members (that’s a quarter of the U.S. population),  now sets the standard for delivery that’s both free and fast. The site’s more than 300 million SKUs prompt shoppers to expect that they’ll be able to find “long-tail” rarities online.

And, of course, Amazon’s practice of undercutting the competition on product pricing has led shoppers to expect online deals. Indeed, relevant discounts topped the list of expectations for eCommerce sites in the Kibo holiday survey, with 70% of respondents saying they expected to see them when shopping online.

But for many small- and mid-sized merchants, a race to the bottom when it comes to pricing is dangerous to start, as are perennial free shipping offers that erode margins. Instead, in order to take advantage of secret Amazon’s shortcomings, merchants must maintain and grow their businesses by doubling down on their unique assets, demonstrating worth through relevance and creating a valuable experience that spans touchpoints.

 

In 2018, merchants should prioritize:

BOPIS. Buy online, pickup in-store, aka BOPIS, is a retailer’s magic bullet when it comes to fast, convenient, and free online order fulfillment. In order to meet and exceed expectations, however, merchants must execute flawlessly, which means deployment and exhaustive testing of:

  • Real-time inventory visibility. More than one in two shoppers in Kibo’s holiday survey said they use online inventory information to justify a trip to the store, so that information must be accurate, especially during peak seasons when store stock is in rapid flux. Flagging items that are almost gone in stores can give shoppers extra motivation to commit to purchasing online before jumping in the car.
  • Speedy site-to-store fulfillment. Shoppers expect BOPIS to beat home-delivery orders when it comes to speed, with more than 80% saying they their items should be ready for pickup within 24 hours and 59% expecting pickup within 4 hours, according to a BOPIS study by Bell & Howell.  Merchants should meet this expectation wherever possible and promote it, flagging items available for one- or two-hour pickup on the product detail page as well as highlighting the overall speed of BOPIS service.
  • Seamless and efficient pickup execution. Merchants should invest heavily in testing post-purchase transactional messaging and in-store pickup processes to ensure BOPIS delivers on its promise. Notification messages should clearly spell out next steps for pickup, store signage should prominently point the way to pickup desks, and the counters should be adequately staffed to reduce wait times. While merchants may be tempted to place pickup counters at the back of stores in the hopes of encouraging additional purchases, delivering on the expectation of speedy pickup can foster longer-term loyalty. In fact, to make the process more efficient, merchants should even consider self-service lockers, which are rapidly being deployed for Amazon in Whole Foods locations, and holiday curbside service for BOPIS orders.

 

Real-time personalization. Creating valuable brand experiences means delivering relevance in the moment, from showcasing unique finds that match shoppers’ holiday gift lists to offering proactive suggestions based on past orders. Shoppers now expect merchants to be able take into account their past interactions with the brand when it comes to site offers and content, and while personalization has been a buzzword for years, the latest real-time individualization tools can help merchants realize the goal of providing one-to-one shopping experiences. To deliver on the promise of personalization, merchants should employ:

  • Explicit as well as implicit personalization tools. While much is made of technologies that churn through behind-the-scenes big data to power product recommendations, merchants can also deploy features that ask shoppers to volunteer information outright. By taking a page from concierge-style startups like StitchFix and Trunk Club, merchants can ask shoppers to create style profiles that can then be used to inform product recommendations, buyers’ guides, and in-store personal shopping services; or, on a smaller scale, merchants can ask shoppers interested in new products from a particular line or brand name to sign up for alerts of upcoming launches. 
  • Robust loyalty programs. Merchants are increasingly investing in customer retention, and for good reason: returning buyers comprise just a third of customers, but account for 42% of online revenues, according to Forrester Research, Inc. Merchants can use loyalty points to their advantage to encourage engagement with the brand, offering rewards for activities that enrich customer profiles as well as deliver on the promise of personalized products and services. Offering exclusive perks — such as free expedited shipping for last-minute holiday shoppers, sneak peeks at new products, dedicated VIP BOPIS pickup counters, and members-only in-store events — can extend the benefits of membership beyond product discounts, and help customers maintain ties with the brand.

 

Read how Kibo’s industry-leading fulfillment and real-time individualization solutions can help merchants not only survive, but thrive in 2018.

Buy Online Pickup In-Store, BOPIS

New Report: 25% Increase In Consumers Planning On Using BOPIS This Holiday!

Buy online pickup in-store (aka BOPIS) services have been growing steadily in popularity, and give retailers an edge when it comes to fast, free order fulfillment. In the fiercely competitive holiday environment, new Kibo research gives merchants new ways to promote the BOPIS service to maximize its usage and thereby cement their brands’ reputations for stellar service.

According to the new research presented in Kibo’s Holiday Consumer Trends Report, consumers say they’ll rely on BOPIS more than ever. Close to 60% of shoppers said they’ll select the service, an increase of more than 25% over last year. Year-round, Kibo research indicates that fully 78% of consumers have used BOPIS services in the past six months, demonstrating that store pickup services are now considered mainstream.

Evidence suggests buy online pickup in-store has a positive impact on the bottom line. For starts, more than 70% of shoppers say they made further impulse purchases when they visited stores to pick up items ordered online, according to research cited by eMarketer.

BOPIS has the added benefit of differentiating small to mid-sized retailers compared with online-only behemoths such as eBay or Amazon, which can’t compete with the niche expertise and personal service specialty retailers can offer in stores. Amazon’s launch of its own brick-and-mortar locations and acquisition of Whole Foods supermarkets are testament to the importance of physical store outlets.

During the all-important holiday season, then, it makes sense for merchants to make the most of the BOPIS services they offer. That means positioning BOPIS to address consumers’ expectations for holiday offerings and promoting it throughout the path to purchase, not just in the cart and checkout. Among the promotion options:

 

BOPIS is the default free option. Consumers’ desire for free shipping is as strong as ever, with 70% saying they expect free standard delivery during the holidays, according to the new Kibo data. And they recognize cost savings as the primary benefit of BOPIS, with 66% saying that’s why they’re likely to use it. Not only can buy online pickup in-store help meet these expectations, but it can help merchants stay competitive even if they can’t afford to offer frequent free home delivery promotions (or across-the-board free shipping) during the holidays.

Spotlight BOPIS for cart abandoners. The cart abandonment rate hovers around 60% and is likely to spike higher during the holiday season, when consumers are researching and comparing total order costs at a furious clip. To lure them back, 71% of shoppers say merchants should provide a discount, and 69% say they hope offers triggered by cart abandonment will specifically contain free shipping. Spotlighting BOPIS in abandonment emails gives merchants the means to save the sale with free fulfillment — without breaking the bank.

BOPIS helps combat last-minute crowds. When asked why they prefer to shop online, 58% of consumers in Kibo’s holiday study cited the lack of crowds and lines, and 68% said it’s more convenient than visiting stores. And more than half said they’ll use buy online pickup in-store services to help them save time in stores. To highlight this benefit when it matters most, merchants can use BOPIS to reassure last-minute shoppers who missed shipping cutoffs by highlighting the speed and efficiency of store pickup services. Whether merchants follow Walmart’s lead and position pickup stations at the front of the store or not, they can make the process smooth by clearly communicating logistics in post-purchase emails and ramping up store signage to help holiday shoppers in their last-minute dash.

Concierge BOPIS service is a loyalty club perk. Extra loyalty club rewards were second only to discounts as the top way to improve the holiday shopping experience, according to Kibo holiday study participants. Furthermore, club members are looking for perks when it comes to shipping, with 49% saying they’d expect club membership to give them access to free home delivery. Merchants can enhance BOPIS services to help satisfy these expectations: they can accord loyalty members priority BOPIS service by giving them an express lane at service counters and offering to wrap gifts for free prior to pickup. Merchants could even connect buy online pickup in-store with personal shopping services and exclusive member events, enabling loyalty club members to have gifts picked and packed while they enjoy other store attractions.

 

Download Kibo’s Holiday Consumer Trends Report for further guidance on consumers’ omnichannel expectations for the holidays, from eCommerce site functionality to shipping speed to returns.

Holiday Season Customer Service

Tips For The Best Customer Service This Holiday

As the holiday season revs up, many sellers are focused on their promotional calendars, hoping that savvy discounting strategies and big wins on key dates such as Black Friday will bring success. But just as important, though often overlooked, is customer service — a core component of the shopping experience that can make or break brand loyalty.

Given that few brands can compete on price with discounting juggernauts such as Amazon, customer service is increasingly a key differentiator for small- to mid-sized merchants. Those who promote and deliver on the promise of stellar service — from helpful pre-purchase interactions to on-time order delivery to convenient returns — stand to retain customers and earn word-of-mouth buzz. Those who’ve had positive prior experiences spend an average of 140% more than those who ran into customer service roadblocks, according to the Harvard Business Review. And thanks to social media, the potential downside to poor service is significant: Fully 46% of consumers — and 56% of Millennials — have called out brands on social networks for poor customer service, according to Sprout Social.

Customer service is so important that Kibo’s customer success team devoted an entire holiday readiness webinar to the topic. Among the priorities they identified:

 

Spotlight holiday shipping deadlines now.

Given that some 40% of shoppers have begun their holiday gift-buying in October or earlier, according to the National Retail Federation, merchants should stack the deck of free shipping promotions in favor of early purchasing and spotlighting those specials now, along with shipping timelines for the pre-season as well as the peak period after November. To further stimulate planning and early purchasing, merchants should message holiday cutoff dates early and often via multiple touchpoints — from triggered email messaging to social media.

And “early” doesn’t just apply to the holiday calendar — it’s also relevant for the path to purchase. Shipping processes and timeframes should be tailored to the item level and displayed on the product detail page as well as in the cart and checkout. For perishables, large items, and other merchandise requiring special handling, information should be tailored and specially flagged. Overall shipping cutoff dates and holiday delivery services can even be promoted via banners from the home page and category pages, as well as on advertising landing pages.

Vet BOPIS order process end to end.

Speaking of order fulfillment, merchants should cater to the 79% of shoppers who use Buy Online, Pickup in Store, aka BOPIS, services as a speedy and free way to take possession of their goods. For starters, sellers should list BOPIS options alongside home delivery options wherever shipping information is displayed — and highlight BOPIS in particular, especially as delivery cutoff dates speed past.

In addition, merchants should vet their BOPIS experience thoroughly in advance of peak crowds to make sure messaging is accurate and consistent, from the first inventory lookup option on the product detail page through to the in-store signage directing shoppers to the pickup desk. While it’s late for major technical overhauls, sellers can tweak verbiage to clarify the process, adjust in-store merchandise displays to tempt pickup customers to make additional purchases, and find ways to proactively message about any potentially confusing hurdles that might lead to dissatisfaction or delays.

(Merchants who don’t offer BOPIS should move it to the top of the 2018 priority list — and consider Kibo’s industry-leading omnichannel solution to create a seamless customer experience.)

Make returns a win-win.

Given the uncertainties of ordering items online without touching and trying them, it’s no surprise that fully 30% of eCommerce customers go on to return purchases — a percentage that jumps during and after the holidays, when gift returns are rampant.

So given how prevalent returns are, they needn’t be the end of the customer relationship; rather, they can be an opportunity — if the process is painless. Indeed, fully 92% of shoppers returning items say they’re willing to consider purchasing from the same merchant again based on the ease of the returns experience. Shoppers who can return online orders in-store may reward that convenience immediately: 70% make an additional purchase during their visit.

During the holiday season, merchants should highlight convenient return policies — from free return shipping to in-store returns for items bought online. And while it may seem self-defeating to promote returns even before orders are placed, such transparent messaging signals a commitment to service that can boost trust and brand loyalty. Proactive messaging about returns via social media and on the eCommerce site can reassure harried holiday shoppers that their gift picks won’t go to waste if they’re not a perfect match.

Use chatbots sparingly and transparently.

Shoppers have ever-heightening expectations for swift customer service, especially when it comes to social media. Upwards of 40% of shoppers who use social media to reach brands expect a response within an hour, according to research from The Social Habit.

With this need for speed, it’s tempting for merchants to turn to artificial intelligence and chatbots to handle customer service complaints instantaneously. But chatbots that merchants attempt to pass off as human rarely succeed, and can alienate shoppers with generic or irrelevant responses that complicate rather than speed resolution of their requests.

To ensure both speed and satisfaction, merchants should triage incoming requests and route complex questions to live humans; chatbot usage should be limited to use cases where responses are clear-cut. Whatever chatbot interactions do occur should be clearly labeled as such, and easy access to live human help — via a link or toll-free phone number — should be readily available. Given that 90% of support requests are for order status updates — a task easily handled initially by chatbots — sellers can still realize cost savings in the call center even if that’s the sole service topic they delegate to AI-driven systems.  

To help slow the tide of incoming requests in the first place, merchants should also beef up their self-service content. A growing number of shoppers consult FAQs and customer-contributed Q and A resources before even trying to reach live help, and 39% of Millennials turn to self-service help first and foremost. As the holidays approach, merchants should review Q&A content for top products, update FAQs, and incorporate common responses into core product page information.

 

Looking for more holiday readiness tips? Read the first and second blog posts in the series here. To ramp up the shopping experience for 2018, check out Kibo’s omnichannel commerce solution and gain access to strategy expertise during the holidays and year round.

The Case Of The Missing Omnichannel Strategy

Omnichannel is the goal, but where do retailers stand?

As the industry starts to focus more on how omnichannel technology influences the customer experience, it’s become important to see how far retailers have come, and where they currently stand.

View this infographic to explore what you might be missing from your current omnichannel strategy in regards to:

  • Fulfillment and Inventory
  • Personalization
  • Price Consistancy
  • In-Store Signage

 

The State of Omnichannel Commerce, Omnichannel Strategy