Breaking through the barriers to multi-channel

21 April 2009

The Internet and cloud technologies offer exciting possibilities for the future of multi-channel retailing, says Carlo Rimini of Snow Valley.

Ten years ago when we built our first e-commerce solution, multi-channel integration was seen as the Holy Grail for bricks-and-mortar retailers.

Some had been well positioned from the start: Argos in the UK already had a business model that allowed full visibility of product inventory across the business; others, like Boots, had loyalty cards that gave them access to customer data covering purchases both in-store and on the Web.

But most retailers had neither of these things, and the complexity and the challenges of integrating their systems seemed insurmountable. Product information, price feeds, and what little customer data existed, was often held in a lot of different systems. The arrival of Web retailing added to the complexity and threatened to increase the number of data silos even further.

Since then, a lot of progress has undoubtedly been made. I only need to look at our last project for a retailer in the UK – it went from a non-transactional Web site to a fully multi-channel service, allowing its customers to buy online for delivery to a store, order in-store for delivery at home, or buy online for home delivery. Others are able to offer a ‘deliver to store’ option, or allow customers to go online and check stock availability in their local branch.

But in many ways this is just the tip of the iceberg. Plugging one system into another system can undoubtedly bring advantages to any business. The real value for multi-channel retailers lies in releasing several types of data from various repositories and allowing systems to suck in that data so we can bring it all together in meaningful ways. By doing this, retailers can begin to move to a new level of multi-channel selling and customer relationship management, ultimately achieving the single customer view that remains so elusive to most.

The e-commerce platform is playing a starring role in all of this. Firstly, it’s giving retailers new types of data – customer intelligence like we’ve never seen before, rich product data that has had to be created for online merchandising purposes, and user-generated content, which is growing in its strategic value to any retail business.

The Web has also given high street retailers the previously unprecedented capability to observe and respond to customer behaviour and interaction. The approaches emerging from the e-commerce department will shape the way that retailers develop their entire business models and customer strategies.

All of this means that the Web is ideally placed to act as the hub for the future evolution of the multi-channel business. And this requires three elements from us as suppliers – extensible e-commerce applications that can be grown rapidly in scale and scope; open integration models that enable simplified data transfer; and lastly, and possibly most importantly, support in helping retailers to reshape their business and customer strategies so that they can use the data that is being made available in ways that deliver tangible business value.

Which brings me to the cloud. I’m very excited by the possibilities that cloud computing and Azure can offer to e-commerce and the world of multi-channel retail. As the e-commerce platform moves into an ascendant position within the retail infrastructure, performance becomes a significant business issue. The international nature of e-commerce also adds extra demands – there are no closing times online and the technology and the support must be in place to deliver that 24-hour service. The cloud will allow us to offer the scalability and elasticity that’s needed.

All of the above can be best achieved using Microsoft technologies – Snow Valley has been doing so successfully for ten years and we look forward to the exciting times ahead.