STORES Magazine - April 2015 - (Page 64)

n POV What is the Return on Omnichannel? by KERRY LEMOS Kerry Lemos is the CEO of Retail Pro International Many retailers are initially very excited to embark on an omnichannel journey. However, once they begin plotting their strategy, many start to wonder if the substantial effort required is worth the investment. It's no small task: Inventory proshipping costs? Even though sales cesses must be upgraded, websites didn't come from the highest-profit updated and employees trained. departments, they added up to an But 50 percent of all U.S. retail sales overall success as new inventory efare predicted to be omnichannel ficiencies were found and radiated by 2017, according to Forrester, sales were made when customers and for many retailers, the concept picked up the orders. of omnichannel helps better paint Sephora is also a leader in oma picture of a repeat customer's nichannel strategy. In addition to total value. With the probability of a successful network of physical repeat customers buying a product retail stores, the brand has a strong between 60 and 70 percent and the online presence and even hosts its prospect of new customers doing own online "BeautyTalk" commuso below 20 percent, it's clear why nity. so many are looking to omnichannel The retailer integrates online with for answers. in-store activity through the conSuccessful omnichannel strategies stantly evolving Sephora to Go app, incorporate several components, allowing customers access to their often including shipping from "loves" list on any mobile device. a retail store. A CIO might sugAs customers are encouraged to gest integrating the store's retail cross channels with their omnisoftware with a distributed order present shopping lists, rethinking management system in order to roll how sales and costs are attributed Digital efforts helped out a ship-from-store program, the across channels becomes a priority. Macy's fourth-quarter sales goal of which would be to double Sephora is looking to evolve the increase to $9.364 billion, inventory turnover. The CFO might experience, deploying beacons in up 1.8 percent from the reject the project entirely, citing an stores throughout the United States prior year. increase in shipping costs, resulting to deliver personalized alerts to in an overall loss. Organizational prishoppers who opt in. orities need an alignment to move forward; it is imperative The trend is clear - no matter the evolving processes or to leverage the benefits of any part on an omnichannel technology, the target is on continuing the retail relationstrategy to solve a current business need. ship with the consumer across all platforms, channels and One popular omnichannel strategy for retailers is buy mediums. Correct sale attribution, together with tailored online, pick up in store. Macy's expertly integrates the onretail experiences and customer nurturing, is critical to line and in-store experience, which is reflected in its most the strategy. It is no longer just a mobile sale or web sales recent financial results. Digital efforts helped fourth-quarvolume driving development of that channel: It is the retail ter sales increase to $9.4 billion, up 1.8 percent from the experience and the brand story. And the rising spend per prior year. Among its strongest performers were dresses customer and elevated loyalty metrics are the return on inand men's and women's shoes. In those particular departvestment measurements for the omnichannel investment. ments, Macy's tested a single view of inventory between In the end, this holistic approach to retail enhances the stores and direct-to-customer warehouses. shopping experience, which leads to satisfied, loyal cusCan smarter fulfillment routing based on the most profittomers. And that's an investment well worth making. able location result in more balanced inventory and fewer markdowns leading to savings that can offset any new 64 STORES April 2015 NRF.COM/STORES http://www.NRF.COM/STORES

Table of Contents for the Digital Edition of STORES Magazine - April 2015

A Most Complex Game
It's All Connected
Retail People
Selling Satisfaction
Editor's Page
President's Page
Retail Politics
NRF News
NRF Communities Update
End Cap
Business Operations
Online Fraud

STORES Magazine - April 2015