Unified Commerce and Long Tail: Winning Duo in Retail
The retail industry is continuously changing. The e-commerce boom forced retailers to make a transition to the digital age, failing which they would have missed the boat. The ongoing pandemic only exacerbated the trend... Or the bottoming out, for those who didn’t catch the wave. Retailers of today have to adapt their processes to the multitude of sales channel, and widen their product offer in the wake of an ever more demanding base regarding customer relations, selection, price and quality.
State of Play
Saturday afternoon, 3 p.m., Mont-Royal Avenue in Montreal: John is strolling on the street with his girlfriend and is looking to buy new shoes. He sets his heart on a pair of grey sneakers. “They look great!” he says. He tries them on, but realizes the colour is a tad dull. The salesperson takes out his tablet computer and shows John (using a clienteling tool) that the model is also available in green, yellow, pink... He doesn’t have them on hand but can fill a customer order. Excellent! John would like them in green! “Very well, sir. Would you like them delivered to your door, or do you want to claim them in one of our stores?”
At the same time in Chicoutimi, Edward shops on the website of that particular retail chain. He buys shoes of the same model as John, but in pink. He decides to claim them at the Quebec City store since he will be in town for business next week (thus no shipping fees).
Brian, a third character, calmly scrolls through Facebook. The now-fabled shoes appear on his wall, in yellow. It’s love at first sight! He clicks on the link and decides to buy them, and have them delivered to his door since the pair was not in stock at the retailer’s warehouse. This sale automatically triggers a purchase at the vendor’s facility, which will deliver them directly to the end customer.
Three examples sum up what the retail industry looks like today:
Retailers receive customer orders through multiple platforms, but they process them the same way: via the unified commerceapproach.
Retailers sell products that they don’t physically have in stock (either in-store or at the warehouse). They give other options using the long tail effect.
Similarly to the multichannel approach which allows placing an order on multiple platforms (in-store, web, phone, etc.), but whose unidirectional nature prevents the organization from optimizing its processes, the unified commerce also provides a unique and standardized processing of customer orders. For instance, the client can start an order by clicking a link on social media, confirm it on a website, edit it using his/her cell phone, request a follow-up by calling the retailer, and finally pick up the item at the store.
When we implement it in Microsoft Business Central, the LS Central software from LS Retail provides a management solution for unified commerce customer orders. Deposit management, sourcing from different regions, order pick-up, door delivery, notification emails sent for items ready to be picked up, order status, order management in the warehouse management system, freight cost management, clienteling, search for suppliers... It is a complete solution.
The Long Tail Effect
The three pairs of shoes, each in a different colour, sold by the retailer in our example, are not available in-store, but they are on the Internet and via the clienteling tool. The latter grants the consumer access to analmost infinite number of varieties and products. Indeed, if space is limited in the store, it isn’t on the Internet, and the product offer reflects that sheer vastness through the clienteling tool. The retailer can thus grow its sales with product diversity.
This solution, dubbed the long tail effect, when combined with the unified commerce approach, allows retail professionals to open their business to today’s and tomorrow’s world.
The power of long tail has mostly been experienced at Amazon; it allowed the company to become one of the biggest retailers across the world. But smaller, specialized retailers explore this solution more and more in order to offer a multitude of items to their base, and to become true niche platforms. In our example, the grey sneakers would be the “hit” items while those in other colours would be considered “niche” since they are not part of the regular stock in-store or at the warehouse.
Just imagine all the power the retailer would enjoy if he became an Amazon-of-sorts in his niche. Imagine a bathroom products salesperson selling the usual baths and furniture, but also all things related to the bathroom: mirrors, non-slip accessories, duck-shaped foam dispensers, and much more. His related product offering combined with the “hits” would be expanded greatly, without him taking risks associated with purchases and inventory management.
Progress itself forces software publishers to be creative, or to follow the trend of the retail industry. Createch boasts a strong and proven expertise supported by its know-how in this particular industry, thanks to numerous implementations of LS Retail—global publisher of solutions dedicated to the retail industry. Createch is recognized as a platinum partner at LS Retail for the successful projects they carried out, but also for having indirectly contributed to moving LS Retail solutions forward. Do not hesitate to contact one of our experts for more information!