THEORIES ON OMNICHANNEL SUPPLY CHAIN
International distribution
Globalization has garnered significant attention and sparked extensive discussions across societal, institutional, cultural, and business contexts In any globalizing process, the movement of goods and services within and among local industrial and consumer markets holds substantial importance The globalization of markets and the restructuring of distribution mechanisms are interconnected processes that bring about alterations in market configurations (Mattsson & Wallenberg, 2003) As national markets expand and fresh consumer demands surface, there is a discernible increase in specialization within distribution, both in terms of distribution levels and the types of products and services handled (Mallen, 2006).
Furthermore, as the global market sphere broadens, multinational corporations feel the mounting pressure to establish worldwide communication, distribution, and information networks, enabling the seamless flow of goods and information across national borders (Min & Eom, 2014) Excelling in distribution channels has evolved into a robust source of competitive distinction In the 1980s and 1990s, businesses began viewing distribution channels as more than mere cost-saving mechanisms and recognized their potential to enhance product offerings or services as integral components of the broader supply chain process, thus fostering competitive advantage (Mentzer et al., 2004).
Maintaining the growth of the global market and integrating global economic activities necessitates efficient and cost-effective distribution strategies, as emphasized by Ross (2016) The challenge for managing global distribution lies in establishing a supply chain that is nimble and adaptable enough to accommodate varying customer needs while capitalizing on the advantages of focused manufacturing (Schary & Skjott- Larsen, 2015) According to Black et al (2020), the last decade has witnessed swift and substantial transformations in the distribution channels for goods and services within developed economies Companies must recognize that selecting a distribution channel is intricate within their domestic market and even more complex when venturing internationally and entering the export arena For companies planning to expand abroad, it's crucial to understand that the choice of distribution channel significantly influences future success and growth A multitude of distribution channel options exist, and the circumstances may differ across companies and markets Moreover, changing distribution channels later on can be intricate and costly Thus, it is of paramount importance that this decision receives the necessary attention and recognition, considering its long-term impact on the success of export investments (Anderson et al., 2017).
Developing steadfast competitive advantages relies on effective distribution strategies, as marketing channels possess enduring characteristics, demanding a coherent structure for their establishment This is further reinforced by their interpersonal and relational nature (Neves et al., 2021) In light of rapidly evolving distribution channels, consumer studies should extend beyond comprehending product selection and encompass the rationales behind channel preferences (Black et al., 2020).
According to Root (2018), identifying the most suitable channel type remains challenging even when guided by performance criteria Managers are confronted with the task of fulfilling various channel objectives, including sales volume, cost efficiency, control, and collaboration among channel members—objectives that are seldom fully satisfied by any single channel system Additionally, managers often grapple with limited and unreliable information when assessing sales potential and costs of alternative channels Consequently, the selection of the most appropriate channel entails a screening process heavily reliant on qualitative evaluations and judgment Black et al (2020) suggest that the nature of the product significantly influences channel choice The product's attributes can be assessed along two vital dimensions that influence the level of consumer involvement: complexity and the perceived risk linked to its purchase Given the paramount role of aligning products with suitable channels, it becomes evident that in addition to product attributes, the characteristics of the channels themselves also hold substantial sway.
Czinkota and Ronkainen (2014) indicate that distribution channels can range from straightforward direct connections between producers and consumers to intricate multilevel structures employing various intermediaries, each serving distinct functions The direct producer-to-consumer arrangement is notably straightforward when compared to more complex setups, like the producer-to-agent- to-wholesaler-to-retailer-to-consumer framework, which is categorized as an indirect channel by Mallen (1996) Although most international companies would ideally opt for a direct channel using their own sales teams, they often resort to intermediaries such as agents or distributors due to factors such as limited sales volume, high initial costs, and the necessity for local expertise (Coelho et al., 2020).
In Figure 1.1, five alternative consumer channel types are depicted.
Figure 1.1 Five alternative consumer channels
1) Producer - consumer Cutting out distributor profit margin may make this option attractive to producers Direct marketing is of growing importance in Europe and includes the use of for example direct mail, telephone selling and direct response advertising (Jobber, 2011)
2) Producer - retailer - consumer The growth in retailer size has meant that it becomes economic for producers to supply retailers directly rather than through wholesalers Consumers then have the convenience of viewing and/or testing the product at the retail outlet (Jobber, 2011).
3) Producer - wholesaler - retailer - consumer For small retailers with limited order quantities, the use of wholesalers makes economic sense. Wholesalers can buy in bulk from producers, and sell smaller quantities to numerous retailers The danger is that large retailers in the same market have the power to buy directly from producers and thus cut out the wholesaler In certain cases, the buying power of large retailers has meant that they can sell products to their customers cheaper than a small retailer can buy from the wholesaler Longer channels like this tend to occur where retail oligopolies do not dominate the distribution system In Europe long channels involving wholesalers are common in France and Italy In France, for example, small independent wholesalers dominate the distribution of vehicle spare parts (Jobber, 2011).
4) Producer - agent/distributor - retailer - consumer / Producer - agent/distributor - wholesaler - retailer - consumer This type of channel is most common when companies enter international markets, due to the fact that it does not require as much investment in terms of time and money (Jobber, 2011) Exporting companies may delegate the task of selling the product to an agent/distributor An agent contacts wholesalers or retailers in the exporting company's name and receives commission on sales For example, overseas sales of books are sometimes generated in this way A distributor is an independent company which purchases the products of the producer and sells it in its own brand name or uses the exporter's brand name The distributor has the entire responsibility of the rest of the distribution channel such as choice of intermediaries, storage and marketing and an agent has various responsibilities depending on the agreement with the producer (Bradley, 2019) Some companies use multiple channels to distribute their products Grocery products, for example, use both producer to wholesaler to retailer (small grocers), and producer to retailers (supermarkets) (Jobber, 2011).
The selection of different distribution pathways is influenced by the level of control the manufacturer aims to maintain over the distribution process Opting for a non-direct distribution channel entails relinquishing certain marketing duties, sales functions, and product storage to the foreign intermediary Thus, careful consideration must be given to the choice of intermediaries as it holds significant importance (Gilliland & Bello, 2017).
1.1.2 Selection of international distribution channels
Selecting the appropriate distribution channel is of paramount importance for companies, given its substantial cost and significant investment The producer is required to dedicate substantial effort and careful consideration to this decision (Holmvall, 1995) The forthcoming section will introduce theories pertaining to the procedure of choosing international distribution channels.
When a firm decides to enter international markets and opts to engage an intermediary, a thorough selection process becomes essential for identifying top- quality intermediaries This endeavor demands considerable attention and diligence.
As outlined by Root (2018), the decision-making process encompasses four distinct phases:
4) Finalizing the choice of intermediary
The intermediary profile lists all the criteria a company should look for in a prospective intermediary for a foreign target market The potential intermediaries must be compared and contrasted against determining criteria according to Czinkota and Ronkainen (2014) and Root (2018) If the intermediaries have different capacities, needs and goals it may result in conflicts with the company Therefore, it is crucial that the intermediaries' outlook and approach comprehend to the companies according to Cavusgil et al (2015).
Especially when various criteria are being weighed, these lists must be updated to reflect changes in the environment and the marketer's own situation Some criterion can be characterized as determinant, in that they form the core dimensions along which candidates must perform well, whereas some criteria, although important, may be used only in preliminary screening (Czinkota & Ronkainen, 2014)
Omni-channel in international retail
Digital technology has introduced numerous pertinent elements of success, as well as various possibilities and challenges for implementing strategic omnichannel (OC) systems With the integration of advanced digital technologies into many OC initiatives, the importance of OC marketing and its role in achieving excellence in the omnichannel system have ecome apparent zt rk Okumus, 1 Numerous companies are currently employing OC distribution techniques while also leveraging retail marketing strategies, resulting in an overall influence on OC shopping experiences and the cultivation of consumer loyalty (Doyduk, 2018).
Once the foundational principles of OC marketing, ethical considerations, and essential components are understood, they can e applied to yield maximum advantages H ner et al., 16 lthough the term "OC" or "Omni Channel" emerged six years ago (Rigby, 2011), the core concept and the notion of achieving desired outcomes through well-defined approaches have remained somewhat ambiguous This is due to the vague and imprecise application of Cross, Multi, and
OC concepts found in various literature (Beck & Rygl, 2015) While multi-channel marketing entails integrating different channels while maintaining separate operations, the OC system involves seamless collaboration among integrated channels This enables customers to utilize various digital channels for research and experience each physical store within a single transaction (Piotrowicz & Cuthbertson, 2014) The unified operation and management of all channels ensure that customers can anticipate consistent brand experiences whenever and wherever they interact with the company's website (Piotrowicz & Cuthbertson, 2014).
Consequently, the concept of OC represents a significant, pragmatic, and groundbreaking advancement in recent business strategies, carrying both theoretical and practical implications (Bell et al., 2014) Verhoef et al (2015) assert that companies engaged in global competition have already revolutionized markets through innovative marketing concepts and cutting-edge technology Advances in communication and information technology have led to an increased array of retail formats, enabling consumers to conveniently engage with the company through secure customer journeys (Klaus, 2013) Moreover, beyond traditional online and brick-and-mortar stores, the proliferation of mobile channels, various mobile devices, social media platforms, branded applications, and interconnected components and objects have transformed the entirety of consumer purchasing processes and experiences (Agatz et al., 2008).
The term "omnichannel," initially introduced within business circles and among practitioners, has more recently gained significant attention within academic realms It has substantially revolutionized the retailing paradigm, reshaping perceptions of evolving consumer behaviors and shopping habits in the current retail landscape (Banerjee, 2019) Consequently, managing omnichannel strategies presents a continuous and significant challenge for diverse brands This stems from the heightened expectations of customers, who demand exclusive shopping experiences throughout their customer journey (Juane-Da-Ayensa et al., 2016) The proliferation of social media trends and mobile technology has intricately complexified the customer journey This entails the simultaneous utilization of various communication channels and customer selection methods, giving rise to novel behavioral patterns (Piotrowicz & Cuthbertson, 2019).
Given the absence of a unanimous literature consensus on omnichannel retail management, efforts have been directed towards comprehending the precise nature of omnichannel retailing and elucidating it through research to establish its current status (Tetteh & Qi, 2014) Consequently, several contributions have emerged from this endeavor Firstly, it has clarified the ambiguity surrounding the term
"omnichannel," distinctively defining the perspectives of cross-channel, multi- channel, and true omnichannel views Secondly, it has synthesized existing knowledge and experiences concerning the omnichannel shopping process and the behaviors of newly engaged consumers Thirdly, it has put forward prospective terminology for future research, focusing on the strategic dimensions of omnichannel retailing Lastly, it concludes by offering practical implications and theoretical insights into omnichannel phenomena, unveiling unexplored inquiries that have recently garnered substantial attention among researchers (Tetteh & Qi, 2014).
The progression of omnichannel development can be segmented into four primary phases: (1) Initial phase: predating the 2000s, characterized by limited e- commerce studies; (2) Multi-channel: spanning the early 2000s to 2010,emphasizing a greater concentration on multichannel approaches; (3) Emerging phenomenon: extending from the early 2010s to the mid-2010s, marked by an initial and evolving stage of omnichannel implementation; and (4) Revolution: spanning from the mid-2010s to the present, marked by the establishment of a comprehensively integrated ecosystem for omnichannel operations (Table 1.1).
Initially, the concept of omnichannel retailing originated from the notion of'click "n" mortar,' a business model encompassing both online and offline operations(Riggins & Rhee, 1998) As consumers increasingly turned to the
Internet to explore products and services, numerous retailers introduced online channels to complement their physical stores Concurrently, entirely virtual retailers like Amazon emerged during this period, conducting business solely through online platforms without brick-and-mortar establishments (Steward et al., 1999).
Furthermore, the period preceding the 2000s marked the initial exploration of e-commerce as an innovative business model A primary emphasis during this phase was on integrating e-commerce practices with traditional brick-and-mortar retailing, often referred to as 'cyber-enhanced retailing,' aiming to enrich the shopping experience (Brown, 1981) Additionally, online channels were seamlessly incorporated into conventional retail setups to expand interaction points and nurture customer relationships (Brown, 1981) In this stage, diverse website development technologies were utilized to establish online visibility for retailers (Steward et al.,
1999) However, in this early phase, managing multichannel strategies proved challenging due to customer unfamiliarity with these new avenues Furthermore, despite most countries being connected to the internet by 1999, establishing an online presence necessitated intricate configurations, with dial-up connections serving as the primary choice for personal users (Bickart & Schindler, 2001). Consequently, this confusion among customers resulted in reduced sales, diminished market share, and compromised competitiveness, highlighting the necessity for improvements in multichannel marketing endeavors (Cespedes & Corey, 1990).
The early 2000s to late 2000s: Multi-channel
In this period, there was a heightened focus on the importance of multichannel strategies as retailers came to realize the value of establishing such systems (Metters
& Walton, 2007) Within this landscape, the coexistence of diverse sales channels became evident The convenience of e-commerce provided customers the ability to explore multiple avenues for comparing options and securing the most favorable deals (Metters & Walton, 2007) Retailers, aiming for a competitive edge, sought to offer distinctive cross-channel benefits and enhance their practices in managing customer relationships (de Koster, 2003) Rather than integrating various channels into a unified system, they were often treated as separate entities (Hovelaque et al.,
2007) Retailers introduced fresh distribution methods specifically tailored for online platforms, such as drop-shipping (Hovelaque et al., 2007) or establishing new distribution centers (de Koster, 2003) Consequently, the structural, inventory management, and supply chain aspects of retailers underwent substantial transformation due to the differences between e-commerce and traditional retail (Metters & Walton, 2007).
Furthermore, the diverse channels presented an opportunity to enhance customer interactions, enabling retailers to gain better insights into their clientele and serve them more effectively (Hovelaque et al., 2007) As a result, prominent retail brands like Walmart, Best Buy, and Nordstrom increasingly adopted multichannel strategies (Grewal et al., 2008) Effective customer relationship management had the potential to foster stronger brand commitment, thereby increasing switching costs and nurturing customer loyalty (Neslin et al., 2006). Consequently, factors like channel switching, consumer decision-making, and brand loyalty gained significant attention from previous researchers (Kwon & Lennon,
2009) The acceptance of technology by customers, whether in online channels or brick-and-mortar stores, also emerged as a key focus of research (Wixom & Todd, 2005).
While multichannel strategies provided customers with multiple touchpoints for engaging with retailers, they also raised the likelihood of service failures due to disparities across channels (Noble et al., 2005) Consequently, maintaining consistency in brand identity across channels required dedicated efforts Various technology systems for managing multichannel operations were adopted to facilitate the integration of production, distribution, and marketing components (Neslin et al.,
The impact of omni-channel commerce on the supply chain
Reagon (2019) explains that in the context of a conventional supply chain, the process of moving goods from the factory to the ultimate customer involves traversing a multi-tiered supply chain structure consisting of a factory warehouse, an international warehouse, distribution centers scattered globally, and retail stores.The international warehouse primarily handles complete pallets Consequently, the distribution center receives substantial pallets containing individual products, which then need to be unpacked and dispatched to their respective destinations.Ultimately, products are sold individually at the store level Therefore, if a retailer intends to directly ship items to a customer (for example, due to an online order),the store level remains the sole location where all the products are readily available(as depicted in Figure 1.5).
Figure 1.5 The “traditional” supply chain
1.3.2 Expanding the portfolio for better customer engagement
Hendry et al (2018) suggest that the implementation of a B2C or a B2B channel with substantial changes in order processing would have a significant impact The practical processing methods differ greatly depending on whether operations are based on pallets dispatched to stores or boxes sent directly to customers In the case of most retailers, the distribution center ships deliveries equivalent to the number of stores, with certain deliveries comprising full truckloads Transitioning such sales volume to a B2C channel necessitates the packing of a truck with boxes containing only one to five items, resulting in the handling of thousands of boxes daily This shift notably amplifies the volume of deliveries while decreasing the count of individual items within the system Gửlgeci
Moreover, the unpredictable nature of online ordering compels companies to diversify their inventory to maximize the fulfillment of customer demands, given that having the exact desired product available is crucial for retaining customers who anticipate rapid delivery Consequently, retailers must expand the range of stock-keeping units (SKUs) while decreasing the quantity of delivery lines dispatched per shipment (Wong et al., 2020) To illustrate, a short time ago, a shoe retailer operating a physical store needed to carry around 100 different shoe types to meet customer demands - a substantial number However, in the current era of competitive platforms like Zalando, Zappos, and shoes.com offering over 20,000 types, the same shoe retailer now has to ensure the availability and shipping of nearly every brand and type of shoe When factoring in various popular shoe sizes, this multiplication of assortment becomes even more significant (Wong et al., 2020).
Figure 1.6 visually depicts the rise in average stock-keeping units (SKUs), the decline in average line items per delivery, and the increasing number of sales orders per channel that a traditional retailer should anticipate when embracing e- commerce.
Figure 1.6 Fundamental effects of e-commerce engagement on a traditional retailer’s supply chain
1.3.3 Impacts on warehouses and IT
Due to transportation and labor-related challenges, the majority of businesses will likely opt to modify their distribution centers to accommodate B2C orders This adjustment will entail tangible changes within the warehouse environment, such as the creation of new sections designated for packing stations and consolidation areas.
In certain instances, distribution centers might even need to be relocated to encompass a broader array of products Beyond the physical alterations, there will also be notable repercussions on the information technology (IT) processes governing the warehouse Overhauling conventional warehouse operations to accommodate online orders is just one among numerous adjustments that the warehouse management system must undergo.
Opportunities and challenges for omni-channel retail
An omnichannel marketing strategy places the customer as the central focus of its operations It aims to seamlessly integrate all available channels to engage with customers across various touchpoints, both offline and online This approach creates a comprehensive consumer journey that guides individuals from initial curiosity to eventual purchase and loyalty stages (Pauwels & Neslin, 2015).
By accompanying customers throughout all stages of their purchasing journey via the channels they already frequent, retailers can consistently engage them with new releases, updates, or exclusive benefits This enables customers to easily recognize and understand the brand's offerings, fostering trust and familiarity between the business and its clientele (Dubey et al., 2021).
An omnichannel marketing strategy centers around customers, addressing their needs and preferences Unlike other marketing approaches, this strategy meets customers where they are—whether they're browsing products on Instagram or exploring a physical store This sets it apart from direct advertising, which often emphasizes the business's offerings rather than catering to customer requirements(Saghiri et al., 2017).
A successful omnichannel campaign generates a wealth of valuable data for retailers This includes insights from individuals seeking information, engaging with social media content, and even those who abandoned their online shopping carts. This data forms a critical part of the omnichannel strategy, allowing retailers to gauge customer interests and fine-tune their campaigns to effectively target the right audience (Figure 1.7).
Despite the potential of omnichannel marketing to enhance growth, stimulate innovation, and elevate long-term performance by optimizing customer interactions, we argue that this potential remains largely untapped We identify three primary interconnected challenges that have hindered the realization of omnichannel's full potential:
To unlock the complete benefits of omnichannel marketing, companies require comprehensive information concerning all customer interactions throughout various stages of their journey This encompasses interactions related to communications between the company and its customers, customer engagement in activities such as gathering information, making purchases, receiving products, initiating returns, and seeking post-purchase assistance However, obtaining and effectively utilizing such data can be complex and difficult (Li et al., 2015).
A crucial challenge in fully leveraging omnichannel marketing pertains to the accessibility and usability of data from diverse touchpoints Verhoef et al (2015) broadly categorize these data-related challenges into two primary dimensions: (1) acquiring access to such data and (2) integrating data from disparate sources.
As previously noted, within the omnichannel framework, companies engage with customers through numerous touchpoints, some within the organization and others external to it Often, data concerning different touchpoints with the same customer are isolated within specific departments Consequently, a particular unit may be unaware of the data collected by other units For instance, a company's e- commerce team might lack knowledge about the information available on a customer from other divisions within the company, and vice versa This creates an initial bottleneck in effective omnichannel implementation, involving the need to identify the types of data existing on the same customer within the organization (Wilder-James, 2016) The degree of departmental separation within a company depends on how it approaches data-driven marketing In some instances, this role is centralized within a centralized data science team In contrast, other organizations distribute individuals across smaller specialized units.
Externally, this challenge becomes more intricate For instance, many touchpoints for a consumer interested in purchasing an automobile are beyond the control of the manufacturer, who may employ paid, owned, and earned media for customer engagement, provide product details, and potentially encourage visits to their distribution channels (such as local dealerships) Subsequent interactions, like test drives and price negotiations, occur within these dealerships However, neither the manufacturer nor the retailer possesses a comprehensive view of these multiple interactions; moreover, they may not even be aware of the occurrence of such interactions Thus, even if a company successfully catalogs existing customer data within each silo of the organization, it may remain unaware of data concerning the same customer originating from sources outside the company (Avery et al., 2012; Liang et al., 2019).
Once a company possesses awareness of all customer data within (and possibly outside) the organization, the subsequent challenge is securing the right to utilize this data (Wathne & Heide, 2000) This bottleneck arises in part due to intricate administrative processes that can impede or even prevent data sharing between distinct departments within the same company For instance, within financial firms, a particular set of customer investments might not be communicated to other divisions within the company Moreover, industries like healthcare and finance can be subject to regulatory constraints that limit data sharing across units.For example, Miller and Tucker (2014) demonstrate the existence of data silos in healthcare, finding that even within a hospital system, complete sharing of patient and clinical data is not evident.
Even if companies successfully navigate the challenges related to data awareness and access, managers must still address the task of integrating this data to extract meaningful insights Two main problems can emerge during this integration process Firstly, because each customer touchpoint might be managed by different entities, both internal and external to the company, the data may be stored in diverse databases, using distinct rules, data formats, and reporting standards Consequently, matching data concerning the same customer across various touchpoints can be exceptionally daunting (Neumann et al., 2019; Stuart et al., 2017).
The second predicament lies in the varying reliability of data from diverse sources For instance, the sales department within a company may possess precise information about its interactions with customers Conversely, data assembled by the marketing department regarding other interactions could be less accurate, potentially due to data aggregation and reliance on third-party vendors who adhere to distinct rules and definitions that might not perfectly align with the company's. Similarly, data on certain interactions might lack critical details, stemming, for instance, from the firm's internal limitations A prime example is interactions via a call center or customer support channel, which often involves manual entry of customer inquiry details, rendering it susceptible to transcription errors This stands in contrast to sales transactions channels, where advanced point-of-sale information technology systems automate the process, yielding reliable data on customers' purchase history and returns (Neumann et al., 2019).
For optimizing the customer experience across all channels, firms require knowledge of the impact of various touchpoints on behavior and the ability to measure the return on investment of their marketing expenditures As EricSolomon's opening quote encapsulates, this is embodied in "proving sales results."Yet, this analysis can be complex when the influence of a touchpoint extends across multiple stages in the purchase funnel, several occur simultaneously, or consumers navigate between different stages within their path-to-purchase journey.
3) Challenges in Ensuring Customer Privacy
The potential of omnichannel marketing hinges on utilizing data regarding all interactions between the firm and its customers However, this can potentially infringe upon customer privacy Consequently, a significant challenge for firms lies in determining how to adopt an omnichannel strategy while upholding consumers' privacy.
CURRENT SITUATION AND EXPERIENCES OF
Omnichannel retailing in the United States
2.1.1 Current situation of omnichannel retailing in the United States
As per Euromonitor's recent findings (2023), the retail landscape in the United States is undergoing a call for increased emphasis on the omnichannel experience. Customers are displaying a continued interest in physical stores but desire a convenient and interactive approach to shopping A report from the National Retail Federation (NRF) (2023) unveils that non-store and online sales, encompassed within the overall figure, are projected to witness a year-over-year growth ranging between 10% and 12%, reaching a value between $1.41 trillion and $1.43 trillion. While online shopping's conveniences are frequently leveraged by consumers, a significant portion of this growth can be attributed to multichannel sales, where physical stores continue to be integral in the fulfillment process While the role of brick-and-mortar stores has evolved over recent times, they continue to be the primary point of purchase for consumers, contributing to around 70% of total retail sales.
Notably, a major U.S retailer achieved its most successful quarter in Q2 2020,observing a sales surge of 24.3%, with digital sales experiencing a remarkable increase of 195% (Statista, 2023a) This retailer managed to capture market share from its physical competitors by effectively integrating physical and digital components – the essence of omnichannel Expert Market's research (2023) indicates that consumers engaged in multiple channels spend four times more than those solely shopping in-store and ten times more than digital-only consumers.During this period, over three-quarters of their online sales were fulfilled via their physical stores, showcasing the seamless coordination of the digital and physical realms necessitated by omnichannel operations.
Similarly, Inditex, the parent company of Zara, reported a return to profitability in its Q2 (which covers May to July) attributed to omnichannel capabilities These capabilities led to a 74% surge in digital sales during the first half of 2020, while competitors were grappling with losses Once again, Zara successfully harmonized digital and physical aspects It also unveiled the introduction of three new omnichannel features: Click & Go, Click & Find, and Click & Try.
To provide such an immersive customer journey, both companies dedicated several years to developing and investing in their omnichannel and supply chain capabilities (referred to as omni-chain) Presently, consumers anticipate the option to make purchases via computers, phones, or in-store kiosks, and select deliveries at home, in the store, at predefined locations, or even in their car trunks Retailers incapable of offering such choices might be missing out on approximately 10-30% of potential sales (Big Commerce, 2023).
A few years ago, it was surprising to witness digitally inclined consumers opting to visit physical stores to collect their online purchases when provided the choice The introduction of "Click & Collect" had a jolting effect on the industry, highlighting how many customers favored this option For instance, Adidas launched this service in the United States in 2014 with an expectation of 10 weekly orders Astonishingly, it received 1,000 weekly orders, necessitating a halt due to supply chain constraints Within two years, Adidas became adept at managing these capabilities The lesson learned during this period was that significant IT and supply chain capabilities are required to successfully execute an omnichannel strategy.
McKinsey (2023) reveals some US enterprises that successfully employ omnichannel, including:
Nike's omnichannel strategy includes a mobile app that allows customers to reserve products online and pick them up in-store, as well as a loyalty program that rewards customers for their purchases across all channels Nike's journey with omnichannel retailing in the United States has been marked by a series of impactful experiences The company's approach to integrating various sales channels and providing a seamless customer experience has yielded notable outcomes Nike's foray into omnichannel retailing in the US involved a comprehensive strategy that bridged the gap between physical stores and digital platforms The company recognized the changing consumer behavior, where customers were increasingly engaging with both online and offline channels during their purchasing journey As a response, Nike strategically aligned its retail operations to cater to these evolving preferences One significant experience for Nike was the development of its digital infrastructure The company invested heavily in its online platforms, enhancing its website and launching a robust mobile app This allowed customers to browse products, make purchases, and access personalized content seamlessly across different devices This investment in digital transformation was pivotal in providing a consistent brand experience, regardless of the chosen channel Another crucial aspect of Nike's omnichannel strategy was the integration of its physical stores with its digital presence The company introduced features like "buy online, pick up in- store" (BOPIS), enabling customers to shop online and collect their purchases from a nearby Nike store This initiative not only combined the convenience of online shopping with the immediacy of in-store pickups but also led to increased foot traffic to the brick-and-mortar locations Furthermore, Nike's omnichannel retailing approach allowed for creative marketing campaigns that seamlessly spanned different channels The company could engage customers through social media, email marketing, and in-store promotions, ensuring that the messaging remained consistent and coherent across all touchpoints.
To adopt the omnichannel retailing in the operations Walmart has performed a number of strategies Walmart aimed to provide a seamless shopping experience for customers across its physical stores and digital platforms Customers could order products online and choose from various delivery options, including home delivery,in-store pickup, and curbside pickup In addition, Walmart heavily invested in its online grocery shopping service, allowing customers to order groceries and other items through its website or app Customers could select items, schedule pickups, and choose delivery options that suited their preferences Particularly, Walmart introduced pickup towers and lockers in its physical stores Customers who placed online orders could pick up their items from these automated kiosks, enhancing convenience and reducing wait times Particularly, Walmart experimented with various delivery methods, including partnering with third-party delivery services and testing autonomous vehicle delivery in select areas These efforts aimed to provide customers with flexible and efficient delivery choices Finally, Walmart acquired companies like Jet.com and Bonobos to bolster its e-commerce capabilities and extend its reach These acquisitions helped Walmart tap into new customer segments and expand its online offerings.
A number of omnichannel strategies have been adopted by Sephora Sephora seamlessly integrated its brick-and-mortar stores with its online platform. Customers could browse and purchase products on the website or app and choose to have items delivered, or they could visit physical stores for in-person shopping and assistance Sephora introduced a "Buy Online, Pick Up In Store" (BOPIS) option, allowing customers to place orders online and collect their purchases from a nearby physical store This provided convenience for customers who wanted quick access to their chosen products Sephora's physical stores incorporated digital technology to enhance the shopping experience This included features like digital mirrors that allowed customers to virtually try on makeup, providing an interactive and engaging experience Moreover, Sephora utilized customer data to offer personalized product recommendations and targeted promotions This enhanced customer engagement and encouraged cross-channel shopping Sephora leveraged augmented reality (AR) technology to allow customers to virtually try on makeup products online This feature facilitated confident purchasing decisions and bridged the gap between online browsing and in-store trial Particularly, Sephora utilized streamlined returns in its omnichannel retailing Sephora worked on providing a consistent returns process for both online and in-store purchases, allowing customers to return products through their preferred channel.
Buy Online, Pick Up In Store (BOPIS) is the first and foremost omnichannel adopted by Nordstorm Nordstrom introduced a robust BOPIS program, allowing customers to order products online and pick them up at a nearby Nordstrom store. This service provided convenience and flexibility, bridging the gap between online and offline shopping Also, Nordstrom utilized its physical store network as mini- distribution centers This enabled the company to fulfill online orders from the nearest store, reducing shipping times and increasing product availability. Importantly, Nordstrom implemented a single inventory system that connected its online and offline channels This ensured accurate product availability information across all touchpoints, preventing discrepancies between online listings and in-store availability In addition, virtual styling services is also employed by the Company. Nordstrom introduced virtual styling services, enabling customers to connect with personal stylists online for advice and outfit recommendations This service brought the in-store personalized assistance to the digital realm Nordstrom offered customer service through various channels, including online chat, email, and phone This ensured that customers could receive assistance regardless of their preferred mode of communication Finally, the Company offers flexible returns Nordstrom streamlined its returns process by allowing customers to return online purchases in- store, providing more convenience and flexibility in handling returns.
Best Buy has invested in omnichannel strategies to promote the customer experiences Firstly, Best Buy established options for customers to buy products online and choose to either pick them up in-store or have them shipped to a nearby store This strategy combined the convenience of online shopping with the immediacy of in-store pickup Secondly, similar to Nordstrom, Best Buy utilized its physical stores as fulfillment centers This allowed the company to fulfill online orders from nearby stores, reducing shipping times and improving product availability Thirdly, Best Buy introduced curbside pickup services, especially gaining significance during the COVID-19 pandemic Customers could place orders online and have products brought out to their vehicles in the store's parking lot. Fourthly, Best Buy ensured that its pricing was consistent across online and offline channels, including honoring online prices in-store and vice versa This eliminated any pricing discrepancies and enhanced customer trust Fifthly, Best Buy's website and app provided real-time information on product availability at nearby stores. Customers could check if a specific item was in stock at their local store before making a visit Finally, Best Buy's mobile app featured personalized shopping lists, mobile checkout, and exclusive deals The app enhanced the in-store experience by providing a convenient way to access product information and make purchases.
Several omnichannel strategies have een adopted y Macy‘s Specifically, unified inventory management is implemented through the Macy‘s chain Macy's aimed to provide customers with access to its entire inventory across online and physical stores This means that whether a product is available in-store or online, customers could purchase it through any channel Click and Collect (Buy Online, Pick Up In-Store - BOPIS) is also implemented by the Company Macy's enabled customers to place orders online and then pick up their purchases from a nearby physical store This approach allowed customers to save on shipping costs and receive their products faster In addition, Macy's utilized its physical store locations as mini-distribution centers This allowed them to fulfill online orders from the nearest store, reducing shipping times and costs Moreover, Macy's invested in technology that helps bridge the gap between online and in-store experiences This could include things like providing in-store kiosks for online shopping, price checking, or even ordering out-of-stock items for home delivery Accordingly,Macy's may have experimented with virtual shopping experiences and augmented reality (AR) to allow customers to virtually try on clothes or visualize how furniture might look in their homes Part of omnichannel strategy involves ensuring that the brand's message, pricing, and promotions are consistent across all channels This helps create a seamless and recognizable experience for customers Finally, Macy's would likely have integrated customer service across channels, so a customer could start an inquiry on one channel (e.g., live chat) and continue it on another (e.g., phone) without losing the context of the conversation.
Target had been actively implementing omnichannel retailing strategies to enhance the customer experience and drive sales Firstly, Order Pickup and Drive
Up is employed by Target Target offered options for customers to order products online and pick them up in-store (Order Pickup) or have them brought to their cars in the parking lot (Drive Up) This provided convenience and minimized wait times for customers Similar to Macy's, Target used its physical stores as fulfillment centers, allowing them to ship online orders from the nearest store This approach reduced shipping times and costs Target also offers same-day delivery Target partnered with delivery services to offer same-day delivery options for online orders in select areas This allowed customers to receive their purchases quickly without having to visit a store In addition to Drive Up, Target likely offered traditional curbside pickup services, allowing customers to remain in their vehicles while Target associates brought their orders to them Some Target stores might have had pickup lockers where customers could retrieve their online orders without interacting with store staff This provided added convenience, especially for customers on the go Target's loyalty program likely integrated with its omnichannel strategy, offering personalized deals and rewards both online and in-store to incentivize repeat business Like other omnichannel retailers, Target likely focused on maintaining consistent branding and messaging across all channels to provide a unified experience Target might have explored technologies such as augmented reality and visual search to enhance the online shopping experience These technologies can help customers virtually try on products or find similar items based on images Finally, target likely offered various payment options, both online and in-store, to accommodate customer preferences, including mobile wallets and contactless payment methods.
These examples show that successful omnichannel retailing strategies involve providing customers with a seamless shopping experience across all channels, including online and in-store Retailers that offer free shipping, buy online and pick up in-store options, and personalized services tend to be more successful in implementing an omnichannel strategy.
2.1.2 Evaluation of omnichannel retailing in the United States
In sum, omnichannel retailing refers to the approach taken by retailers to provide a seamless and integrated shopping experience across multiple channels, such as brick-and-mortar stores, online websites, mobile apps, social media, and more The objective is to offer customers a consistent and convenient experience, allowing them to interact with the brand through various touchpoints and switch between them effortlessly In the United States, retailing omnichannel is characterized by the following points:
1) Technology Adoption: The United States has been at the forefront of technology adoption in the retail industry Many retailers have invested in sophisticated systems to synchronize inventory, order management, and customer data across channels This enables customers to shop online and have items delivered to their doorstep, or they can choose to pick up items in-store, providing flexibility and convenience.
Omnichannel retailing in Japan
2.3.1 Current situation of omnichannel retailing in Japan
The emergence of Omni-Channel (OC) in Japan has begun recently and is rapidly progressing Simultaneously, the adoption of smartphones among Japanese consumers has surpassed 70% in 2017 (MIAC, 2017), thereby facilitating the development of OC retail With a well-established e-commerce infrastructure and a digitally versatile consumer market, Japan is well-suited for cultivating an efficient digital market ecosystem Factors such as a dependable logistical system, low rates of Internet fraud, and overall convenience, coupled with the high smartphone penetration rate, have propelled the swift growth of online retailing in Japan (AAFC, 2016).
To illustrate, between 2010 and 2015, online retailing in Japan experienced substantial expansion, reaching a value of USD 65.2 billion in 2015 However, despite the rapid digital transformation, the contribution of mobile shopping to Japanese consumers' monthly private consumption is merely 8%, and internet shopping accounts for 28%, roughly half of the scale observed in the US (MIAC,
2017) This discrepancy could partly result from fundamental distinctions in the retail structure between the two nations.
Japan features diverse retail formats, including department stores, general merchandise stores, convenience stores (CVS), specialty stores, and internet stores(Kondo, 2018) In contrast, the US primarily possesses two retail formats: offline stores and internet stores This streamlined structure in the US fosters the swift establishment of omni-channels (Kondo, 2016) Given that each retail format necessitates distinct resources and capabilities to facilitate an OC strategy, the intricate retail sector structure in Japan might pose greater challenges for local retailers to develop omni-channels.
Nevertheless, major Japanese retailers are responding to evolving market dynamics and consumer behaviors by initiating efforts to integrate their brick-and- mortar and online strategies, offering omni-channel services For instance, Seven & i Holdings has launched an omni-channel retailing platform, enabling customers to place orders for items available across the group's various chains This platform also provides flexible delivery methods, including shipping or pick-up at nearby shops.
Lately, Japanese retail brands like UNIQLO and MUJI have entered the omni- channel landscape as well MUJI, for example, introduced the 'MUJI passport' Digital CRM app in 2013, which was later extended to major Asian markets such as Hong Kong, Taiwan, China, and Korea by the end of 2017 This app seamlessly bridges the offline and online channels by offering diverse retail services such as making purchases, checking in at stores, leaving product comments, and participating in promotions It also enhances customer engagement through a loyalty program where customers earn mileage, provide feedback, and receive promotional updates (KPMG, 2018) The adoption of omni-channel service by these Japanese retailers has resulted in cohesive brand and shopping experiences As smartphone use and mobile shopping continue to rise among consumers, the implementation of omni-channel services is projected to increase within the Japanese retail sector.
A prime example of this in Japan is Muji, a Japanese retail company known for its minimalist design, emphasis on recycling, and aversion to waste across a range of household and consumer goods With over 437 retail stores in Japan as of
2019, Muji has also embraced mobile technology, offering a mobile-sensitive website and app that allows customers to check store inventory and receive personalized product recommendations on their mobile devices Additionally, Muji has effectively utilized social media as a sales growth channel, with 8.3% of customers attributing their purchases to social media posts in 2018 Notably, Muji's primary social media platform is Instagram, which was ranked among the top- performing platforms in Japan as of February 2020 Reflecting their genuine omni- channel approach, Kenji Takeuchi, Muji's head of corporate planning, finance, and
IT, emphasized that the number of customers visiting their physical stores is a key performance indicator for their e-commerce division This comprehensive omni- channel strategy has enabled Muji to achieve consistent year-on-year sales growth since 2012.
2.3.2 Evaluation of omnichannel retailing in Japan
The investigation into omnichannel retailing in Japan reveals that there is a significant difference in omnichannel in Japan and other countries such as the U.S. The critical difference between the U.S type of omnichannel and the Japanese one is that the U.S model does not include the concept of retail format as a source of channels For example, Verhoef et al (2013) point out three levels in their omnichannel research These are (1) the retail firm level, (2) the retail channel level, and (3) the customer level It is clear from their study that the retail format is not considered in the research on omnichannel in the U.S The difference results from the fact that, while the U.S retailers basically operate one or two types of retail formats (real store and Internet store), Japanese big retailers have various retail formats such as department stores, general merchandise stores, convenience stores, specialty stores, and Internet stores We define these types of retail operations as
―retail format‖ in order to emphasize that each retail format could have different resources and capabilities Retail format functions as an origin of a transaction and/ or communication channel in the Japanese type of omnichannel.
The different characteristics of ‗omnichannel‘ etween the U.S and Japan come from the different growth process in both countries Firstly, there is the premise that the U.S type of omnichannel retailer has a single or two retail format(s) This reflects the fact that the U.S big retailers such as Wal-Mart stores and Walgreen‘s have grown as asically a single retail format Even in the case of two formats, they only have a store and a website carrying the same merchandise and assortment On the other hand, the main characteristic of the Japanese model is that it is omnichannel with multiple retail formats It is because big Japanese retailers, such as Seven & i Holdings and Aeon, have diversified retail formats at the company or group level in their growth process The reason why these retailers could grow through the multiplication of retail formats is that each retail format could serve different customer segments The customer segment consists of the target market and the served values from each retail format For example, a department store is the retail format which provides luxurious merchandise and services toward the wealthy, while Internet retailing targets consumers calling for convenience Also, each retail format is different in terms of the store/website atmosphere, social environment, service interface, product assortment, and prices (Verhoef et al 2009), thereby creating unique customer experiences The more the retailer adds new retail formats, the more the contact points increase, and the more the number of the served segments increases As a result, the possibility of growth at the corporate level would be higher At an individual customer level, it has been clarified that the more the consumer uses various retail formats, that is, the more they become omnichannel shoppers, the more they spend (Kushwaha & Shankar
2013) Therefore, a retailer could enclose customers at a corporate level and expand their share of customers by deploying different kinds of retail formats.
Secondly, as for the delivery point of merchandise, the U.S type of omnichannel is based on home delivery, whereas the Japanese model positions convenience stores as hubs where all channels are integrated, and utilizes its detailed store network However, utilizing a store as a delivery and receipt point is not only unique to Japanese omniretailing It is also called ‗click and collect,‘ which means ‗the a ility to order and return or exchange goods in-store, ordering while in-store, using one‘s own mo ile device or self-service technology provided y the retailer‘ Piotrowicz Cuth ertson 14 The ‗mo ile click and collect shop‘ ena les the customer to order from an online shop on their phone, and then collect the merchandise at a physical store or a collection point‘ Beck Rygl
2015) Nevertheless, in the case of big Japanese retailers with a huge number of convenience stores and various types of retail formats, the retail stores which could e operated as a ‗hu ‘, are quite numerous.
From the discussion above, it seems reasonable to suppose that the Japanese type of omnichannel could provide a unique solution to the delivery and receipt pro lem called ‗the last one mile.‘ The Japanese type of omnichannel has unique challenges Firstly, Japanese omniretailers carry a wide variety of merchandise based on their multiple retail formats The more variety there is, the more difficult it is to manage it in an integrated way Secondly, the quantity of information on buying, selling, logistics, and customer data is enormous These kinds of information are critically important for omnichannel retailing to provide seamless customer experiences Thirdly, the organization structures and the management systems are various because they have been developed and operated in units for each retail format It would be difficult to exchange resources such as human, physical goods, capital, and information among retail formats due to their organizational ‗silos‘ Fourthly, in relation to these challenges, each retail format has its own unique organizational capabilities, which manage the organization effectively and efficiently For example, in the case of a department store, capabilities for departmental control and relationship development with apparel manufacturers are necessary Capabilities for a chain store and a low cost operation are needed in a general merchandise store; and capabilities for unit control and frequent, small lot transport are critical in a convenience store.
2.3.3 Lessons learnt from the retailers in Japan
There are some key lessons learned from omnichannel retailing in Japan up to that point:
1) Embrace Mobile Technology: Japan has a highly connected and tech-savvy population To succeed in omnichannel retail, businesses need to prioritize mobile-friendly platforms, including mobile apps and websites Providing seamless mobile experiences is crucial for engaging with Japanese consumers.
SUGGESTIONS TO DEVELOP OMNICHANNEL SUPPLY
Overview of omnichannel retailing in Vietnam
3.1.1 Current situation of omnichannel retailing in Vietnam
As per Diendandoanhnghiep's findings in 2023, the retail landscape in Vietnam has undergone a significant transformation due to pandemic-induced changes, shedding light on emerging trends within the non-grocery and grocery segments A transformative shift has occurred in the retail sector, as highlighted by Deloitte (2023): non-store retail sales have surged, and the adoption of omnichannel retail is progressively becoming the standard Although a gradual transition towards omnichannel retail was already underway before the pandemic, it was the COVID-
19 outbreak and the ensuing social distancing measures that truly accelerated this trend.
The retail industry in Vietnam has reaped the benefits of increased consumer demand In the initial nine months of 2022, economic activities and daily life began to recover, sparking a rise in the demand for goods Notably, the total retail sales of consumer goods and services during this period exceeded previous years' levels, experiencing a remarkable growth rate of 14.2% compared to the same nine-month period in 2019 (VietCredit, 2023).
Deloitte's report (2023) also highlights that many urban Vietnamese consumers have become well-acclimated to omnichannel buying habits These consumers make purchases not only through physical stores and brand websites but also through various third-party instant messaging platforms and food delivery applications They skillfully toggle between these options to secure the most convenient delivery slot or avail the best promotional offers.
From the retailer's perspective, Deloitte (2023) emphasizes that the transition to omnichannel retail is a multifaceted strategy By expanding their digital presence, retailers can offset some of the revenue losses associated with COVID-19 disruptions while simultaneously accessing new customer bases Online and mobile platforms now enable retailers to reach consumers located far from their physical stores, extending their reach beyond previous geographical limitations.
Moreover, digital presence can greatly enhance customer engagement For instance, Shopee, an e-commerce platform, has creatively used mobile games to enrich the overall user experience of its mobile app Additionally, having a digital presence can stimulate traffic to physical stores, and vice versa Customers who research and compare products online may choose to visit a physical store to inspect the product before finalizing the purchase Conversely, individuals may explore different physical stores before making their ultimate purchase decision online.
As retail entities strive to capitalize on the omnichannel trend, innovative partnerships are emerging within the marketplace An illustrative example is the
"Ung ho nong san Viet" program, launched by the Saigon Union of Trading Cooperatives in collaboration with the Momo mobile payment platform This initiative aims to support the local agricultural sector and has featured endeavors such as promoting the sale of locally grown lychees through the Momo e-wallet platform.
3.1.2 Difficulties of omnichannel supply chain among the retailers in Vietnam
According to Deloitte (2023), omnichannel retailing in Vietnam was still in its early stages and faced several challenges There are some of the difficulties that were prevalent at the time:
1) Limited internet infrastructure: Vietnam's internet infrastructure was developing but still faced challenges in terms of speed, coverage, and reliability This affected the seamless integration of online and offline retail channels, making it difficult for retailers to provide a consistent experience across various touchpoints.
2) Consumer behavior and preferences: Vietnamese consumers were gradually adopting online shopping, but many still preferred the traditional brick-and- mortar experience Convincing them to shift to online channels or engage with omnichannel strategies could be challenging for retailers.
3) Payment methods: While online payment methods were improving, cash-on- delivery remained a popular choice for many consumers This posed challenges in managing payments and inventory for retailers operating both online and offline stores.
4) Logistics and fulfillment: Efficient logistics and order fulfillment were crucial for successful omnichannel retailing However, Vietnam's logistics infrastructure was still evolving, leading to delays and complexities in delivering products to customers promptly, especially in remote areas.
5) Data integration and analytics: Omnichannel retailing relies on data integration and analytics to offer personalized experiences and targeted marketing However, integrating data from various sources and ensuring its accuracy can be a daunting task, particularly for smaller retailers with limited resources.
6) Regulatory challenges: Navigating the regulatory environment for e- commerce and omnichannel retailing could be complex and time-consuming. Compliance with various regulations, especially when dealing with cross- border operations, could pose challenges for retailers.
7) Competition with established marketplaces: Global e-commerce platforms and large local marketplaces already had a significant presence in Vietnam. Competing with these established players for market share could be tough for smaller retailers or those new to the online retail space.
8) Cybersecurity concerns: As online activities increased, so did the risks of cyberattacks and data breaches Ensuring the security of customer data and maintaining trust in the omnichannel retail ecosystem was a significant challenge.
Despite these challenges, omnichannel retailing in Vietnam held enormous potential due to the country's large population, increasing internet penetration, and growing middle class with higher disposable incomes Retailers that could overcome these difficulties and adapt to the changing landscape stood to benefit from the opportunities presented by the omnichannel approach.
3.1.3 Case studies of retailers in Vietnam
Suggestions to develop omnichannel supply chain of Vietnamese
Omnichannel retailing is a strategy that integrates multiple sales channels to provide a seamless and consistent shopping experience to customers There are some suggestions to develop omnichannel retailing in Vietnam based on international experiences of the retailers in the United States, China, Japan, and Korea.
Implementing a mobile-first strategy is essential for Vietnamese retailers aiming to successfully embrace omnichannel retailing With the rapid growth of smartphone usage and mobile internet penetration in Vietnam, leveraging mobile technology effectively can significantly enhance the overall omnichannel experience There are key steps and considerations for Vietnamese retailers looking to prioritize a mobile-first approach as follows:
1) Develop User-Centric Mobile Apps: Create user-friendly, intuitive mobile apps with seamless navigation Prioritize a clean and responsive design that provides a pleasant shopping experience, making it easy for customers to browse and purchase products.
2) Optimize Performance: Ensure that the mobile app loads quickly and efficiently, even in areas with varying network connectivity This optimization is vital for retaining users and preventing frustration.
3) Integrate All Sales Channels: Seamlessly integrate the mobile app with other channels such as physical stores, e-commerce platforms, and social media This integration ensures that customers experience consistency across all touchpoints.
4) Multi-Platform Compatibility: Develop apps for both Android and iOS platforms to reach a broader audience Additionally, ensure the mobile app complements a responsive website for users who prefer mobile browsing.
5) Mobile Payment Solutions: Integrate popular Vietnamese mobile payment methods like e-wallets and QR code payments for a smooth and convenient checkout process.
By focusing on these measures, Vietnamese retailers can harness the power of a mobile-first strategy to deliver exceptional omnichannel experiences, increase customer satisfaction, and remain competitive in an evolving retail landscape.
Implementing Click-and-Collect services is a crucial step for Vietnamese retailers aiming to successfully embrace omnichannel retailing This strategy combines online and offline elements, providing customers with a convenient and flexible shopping experience There are some key steps Vietnamese retailers should do to effectively implement Click-and-Collect services:
1) Technology Integration: Integrate a user-friendly website and mobile app with real-time inventory management.
2) Streamlined Process: Clearly communicate the Click-and-Collect process and offer flexible pickup locations.
3) Communication: Send order confirmations and timely updates to customers via email or SMS.
4) Efficient Fulfillment: Assign dedicated staff for Click-and-Collect orders and prepare orders in advance.
5) Designated Pickup Area: Create clear signage and convenient parking at the pickup location.
6) Customer Support: Provide accessible customer support for inquiries and issues.
7) Feedback and Improvement: Collect and act on customer feedback for continuous optimization.
8) Promotion and Marketing: Promote the service and consider offering incentives to encourage adoption.
9) Data Analysis: Analyze Click-and-Collect data for tailored offerings and marketing strategies.
10)Consistent Experience: Ensure the Click-and-Collect experience aligns with the overall brand and customer experience across channels.
By implementing these steps, Vietnamese retailers can offer a seamless and convenient Click-and-Collect experience, enhancing their omnichannel retail strategy.
It is recommended that Vietnamese retailers should ensure real-time inventory visibility across all sales channels Customers should be able to check product availability in nearby stores while shopping online or in the mobile app This feature helps prevent disappointment due to out-of-stock items Vietnamese retailers can enhance inventory visibility for successful omnichannel retailing through the following steps:
1) Integrated Inventory Systems: Implement integrated inventory management systems that provide real-time updates on product availability across all sales channels, including physical stores, e-commerce platforms, and mobile apps.
2) Unified Database: Maintain a centralized database that consolidates inventory information from different sources, enabling consistent and accurate stock tracking.
3) Barcoding and RFID: Utilize barcoding and RFID technology to tag products, improving inventory accuracy and the ability to track items at a granular level.
4) Cross-Channel Coordination: Ensure that inventory data is accessible and synchronized across all channels, allowing customers to check product availability online and in-store.
5) Inventory Visibility Tools: Utilize inventory visibility tools and dashboards that provide real-time insights into stock levels, helping both staff and customers make informed decisions.
6) Communication Channels: Establish clear communication channels between physical stores and online sales teams to coordinate inventory updates effectively.
By enhancing inventory visibility through these measures, Vietnamese retailers can achieve seamless integration across channels, improve customer satisfaction, and optimize operations for a successful omnichannel retailing strategy.
Vietnamese retailers should implement a centralized customer database that collects data from various touchpoints (online, in-store, mobile) to create a unified customer profile This data can be used to personalize marketing efforts and improve customer service To unify customer data, it is suggested that the company should adopt the following measures:
1) Centralized Customer Database: Create a centralized customer database that consolidates data from various channels, including in-store purchases, online transactions, and mobile app interactions.
2) Customer Identification: Implement methods for identifying customers across channels, such as loyalty programs, email addresses, or mobile phone numbers This ensures a seamless and consistent customer experience.
3) Data Integration: Use data integration tools to connect online and offline data sources This enables a comprehensive view of each customer's behavior, preferences, and purchase history.
4) Real-Time Updates: Ensure that the customer database is updated in real- time, allowing staff in all channels to access the most recent customer information.
5) Feedback Loop: Encourage customers to provide feedback through surveys or reviews across channels Use this feedback to continually improve the omnichannel shopping experience.
By unifying customer data in this manner, Vietnamese retailers can deliver a seamless and personalized omnichannel experience, leading to increased customer satisfaction, loyalty, and overall business success.
It is highly recommended that Vietnamese retailers should leverage popular social media platforms in Vietnam, such as Facebook and Instagram, to enable social commerce Integrating online shopping directly within these platforms can drive more sales and engagement Social commerce of Vietnamese retailers should involve the following aspects:
1) Social Media Integration: Integrate e-commerce functionality directly into social media platforms like Facebook, Instagram, and TikTok Enable customers to browse and purchase products without leaving their favorite social networks.
2) Influencer Collaborations: Partner with local influencers and micro- influencers to promote products through their social media channels Their recommendations can drive traffic and sales.
3) Shoppable Posts: Create shoppable posts that allow users to click on products within social media content and make direct purchases Use compelling visuals and descriptions to entice shoppers.
4) User-Generated Content: Encourage customers to share their experiences and product reviews on social media Use user-generated content in marketing campaigns to build trust.
5) Social Media Advertising: Invest in targeted social media advertising to reach specific customer segments Leverage retargeting ads to re-engage potential customers who have shown interest in your products.
6) Analytics and ROI Measurement: Implement social media analytics tools to track the performance of social commerce efforts Measure return on investment (ROI) and adjust strategies accordingly.
By effectively promoting social commerce, Vietnamese retailers can tap into the vast reach and influence of social media platforms, offering customers a seamless shopping experience while driving sales and brand engagement across channels.
For fashion and beauty retailers, firms should consider implementing virtual try-on technology, allowing customers to virtually try products like clothing, glasses, or makeup before making a purchase To implement successful omnichannel retailing, Vietnamese retailers can adopt virtual try-on technology in the following ways:
1) Integrate Virtual Try-On Features: Embed virtual try-on tools within your website and mobile app, allowing customers to virtually try on products like clothing, eyewear, or makeup before making a purchase.
2) Augmented Reality (AR): Utilize AR technology to enable customers to see how products look in real-time, using their device's camera This interactive experience enhances customer engagement.
3) Visualize Customization: If applicable, allow customers to customize products and visualize them in real-time For instance, they can personalize clothing colors or design custom furniture.
4) User-Friendly Interface: Develop a user-friendly and intuitive interface for the virtual try-on feature, making it easy for customers to use and navigate.
5) Customer Feedback: Encourage customers to provide feedback on their virtual try-on experiences and use this information to improve the technology continually.
By adopting virtual try-on technology effectively, Vietnamese retailers can provide an immersive and interactive shopping experience that bridges the gap between online and offline channels, ultimately increasing customer satisfaction and sales
In the Vietnamese retailing context, it is suggested that the retailers should offer various payment methods, including digital wallets, credit cards, and cash on delivery, to accommodate the preferences of different customer segments For the successful adoption of seamless payment options, the following proposed measures should be implemented by Vietnamese retailers:
1) Unified Payment Platform: Implement a unified payment platform that accepts various payment methods, including credit/debit cards, mobile wallets, and bank transfers, across all sales channels (online, in-store, mobile).
2) Mobile Payment Integration: Incorporate popular Vietnamese mobile payment solutions like e-wallets and QR code payments, ensuring customers can make purchases easily and securely via their mobile devices.
3) Contactless Payments: Equip physical stores with contactless payment terminals to accommodate customers who prefer cashless transactions, enhancing safety and convenience.
4) Payment Security: Prioritize robust payment security measures to protect customer data and build trust Ensure compliance with industry standards and regulations.
5) Cross-Channel Payment Continuity: Offer options like buy online, pick up in-store (BOPIS) and allow customers to complete their payment seamlessly across channels without re-entering payment information.
Through these above mentioned measures, Vietnamese retailers can provide a frictionless shopping experience that accommodates diverse customer preferences and behaviors, ultimately contributing to the success of their omnichannel retailing strategy.
Fast and reliable delivery is crucial in an omnichannel strategy Vietnamese retailers should consider offering same-day delivery for orders placed online or via the mobile app, especially in densely populated areas It is recommended that Vietnamese retailers should adopt the following measures:
1) Robust Logistics Infrastructure: Build or partner with a reliable logistics network that can handle same-day delivery efficiently, ensuring timely order fulfillment.
2) Geographical Coverage: Focus on serving densely populated areas initially to maximize the impact of same-day delivery services.
3) Real-Time Inventory Management: Implement advanced inventory systems to provide accurate, real-time information on product availability. This ensures that orders can be processed and delivered promptly.
4) Efficient Order Processing: Streamline the order processing workflow to minimize delays This includes quickly picking and packing items for shipment.
5) Optimized Route Planning: Use technology to plan delivery routes for maximum efficiency, reducing transit times and ensuring timely deliveries.
6) Clear Delivery Policies: Clearly communicate delivery policies, including cutoff times for same-day delivery orders, to manage customer expectations.
7) Partner with Reliable Delivery Providers: Collaborate with trustworthy delivery partners who have a track record of reliable and timely service.
Through these proposed measures, Vietnamese retailers can provide a competitive edge in the market, offering customers the convenience and speed they expect in today's omnichannel shopping landscape.