Unless you’ve been living under a rock (or you’re the USPS), I assume we can all agree customer demands have drastically changed over the past few years. Especially given the new market conditions that came about because of covid.
These days, retail is hard. And distribution is even harder. Especially since most retailers are working with outdated or handicapped systems, bad partners and/or team members who have been resistant to change for decades.
So now, there’s a new conversation happening across retail. It’s being brought up at conferences. It’s spoken about from stage. It’s the new buzzword all over the internet. That conversation is about omnichannel distribution. At Shipsi, we see ourselves as an expert in this “shiny new topic”—we’ve been preaching about it since 2017. And yes, it IS all it’s cracked up to be. In fact, it’s the future of retail.
So today, you’re going to get a crash course on exactly what omnichannel distribution is…and how to make it work for you.
So, What IS Omnichannel Distribution?
Put simply, omnichannel distribution is when a retailer creates a consistent, reliable buying experience for ALL customers—regardless whether they’re buying online, in store, from an affiliate, from your Pinterest, or anything else.
A few years ago, Webster dictionary had no idea what omnichannel distribution meant. Today? It’s the gold standard. A great omnichannel experience essentially guarantees that every single one of your customers will have an incredible experience, regardless whether they picked up a item in store from one of your resellers, in store from YOUR store, or online through the many channels you have available.
So, how does this help you? Well, for starters, branding.
How did the most popular brands in the world get all that popularity? By ensuring that every single customer encounter was a great one.
No resellers hassling consumers about your money-back guarantee. No bad experience with one local retailer in Charleston making you look stupid on Amazon reviews. Great brands make sure that every customer not only has a clear, frictionless path to buying…but they also have control over the customer experience, every single time. That way, they know it’s up to their standard.
The second way omnichannel distribution helps you? Infrastructure. Because terrible infrastructure can destroy you.
So what’s the problem? Well, I experienced it firsthand when I was in the buying office for Saks over a decade ago…and plenty of times since.
I’ve worked with hundreds brands and retailers manufacturing or selling just about any type of goods under the sun—and just about all the technology and physical infrastructure combinations you can imagine. And here’s what I’ve discovered:
Retail started in brick and mortar and with the digital shift of the 00s, then bolted the .com side of their business. To make things even more convoluted and continuing on to the 10s, just about everyone had some flavor of an ‘Innovation Strategy’ which resulted in what I strongly believe created a snowball effect of greater work, additional (likely unnecessary) spend and even more fragmented systems and infrastructure.
Right now, there are basically 2 types of retailers who are addressing this “omnichannel distribution movement” completely wrong:
- Those who are willfully ignorant of the fact that retail is changing. These people are resistant to change and believe they can stay archaic and still survive.
- Those who know how silly it is to stay archaic, but their solution is to dip their toes in the water of every single new “shiny object” that comes along…which overcomplicates their systems and confuses the hell out of their consumers.
Frankly, I’m not sure which is worse. But neither have to be you. In a moment, you’ll learn exactly how to implement it. But first, let’s talk specifics. If you’re going to claim that you’ve become an omnichannel distribution master, you need to address your:
- Consumer interaction
- Packaging
- Shipping
- Communication
- And much more
Each piece is critical to the overall brand experience.
That’s why, since inception, Shipsi has had a critical eye on these elements—providing a consistent experience whether we’re picking up goods from a warehouse, distribution center or store locations and created alternative approaches to maintain this experience behind the scenes, even when a retailer is not technically ‘fully omnichannel distribution’ capable.
Here’s what I mean: We’ve made our platform easy and scalable enough to ingest multiple inventory data sources or offer complementary solutions to exceed consumer expectations. Regardless whether our clients are ordering online or in store, Shipsi Delivery is available. And all of that is part of a great omnichannel experience.
Types of Distribution
So, in order to have an omnichannel distribution strategy…it’s important to know about the different types of distribution.There are certainly no lack of options when it comes to types of distribution out there. Let’s start by keeping it simple and from where it started: The good, old-fashioned in-store experience.
In Store
Let’s say you’re shopping at your local corner hardware store. You want a square propane fire pit for your back patio and wouldn’t mind some help from that strong, handsome man at the store.
Will he deliver them personally? That’s certainly one way, but what about all the other ways you might want that fire pit?
That brings us to our next channel.
Buy Online, Pickup In Store
The next option you could try when deciding how you want that fire pit is to buy it online and pick it up in store yourself (to catch a quick glimpse, of course).
But do you really have time to get there today? If not, you might try this next channel:
Buy Online, Ship From Store
With this channel, you don’t have to spend the time going to the store. But it’s only a mile away, is it worth waiting the three days or more?
Let’s say you opted for this option after procrastinating going up to the store for 3 days. Then you had to wait 3 days to have it shipped to your home. You now have your fire pit, finally! But…the coloring, it’s just not right, and you’re fatigued with buyers remorse—maybe you should have gone with the warmer tone one to match your furniture?
Or maybe this one will work somewhere else, wait no it won’t. It’s a straight up return. Damn it.
Three weeks later your fire pit is shoved in the corner of your patio, and you’re fatigued from the weight of the quickly approaching 30 day return period every time you walk past it.
You cave, gear up with your lipstick keys, mask and sanitizer to head to the store to make your return. While in this scenario from the local hardware store, dropshipping is likely not an option. But, what about same day delivery from your local hardware store?!
Same-Day Delivery
Same-day delivery gives you the power to get exactly what you want—and if you don’t like it, you know that exact day.
Which is why same-day delivery gives you the power to create a seamless omnichannel experience.
Why Omnichannel Distribution is Important
Whether you work for a big box department store or own your own local floral shop around the corner, if you haven’t already got the message here… STOP PUTTING CONSUMERS THROUGH THIS / MAKING IT SO DIFFICULT TO WORK WITH YOU. There are countless industry resources and claims out there and though it can get quite muddy, one this is crystal clear– consumers want…
What they Want
When they Want
Where they Want
I vividly recall feeling my excitement when reading the eMarketer Forecast from ’19, highlighting the additional +53B projection on retail for 2020. Not to my surprise and even higher elevated level of excitement, last week I stumbled on a publication that claimed a whopping $105B additional retail sales attributed to covid. Data dive: How COVID-19 impacted ecommerce in 2020 What’s even more fascinating is the 114M+ consumers shifted to digital last year, meaning new digital shoppers new at the table. Meaning, a consumer who has done less in the physical world, more in the digital world for that same activity. PMNTS. Couple that with the lack of desire to go into physical stores with claims anywhere from 25-52% of consumers not wanting or willing to go into stores anymore. This is clearly a result of the increased demand for buy online, pick up in store offerings primarily supported from big box retailers. But what about everyone else, alternative approaches and how to actually get there?
How to Implement
The first step and something I’ve personally witnessed countless times is a reactive sense of urgency, rushing to the ultar to find a partner rather than doing the necessary diligence required to evaluate– in most cases via an RFP process which often circles back to more time, effort and resources spent only to leave you with a partner who may have dazzled you with fancy presentations but in the end left you hanging out to dry. Choose the right partner. Set proper expectations, mutually beneficial outcomes on both sides of the table. A launch plan is not one sided. At Shipsi, we think about each clients long and short term strategy and develop solutions that cater to win in both the short term and longterm. For example, a spin up product we created during covid to reduce friction from a technology/ implementation perspective is the Instant Delivery Portal– a no integration solution for any brand or retailer to schedule a delivery simply by entering the consumers address within our portal. We’ve seen this used across various industries and different use cases, beauty webinars to concierge services, b2b store transfers and offers a quick, easy solution to get started making deliveries within an hour from setup while teams work on an online integration. While retail keeps rapidly changing, we’ve learned a lot of the lessons in parelle with our partners and continue to modify and enhance our capabilities (signature, insurance, customer support) through a drag-n-drop API and pre-built ecomm integrations like our Shopify App. A critical element of this and something we hold a lot of pride in is the transparent communication, regardless if someone is leveraging our API, Shopify App or Instant Delivery portal we provide notifications, real-time tracking and support for everyone involved; store associate, consumer, driver. All native in their systems and capitalizing on existing physical infrastructure.
Stay focused, don’t get lost in the sea of providers available. Select (on both sides of the table) the right partners who have the team to support and is willing to drive to your goals with a complementary and sustainable solution. Start taking action today before you get left behind as one of the 100k projected store closures coming over the next 5 years according to USB research.