NEW YORK CITY — As the Internet becomes more influential, companies are grappling with the best ways to integrate multiple channels to maximize the customer experience and be more efficient, according to research released by Shop.org, the digital division of the National Retail Federation. The study was conducted by J.C. Williams Group and underwritten by Sterling Commerce.
The report, "Organizing for Cross-channel Retailing," is the result of a six-month study that benchmarks and documents cross-channel organization design. The study was based on individual interviews with retail executives in addition to round-table workshops with executives.
According to the report, it is common for retailers to have completely separate online operations with their own marketing, merchandising and fulfillment capabilities. Many retailers with this independent structure have seen tremendous growth and profitable returns. However, the study noted that, over time, a lack of integration results in inefficiencies and customer confusion. While there are numerous roadblocks to the creation of fully integrated cross-channel retail business, the study concludes that cross-channel success will be most likely when it becomes a top-down mandate.
Although the research is expected to revive a discussion over the best way to organize a company to leverage the Internet, the report concludes that there is no one-size-fits-all model for retailers to follow.
"Integrating the operations of stores and Web sites will undoubtedly lead to greater customer satisfaction, but it is not an easy road," said Jim Okamura, senior partner at J.C. Williams Group, which conducted the study for Shop.org. "The first retailers to accomplish this structural change successfully will achieve a competitive advantage and will quickly be followed by other companies looking to duplicate that accomplishment."
"It's time to stop thinking about 'online retail' as its own world and start thinking about it as part of the overall retail industry because they are serving the same customers," said Scott Silverman, executive director of Shop.org. "It may take another generation of retail leaders, however, before companies are able to best capitalize on the strengths of multiple channels from streamlining their organizational structure."
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Lack of channel integration creates inefficiency, customer confusion
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