Report: Two-thirds of retailers lack cross-channel integration

BOSTON — Aberdeen, a Harte-Hanks Company, surveyed 220 retail enterprises between February and March 2008 to determine the current state of cross-channel technology and process integration. Recent Aberdeen research indicates that only 30 percent of cross-channel retailers have attained some level of cross-channel integration across their inventory, order management, fulfillment, and customer processes such as consistent pricing, product information, promotions, and loyalty initiatives. All of the above processes contribute toward new customer acquisition and customer retention in the Web, catalog and store channels.

"Our data shows that the reasons for the lack of integration include channel conflicts — lack of channel flexibility, legacy systems impeding multi-channel process integration, and lack of agile customer and process management tools for cross-channel productivity, communication, and resolution," said Sahir Anand, senior analyst and chief author of the multi-channel benchmark report.

The report has detailed the Best-in-Class approach to integration. For instance, Best-in-Class retailers' focus on creating a roadmap for multi-channel integration compared to Average and Laggard companies. More than half (53 percent) of the Best-in-Class are currently focused on developing an integrated brand identity amongst their customer base as a core strategy.

"These companies are 30 percent more likely than laggard organizations to follow a strategy that is based on brand integration rather than a channel-specific focus on customer processes. The channel-specific focus has so far dominated multi-channel selling. However, Best-in-Class are gradually creating an overall focus on the brand," said Anand.

The research reveals that designing the process and system strategy for multi-channel integration is a significant decision for any retailer from a Web site, call center, end-to-end order management, or customer fulfillment standpoint. The business case for improving, or introducing, a unified cross-channel strategy involve factors such as customer value, business targets, investments to change or improve existing multi-channel technology, operating costs and internal skill sets.