An overview of the client

RetailNow is a mid-sized specialty retailer that specializes in gourmet food items, housewares, and home goods. It has 42 physical locations throughout the Midwest and Northeast. Established as a lone boutique in 1997, the business has amassed a devoted clientele through attentive product selection and individualized service. By 2020, RetailNow's online and in-store operations were not well integrated, and their e-commerce presence was barely 8% of their overall income.

The difficulty

RetailNow was dealing with existential issues that threatened its business model when they came to us in early 2020:

• Disruption from the epidemic: The COVID-19 epidemic drove all physical retailers to temporarily close, which almost immediately resulted in a 78% decline in in-store income.
• E-commerce Restrictions: Their previous e-commerce platform was out of date, had a bad mobile experience, had little information about products, and was not integrated with store inventory.
• Inventory management issues included stockouts, overstocking, and irate consumers as a result of inventory being handled differently for online and retail locations.
• Gaps in the customer experience: Customers found it difficult to switch between their online and offline purchasing experiences (e.g., buy online, pick up in store).
• Competitive Pressure: Market share was being quickly acquired by big-box retailers with advanced omnichannel capabilities and digitally native rivals.

When revenues in the first quarter of 2020 fell 62% from the year before, the situation reached a breaking point. "We realized this wasn't just about weathering the pandemic," says Jennifer Taylor, chairman of RetailNow. "This involved radically rethinking our business strategy for a future in which the distinction between online and physical retail is irreversibly hazy. We had to change or we would be forgotten."

How We Proceed

We created a comprehensive omnichannel transformation plan after conducting a thorough analysis of RetailNow's business operations, technological setup, and competitive positioning. This plan would not only solve the company's immediate pandemic issues but also set it up for long-term success in the changing retail environment.

Phase 1 (two months): Crisis Response and Digital Foundation

We started by quickly enhancing RetailNow's digital capabilities in order to solve the current revenue crisis:

• Rapidly switched from an outdated e-commerce platform to a cutting-edge, cloud-based solution with responsive design
• Virtual Shopping Experience: Video consultations were introduced, enabling store employees to offer individualized shopping support from a distance.
• Curbside Pickup: All sites that could reopen with restricted capacity now have a curbside pickup alternative that was implemented quickly.
• Digital Marketing Pivot: Transferred funds from in-store and print advertising to digital platforms with more focused messaging
• Staff Training: Store employees were quickly instructed on digital tools and new fulfillment procedures.

Extreme speed and adaptability were needed throughout this phase by both our team and RetailNow employees. "What would typically be a six-month e-commerce migration was shortened to six weeks," says Michael Rodriguez, CIO at RetailNow. "There were some rough edges at launch, but getting a viable digital solution in place quickly was critical to our survival."

Phase 2: Implementation of the Unified Commerce Platform for Curbside Pickup (5 months)

After putting emergency protocols in place, we concentrated on creating a single commerce platform that would break down channel silos:

• Integrated Inventory Management: Put in place a consolidated inventory system that offers real-time visibility across all locations and channels.
• Order Management System: Implemented an OMS to coordinate intricate order fulfillment situations across several channels.
• For consistent consumer experiences, point-of-sale systems in-store and the e-commerce platform were integrated.
• Customer Data Platform: A CDP was put in place to enable personalization and consolidate customer data across touchpoints.
• Content Management System: A headless CMS was implemented to handle marketing content and product details across platforms.

As we attempted to align procedures and integrate systems that had previously operated independently, this phase brought with it substantial organizational and technical obstacles. "The technology implementation was complex," says Sarah Chen, our technical lead for the project, "but the bigger challenge was helping the organization shift from thinking about 'stores' and 'e-commerce' as separate channels to seeing them as complementary touchpoints in a single customer journey."

Enhancing the Omnichannel Experience in Phase Three (four months)

We concentrated on developing smooth client experiences across channels after establishing the framework for unified commerce:

• Dedicated pickup locations and real-time notifications were included in the fully functional Buy Online, Pick Up In-Store (BOPIS) experience.
• Ship from the shop: allowed retailers to complete online orders, cutting down on delivery times and increasing stock levels.
• An endless aisle gave store employees tablets so they could browse the whole product catalog and order things that weren't in stock.
• Mobile App: included wishlists, product scanning, store finding, and tailored suggestions into a mobile application.
• Unified Loyalty Initiative: The loyalty program has been redesigned to function flawlessly across channels with reliable earning and redemption.

To make sure the additional features would complement rather than detract from the individualized service that was RetailNow's signature, we collaborated closely with associates and store managers during this phase. "With all this technology, we were worried that it might make the experience feel less personal," says Rebecca Johnson, vice president of store operations. "But we found that by freeing our associates from routine tasks, they actually had more time for meaningful customer interactions."

Phase 4: Continuous Data-Driven Innovation and Optimization

We turned our attention to using data for ongoing innovation and optimization after establishing the fundamental omnichannel capabilities:

• Advanced Analytics: Used retail analytics to extract information from customer behavior across channels.
• AI-driven personalization was implemented via the Personalization Engine to provide customized experiences across all touchpoints.
• Predictive Inventory Management: Machine learning models were used to maximize network inventory distribution.
• With the use of digital clienteling, retail employees can now offer individualized service based on past interactions both online and offline.
• Retail Experience: created ideas for in-store experiences improved by technology that are impossible to duplicate online.

Impact and Outcomes

In addition to assisting RetailNow in surviving the epidemic, the omnichannel transformation has set them up for long-term success in the changing retail environment.

Numerous qualitative advantages have resulted from the transition, in addition to these headline metrics:

• 45% of online shoppers visit a store within 30 days, demonstrating the channel synergy that physical stores now influence online engagement and vice versa.
• Inventory Efficiency: By reducing carrying expenses by 28% and stockouts by 64%, unified inventory
• Customer Loyalty: Customers who shop across channels have 3.2 times the lifetime value and 2.8 times the retention rates.
• Market Expansion: The use of digital tools has made it possible to enter new geographical areas without physical stores.
• Agility of the Organization: The business can now quickly test and implement new ideas across channels.

"This adjustment has had a profound impact on our company philosophy. We no longer regard ourselves as a chain of stores with a website; rather, we see ourselves as a single retail brand that serves consumers wherever and however they choose to shop. We had to speed up our digital transformation due to the epidemic, but the skills we developed have set us up for success long after the crisis is over. In an integrated environment, our stores are now more useful than ever as experience centers, fulfillment centers, and brand touchpoints in addition to being sales channels."

— Jennifer Taylor, CEO of RetailNow

Lessons Learned

Other merchants starting omnichannel journeys can benefit from the following insightful findings from the RetailNow transformation:

• The Customer Journey should come first. The first step in a successful omnichannel transformation is not technology but rather knowing how people want to purchase.
• Data Unification Is Crucial: The basis of all omnichannel capabilities is a single view of inventory, customers, and orders.
• Store employees are essential. In order to embrace their changing position in an omnichannel paradigm, store employees need to be prepared, trained, and given incentives.
• Maintain equilibrium Quickness and Expandability: Emergency situations may call for immediate tactical fixes, but these should be planned with a route to strategic platforms in mind.
• The importance of organizational alignment Organizational structure, measurements, and incentives must alter in order to break down the silos that separate e-commerce from store operations.

Most significantly, the RetailNow story shows that physical retail may prosper in the digital era by developing to play a distinct and complementary function in an integrated customer experience rather than by actively competing with e-commerce.