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RFID helps grow multichannel business

Year 2011 was the year of online. A record-full of US and UK retailers increased their online presence making just about anything available for purchase on the www. But consumers want more.

According to a recent study published by Drapers 38% of Brittish shoppers expect click-and-collect services; services that allow them to go online, select an item and go pick it up at a certain location. RFID will help drive the adoption of new online strategies and click-and-collect services. The early adopters of RFID say that they never could have done online related changes without RFID. The attraction of RFID lies in the ability to make items unique, yet easily identifiable and the possibility to register items with no human intervention. Its benefits to fashion retailers are indisputable. Inventory related operations alone offer lucrative ROI. The online element could be called the bonus.

valkoinen 70% leave with no purchase

No sale need go missing

Internet Retailer reports from a study researching the trends of online shopping and found that 70% of shoppers who enter a website with the intent to buy leave empty handed - or should I say empty basketed. Shocking! Half of the instances are explained by the fact that the consumer did not find the item and this should be fixed with re-design of the website. The other half would easily be fixed with RFID, namely the half that is due to retailers not selling as they are uncertain of their stock levels or simply do not have items in their stock for online.

A well deployed RFID strategy ensures a 99% stock accuracy at all times. This leaves no chance for doubt over stock levels and no sale goes missing. To give you an example: American Apparel normally run their online sales from the warehouse. In case an item is not available in the warehouse, the system will check different stores' stock levels too and when stock is available, allocate the order to the store. The stores become mini-distributers by packing and shipping the goods to the customers. This has a direct impact on customer satisfaction, yet according to American Apparel themselves, it would never have been possible before RFID.

Another fashion house, Van Vuuren Mode from the Netherlands, is also among the first retailers to use RFID in order to facilitate their online operations. For them this was one of the drivers in the RFID adoption. Their strategy is interesting and somewhat unique to my knowledge: They have no separate stock for online. When they get an online order, it is pushed to all stores and the first store to pick up the order, will make the sale: making the stores in-fact to compete of the online orders.

valkoinen inventory accuracy 99%

Creating the shopping experience and selling more

Let's return to click-and-collect: we know consumers want it - why would you invest in it? Well, first of all it offers you a fantastic opportunity to sell more. I give you three examples:

  • People who do not use your online service at all. Some of the people are like me: I do not order any clothes or shoes online. I buy other things like books, music, airline tickets and electronics for example; and I can imagine buying accessories. The reason I don't buy clothes online is my shape, I never know if an item is going to fit me, not even if I've bought the brand before. And if I find an item I adore, it arrives and it won't fit - I'll just hate it, I'll be disappointed and I'm not going to wait for the post again… Plus, I hate the returning of items, it's a hassle I don't want. BUT if you had click-and-collect, we'll then I'll just try the item on in the store to which I ordered it, wouldn't I.
  • Impulse shopping. Actually, I need not say more…
  • You reach more people. In most cases, different stores hold different stock: smaller stores only stock a part of a collection for example.  In smaller cities you have less selection due to lower demand, but it need not be.

Secondly, because you save costs:

Just share the stock! Holding separate stock everywhere is fast becoming so last season. Not only will you be able to offer all goods to all consumers as the not-in-store items are easily delivered there, you will also save on cost. At best you might be able to reduce the size of your backroom, as you will deliver more stock directly to shop floor.

And finally because it helps you with SOMOLO strategy

Create the experience! All retailers face the challenge of meeting the customer on social, mobile and local (SOMOLO) platforms. A click-and-collect service enables three things: 1) you bring the store to the customer by widening your product palette on the online 2) you bring the online to the store by showing your online content in the fitting rooms or on large displays in special areas and 3) special mobile marketing to induce additional shopping: for example as the consumer orders click-and-collect they get an offer to their mobile phone, the offer only gets activated in your the store.

DoubleBubble

From the consumer perspective, they will experience you the same on all platforms and see them link seamlessly. Additionally they feel the level of service higher as they have access to a higher level of services. And instead of this costing more to you, it costs less!

1 comment on “RFID helps grow multichannel business”

  1. Posted 16 March 2012 at 09:26:27

    The global and faceless nature of online shopping can sometimes present hurdles if a problem occurs with your purchase. There may also be practical difficulties in obtaining a remedy from an overseas-based seller, so check the terms and conditions of the contract before you buy.

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