By Linnworks
In a perfect world, retailers would set up branded online stores and have customers come directly to them. But we live in a challenging world, and engaging and retaining consumers via this direct route can be an expensive business fraught with risk.
Since the turn of the century, the retail landscape has undergone a seismic shift. The power once held by dominant retail brands has now shifted to consumers, who have the freedom to shop anywhere. This rapid evolution of the retail landscape, driven by changing consumer behaviour, is a clear sign that the era of high-profile retail brands is giving way to a more diverse and connected retail environment.
For retailers, multichannel retail now means so much more than simply listing items and fulfilling orders from a handful of websites.
What does the multichannel retail landscape look like in 2024?
Consumers love the convenience, choice and value offered by online marketplaces. In Linnworks’ recently published State of Commerce Ops 2024 report, 51% of consumers said they preferred to shop on online marketplaces, compared to just 20% who favoured shopping directly on brand’s websites.
The online marketplace sector has become highly fragmented. While sites like eBay and Amazon continue to dominate regions like the UK and the US, they are facing fierce competition in their home markets from look-a-like competitors, famous traditional retail brands, and niche operators. Meanwhile, brands you may or may not have heard of dominate the market in other geographies.
Online retail happens everywhere on traditional and mobile-optimised eCommerce websites, mobile apps, and social media channels. And while many of these multichannel retail environments look very familiar, new channels like TikTok Shop are completely redefining what online shopping looks like. In short, consumers have never had so many choices, and customer loyalty is harder to win.
If retailers want to keep up with the competition and grow, they can be seen in more places and adapt to the needs of the market and the changing expectations of consumers. This is reflected in the fact that 52% of the retailers we speak to state their number one goal is to expand to new markets and new channels is their top priority.
Faster, Smarter Shipping and Returns
Retailers don’t just have to worry about where to list and sell their products. Fulfilment is an essential component of any competitive retailer’s offer. It’s not just about meeting their customers’ expectations; it’s about competing with the most agile retail businesses and maintaining the standards that online marketplaces demand.
Regardless of whether sellers offer next-day, same-day or preferred-day delivery, making sure their products are in the right place at the right time can take time and effort. When stock is located in multiple warehouses and warehouse locations, third-party fulfilment centres, and even micro-fulfilment centres, it’s essential to have a clear understanding and visibility of how those products move through your business and get to your customers on time and every time.
Managing returns, customer refunds, and deciding whether items are returned to stock, liquidated, or otherwise disposed of adds extra complexity to this challenge.
Retailers can prioritise demand forecasting and data-driven decision-making when deciding whether to return items to stock, liquidate them, or dispose of them. By utilising data analytics, retailers can predict the likelihood of an item selling quickly, making restocking a more informed and profitable choice. Additionally, leveraging comprehensive data on returns, sales, and customer feedback allows retailers to continuously refine their returns strategy, ensuring more efficient and strategic decision-making that maximises profitability and minimises costs.
This, of course, becomes even more complicated when selling across international borders.
Cross border selling
Cross-border selling adds significant complexity to the world of multichannel retail. According to Statista, over 55 percent of supply chain professionals find cross-border eCommerce challenging. This complexity arises from navigating various customs regulations, managing international shipping logistics, and handling currency conversions, all of which require robust strategies and advanced planning to ensure seamless operations and customer satisfaction.
But cross-border selling is also where the opportunity lies. In fact, the value of cross-border eCommerce has been predicted to grow by 25% a year – almost twice as fast as domestic eCommerce. To capitalise on these opportunities, it is crucial to leverage a strong ecosystem of logistics partners, agencies, eCommerce platforms, and marketplaces. These stakeholders can provide the necessary support and infrastructure to help businesses successfully expand their reach and thrive in international markets.
One platform, multiple channels
Once sellers decide on their target channels and geographic markets, it’s important to focus on effective management, using advanced technology, to ensure their strategy’s success. This way retailers can manage sales more easily across multiple channels.
By setting specific business rules to manage how individual orders are processed, sellers can effectively manage customer and marketplace expectations, ensuring a positive experience for all parties involved.
This process enables sellers to effectively sell across many different channels as if they were selling from just one. It might be an Amazon order, an eBay order, or an order from any one of hundreds of other sites, but to the team in your warehouse, it’s essentially just another order for your company and is picked, packed, and shipped accordingly. With the right business rules in place, sellers can seamlessly bring new channels online, and warehouse teams can get on with their jobs with minimal training.
46% of retailers still rely on manual integrations linking their operations to online marketplaces, but this can be automated so that sellers can take greater control of their business.
Take control of your multichannel retail success
In 2024, a multichannel approach can bring retail success. Consumers now favour online marketplaces like Amazon and eBay, making brand loyalty harder to secure. Retailers can expand into new markets and master complex fulfilment and international selling requirements. Leveraging platforms like Linnworks helps manage these challenges, streamline operations, and enhance profitability in a competitive and fragmented market.
Published 28/08/2024
