How do you make seamless shopping a reality?

Retailers who are looking to provide a genuine omnichannel customer experience can take one crucial step to help themselves.



According to a new study of more than 300 global retail CEOs, including 100 U.S. CEOs, from enterprise retail technology provider JDA Software Group Inc. and PwC, operational silos are a key inhibitor to delivering an integrated, seamless experience. Only 18% of CEOs said they have eliminated operational silos and are delivering seamless omnichannel shopping experiences for their customers.



Companies without operational silos expressed greater confidence in revenue growth (59% compared to 48% average for all CEOs) and profit growth (63% compared to 43%) than their peers. The study also indicates CEOs that have removed silos are also achieving competitive advantage though lower costs and increased investments in customer-centric services.



Seventy-four percent of CEOs in companies operating in silos say their costs for omnichannel fulfillment are increasing, while only 59% of the companies that have eliminated silos say these costs are increasing.



The highest costs for omnichannel fulfillment center around shipping to consumers. Thirty-two percent of CEOs who have eliminated silos and 45% of those with silos indicate shipping directly to consumers from a distribution center is their highest omnichannel fulfillment cost. Meanwhile, 51% of respondents without silos and 67% with silos cited processing returns as their highest omnichannel fulfillment cost.



Non-siloed omnichannel companies are also more likely to offer in-store click & collect (56%) than their peers with silos (47%), but are less likely to offer any of the other click & collect options such as picking up purchases at lockers or commuter travel hubs. Non-siloed companies appear more focused on the speed of delivery, favoring same-day over next-day deliveries and are more likely to offer specific time slots for customer deliveries.



On average, respondents are spending 26% of their investment capital on omnichannel readiness in 2016, with some of these investments centering around extending omnichannel fulfillment options for customers (51%), providing a seamless customer shopping experience (49%) and understanding social media for business use (49%).



To deal with the high costs of omnichannel fulfillment, CEOs are planning to offset increased costs in the following ways:



• Raising the minimum order value for free home delivery (39%).

• Raising the minimum order value for free click & collect services (31%).

• Increasing the cost for home delivery (29%).