The Road to Customer Experience Nirvana Provides New Challenges, Opportunities for Brand Manufacturers

January 25, 2016

We recently sat down with Matt Rhodus, Industry Solutions Principal for Retail at NetSuite, to gather some insights into some of the big trends and challenges he’s seeing in retail – especially among apparel brand manufacturers. Here’s what he had to say:

Q: You’ve been on the road speaking with a lot of retailers, especially apparel brand manufacturers. What are they telling you about their biggest challenges?

A: In response to the dynamic changes going on in the market, a lot of apparel brand manufacturers are focusing their growth on selling direct to consumers. Wholesale still tends to be the largest business segment for them, but the margins are higher on the retail side. Plus, they are able to control and better narrate the customer experience.

The challenge for many brand manufacturers is they have been in business for decades and, up until recently, have been focused on the challenges that come with running a successful B2B business. B2C is completely new for them and it’s a struggle to make that change, but it does present a huge opportunity to design a modern, innovative customer experience from the ground up. In addition, brand manufacturers that have only a dozen or so stores don’t have the massive technical debt that is holding them back like a lot of traditional retailers have to deal with.

Are you finding that most brand manufacturers are focused on omnichannel?

It’s not so much getting to omnichannel for them. For most of the businesses we are talking with right now, they are really focused on the customer experience. When you design a customer experience and work backwards, that will ultimately get you to omnichannel. We call this methodology, the Stairway to Customer Experience Nirvana(opens in new tab).

Can you explain what the “Stairway to Customer Experience Nirvana” is?

What we found is that, for the most part, the front-end problem for retailers is really a back-end problem. They just don’t want to admit it because of the time and capital they think it will take to fix it. The Stairway to Customer Experience Nirvana recognizes your front-end problem is a back-end problem. But it doesn’t mean costly, multi-year projects to start moving up the stairway. Here’s how it works.

The first step is to remediate. Make sure you have a single view of customers, orders, items and inventory. You can’t sell anything if you don’t understand what those three things are. It’s also about getting that on a real-time platform so any channel can consume from that base.

The next step is to focus on the point of sale system(opens in new tab). The POS has become the most valuable hardware used in brick and mortar stores today and with most transactions occurring on a traditional POS(opens in new tab), its financial worth is apparent. Step two connects the POS to all other systems within the company, providing instant access to inventory levels and customer data throughout all stores and distribution centers. Sales associates will now be able to quickly leverage this data to provide pleasant in-store experiences for customers.

By just taking these first two steps, you will have ultimately solved the greatest pain retailers feel. Now you have one channel fully operating in omnichannel mode.

Step three is to roll out to the remaining channels – ecommerce and beyond. With a solid back-end system in place and a fully integrated POS system in stores, you are ready to roll out a complete omnichannel experience for your customers. This third step will connect any remaining channels to the back-end and POS including; ecommerce(opens in new tab), pop-up stores, catalogs, call centers and kiosks. No matter which channel your customer chooses to shop, they will have the same seamless experience with access to buy anywhere and return anywhere.

Combined, steps one through three enables your sales associates to increase average dollar sales (ADS) with targeted upselling based on shopping cart history and previous purchases. You will no longer turn away sales due to obscure inventory levels, leaving your customers’ needs fulfilled.

Step four is focused on acquisition and retention. Then you can begin layering in personalization to segment appropriately and for omnichannel delivery.

In the final step, technology should no longer be a limiting factor holding retailers back from focusing on more creative endeavors. In this stage, retailers can focus on truly disrupting their markets. Fashion brands disrupt every day with new looks and styles, but constantly face some of the harshest competition from agile new startups taking advantage of constantly shifting technologies. To compete, forward-thinking retailers need to disrupt digitally and can do so once they have a clear perspective on their daily operations.

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NetSuite has packaged the experience gained from tens of thousands of worldwide deployments over two decades into a set of leading practices that pave a clear path to success and are proven to deliver rapid business value. With NetSuite, you go live in a predictable timeframe — smart, stepped implementations begin with sales and span the entire customer lifecycle, so there's continuity from sales to services to support.

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