Omnichannel distribution is a fulfillment approach that some companies use to give customers a way to purchase and receive orders from several sales channels with one-touch seamless integration. The goal of an omnichannel logistics strategy is to reduce costs, improve transit times, and ensure the customer gets a great experience from click to arrival.
It’s important for brands looking to outsource logistics to assess the omnichannel distribution capabilities of their potential third-party logistics (3PL) partner. Implementing an effective omnichannel shipping strategy often leads to revenue growth as customers are likely to spend more online than in brick-and-mortar stores.
What is Omnichannel Fulfillment?
Meaning “all channels”, omnichannel fulfillment is a strategy that handles all inventory, going to many different places, from one location or supplier (like a 3PL). With omnichannel fulfillment, your 3PL manages your entire inventory, optimizing their operations for picking, packing, and shipping to whatever channel your product will go to next. Products are pulled from the same inventory pool, which can be distributed among your 3PLs fulfillment centers, and prepared for shipping.
What are the Benefits of Omnichannel Fulfillment?
One of the main benefits of an omnichannel fulfillment strategy is increasing your customer base. If you operate a brick and mortar store and open up an ecommerce website to sell your products you can reach a significantly larger number of customers and having more customers means more revenue. From the viewpoint of the customer, you are offering convenience and ease of use. They can order, pay, and receive their purchase in any way they choose, be it at a physical location or delivered directly to their door. Since omnichannel also emphasizes good customer service both in-person and online, orders are confidently placed, lessening the chances of returns.
How to Implement an Omnichannel Strategy
Ready to start experimenting with omnichannel for your business? Take the time to research your online target audience so you can make the most of each channel you sell on. Build your strategy around your customer and their data. In many businesses, customers are handled separately in different channels. Having customer information integrated in different channels is key to make this work. You should develop a system to acquire information from each transaction done, regardless of platform. Tracking customer preferences for certain products at a certain time will help you to know the demographics of your business and also the loyalty of customers. The focal point of the strategy should be the user experience and quality of services (especially shipping). As you will be handling multi-channel retail with different mechanisms for ordering and fulfillment, make sure communication between these parties are clear and optimized over time.
“It’s hard to find 3PLs that have a deep expertise in dealing with Amazon, and all of the dot.coms, as well as dealing with brick-and-mortar. We feel like we really have a partner because DCL has that deep experience. DCL has a reputation for being very technology forward, helping companies drive from an omnichannel perspective for their business, not just traditional brick-and-mortar.”
How to Optimize the Omnichannel Experience
The process should be user-friendly across all platforms and categorized so it is easy to manage on the sellers end, too. Managing returns and tracking can give you new opportunities for sales as it increases re-visits. Good communication with the customers throughout the process is a must to ensure the customer’s confidence in you. Find opportunities to save on fulfillment costs with your local market. Offer both in-store pickup or consider using same-day local couriers for faster delivery.
Ecommerce Omnichannel Shipping
When people start a business online, they tend to overlook their shipping logistics, which could wind up being a costly mistake. It’s also easy to feel overwhelmed about shipping, considering Amazon has set a high bar for customer expectations. Trying to compete by offering free two day shipping can turn out to be a very expensive experiment, hurting your profits and bottom line. If there’s any advice we can give you, it’s that free shipping isn’t the end-all-be-all marketing promotion it’s made out to be. While Amazon has the luxury of losing money on shipping and not being held accountable for these losses, unfortunately, the same doesn’t apply to you.
Instead, it’s best to seek shipping solutions that squeeze out the best value in terms of price and speed of delivery.
Omnichannel Shipping Strategies
Now that we have established the importance of shipping in Omnichannel ecommerce, we should also discuss the things you can do to optimize your performance in the shipping departments. Many customers expect fast and free shipping, but not all. Consider offering free shipping during limited time periods, such as the holiday season. Or, you can offer free-shipping year-round for your local/domestic market only. You should make sure you get correct shipping information at checkout so you can avoid delivery problems. Automatically send tracking updates to your customer, and stay in contact with them until the items are received. You might want to consider working with multiple shipping carriers. This will help you get cheaper and better rates for any place you ship to. Have a return policy that allows returns from different channels for the ultimate customer convenience. Handling the logistics for increased sales volumes can be challenging. If you are feeling overwhelmed, consider using a 3PL to handle your logistics needs.
With planning, being willing to experiment, and putting the customer at the center of the process, you can make omnichannel retail work for your business. If you are a growing ecommerce company, and are overwhelmed by the number of sales channels you deliver to, an omnichannel shipping strategy is a great option. By partnering with an experienced 3PL you will have access to multiple fulfillment centers and relationships with major shipping carriers. Your 3PL can help get your products, whether B2B or B2C, into your customers hands faster and at a lower cost than fulfilling them yourself.
If you are looking for omnichannel fulfillment we would love to hear from you. Send us a note to connect about how we can help your company grow. You can read DCL’s list of services to learn more, or check out the many companies we work with to ensure great logistics support.