Most retailers dream of continuous and consistent growth. From the world’s largest chains down to a single mom-and-pop operation, a steady increase in clientele helps ward off the dangers of lean times and makes cash flow forecasting and inventory ordering easier. But, growth can come at a cost. If your demand exceeds supply, you can see your reputation get quickly damaged as frustrated customers voice their thoughts online.
This has happened more than once when companies take on a new marketing or advertising campaign that catches on faster than they expected. Perhaps, as in one particular case, a celebrity is hired as a spokesperson. The popularity of this individual generates a sharp spike in customer visits to a retailer’s Web site, but the servers cannot handle the load and the site crashes. The anticipation and enjoyment that the prospective customers were feeling become frustration and anger instead. Sometimes this cannot be rectified. The damage is done. A reputation is destroyed, and at least some of those shoppers jump ship to the competition.
The statistics on site abandonment are shocking. It takes only a fraction of a second for people to grow disinterested and move elsewhere, even when everything is working fine. This can translate into thousands or even millions in lost revenue, either immediately during the delay, or over the longer term.
Such are the concerns that retailers face when they look at their omnichannel commerce platform and place it side-by-side against their budget. It comes down to one word, scalability, and that is not a word that many in management are comfortable with.
To survive the onslaught of a spike in demand, a retailer’s website must be scalable. It must be able to grow in a fraction of a second in the case of a reaction to an ad campaign. It must also be able to handle slower, larger scale expansion, brought on by the adoption of a new channel like a mobile ecommerce site, an app, or a new payment or search system.
This is one of those situations where management and IT must be on the same page and in the same room. Very often a retailer’s IT department is overloaded, stretched between too many other projects, or it might only exist as an extension of the marketing department. Budget and resource concerns can easily overrule any proactive initiatives. IT and management may not even talk the same language, in the sense that one speaks in broad concepts and the other talks in computerese.
The solution is for retail management to recognize that successful omnichannel commerce relies on keeping a close eye on platform scalability. Under the permanently valid mandate that an ounce of prevention is worth more than a pound of cure, management must recognize that the cost of an outage far exceeds the cost of building and maintaining a scalable platform.
This demands the creation and coordination of a reliable team, both internally and possibly also using external consultants and experts. It also requires that the two sides, management and IT, learn to talk to each other in a mutually comprehensible way. On the surface, retail is about brands, fashions and products. But, none of that will happen if there is not a stable and scalable system running behind the scenes to process orders and payments, show off merchandise on smartphones, tablets, and PC screens, and ensure that last mile delivery is completed.
The worlds of IT, marketing, and retail are colliding. The result is a new frontier of business growth, but only for those who are willing to invest that ounce of prevention.
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