German Karstadt Department Stores report progress in multi-channel business
In the past few months, Karstadt Department Stores progressed in the implementation of the multi-channel business model by restructuring its sourcing, the introduction of an incentive model and by focusing primarily on the customer
According to Terry von Bibra, Chief Retail Officer Omnichannel, “not online is the future, but Omnichannel (multi-channel business). We have undertaken the decisive steps with a uniform approach in all channels, no matter if it is a brick-and-mortar store, online, Smartphone, etc., to ensure future success.” These channels are not focused to particular customer groups, but on the core customers of Karstadt, these are mostly female and they prefer better products over just more articles. The make use of all our sales channels and according to their needs.
The most decisive factor for success is product and line ranges for the omnichannel business, thus the company re-engineered its sourcing. Online and store have to complement each other, thus it will no longer be sufficient to practice the online business à la carte. There is a pre-selection of product ranges in order to decide were these can optimally offered, online stationary, or both. For instance seasonal, very specific or large volume articles such as garden furniture will not be offered the year around in large quantities in the stores, but online.
Another contribution to enhance turnover will be the incentive model. Since April 1, 2014 the turnover for online ordering will be booked to the benefit of a store when the customer is ordering online in a store, or the article stems from the stock of a store or will be picked up by Click and Collect by the customer in the store.
Terry von Bibra explains: “It is our aim to impress Karstadt’s core customers by competence in all of our sales channels. This shows probably the largest difference between Karstadt and most of the classical competitors who are also engaged in Omnichannel, but try to get the customer’s loyality when tapping into the reservoir of pure online traders.” He adds: “Online is not Omnichannel. Independent online teams work in parallel, but not jointly with our stores will not offer a benefit to our customers, thus our Omnichannel strategy is by far not an online strategy only.”