The Path To O2O Business Model Through The Retail Digital Transformation

New realities have taught even offline shopping evangelists to purchase online. Here is a fact from eMarketer: by the end of 2021, US consumers will spend over $ 933 billion on e-commerce.

It is clear that buyers are migrating to the digital space. Businesses must get ahead of them.

We suggest considering a case study on how an offline retailer conquered online commerce due to a digital transformation process.

IT Infrastructure Transformation For e-Commerce Development: Case Study

Client

A national chain of non-grocery stores, connecting 90 points of sale.

Issue

The customer was an offline-oriented company, but new business conditions pushed it to open new opportunities. Management decided to master e-commerce gradually. The first step on the way was a click & collect service implementation. Due to this approach, the company strove to:

• expand its audience by engaging online buyers

• make a shopping process more safe and convenient

• increase the assortment

The latter goal turned out unusual for such situations.

When a retailer enters the e-commerce market, it often reduces the range of goods to process orders quickly," explains Evgeniy Aleksandrenko, Digital Transformation Officer at JEVERA. "In this case, everything was the other way around. The customer's business model is so similar to the convenience store one. It uses small premises for trade.

Meanwhile, there is a variety of SKUs in warehouses. All of them cannot be placed in a small area. But employees can deliver them to a chain store if necessary. When a customer uses click & collect service, such a need arises."

Before contacting us, the company tried to solve the issue on its own. They focused on expanding the functionality of the existing warehouse system and purchasing a new CRM. The client imagined the basic architecture of the solution like the following:

Unfortunately, this approach has several significant drawbacks that can affect the service efficiency:

• lots of business processes, such as refining order details, remain uncovered

• point-to-point integration creates risks: in the case of a system's failure, click & collect will be unavailable

• increasing the load on existing software can lead to its failure

After analyzing the existing business processes, JEVERA specialists concluded the project requires a digital transformation of the entire IT infrastructure.

Solution

We focused on the microservice architecture and suggested implementing order management middleware. It could eliminate direct integration and optimize the load on existing systems.

The new mid-layer product replaced dozens of integration points and took on the main burden of data processing. Moreover, it became a base for new business processes and auxiliary systems implementation, like a contact center.

Perhaps one of the core benefits of this approach was the resilience and scalability of the upgraded digital infrastructure.

The pilot project was launched on the 16th week after the project's start. Anna Tyschenko, CEO at JEVERA, explains such an unimaginably short period by the existing expertise:

"Our experience was crucial in this case. Transition to e-commerce is a common issue for the retail domain. But businesses still chose difficult ways to fix it. Meanwhile, we offered the customer a solution that really works."

If you strive to become an e-commerce market player and have a few options on how to achieve it, feel free to contact us. Our specialist will advise what way to choose in your case.