ROI of eCom vs OMS

The heart of any strong omni-channel strategy is order management. But implementing an omni-channel strategy designed to meet the customer’s expectations requires an effective ecommerce engine. So how do you weigh the ROI of each option when deciding on your implementation? We’ve seen a strong response to these questions in the past and so we think it’s an overlooked area of value and interest.

 

eCom

Because so many factors affect ecommerce marketing, ROI can vary significantly. Marketing channels, revenue margins, and even business stage can impact your return. That means there’s no specific percentage that’s considered the gold standard for ecommerce ROI.

That said, investing in your eCommerce platform is essential for a digital first strategy, for most it’s something that will increase their sales, cuts down costs, and improve productivity. But it’s a balancing act, there are so many factors involved in a a comprehensive eCom experience that any number of them can make or break a site. Primary sources of ROI come from increased customer retention, and improved customer experience often due to enhanced capabilities on site or enhanced data collection to use in meeting customer expectation. Increased average order value from features such as cross-selling and upselling during the order process.

Ecommerce investment also often includes better Search engine optimization (SEO), including local optimization and doing SEO for existing customers also increases the probability of a new customer finding your site and placing orders. These factors listed above are all part of the challenge, often, conflicting elements such as copy (content) & SEO, product, and data (too little, not the right data), etc, each with their different representatives in the business also fighting for priority.

The ROI offered by an Ecommerce implementation is something that’s often a more delayed investment, it takes time to find the right experience, the process(es) that work and the organisational support. project times are long and time to market Is often slow, and capabilities are released all at once, meaning you have to commit to this type of implementation far in advance of seeing the investment in action.

Inventory availability and OMS are (by comparison) easy wins, do you have the product now? and how much of it do you have? (this is key to solving overstocking and driving the sales necessary to clear out the warehouse). And then WIMO, latest research has started to indicate that consumers expect delivery within 2 hours! Is this realistic? It depends on the offering, and we all know delivering a couch is not like delivering your local take away. That said expectations are being set by these services for food delivers, (take aways and local groceries) and the demand will only grow as consumers get used to faster and faster delivery times. After all a consumer’s best experience often sets their expectations for their next one.

 

OMS

The adage, “You need to spend money to make money,” is nowhere more apparent than in digital transformation, ecommerce platform shifts in particular can have large upfront investment costs with lengthy time to market, one of OMS’s primary appeals is that it has an MVP (minimum viable product) with an extremely fast time to market, often taking 5-6 weeks at most. This means you can see and evaluate your ROI early into the project and decide if continuing to enhance that system is worth it for your business.

OMS ROI comes in part from an area which you would otherwise have far less control over, the first major post-conversion hurdle, this is that once a consumer has made the purchase they automatically switch to “when am I getting it” making a customer uncertain about this question is one of the quickest ways to go from customer satisfaction to customer dissatisfaction and is a prime cause for returns and customer support queries.

One of our recent implementations saw a customer acquire huge benefits from their OMS project, with a decrease of 99% in their ‘where is my order’ (WIMO) queries alongside a 95%  decrease in return requests over a 6-month period, see below. The ROI of OMS systems cannot be overstated in results such as these, and it’s hard to imagine that an eCommerce platform shift would generate similarly impressive results in any of its KPIs, this is where OMS delivers and excels; it ensures that the experience you provide is complete, allowing you to compete with a customer’s expectations. 

 

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