AT A GLANCE
- Create integrated e-commerce web presence
- Drive digital customer engagement
- Transform from bricks and mortar to multi-channel retail
- SAP hybris ecommerce platform
- Efficient online sales presence established
- Seamless integration with existing SAP ERP system
- Enhanced customer interaction through digital channel
- Scalable platform for future growth.
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When established multinational retailer Spotlight looked to grow its online sales channel, it looked to Oxygen and the SAP hybris e-commerce platform. As a result, Spotlight today has a powerful web presence and a direct sales channel which has allowed the company to provide a new touchpoint for its customers.
Spotlight Pty Ltd is the largest chain of fabric, craft, and home interiors stores in Australia. The company employs more than 6700 staff, operates in Australia, New Zealand, Malaysia, and Singapore and is headquartered in South Melbourne. The brand is synonymous with expertise in crafting, fabrics and home decorating.
Up until early 2014, Spotlight had a website, but no online store, while another division of the Spotlight Retail Group, Anaconda, was already operating successfully online. Upon celebration of its 40th anniversary in Australia, the company used the watershed moment to find a strategic online partner that could power e-commerce growth and keep pace with customer demand across its various multi-site/multi-brand platforms.
Spotlight CIO Adrian Ward-Smith says the decision to invest in an e-commerce presence was motivated by a number of factors. “The online channel for the Spotlight Retail group establishes another touchpoint for our customers to interact with us. It provides a mechanism to both grow our business and to improve customer intimacy,” he explains.
The company wanted an e-commerce platform to meet immediate needs while also accommodating future growth plans across multiple sites and multiple brands. “Our product range is very broad and we have a high level of promotional activity. The platform needed to be robust enough to handle our large SKU count, our operation in multiple countries, and ultimately service both the Spotlight and Anaconda brands,” Ward-Smith says.
“From the outset, we identified the need to have a Product Information Management (PIM) system to support our e-commerce business and found the inbuilt PCM within SAP hybris as a key differentiator,” Ward-Smith notes.
Peter Aarons, IT project manager, Spotlight, says the company evaluated a number of different providers. “A cross-function panel drawn from our Spotlight and Anaconda businesses scored all providers against categories such as fit with business requirements, vendor integration, partner stability and support, technical approach and financial impact. SAP hybris emerged as the clear leader.”
Furthermore, Spotlight was already operating SAP ERP, underpinning the selection of hybris. “Our immediate focus was to build a platform that gave our customers the ability to shop 24 hours a day, seven days a week. Core to our customer value proposition is our breadth of range, so we needed to replicate that online and chose to roll out department by department,” Ward-Smith says.
Phase one included getting the base e-commerce capability online including fulfilment processes from hub stores and launching a home delivery service with a flat rate of $8.99 per order for Australian customers.
Store picking and packing was facilitated through the development of an interface with a paperless picking system. When a customer places an online order, the system automatically detects which picking location has the capacity to fill the entire order and routes it directly for picking and packing. If no store has the complete customer order in stock, then the software will automatically split the order across two stores for dispatch directly to the customer.
The second phase launched in early September 2014, offering customers a number of additional functions, including the ability to buy products by the metre, such as Spotlight’s popular fabrics and ribbons, as well as bulky items that incur a higher shipping cost. The sale of gift cards was also added online and promotional catalogues integrated with the shopping cart. The final stage of the current release was launched in late September, to cater for New Zealand customers.
The SAP hybris platform integrates with SAP ECC for product data and SAP CRM for customer information. Spotlight has a significant VIP program, so it was important for the retailer to offer the same customer benefits online, and to provide a consistent experience across channels.
“From a product perspective, knowing availability of stock is key. We are currently enhancing our inventory integration to provide a ‘near time’ view of stock on hand, which is essential for displaying availability by store and for future ‘click and collect’ options. Fortunately, our back-end SAP systems were already receiving trickle feeds of transactions from our stores, making the integration relatively simple,” says Ward-Smith.
The back-end components of SAP hybris, known as cockpits, are being used by about 15 Spotlight business users to maintain product data, imagery and other aspects of website content. As the introduction of e-commerce touches most parts of the Spotlight organisation and affects many processes, the company had a dedicated change manager focused on communicating across the business and involving stakeholders in the transformation.
“Key to this is encouraging the organisation to think of e-commerce as just part of what we have always done, rather than a separate silo. It is still retail and we are simply interacting with our customers using a complementary medium,” Ward-Smith says.
In less than four months on the SAP SAP hybris platform, Spotlight is already fulfilling a significant number of online orders each day and now has close to 60,000 products available online.
“The whole online approach has been a major business transformation for us. The Spotlight business has never had an ecommerce site before so it’s been an exciting learning curve. The SAP hybris platform has been easy to use for our staff and smooth to operate on,” says Aarons.
The online presence enables Spotlight to extend its reach into remote locations that are not easily serviced through the store network, according to Ward-Smith.
“At Spotlight we have always had a high level of engagement with our customer. The introduction of hybris provides another mechanism for us to engage with our customers and for them to engage with us,” he says. “One of the key benefits of having the online channel is that we can use our CRM data to create a more personalised experience for our customers – being more targeted with things like our promotional offers increases satisfaction and helps build customer intimacy.
“As we progress, our online channel will become more and more integrated with our physical store network. From a longer term perspective, we wanted to make sure our platform would scale and continue to be developed in line with the e-commerce customer’s changing expectations, which are moving at lightning speed,” Ward-Smith says.
Spotlight continues to enhance its online presence, developing a mobile site and adding click and collect capability; Anaconda’s e-commerce site is also being ported to SAP hybris.
“Our short-term goal is for the online store to generate revenue in excess of one of our largest stores and we are well on track to achieving this,” says Aarons. “Overall, we aim to improve the Spotlight experience through better customer engagement and increase the number of VIP customer cardholders that interact with us electronically.”