There is a continuum of strategies for handling back-end functions for your direct-to-consumer campaign. On one hand, a marketer can select multiple vendors — one to service each function (think order management,
fulfillment, and customer service). On the other hand, a
marketer may select one vendor that provides all services on
a turnkey basis.
Which is a better strategy? There are many factors to
consider and ultimately the marketer will have to determine
its comfort level with any providers that they are considering.
What are the advantages that a turnkey solution provides,
should a marketer choose to take this path?
The turnkey provider offers a degree of cohesion that sin-gle-service providers cannot match. Communication is not
only streamlined — with fewer entities in the mix — but is
also more consistent.
The turnkey provider can speak to the marketer about all
areas, at one time and in one format, leading to faster reaction time and less opportunity for miscommunication.
A good turnkey provider shares information across functions, and with the marketer — often in real time. This
interconnectivity can translate into lightning-speed problem
identification and resolution by leveraging data from one department and applying it to the other.
For example, if customer service begins receiving calls
about a product defect, the manager
in a turnkey environment can walk
down the hall and ask the warehouse
manager to go look at the items in
stock. If there is indeed an issue, the
marketer can be notified and addition-
al shipments can be stopped until a
resolution is put into place.
Savings in Multiple Categories
; Selection and implementation.
Selecting vendors takes time and effort. A marketer talks with multiple
vendors for each function, resulting
in 10-15 — or even more — options
to consider. With a turnkey approach,
multiple vendors are still evaluated,
but each is offering a complete suite of services, saving
time without sacrificing choice. The same can be said
for implementation. The upfront contracts and legal
work, product and campaign setup, and integrations
are all simplified through a turnkey model.
; Service cost. When marketers bundle multiple functions together, they become larger and more attractive
to the turnkey provider. For example, a campaign that
has 1,000 orders per week, while also needing customer
service, order management, and returns management,
can leverage all of these needs by keeping them together. The turnkey provider on the other hand, sees
efficiencies by integrating all of these services.
; Management. A one-stop-shop also means a single
client services department to help with a wide range of
needs, including: offer changes, SKU setup, scripting,
etc. Additionally, the benefit of receiving one itemized
invoice, which can be paid with a single payment, saves
administrative time and makes reconciliation easy.
; Inventory management savings. Some marketers utilize
different vendors based on the type of fulfillment —
retail vs. direct-to-consumer. This requires the splitting
of inventory. This is inefficient, inflexible and costly.
Stocking inventory in multiple locations will likely
require more inventory overall, due to the complexities
of having the right product in the right places. Second,
with all inventory in one location, the marketer can
react to the ebbs and flows of different types of customers. For example, a larger than expected retail order
can be handled by “borrowing” inventory from the
direct-to-consumer allocation. Or if the direct-to-consumer campaign changes, having additional stock
available to draw from increases the response speed.
Another opportunity for making your inventory more
efficient is to place returns and refurbishment under
the same roof as fulfillment, allowing product to be
quickly and efficiently injected back into inventory.
Peace of Mind
The ease of communication, often with one point of contact, empowers the marketer. You know who is handling the
issues and where accountability lies because there is one entity responsible for all of these functions. The payoff? As you
work closely with your valued turnkey provider, your communication and teamwork constantly improve, allowing for even
greater trust — and peace of mind. ;
The Power of Turnkey