“Omnichannel” is one of those commerce buzzwords that gets tossed around casually like “Big Data” or “Personalization”. When mentioned during a quarterly planning session, wise heads nod knowingly around the conference table while glancing at each other for silent confirmation. And unfortunately, like so many buzzwords, few can define it and even fewer can plan an effective strategy around it. In this post we’ll cover some definitions to level-set and cover some of the “why.” In subsequent posts we’ll cover the “how” and basic strategies.
Fun fact: Your customers don’t give a rip about channels. Technology stacks don’t really interest them. Attribution isn’t a concern. They just want to purchase something from you as efficiently as possible and an effective omnichannel experience can be the missing ingredient.
Let’s give ourselves a foundation by covering some basic channel definitions. If you’re selling your products through a solitary outlet – which could be a webstore, brick and mortar, Etsy, eBay, or the back of your pickup at the local Farmer’s Market, then Single-Channel would describe your strategy. This approach has a few advantages although growth opportunities can be limited.
The logical step up from Single-Channel is Multichannel, which means that your business has multiple outlets to connect with your customers. This could include the previous examples under single-channel, but also social media, email marketing and newsletters to name a few examples.
Omnichannel looks a lot like Multichannel, with the critical difference being that all the channels are connected rather than siloed with their own technologies and possibly support staff. Done properly, one’s customers shouldn’t even be aware of the magic that’s happening in the background.
Using DirecTV as an example – if you had a satellite receiver on a TV in your home, that would be single-channel. Perhaps you’ve stepped up your game and have many receivers on their respective screens scattered throughout your home – multichannel. Remember those commercials where the actor had their movie follow them throughout the house on the various televisions for an uninterrupted experience? Omnichannel.
Earlier we said that your customers don’t care about channels? Unfortunately, ¾ of them actually do shop in multiple channels. (Today’s customers use an average of almost 6 touch points) What they really care about is their experience, not your strategies and technologies. Executed properly, omnichannel commerce is invisible, albeit expected, as a whopping 98% of those surveyed demand a consistent experience across your various platforms. Lucky for you that only 7% of retailers provide the opportunity to “start a sale anywhere and finish the sale anywhere.” There are many opportunities here to differentiate yourself from your competitors and get ahead of the curve.
If it’s so obvious, why doesn’t every retailer get this experience right? Like that smartphone in your pocket, it takes a lot of work to get something so complicated to appear simple. Additionally, even if a sound strategy is developed, execution is often a hodgepodge of standalone technologies. Oftentimes a multi-channel company tries to make the jump by “simply” stitching their existing platforms together, which rarely works. This gets expensive, and those connections can be very fragile. A failure in one area can bring down the whole house of cards, with the fixes often being nothing more than band-aids. Often, those standalone technologies are managed by different groups with competing agendas, which runs counter to the idea of omnichannel.
Since our ultimate goal is increased revenue, let’s look at 4 benefits of an effective omnichannel strategy that will help us get there.
- Improved Data Collection – It’s 2021 so we can all agree that the better data we can gather and utilize, the more effective our various strategies can be in trying to reach our target demographics. How many “likes” or “shares” you get on the company Facebook page really only matter to your social media manager, just like the traffic to your website really doesn’t provide much insight in a vacuum. What kind of impact does 1921 views of your latest blog entry actually have on your bottom line? With omnichannel it can be much easier to track customers as they move through your system and provide more detailed analysis. Would it be helpful to know that Facebook traffic sent 31% more traffic to your latest blog post and you saw a 14% bump in new customer purchases from those who read the article? How about a 57% sales spike in those products that were mentioned in both the Facebook post and the blog? A gross oversimplification perhaps, but this is the genesis of effective omnichannel commerce strategies.
- Better Shopping Experience – Do your customer prefer to shop in person, or online? Do they want to be contacted by email, SMS, phone, or smoke signals? With a proper omnichannel strategy and implementation, you’ll be able to provide a consistent experience no matter their method of interaction with your brand. In 2021, customers expect all interactions with your brand to be knowledgeable and efficient. Consistency is very difficult to provide when the various channels are siloed. The data you gather (see #1) can inform on areas requiring improvement.
- Loyal Customers – it’s no secret that your best customers are your most loyal customers. Not only do they spend more with you, but they are the best marketing one can ask for as they spread the word more effectively than that really cool Instagram post you did last Christmas. Discount coupons that rarely hit their targets are like shotgun blasts and also condition your customers to never pay full price. Engaging and personalized brand stories (informed by your optimized data collection in #1 above) are more effective at creating long-lasting loyalty.
- Increased Traffic – This can be measured in many ways; web or physical traffic, shopping carts, social media interactions, and blog engagement to name a few. The more consistent and tailored you make the experience, the more likely your customers are to interact with you on different channels. Studies have shown that for every additional channel used, your shoppers will spend more money in your store.
Hopefully at this point you’ve got enough knowledge to perhaps begin discussions with your team. In future posts we’ll look at some practical strategies and mention some of the technologies we’re using here at Blue Fish to help our clients provide a unified experience for their customers.