Omnichannel: what is it, and why is it an opportunity for companies
First, omnichannel means blending physical and digital channels together to provide a unique brand experience to customers. It means changing the approach, not only to marketing, but to the organization as a whole, which, once and for all, must place the customer at the center.
Creating a unique experience for your customers is what will make your company stand out: blending all the channels you own (email, SMS, Apps, physical store, social media, etc.) into an unique ecosystem will bring synergistic value, allowing you to strengthen your engagement with customers and create an original and innovative image of your brand compared to the competition.
The Purchase-Orientation touchpoints
The study “Total Retail Survey 2017” carried out by PwC, which sampled more than 24 thousand consumers in 32 countries (including Italy), provides some very interesting data on the profile of the Italian consumer: very active on mobile devices (Italy ranks third in the world for device penetration), has increased the number of connections from smartphones by about 44%, compared to 2016, at the expense of the PC (-14%); Mobile device usage is widespread across all phases that proceed and follow purchase, from researching reviews to leaving feedback.
Data from the latest research by Netcomm in collaboration with MagNews “The digital consumer in the mirror” shows the importance of digital in driving purchasing choices even for the 30% of Italian consumers who shop offline, but only after they have looked online for information and reassurance about a particular product.
Consumer shopping journeys are very different, and are linked to specific habits, needs and levels of confidence towards the various tools provided by the company, both online and offline. It is unrealistic to generalize a single digital consumer, just like it is with a “traditional shopper”: Consumers are all seeking unique and customized purchasing experiences with their chosen brands. Businesses must use all the data and technologies at their disposal to precisely understand the behaviors of their current and potential customers. The omnichannel approach is necessary to create unique and loyal relationships.
Multichannel / omnichannel
To understand how to create the perfect synergy between the channels best suited to our target audience, a clear picture of the context is necessary. In the first ten years of the new century, a digital revolution literally broke out, giving people access to information from a variety of sources, which made us all “information hungry”. This increase in capabilities has made it more difficult for companies to spot the right touchpoints for intercepting consumers,which had previously allowed them to control purchasing orientation channels (11 on average, according to Netcomm’s research in collaboration with MagNews).
The spreading of touchpoints is therefore at the core of Multichannel: promoting, distributing and selling the brand through all available channels (Shop, eCommerce, Social Media, Mass Media, Email, Apps, etc. ..). In this approach, each channel is managed independently, with its own set of specific KPIs: revenue for a physical store, or conversions for an eCommerce site.
Creating synergy between channels is fundamental, but this approach is not yet as widespread among companies: Our research “Everywhere Commerce and Store Digitalization”, conducted in collaboration with Popai, showed that only 10% of companies combine promotional or informative SMS messages with emails.
Company and Customer: a new relationship
The new company customer-approach, originates first of all from a totally different view of the customer. By placing the customer at the center of the corporate strategy, and trying to give them increasing value over time, we can identify the most appropriate channels for acquiring and retaining the best customers, by working on the customer experience.
This customer-centric approach requires integration (or at least a sustainable integration project) of the touchpoints most important for customer contact, as well as an evolution of the multichannel marketing strategy; in a nutshell, control of the multichannel experience ensuring that the decision-making journey – from researching information to purchase and post-purchase – is as streamlined as possible. This gains even more value if each unique interaction is customized based on the data we obtain on each of our channels. In this way we can provide a unique experience to each individual user, optimizing the value offered as well as the image of our company
What are the advantages?
- Creating a diversified ecosystem
- More loyal clients
- Growth of the company’s reputation
- Improvement of internal performance, due to greater interdependence between teams
The Omnichannel Retailer
Therefore, in a context where the consumer is highly informed (both about our products and those of our competitors), retailers need to look for new business models that can come ever closer to the consumer’s expectations. Our research “The digital consumer in the mirror” highlighted some relevant data on the typical customer journey of a retail customer: the use of digital has significantly increased the number of touchpoints (both online and offline), activated during the decision and purchase-orientation phases. Therefore, companies must take action to intercept these searches, which very often fluctuate between the digital and physical worlds.
Another interesting aspect is the consumer’s search for a “salesperson 4.0” (“Total Retail Survey 2017”), who knows exactly what offers are also available online and who, for some consumers, remains the first purchase orientation touchpoint (e.g. “Adamant conservative” cluster).
Retailers are expected to have a customized approach consisting of knowledge, understanding and the ability to customize the message according to consumer preferences. It takes the ability to integrate and analyze data from different sources (from the physical store, to the shop, to social networks, to email behaviors) to build a lasting relationship retailer-customer that becomes decisive for the success of the company.
To create synergy between channels, we can start from Email, the first “point of contact” with our consumer.
How to use email as the source of the multichannel marketing strategy
Email marketing activities can provide a myriad of useful data for analysis: conversions, level of user interest for specific initiatives (open and click), conversions (purchase following an email), and level of engagement. These data allow us to identify different profiles according to various preferences, so that the content proposed by the brand is actually in line with these preferences (customization and relevance). Email is also an excellent driver for drive to store actions: for example, starting from a click on a message and the recipient’s geographical position, we can send a discount code to be used in the nearest store; or, we could integrate the loyalty program, informing the client about their current point balance and their dedicated offers, thus blending the physical and digital shop experiences.
All this shows that email is the easiest and most effective channel to activate for creating the connection between our offer and the customer’s demand, as well as maintaining an active and fruitful relationship for both parties (by sending newsletters or new initiatives).
Finally, direct email communication is the most efficient method when it comes to purchase completion on both the online and offline channels.
Analyzing the effectiveness on both channels gives a very interesting result: email is the top driver for online purchases, and the second for offline purchases. Therefore, we must always carry out relevant communication.
A few examples
Let’s look at how some industries have already started to implement omnichannel strategies.
Give customers the ability to pay bills, recharge their phone credit and make wire transfers directly from the App on their smartphone.
Would you like more specific examples concerning the banking / financial sector? Check out our guide to Email Marketing for banking and finance.
Fashion and apparel sector
Within physical shops, some technologies are being implemented to view and sort products from the online catalog, to virtually try clothes on in a sort of “virtual dressing room”, and, again, obtain promotions through the App when near the store.
KPIs to analyze
When measuring the KPIs of omnichannel strategies, we cannot refer exclusively to the usual metrics (revenue, sales, EBITDA, etc.) Which are nonetheless useful to assess the outcome of the investment. In contrast, the most relevant ones are the customers’ engagement and conversions, the duration of their Lifetime Value, loyalty as well as the in-depth knowledge of the customer and their perception of the brand. These KPIs do not seem at all related to the final “receipt”, but this is far from the truth, indeed, being able to create the right perception of their brand is essential in an age where the customer experience is indeed the field of competition.
We have seen that in today’s world, there is a focus on the customer and “life-cycle” towards a company, which is also gaining increasing relevance for entrepreneurs. The challenge remains to create the conditions needed for this to happen: unify the efforts of your channels into a special company ecosystem, which can provide the best experience to the customer, technologies that give you the ability to keep everything under control. Clearly, there is still a long way to go for this strategy to be fully mastered, but companies now have all the means necessary to take advantage of the opportunities that omnichannel, but more generally a customer-centric vision, offers to all those who are up to the challenge.