By Joe Weller
As the lines between offline and online shopping experiences blur, omnichannel marketing provides the greatest challenges and opportunities for marketers today. Customers take control of the relationship as they use multiple media, devices, interactions, and conversations on their journey to purchase.
Engaging customers across the entire journey and making the right one to one connection throughout their relationship with your brand is the ultimate goal, regardless of device or channel. In this article, you’ll learn what omnichannel marketing is, see how some companies are using omnichannel marketing successfully, and learn tips to creating a strategic plan for 2017.
What is Omnichannel Marketing?
Media channels have always been evolving, but the current pace of channel creation and dominance (think Twitter) and those that fade from importance (think MySpace) is unparalleled. As channels continue to evolve and screen time increases, it becomes increasingly important to reach customers 1:1 and ensure that they don’t become disenfranchised (due to conflicting messaging or blurred branding across channels). According to a report from Deloitte Consulting, more than two-thirds of shoppers today are considered omnichannel consumers, which includes both digital and person-to-person interactions, and no smart marketer wants to miss gaining loyalty for their brand.
So what is omnichannel marketing? When Rajiv Arunkundram, Director of Enterprise Marketing at Smartsheet, was asked about his definition of omnichannel marketing, he said, “While there’s not a single standard definition, I would say it’s driving campaigns across multiple channels in an integrated fashion. You want the experience of a customer through the buyer journey aligned through multiple interaction points. Most customers navigate between many touchpoints to make a single purchase.”
In essence, omnichannel marketing is about making the experience real. One-size-fits-all marketing is a thing of the past, and all touch points all need to be relevant to the buyer. Every time you send an existing or potential customer an irrelevant marketing message, the likelihood of them bonding with your brand decreases, and they’re less likely to buy from you. Digital transformation is redefining almost every aspect of daily lives, so marketers must also become digital marketers as they deal with dramatic change in customer behavior, proliferating channels, and technology. Whether it’s B2B or B2C, the seller aims to deliver a consistent and uninterrupted brand experience however and whenever a customer is touched (digital, in-store experience, or phone) by the brand.
- What omnichannel feels like from the consumer perspective. Imagine you’ve been browsing rugs, and visit the website of a specialty rug vendor on your iPad© during your morning commute. You see a hand woven rug you like, select it, and place it into your virtual cart. You arrive at your destination, and don’t complete the purchase. The next day, you’re on the bus heading home from work and settle in with your smartphone for entertainment during the ride. As you read The Daily Beast, you see an ad from the same vendor featuring the hand woven rug that’s sitting in your online shopping cart – on sale. A few clicks later on your phone, and you see the rug you chose is waiting in your online shopping cart. You get home, survey your living room, and decide you’re ready to improve the look of your place—and your smartphone battery dies. You open your laptop, go to the rug website and complete the purchase. This is how today’s customers buy with an experience supplied through synched omnichannel marketing.
- B2C and B2B are embracing the omnichannel in a big way. While omnichannel marketing was originally created to drive B2C sales, the approach has been a powerful influence on B2B customers’ expectations, too. Just like B2C customers, B2B buyers now want 24/7 access, enhanced purchasing with a personalized experience, more connectedness and social media customer service, and price transparency either through online, in-store, or on the phone. According to a PFSweb whitepaper, global B2B eCommerce is expected to double the B2C market by 2020 to 6.7 trillion for B2B compared to 3.2 trillion for the B2C market.
- Molding the messaging to the customer. It’s all about shoppers getting the unified experience they say they want whether it’s in customer service, website, or retail ambience. While customers are interacting with your brand, make the most of the opportunity to gain solid information about them so you can accurately tailor your messages. “This is one of the great challenges for marketers today,” Smartsheet’s Arunkundram commented. “Whereas in the not-too-distant past, it was OK to come up with one message and keep it alive for 6 months, today we may have 100 campaigns tailored for 20 different audiences and 20 different channels. The speed of execution necessary to stay connected to the consumer is changing how people work, making messaging more difficult, and pushing marketers to do more and more as the complexity increases.”
The History of Omnichannel Marketing
How did this shift to omnichannel begin? It’s all about the boom in mobile shopping that began less than ten years ago. In September 2010, a report from IDC Retail Insights stated that omnichannel retailers in that year saw average transaction size increase 15-25 percent, and the profitability of loyalty customers increase 5-10 percent. The report noted said that the ideal experience is accessible on all platforms, from traditional stores to social media, text messaging, relevant emails, targeting ads and of course, online shopping. The conclusion was —and is—that investing in omnichannel is the pathway to future marketing success.
Leading innovators – and successful marketers – are making a point of linking mobile and in- store experiences as they collect data.
What’s The Difference Between Omnichannel and Multichannel Marketing?
‘Multichannel’ and ‘omnichannel’ are often used interchangeably, even though there is a significant difference. Below are more thorough definitions of the two terms:
- Multichannel marketing is the practice of selling products to customers through more than one distribution channel, for example, both in-store and online. Companies that structure their organization into swimlanes that focus on each channel separately deliver a customer experience that’s often different between channels, although it is easier to handle from a management standpoint.
- Omnichannel marketing is more akin to a web of channels (rather than separate, siloed tracks). It puts the customer first and understands that consumer behavior is omnichannel, mobile (even at home), and makes channel navigation seamless. A Google study found that local searches lead 50 percent of mobile users to visit stores. Omnichannel also means that people use several channels simultaneously. For example, using a mobile phone while checking a product in a brick-and-mortar store is becoming a norm. A store with an omnichannel strategy often supports this kind of interaction with in-store Wi-Fi or QR codes that links to product information.
In essence, the difference between multichannel and omnichannel marketing is the difference between tactics and strategy. Omnichannel connects all the dots in a way that multichannel doesn’t. “With the large home improvement client I work with at Smartsheet, we take a strategic perspective,” said Arunkundram. “We design campaigns holistically to ensure that the offers are right and then tie everything together – email, print, digital channels and PPC, and in-store. The big challenge is that many of these campaigns are brief – usually less than two months – so they overlap, and we’re working on the next one before the current one is completed. You have to stay nimble, think ahead, and keep collecting data to make sure you’re messaging to the buyer in a way that connects.”
Unlocking the power of the connected consumer is making a difference to many different companies.
The Importance of Data in Omnichannel Marketing
If you’re going to put the customer front and center, you have to make the connections that create a holistic experience. That’s where data makes the difference. “There are two aspects to consider. First, there is using data to drive segmentation. Then there is the measuring of everything from what is my cost per click, and can I qualify that on a time basis, waiting logic, content – this is very complicated, but necessary to refine the targeting,” says Arunkundram.
“You must be diligent about data collection,” he continued. “The data at the end of any campaign is only important if you are measuring strictly against the goals (which should be KPIs) you have set for yourself. Whoever is working on the campaign needs to keep those at the forefront, and share that data to refine for the next campaign.”
Here are four ways data can improve the brand experience for any company’s customers and prospects:
- Strive for data that’s multidimensional. Gather data from offline and online sources to understand all the customer’s touchpoints.
- Remove silos. Stop any organizational issues that hinder data integration so you can fully understand the buyer’s journey.
- Understand behavior patterns. Establishing patterns of behavior at a granular level. In fact, Arunkundram says that the process will be more about "small pieces of data than Big Data."
- Increase relevance. Clearly plan – and be prepared to make changes based on data – around what your brand will do to deliver messages and experiences that have meaning and relevance to each customer at the right time, in the right place (including in-store and over-the-phone), and on the right device.
One of the most challenging aspects of campaigns in the omnichannel era is their short duration. “For B2C, campaigns are very short,” said Arunkundram. “For B2B these days – a buyer goes through six channels before they make a purchasing decision. The hard question to answer is ‘how is each channel and each campaign driving to the end result?’ Instrumentation needs to be consistent. Let’s say a new lead downloads an eBook. You follow the lead through the lifecycle, and when it finally closes, you know that it started there. How do you weigh all of the interactions? What matters? Sometimes it is less of a standard template and more of a business decision. For me and my clients, we keep refocusing on the goal, and what is the KPI? You need to go back to that.”
Benefits of Omnichannel Marketing
The flip side of all the challenges and hard work involved in creating a seamless, connected and compelling brand experience is that you can answer a major customer expectation: 90 percent of shoppers expect their experience to be consistent across all channels and devices.
The benefits, like the omnichannel experience itself are all interconnected:
Deeper customer understanding. Taking advantage of data collection to improve insights will help your brand identify customer behavior and more importantly, their purchase behaviors.
- Improved brand reputation. Ubiquity, online or offline, increases the reputation and credibility of your brand. The more ways and places your brand shows up, the more recognizable it will become to the buying public – and to your target customer.
- Increased revenue. The more present your brand is, the more traction you have with customers and prospects. When customers engage with your brand in multiple areas, they simply have more opportunity to purchase online or offline.
“A cosmetics retailer we work with creates nuance based on the channel for a particular campaign to sell a specific type of product,” said Arunkundram. “While the message changes for all 17 channels, the CTA stays the same. The 17 variants hang together with no conflicting messages, and go out in a cohesive way no matter where they are seen. This is so much more complicated to execute in terms of messaging and the sheer volume of work to get it out the door. But it is successful and we continue to refine every aspect of the campaign to improve results even further.”
Rigorous and thoughtful implementation of omnichannel marketing and making the most of data are the cornerstones for success, and can even bring troubled companies back from the brink.
Challenges of Omnichannel Marketing
With such a wide-ranging approach that uses multiple channels that also requires hyper-segmentation, omnichannel marketing creates a unique set of challenges for brands. There are new hurdles and new channels that keep cropping up on an almost continuous basis. Most can be categorized in three general areas:
- Highly personalized messaging. Thanks to the abundance of channels and options customers have, delivering the right message to the right audience isn’t enough. Customers need to receive your message, but they also have to be rapt, open and willing to engage.
- Highly choreographed campaigns. The customers are in-charge, and they decide on the channel and device they want to use. Marketers must continuously create and coordinate meaningful and trustworthy micro-campaigns and touch-points that fluidly span multiple channels.
- Marketing response attribution. Taking response attribution away from rules-based models and moving to a data-driven, evidence-based approach is more difficult. It also means you can target with greater precision and harvest more valuable insights. From there, you’ll be able to allocate budgets and design strategies for the greatest impact.
When you have such a major task, it may seem logical to add more marketing team members or outside agencies. “The problem doesn’t go away when you throw more people at it—what’s important is that you can tie your omnichannel efforts together in a seamless manner, and adding to the scale can actually make doing that more difficult,” said Arunkundram. “What’s really important is that whatever you do is focused, and that everyone is on the same page. For example, in the work we are doing with one of our own clients (a cosmetics retailer) there are between 20 to 50 channels to manage in a cohesive way. What’s important is to communicate and to measure - and keep measuring - against the goals you set.”
Loyalty is retailers’ goal - not just so customers come back for your product or service, but because of the convenience you can create for them when they stand with your brand.
Case Studies in Omnichannel Marketing
Case Study #1: Omnichannel Marketing Boosts Stock Price – Dick’s Sporting Goods
A Fortune 500 corporation, Dick’s Sporting Goods company’s stock price has been showing impressive gains from the expansion of its customer-oriented focus and its investment in omnichannel marketing. After a hard look at shifting strategy, the company has built a much stronger loyalty program app. Weekly specials are sent to a geographic area near a brick-and-mortar location, and in-store sales people have their own mobile devices to assist customers with online ordering while they are in a Dick’s Sporting Goods store. Customers also have an added benefit, since they can pick up online orders at a physical location and avoid shipping payments. As a result, ecommerce sales have grown by 50 percent in local markets with a brick-and-mortar store.
Case Study #2: Omnichannel Marketing Marries Mobile to Physical Stores – Apple
Apple keeps making improvements to ensure that its mobile and store experiences connect to each other and enhance sales. Customers book support appointments at an Apple store’s Genius Bar through the mobile app (or online). When customers arrive, the store app messages confirm requests and let them know when a tech will be available. For customers who order online for in-store pick-up, a detailed alert with relevant order information is sent when their mobile device senses they are near the Apple store. As transactions happen, data is collected and analyzed to ensure next-level brand experiences.
Case Study #3: Omnichannel Marketing Connects with User Centricity – Bank of America
Bank of America has a customer-centered, channel- agnostic model that’s resonating with banking customers. The company’s current digital touchpoints are dynamic and seamlessly integrated across desktop and mobile, and also support check deposits, bill payments, and appointment scheduling. For the 46 percent of Americans who manage their finances online, it’s essential that they have a connected experience that builds trust. It’s not just a technology issue, and Bank of America continues to think differently about every customer engagement as it builds new, improved, more personal functionality to meet customer’s banking needs.
Case Study #4: Omnichannel Marketing Creates a Turnaround – J.C. Penney
J.C. Penney was almost written off in 2013 – the year the company had to issue shares just to pay its bills - but when the 100-year old brick-and-mortar retailer turned to omnichannel marketing to reinvent itself, the company went from shaky to more solid ground. By remodeling its systems and adding data analytics to help it further improve omnichannel services, such as buy online, pickup in-store and mobile commerce. CEO Marvin R. Ellison notes that customers who pick up their online orders in-store have a 35 percent attachment rate, which means that they buy another item in store during their visit. “We are repairing a broken online business, and in the second half of 2015 we developed true omnichannel capabilities,” Ellison said. “The development will allow us to share inventory from brick-and-mortar store locations with our dot-com area and have seamless connections with our customers, how and when and where she wants to shop. These new capabilities allowed us to deliver record holiday online sales in the fourth quarter and we'll continue to have plenty of upside to grow.”
Case Study #5: Omnichannel Marketing Brews Up Loyalty – Starbucks
Starbucks Rewards app allows you to order your coffee, snack or meal ahead of time, find the nearest Starbucks, and get directions. That’s just the beginning. A free rewards card can be used whenever you make a purchase. You can review card status and replenish funds using a smartphone, Starbucks website, at the store, or via app – you can even send gift cards. Every change you make is updated in real-time across every channel. If you’re standing in line and realize you’re short, you can reload your account on the spot before the barista serves you. Starbucks knows what their customers love – convenience that feels like just-for-me.
7 Tips for 2017: How to Create Your Omnichannel Marketing Action Plan
Every good marketing implementation begins with a plan, and because of the scope of what true omnichannel marketing must deliver to be effective, it requires a concerted and coordinated effort. Here are some things to think about as you develop plans for the coming year:
- Create and maintain a single view of the customer. For 1:1 marketing, a tool that consolidates all customer data in one place regardless of source makes sense. Remember, it’s not the amount of data that’s important; it’s understanding who the customer is and what he wants.
- Your customer view must progress. Everything changes these days, fast, and your customer view has to change as well. That means bringing in fresh data, updating old data, creating new models and establishing best practices that make sense for your product and/or service, but above all, they must make sense to your customer.
- Create consistent customer experiences across all channels. While the quality of the customer experience is important, consistency is equally significant, because your customers experience your brand holistically. A positive online experience can be negated if the in-store interaction is poor.
- Be nimble and quick with channel tracking. Allocating marketing funds to the right channels has always been tough – and it will become progressively more difficult in the future. The access to data around your target customers gives rise to endless possibilities and more challenges to message consistency. You’ll need to be ready and able to leverage the dramatic increase of user engagement in the digital sphere.
- Up your content quality and forms. Content is still king and represents your brand in the digital world. High-caliber content sells the product, answers questions, and builds trust. As a result, you create a sticky experience that keep your customers coming back. Content should take many forms, with an emphasis on video. Video content draws a customer’s attention, and maintains it by demonstrating your brand personality and particular attributes. You’ll gain a better Google ranking, improve click-through rates, and appeal to more mobile users.
- Keep an eye on your KPIs. This should be the first and last item you check against as you develop an omnichannel action plan. With all the complications involved, it can be easy to lose sight of the ultimate goals. “One thing that can’t be stressed enough is ensuring that you are working on the right thing. That means you must focus on your established KPIs, and consistently measure against those,” said Arunkundram.
- Establish a unified platform. Success in omnichannel marketing isn’t determined by which channels are being used, but by how well they are integrated. Using a marketing platform that enables the integration of traditional and digital channels makes it easier to create and execute cross-channel campaigns that support segmentation, enable predictive analytics, content management, next-best-offers for inbound and outbound programs and accurate response attribution.
“One of the things Smartsheet does is drive the level of standardization with real time reporting and visibility to the entire team, and make sure that you are all working toward the same goal. Then you can build on that – for example, with the refinement of email campaigns,” said Arunkundram. “You should be able to look at what has worked in the past – and what has not. Consistency in execution is of the utmost importance and the way to develop best practices for your particular brand.”
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