Retail is changing from
"location, location and
Forrester Research 06/2008:
Multi-channel increases retail business by 44%
Kim Østergaard, email@example.com
Are you seeing it like your customer
Is your brand siloed in the minds of the consumer?
When you look at it from the inside - or the management-led
way - how many silos do you see?
Multi-channel is about merging it into ONE channel
Information about me
32 year old Dane with 11 years of e-commerce experience
2 children and a lovely wife :)
Was in 1998 one of the pioneers in hardware box-moving
Established an online department in an ad-agency just
before the millenium (ISP+ESP+creative services)
Founded in 2003 TrendyBaby.dk (.se + .no) together with
my wife, grew it to +140.000 members and +50.000
customers in 3 years. Drained by growth ...
Established Bestseller Online in 2007 (left two weeks ago)
and grew the organization to +60 employees.
Strategic goal: To secure the retail future of Bestseller by
implementing multi-channel retailing and multi-channel
marketing using customer intelligence to increase sales in
all channels by turning prospects into customers and
customers into active advocates
The current growth will not alone come from fancy
technology - but from plugging good products,
service, deliverability from stores onto the Internet.
Soon nobody will talk about multi-channel - it will just
be there as phone and e-mail are today.
Some facts about online / multi-channel
54% of shoppers choose the online channel because it
saves time - also named as the convenience factor.
40% because they can locate hard to find items - multi-
channel is the most cost-effective way to extend the in-store
Only 34% shop online because of price. This does vary a lot
between product areas.
The credibility of the public is the
true value of every brand
From location to: "What do
you know about your
... and how to use the knowledge to
create more business?
Why is knowledge that important
Ultimately consumers buy from retail brands, not retail
channels. They expect to be able to get the same product
information, services and inventory availability from all
Convenience is the key driver for the consumer - how do we
as merchants (retail chains/brand owners) live up to today
and tomorrows expectations.
The customers are more demanding than ever which gives
us new possibilities to communicate - but we need to
'remove' the noise and be very targeted.
Let's look at some ways of communicating targeted with
the consumers ... (and not to, it should be a dialogue)
It is essential to deliver a compelling and consistent brand
message accross all channels.
Targeted multi-channel communication
Communication needs to be compelling and inspirering.
A good mix of brand, products and intelligence.
The goal is to increase the percentage of active advocates
(or ambassadeurs / very loyal consumers).
Some practical examples:
Sign-up customers through SMS in-store and use text
messaging to optain the e-mail address.
Sign-up online and trace which products the consumer
are browsing. Enrich the profile with the info.
Offer free value membership in-store with card. Use
'would you like to have the receipt e-mailed' - combine
basket and card info - use predictive intelligence to
suggest best match for next purchase.
The Internet can hold almost anything
- in the multi-channel world you can extend the in-
store assortment online
84% of US consumers prefer
retailers with multi-channel
operations / merged channels
... tomorrow they will demand it
The power and the money
- why we need to change with ...
The power is going back to where the money's always been:
In the hands of the consumers.
In the 80's the manufactors decided which products
where available to us.
In the 90's and up til now the retailers (and large
department stores) have had the control.
From now on (maybe first 2012 in the northern mainland
Europe) the consumers will with the social and engage
tools available take control.
Maybe some of you already experienced a product
get extra succes with viral power (see next slide)
Maybe you heard about some products flop because
of negative feedback on FaceBook, Twitter and other
social medias (Social and Engage).
Marketing challenges (marketing 2.0)
We need to understand our target group and define
What does your marketing department currently focus on?
Most CMO's focus on 'which media can we buy' and how
is our overall 'expression'. They are still looking at the
Internet as an electronic brochure (flash focused) for full
Now we need to focus on 'how can I best influence my
customers to purchase?' (going back to knowledge)
Analytic data should be combined with persona profiles and
create the foundation for behavioural campaigns and
tailored (real-time) e-commerce sites.
The level of insight we can get online from campaigns
are significantly better then earlier.
Nordstroms: Use good judgement in all situations ...
Social 2.0 - consumer driven innovation
No company today can innovate fast enough - not even the
largest companies around. Just look at what Google did with
Wave - they presented it for developers to do API's long
before the product is ready for launch.
We need to learn from Google and others - and open up, be
social, with our customers. Fashion companies can ask
selected members/customers to be prosumers - and help
select colours and patterns etc .....
Web portals are the hub to consumer driven innovation
Amazon is another example they are inviting others to
develop and use their products to sell.
Even the social platforms like Facebook and MySpace are
inviting other to develop applications.
We shouldn't be afraid of 'some' stealing our business. If our
business is original - it will last ...
Engage 2.0 - how to foster loyalty
The lowest acuisition cost for online customers (e-
commerce) are through customer clubs.
Customer clubs are permission based marketing where
subscribers can turn into loyal members / customers.
If you have an impressive physical presence - the
customers are expecting the same online.
Our most loyal customers are named active advocates - and
have the highest shareholder value.
Online we need to use the data collected - so every page is
seeked optimized - give them what they want.
Add social tools to sites - like blogs, forums, reviews, wikis
and other social elements.
Be represented on the large networkds like Facebook,
MySpace, Twitter and similiar - but have something to say!
Have you tried to calculate the online potential ...
Challenges in building multi-channel
Organizational readiness? (this will drive some big
changes in the organization)
As senior management (owners, CEO ...) you shall be
ready to handle the management task of setting sails
for the biggest change ever.
All stakeholders should be indentified - all the way from
the board to store managers. What 'cheese' will be
moved from each of them?
Does your organization have excellent communicational
The task of aligning retail IT-systems can be huge.
I've earlier selected Websphere Commerce because
of it's openess through other systems like DOM's
Skills / areas that need to be covered
Brand marketing should be able to identify/produce:
Marketing strategy including the brand DNA's.
Mock-ups on new directions for the web-designers to
follow and implement.
Produce the universe or branding part of the site.
The brand identity and personas.
Give the communicational guidelines.
Marketing plans shall be much more detailed and start
focusing on how to influence the customer to purchase.
Retail events are to merge with online plans - therefore
marketing needs to be involved (follow guidelines).
Produce the content for the web, campagins, also the
social- and mobile content - new channels will evolve
over time. Also image based photos.
Handle the overall "Expression" of all channels.
Skills / areas - #2
Online retail is not just retail
Online retail is not something the retail department 'just'
can handle. Everything we previously discussed are
fundamentals for succesful online retailing.
Merchandising and stock responsibility
Retail collaboration is very important. For succesful
implemented multi-channel retail the training of in-store
employees are fundamental.
Online marketing has nothing to do with marketing on a
SEM and affilite based marketing
SEO and SMO are often placed under online marketing.
Project planning could sometimes be a political
nightmare - with toooooo many stakeholders.
Skills / areas #3
Product photography - all styles/products needs to be
Video for 3D feeling and catwalk if fashion - are recorded for
a 30% increase in conversions.
Product copywriting - all products needs to be described
and often wholesale data lacks with details like washing
instructions / technical information.
Platforms for e-commerce and m-commerce. They need to
be integrated for stock visibility and more.
Customer Service - many customers from stores/brand will
seek online support.
Logistics for B2C - can you reuse the existing warehouse.
E-commerce web-design with knowledge of usability and
site architecture. How design fulfill the strategy and KPI's.
Skills / areas #4
Front-end scripting. The design are here brought to live -
ready to be implemented into the commerce solution.
Technical team skilled to handle the platform, hosting,
integration with ERP and base systems, implement front-
end scripted code, support the business - and much more.
Web-analytics and CI responsible.
Customer Club system (ESP) integrated with Web-analytics
and Customer Intelligence systems. Behavioural targeting /
personalization are based on collected information.
Controller function knowing which numbers to measure. You
should define both the KPI's and critical identificers.
Online management being able to inspire and lead the
battle from multiple channels into multi-channel /merged
Please contact me on kim@imd.
or phone +45 4244 0011
Would you like this presentation -
please e-mail me, and I'll share it
through Google Docs.