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How to Achieve Multi-Channel Nirvana


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A whitepaper examining the routes to a successful multi-channel strategy for today’s forward thinking brands and retailers.

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How to Achieve Multi-Channel Nirvana

  1. 1. Multi-channel Nirvana for Brands and Retailers Most retailers today understand the need of having a brand presence in multiple channels. Indeed, most money-making retail brands will not only have stores, but a transactional website and a catalogue, too. Yet that is no longer enough. Retailers must now look to implement a true multi-channel strategy – one where the different ways of transacting complement and grow the others for the benefit of the whole business and the customer. At present there is no consistency of message or approach across these media: not only do these channels not talk to each other, they are also left fighting against each other for the same customer. It is partly because these channels have grown independently of each other, implemented at different times and grown at wildly differing speeds – witness the explosion of ecommerce over the past decade – there may once have been a business rationale for keeping units siloed. Today’s shopper often has to register three times for the same company across its channels, and is counted as a ‘different’ shopper at each. Where brands are striving to be – where we are advising them they should be – is putting the customer at the centre of their brand’s universe. All a brand’s touch-points should be consistent in message and be feeding to and from each other in a virtuous circle of activity. Some have started down that road. Retail giants such as Marks & Spencer and John Lewis are investing heavily to create a seamless cross- channel customer experience, but for a large retailer, it takes time and money. Those that have not already started down this journey yet may find themselves left behind. Retailers must consider a single-minded view where a customer is a customer however he/she transacts. There are reasons why this hasn’t been possible until now, but savvy retailers today have all the tools they need to action such a strategy. email: web: blog: twitter: @pod1
  2. 2. Multi-channel Nirvana for Brands and Retailers Upgrading technology and that means that they’re actively encouraged to log on and order the item for delivery for the Retailers must put in place a system that customer rather than risk losing the sale. allows for multi-channel conversations to be had. This must encompass till systems, Just that one piece of accounting policy means website sales, warehouses, catalogue stock that John Lewis is immediately thinking in multi- systems and so on. If the customer is to be channel terms. It doesn’t care which channel you able to ride seamlessly between touch-points buy from as long as you buy from John Lewis. your brand must already be doing it. It takes time and is expensive, as it requires Consider how customers interact extensive upgrading or completely changing on each channel and how best current systems. Newer or smaller retailers will have the advantage of being more fleet of foot, to leverage this being able to implement such systems without Look too, at how the likes of John Lewis and too much trouble, but beware: such a technology Marks & Spencer are encouraging you to buy, upgrade does not come cheap, albeit one you can collect and return goods through any one of the ill afford to implement soon. different channels they offer. Such policies not only offer greater convenience Changing accounting systems to customers but also educate them to experience the brand seamlessly in their preferred way. Not Pertinently, a brand’s stock system needs to be every customer interacts alike. Indeed, whilst central, and this should also lead to a change some consumers will only ever search and buy in in accounting procedures. stores, others will research online before heading to the store to buy, or they’ll buy online or over the At present the marketing and store managers for phone and collect in store. the website, for the catalogue, and for the stores each have their fiefdoms – they don’t want to be Some customers will only ever buy on the phone, driving sales to the other if it impacts on their or online, or in the shop but they are using those sales and bottom lines. Equally, they don’t want to three areas to interact with the brand. be refunding on stock that has been purchased via a different channel. What we’re finding is interaction is very different in each occasion. It’s integrating those three But take , for example. John Lewis experiences and that takes time and effort. is probably the leader in multi-channel, and is now It’s about signposting in store, messaging on recognising that an online sale should be based a catalogue. on where a person – a customer - is. It records online sales to the nearest store to where the item is being delivered. That means that in-store personnel are beginning to understand and advocate the importance of the online channel. They know that if it’s not in stock in store but is online then that sale will be allocated to them email: web: blog: twitter: @pod1
  3. 3. Multi-channel Nirvana for Brands and Retailers Retailers should be encouraging customers When you’re talking about luxury goods multi- reading their catalogue to also go online. Thus, channel becomes even more critical. The catalogues should include notes urging people to boutique and luxury brands who have launched see video footage, or extra styles and colours. It’s transactional sites were seen as brave as even about creating triggers to action, and making sure 12 months ago ecommerce was considered they are easy to follow. not luxury. “ Brands that have abe the brands that and website tend to catalogue, shop But the reality is that you have to go to where the customer is. Customers are everywhere; they’re across the globe, whereas a luxury retailer will are doing the best. They have the best typically have only a few boutiques albeit they online sales because they have those might also be stocked within the big department touch-points. ” stores as well. The relationship between catalogue and store is a Such brand footprints remain minimal in the real bigger challenge as shops have physical spaces: world so a website becomes a window to the rest they have geography. Again, it requires simple of the world – a chance for customers to search signposting but as yet nobody has cracked it. and review before they plan a trip to try and buy. Think, for example, how your customer might be able to recognise the layout from catalogue to Increasingly customers are even buying expensive store – is there any commonality? Make sure that items online, in no small way buoyed by the the same categories or labels are used in each success of , case, take a good look at how the shop is split up whose concept, delivery and customer service and laid-out. has helped others see the benefits of ecommerce. Content has become key in driving traffic and conversion. Retail sites often feature magazine- style design, including ‘editorial’ features, as do many of their catalogues. Many are now also launching mobile brand sites, another consumer touch-point which will also require an increasing amount of thought in coming months and years. Of course, any multi-channel retailer must look to its offering, its audience and its challengers – wherever they may be. has been quoted as saying they’re the last man standing on the high street when it comes to buying entertainment. And no wonder that already the brand is breaking out of retail, with initiatives such as cinemas within shops and music venues: simply, entertainment is so easy to buy online. But with fashion there is still a need to have a bricks and mortar process. People want to try things on. They want to feel the fabric and touch the product. email: web: blog: twitter: @pod1
  4. 4. Multi-channel Nirvana for Brands and Retailers Extend your loyalty and It works for the brand to have that single view of the customer, and it works for the customer promotions programmes because it makes their experience more across channels rewarding and personalised. Another way of encouraging customers to experience the various brand channels is to “ The first brand in each category that has that single view of the customer is provide incentives such as promotions or a multi-channel loyalty scheme. At the moment going to own that market. there are minimal incentives available to a web Nobody has done it yet. We’re on the customer to go in store and vice versa. threshold of that. ” This multi-channel nirvana should also apply to loyalty cards and schemes. If I hold a card for a brand then I want that brand to know me across all its touch-points. That means I want to know on my account not only what I’ve bought online but also in store. The customer does not want different accounts with the same brand – it wants Are delivery charges stifling the system to know he’s a great, loyal customer your online potential? and wants to feel rewarded. Retailers must also take delivery challenges One brand that is starting to do this is into account. The single biggest reason why the supermarket giant. It’s linking it’s club card people abandon online baskets is because of customer’s in-store orders with their online the delivery charges. orders so that wherever you shop, you have a history and therefore repeat ordering is that much At present consumers are being challenged to slicker. That’s real cross-channel integration. It’s decide whether it is worth a trip to the high street obvious really, but you can imagine the technology – perhaps to a rival brand – rather than pay for it headache they faced to make this a reality. to be delivered and wait for those goods. It’s also important to note and promote the things At some point soon, we believe that delivery each channel does well. In a perfect world the charges will be wiped out. When considering website will know where a shopper is surfing the lifetime value of the customer versus delivery from – it knows where that consumer lives and its charges, you start to see the bigger picture and closest store and its website should be tailored, delivery becomes an obvious cost to absorb. personalised to reflect that taking into account Instead, all channels should be sharing costs that customer’s preferences and offers available such as delivery fees and using free postage as in their nearest stores. acquisition tools for customers. The retailer is taking In Manhattan, New York, and increasingly in geography into consideration. One thing it is London, some retailers offer same day delivery. looking to integrate on to its transactional website You can be in store, but why don’t you order is the location of each visitor, even taking into the it online and have it delivered to your office or account such variables as the weather so it home later that day? It’s another added value. can promote umbrellas in showery weather, What makes the customer want you, and not your for example. competitor? How can you make it easier to buy from you? email: web: blog: twitter: @pod1
  5. 5. Multi-channel Nirvana for Brands and Retailers Digital shouldn’t mean the end of the high street store Whilst at Pod1 we believe that online sales are going to firmly account for far more than flagship store sales (making them a retailer’s biggest revenue driver) there is still a need for the high-street shop. These bricks and mortar stores are evolving into the ultimate outdoor ads – each shop-front acting as an advertisement for the brand within, keeping that brand front-of-mind whether or not a passerby pops in or not. When you do come across those brands again, those ‘advertising’ messages will come forth. We will also see the rise of channels within channels – increasingly stores will offer kiosks True multi-channel and multimedia services within their doors. Sales The Mecca of multi-channel retailing will be consultants may take their lead from the likes of when all prices are standard – nothing cheaper Apple and John Lewis, such as by having floating or more expensive, no differing charges such service staff carrying multimedia devices that will as for delivery depending how you choose allow them to inform the customer of size and to collect your goods – and most importantly stock levels immediately through to allowing them when all information known about a customer to pay for the goods there and then. is shared. To do so retailers must work out how they record Evolving channels business profit and loss, how they account. Retailers, marketers, sales directors across all the In the medium term, devices such as smart incumbent business units must work together. The phones will also be able to direct shoppers business must be seen as a holistic whole, rather to shops, or sections within the shop, or than a loose collection of kingdoms in order to allow them to compare prices or interact with ensure a coherent customer experience. Start that marketing messages on the go. At the moment way and expand it. smart phone take-up, and its use by brands is tiny. Mobile will grow as a channel but we Eventually, when a retailer has that single view expect it to be bundled in with the web: it is a of the customer, it will be able to personalise its digital window to your brand with essentially offering – and that’s where things really the same engine behind it. It is going to grow, get interesting. although there remain issues surrounding it, such as the inability to transact directly Building a multi-channel strategy is not merely through most phones. for the retail giants: most organisations can do it with time, well-trained teams and relatively straightforward technology. email: web: blog: twitter: @pod1
  6. 6. creative digital agency LONDON NEW YORK CAPE TOWN About Pod1 Clients include: Creatively focused but commercially led, the Pod1 Group • Amanda Wakeley are experts at originating creative ideas to help retailers sell more online. In other words, they’re fanatical • Anya Hindmarch about Ecommerce! • Coast • Derek Lam Since 2001, and now from offices in London, New York and Cape Town, Pod1 Group has been delivering world class ecommerce • Gieves & Hawkes websites for many of the world’s leading brands and retailers. It’s • Hillarys Blinds unique approach to ecommerce design and build, founded on • Jigsaw planning and insight development, has led to many firsts in • John Varvatos online retail. • Kenneth Cole The team takes time out to understand the brand, it’s business • Kurt Geiger objectives and, most importantly, the customer before making • Links of London recommendations for the design, functionality and usability of a website or campaign. • LK Bennett • Lord & Taylor For the latest in ecommerce and to be first to • Matthew Williamson receive our whitepapers, register your details • M&S at: • Net-a-Porter • Uniqlo GET IN TOUCH LONDON NEW YORK CAPE TOWN tel: tel: tel: +44 (0)20 7524 7660 +1 212 625 8590 +27 21 439 9059 fax: fax: fax: +44 (0)20 7524 7660 +1 212 658 9016 +27 21 439 9234 address: address: address: 223 Westbourne Studios 495 Broome Street Suite 403 The Regent 242 Acklam Road 2nd Floor 19 - 33 Regent Road London New York, Seapoint W10 5JJ NY 10013 Cape Town, 8005 United Kingdom USA South Africa email: web: blog: twitter: @pod1