Posts Tagged ‘Customer Experience’
Shop.org and the Omnichannel Obsessed
This year’s Shop.org Annual Conference was held in our own hometown of Chicago. We were delighted to participate and network with a “Who’s Who” collection of Ecommerce Executives with abounding expertise. The conference confirmed that chasing the Omnichannel customer experience is high on the list of priorities for most multichannel retailers in attendance. As a overview of what we learned we’ll stick to the highlights and a bit of generalization.
Our awards for the most discussed challenges from the Executives we spoke with were:
1) Prioritization of omnichannel efforts. Senior management and the board are pushing hard for rapid innovation. In many cases they don’t understand some of the underlying challenges, costs, or timeline (e.g. process change, infrastructure inefficiencies, visibility to data at a customer touch points, skill sets and training, etc) that are necessary to execute Omnichannel capabilities.
2) The role of the ecommerce team is changing. They are being called upon to either be “all things digital” within the organization. Tapped to handle digital innovation, brand initiatives, develop the mobility strategy and grow the ecommerce business all at the same time. In these cases, the team is concerned with resources and budget to support efforts coming from multiple areas of the business that don’t necessarily impact their P&L but are now their responsibility. Additionally the Ecommerce team is being asked to be aware of the challenges that the store team is faced with Omnichannel programs.
Alternatively, the business has restructured and Ecommerce traffic driving efforts have fallen under the “digital marketing” team, which is no longer inside of the Ecommerce team. The approaching holiday season has them on high alert. Their increasing resource needs and a necessity for marketing flexibility to meet revenue goals, without these direct resources, has them concerned.
3) Organization Design and talent acquisition remain a key hurdles in accomplishing the future vision. Fundamental questions are being posed as to “Where should Ecommerce report?”, “Who owns the marketing budget and how should it be spent?”, “How should we incentivize the store team to assure that they are digitally savvy and omnichannel advocates?”, “Who makes pricing and promotional cadence decisions and what are the guardrails associated with them?” .
Our favorite observation: With all the change and increased performance pressure Omnichannel has stirred up, Ecommerce executives appear more open to sharing insights and learning from one another again. We had several requests to connect retailers who were non competitive but focused on exploring the same issues.
Our roundtable topic “The Top 3 Myths of Omnichannel Retail” was well attending and enlisted a robust discussion about Omnichannel challenges and mobile efforts. Everyone was excited by Target’s Cartwheel app and it’s in store couponing using geo-fencing capability. We handed out our Omnichannel Self Assessment Tool. We hope it helps the team’s internal discussions regarding the Omnichannel vision and to exemplify the complexity of Omnichannel execution.
We are big fans of the content brought to the industry via Shop.org and this conference confirmed their dedication to topical and timely quality content. Bravo!
Myth Busting –
The Top 3 Omni Channel (Cross Channel) Myths
For our inaugural blog post (yes, we know we’re late!), we thought we would do some myth busting.
Myth #1 – The customer experience must be the same across all sales channels.
Defining the customer experience within an Omnichannel /Cross Channel strategy is one of the most difficult jobs of any retailer. Many retailers we work with find it difficult to describe what they want their customer experience to be. In many cases, dependent upon who we ask within the management team, we will get differing answers. The most common refrain that we hear is “We want our customer experience to be the same across channels”. This is when you will find us asking what we consider foundational questions:
- Are your customers the same in all channels or are they different?
- Do you have opportunities online to enhance areas of your business that may not be possible in the store? (e.g. you product offering, enhancing customer loyalty, or acquiring new customers, etc.)
- Are you considering channel differences (e.g. competition, and cadence) that you may be able to take advantage of?
We counsel retailers that the brand construct should be consistent across channels but doing the work to understand how to leverage the channel differences will result in happier customers and typically better financial performance.
Myth #2 – Omnichannel Retailing is a competitive advantage
There was a time in the not too distant past when Cross Channel strategies could only be delivered by retailers with scale and deep pockets. By default, those retailers who embarked on early Cross Channel strategies had to have the means to invest and the patience of their board for the time to realize that investment. It was a select group willing to take on big risk as Cross Channel strategies were unproven. These early and select pioneers envisioned big competitive advantages with their strategies. They were able to provide their consumers with a value proposition based on convenience and service as they shopped across the available channels. Today, consumers are much more demanding and their expectations include Cross Channel capabilities. Retailers of all sizes have risen to the challenge of considering how their channels can work together better to meet those expectations. We are seeing exciting advances across all segments of the market.
But, Cross Channel strategies are relatively unproven and represent a great deal of internal change to execute. We find:
- Advanced Cross Channel capabilities cannot substitute for good retailing in each channel independently, pure and simple.
- A good ecommerce customer experience is necessary to enable Cross Channel retailing. You cannot leap frog or short cut here.
- Understanding what Cross Channel capabilities will enable a robust customer experience for your business will help differentiate you from your competition. Selectivity and executional excellence are the keys to differentiation.
Myth #3 – The Omni Channel experience is all about technology and operations.
Omnichannel strategies have changed the role of the IT lead inside of retailers. Smart retailers have recognized that these technical visionaries are the gatekeepers to a smooth transition between channels. Their roles have been elevated to strategic thinkers and they have claimed their place at the Senior Leadership table if they were not there before. But, a leading technologist within a Fortune 500 company from our recent paper for the NRF “Organizational Structure for the Future of Retail: The Digital Effect” said “I can build platforms faster than the culture can absorb the change.”
Omnichannel Retail is a sea change in the way organizations work together, plan together, and service the customer. Without the ability to describe the customer facing experience and understanding how the work will get done to achieve Cross Channel goals, the development of technology and operations meant to support the customer experience will be costly and likely flounder.
We are watching as savvy retailers work closely with their IT teams to create prioritization and flexibility in their roadmap priorities. They consider the speed of internal adoption, competitive market conditions, and customer driven insights to shape their vision for the future and guide their development priorities.
Cross Channel and Omnichannel Definitions
First a few words about the definition and usage of the term Omnichannel. We have been working with retailers for almost two decades on integrated channel strategies. Our belief has always been that the brick and mortar stores would become the integrated point of difference for most retailers. We helped retailers develop their multichannel strategies when Ecommerce was new. We promoted Cross Channel retailing strategies as customer behavior changed and they began to demand an integrated and easy way to cross between selling channels. Then, Harvard Business Review wrote a game changing white paper titled “The Future of Shopping”, that coined the phrase Omnichannel.
There is no retail dictionary to validate the definition of Cross Channel and Omnichannel. In most cases, we see them used interchangeably. Our definitions are:
- Cross Channel Retailing is the operational interaction to drive sales, communications and supply across channels (e.g. store, website, catalog, mobile, social). We envision these integrated operations, (including human capital, content and data) to enhance the customer experience by giving her the freedom to experience the brand on her terms.
- Omnichannel Retailing is the underlying infrastructure and processes necessary to operate and execute on Cross Channel capabilities.
To say that the future of retail will look different because of the changes Cross Channel / Omnichannel retailing will deliver is a good bet. How each retailer gets to their future will be as different as the definition of the term within the industry.