Posts Tagged ‘Omnichannel’
Omnichannel Challenges – Keeping Score In A Connected Environment
Multichannel retailers are responding to the connected consumer at break neck speed. The shift in their business model demands that they work horizontally across the organization, breaking down silo’s, and developing new collaborative processes. Yet in many cases the organization of human capital, budgeting and planning, and key metrics have not aligned with their new Omnichannel strategy.
We ask our clients to answer “Big Questions” to help illustrate the challenges that they will face in their shift to an omnichannel future.
Is it the expectation that the Ecommerce team will support “all things digital” within the business?
In some cases we see brand marketing taking on the role of social marketing and digital display for awareness building. But in most cases the Ecommerce team is still responsible to develop content, support brand campaigns on the site, develop the mobile strategy, and to help educate the Senior Team on how to leverage the digital infrastructure critical to the omnichannel future. In many cases, they are asked to manage vendor selection, the digital roadmap and more – in addition to driving ecommerce revenue growth. Yet, when it is time to resource the “all things digital” team, the resources are based on Ecommerce revenues. We encourage our clients to measure the influence of digital efforts on the broader business to properly resource for the Omnichannel customer experience.
In response to our suggestion to measure online influence we often hear “ We can’t always see what happens at the store and we need to understand how much of the business is incremental ”. Our overwhelming recommendation will save you time and effort. Don’t chase the incremental statistic – it’s difficult to prove and may only give your detractors the opportunity to poke holes in your analysis. Instead, determine your key metrics (e.g. customers who buy in multiple channels, cross channel customer satisfaction ratings, number of hits on the store locator or who redeem coupon codes at the store, incremental sales from “pick up in store” orders). Track what you can to develop a benchmark and look for growth. Report progress to the broad management team and reward positive influencers. This will help you align disparate teams to work together better.
When the time comes to add resources pay close attention to the skillsets that are needed to drive those customers across channels. Sometimes it is as simple as adding more copy and creative talent. Sometimes it means reducing the administrative workload of Senior resources by bringing in support personnel. Other times it is developing a core competency in an area you have been outsourcing and the new positions will require acquiring high level specialized skill sets. With the changing role of the digital team, make sure to support growth by getting the necessary resources to deliver the customer experience you envision.
Are you willing to track and reward store associates for online revenue increases in their store’s trading area?
We are asking store associates to become digital evangelists but in many cases we don’t reward them for contributing to the increase in online sales in their store’s trading areas. Or on adding incremental sales for in store pick up orders. In many cases we ask them to learn more about an extended online offering but don’t give them incentive or “time on the clock” to do so. The Container Store is an omnichannel best practice leader that allows store staff to train and learn about digital advancements “on the clock”, and this shows in their excellent store execution. Our research has confirmed that tracking and sharing online revenue within the store’s trading areas has been a game changer for most retailers.
Incentivize the behaviors you want to build upon.
Until retailers are at a point where we can look at sales in a holistic manner and reward people across channels for behaviors we want to reinforce, we will struggle with the omnichannel customer experience. Understanding that organizations will evolve, measurement tools will improve and new processes will replace old ones suggests our success metrics need to evolve too. Develop a plan to measure, report, and reward your team to support a digitally connected environment and you will lessen the friction that comes with change management.
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!
Cross Channel Marketing – The Planning Gap
Let’s face it, there is no longer a direct correlation between the marketing channel (e.g. email, Search, browsing) and the point of purchase. One of my favorite depictions of this is Brian Walker’s “From Channels to Touch points” image. http://blogs.forrester.com/brian_walker/11-03-11-welcome_to_the_era_of_agile_commerce.
Organization design for cross channel retailers to support an omnichannel strategy is one of the biggest issues retailers face as they consider their customer experience. In this post we won’t go into the changes we are seeing on organization structure, budgeting, marketing campaign handoff’s, the demand for specialized skill sets, or the need for clear lines of responsibility and accountability among the teams. These and a host of other considerations are issues that require facilitation and discussion from the very highest levels of the business.
Instead, we wanted to focus on the challenge of disparate marketing teams within our businesses. Brand marketing (or core marketing) and ecommerce marketing each have their own budgets, sets of goals, and processes. The question we are always asked is “How can we make a seamless experience for the customer across channels as we campaign for their buying dollar?”
Regardless of whether it is a branding, ecommerce, or social campaigns, we find that some of the biggest differentiators (and white elephants) within retailers are their planning rituals, campaign management processes, and post campaign performance measurements.
One common mistake we see in planning is including the digital team too late in the process. When done in this manner, the campaign lacks the benefit of a holistic customer approach. It runs the risk of a routine execution and poor return on investment. In the worst cases, the digital team is not aware of the campaign and is asked to support in the 11th hour. Equally guilty are the Ecommerce marketing teams running promotions that the retail stores are not aware of; leaving the front line team at the store vulnerable to customer dissatisfaction and a disjointed brand experience.
We juxtapose this with a best practice planning process that begins with rigorous channel calendaring and a cross team process that traces the customer journey from all touch points. Merchants are Included in this planning to help build a robust understanding of product and supply chain concerns. And store operations assure that the front line and customer care center is aware of the promotion and able to manage the questions or issues that may arise in store.
Big data, little data, and all the data in between should still rely on the same processes for campaign development. The big questions that have to be asked are:
- What are we trying to achieve (e.g., new customer acquisition, awareness, increasing page views, reactivation, retention)? Be specific about the campaign goal, it will help the team determine how to measure success.
- How are we going to measure it? If we are measuring across channels, what are the proof points? Will we be considering attribution from other marketing activities?
- What does success look like? It is always good to collectively agree on what success looks like. It helps to manage expectations and frame up the results.
- Who is responsible for measuring the effort? With multiple teams involved it helps to give the program measurement an owner.
- When will we look at the results? As with success measurement, timelines are important. You may want to see early results and later results too. But it is important to decide upfront to ensure that expectations are set.
- Based on our hypotheses, what are possible next steps? It is helpful to anticipate next steps with the cross functional team in case there needs to be longer term issues such as resources, inventory, or budget that might be impacted by the results of the program.
- Who needs to be notified of the program and what tools will they need to ready their team? This is always the one that gets the least attention but is crucial to success. Take a moment to make sure everyone who needs to be aware of the program is considered.
We consistently impress upon our clients that the most vulnerable parts of the customer experience are at the customer touch points. Through planning and cross team collaboration, brands reduce risk and improve the customer experience.