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An Omni-Channel World

The number of channels consumers use is expanding constantly and consumers glide effortlessly from a brand’s online site to Facebook, to a review site, to a Tumblr blog, to a shopping bot, to a retailer’s app, and so on. Brands seek to reach the consumer, it seems, everywhere they are. Omni-channel can be confusing, defined in various ways by consultants, brands, and vendors. What matters most is the expectations of ever-connected consumers.

First, it is increasingly the case that consumers expect seamless omni-channel brand experiences—in which they can smoothly and deftly transition, intercommunicate, and interconnect between platforms, sites, and locations. This is not the same as multichannel marketing in which brands simply do coordinated marketing across retail, direct marketing, and digital channels. Omni-channel means the brand must be ever present, everywhere at once, and yet personalized, flexible, and with one-on-one customer intimacy.

As an example of this challenge, according to the Board of Governors of the Federal Reserve, 87% of the U.S. population owned or had regular access to a mobile phone in December 2014. Thirty-nine percent have used their mobile phone for mobile banking; and 22% have used their mobile phone for mobile payments. Although 87% of consumers used a bank branch in the last 12 months, and 75% used an ATM, 74% used online banking, and 33% used telephone banking.14 Digital’s impact on experience is real; however, the problem is not a purely “digital-only” one. It spans various channels—web-based online, mobile, retail, kiosk, telephone, and others.

The nerve center of the brand relationship is located online. In the BC Customer Empowerment Research Study, we asked consumers to tell us their preferred ways to receive information about new products or services from a company. The number one response by far was email (80%), followed by U.S. Mail (41%), and then Facebook (23%).

Concurrent channel usage should now be regarded as the new normal for connected consumers. Google survey research on 6,000 smartphone users aged 18–54 found that 71% of in-store shoppers who use smartphones for online research say their device has become more important to their in-store experience. Fifty percent of consumers will visit a store within one day of a local search on their smartphone. Scott Zalaznik, Sprint’s vice president of digital, said: “Ninety percent of our customers start their journey online but buy in-store . . . and a quarter of those who click on our mobile search banners end up visiting our stores.”15

According to Google, 42% of in-store shoppers search for information online while in-store. For these in-store online searches, they usually use search engines (64%). However, nearly half use the retailer’s own site or app, and only 30% look up details from a different retailer’s website or app (see Figure 1.3).

Figure 1.3

Figure 1.3 Simultaneous Channel Usage

Source: “New Research Shows How Digital Connects Shoppers to Local Stores,” Think with Google, October 2014, https://www.thinkwithgoogle.com/articles/how-digital-connects-shoppers-to-local-stores.html. Used with permission.

What this says is that for consumers the line between physical retail and online access has vanished. Furthermore, consumers are increasingly looking to branded apps to do their browsing and shopping, enabling brands to strengthen the customer–brand relationship—and dissuade them from turning to competitive brands. The trend toward apps, rather than merely using a mobile browser, is important because it encourages consumers to process brand information in the brand’s proprietary environment—not the broader competitive market environment of open search—and therefore properly frames consumers’ perceptions about the brand’s features and benefits.

Another important insight: For many consumers the local store is becoming more like a local distribution center where they can “pop in quickly to pick up a product they’ve researched in advance,” said Google. “When asked what information would be helpful to have in local search results, respondents in [their] Digital Impact on In-Store Shopping study listed ‘product availability at a nearby store’ (74%) and ‘pricing at that store’ (75%). That’s why it’s important to promote and share inventory seamlessly across all channels.”16

Macy’s vice president of marketing strategy, Serena Potter, emphasized the importance of having local store inventory visible to consumers browsing its website or searching. Macy’s uses Google local inventory ads to connect shoppers with information about the products they seek. “We can tell her that there are eight of what she wants in her size and desired color available right now in the store that’s five blocks away.”17

Sephora, a leading cosmetics and beauty retailer, especially focuses on its mobile app to leverage a better in-store customer experience by giving customers direct access to product ratings and reviews. According to Bridget Dolan, vice president of digital media at Sephora, “We think one of the biggest opportunities that we have in retail is for our customers to leverage their phones as a shopping assistant when they’re standing in the store. Having access to this information is that perfect new moment for customers to find everything they’re looking for and get advice from Sephora.”18

However, research also suggests that when it comes to delivering a seamless digital–physical experience brands often fall short of consumer expectations. In the digital economy, customer journeys are more fluid, more varied, with different start and end points—with different channels and media being important at different moments. The moment of decision may be early and instantaneous after the failure of one’s trusted old product, such as a food processor, or late after extensive thought or deliberation, such as buying a new car—what matters however is recognizing and responding in that moment of decision. Google researchers said:

Amazon has one of the best recommendation engines, presenting shoppers with new information, offers, and suggestions that are not only relevant to them, but also of immediate use in the moment. For example, Amazon’s recommendation engine automatically suggests items that are “Frequently Bought Together . . . ,” or “Customers Who Bought This Item Also Bought . . . ,” or “Sponsored Products Related To This Item . . .” or “Special Offers or Product Promotions,” or “Your Recently Viewed Items and Featured Recommendations—Inspired by your recent browsing history.”

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