All consumer sectors, including Retail, Automotive, Food and Beverage, Travel and Financial services, used to be about Location, location, location. Where your physical presence was. With the invention of the world wide web in 1989 and the first online transaction in 1994, we saw the beginning of the democratisation of all these sectors.
That is because the internet changed all turned the status quo on its head. Nowadays, we can buy anything, anytime, anyplace and from anyone! And the proliferation of choice available to us means that at least 33% of us will abandon a brand after one bad experience!
This is another reason why channel strategy is so important. Or, to put it another way, turning up where your customers want you to be.
Because these days, we live in a multichannel world. Consumers are looking for joined-up and seamless experiences; this is where the term omnichannel comes into play. Where we can have seamless, frictionless, and effortless customer experiences that take place within and between different contact channels.
Here’s a useful distinction between Multichannel and Omnichannel:
Multichannel is an operational view – how you allow the customer to complete transactions in each channel.
Omnichannel, however, is viewing the experience through your customer’s eyes, orchestrating the customer experience across all channels so that it is seamless, integrated, and consistent.
Consumers expect, quite rightly, to start a conversation or a journey in one channel and conclude it in another. And irrespective of their task, any brand should be able to recognise who they are, what they want and how best they might serve them.
However, too many businesses focus on the cost to serve rather than on customer lifetime value. The cause and effect of this are they make decisions to not be in the channels or to invest in enabling the joined-up experience consumers seek. Guess what happens? They go elsewhere.
It can also help your strategy and planning to consider attribution. If you have a multichannel business, then most of your customers will start their journey on your website, but many will complete it in your store or other physical location. The reverse is also true for many categories, such as automotive or furniture, where consumers might want to see the product in real life but conclude their transactions online.
The graph below clarifies how different retail categories of products are procured online by consumers:
Source: Big Commerce
Channel ownership:
There are lots of potential channels to market. Some of which are owned directly by the brand and some indirectly. But hugely important none-the-less:
Internal control
– Your stores or other physical presence
– Your website – desktop and mobile
– Your app
– Social media and social commerce
– FB, Instagram, TT
– Customer service – email, voice, chat, Twitter
– Email communication
– Push notifications
– Proximity marketing
External control
– Wholesale
– Other 3rd party stores or physical presence
– Other 3rd party websites
– Amazon and other marketplaces
– Intermediaries (Franchisees/Licensees)
In B2B markets:
– Personal selling
– VARs Value-Added Reseller
Customer Personas
When thinking of your channel strategy, it is also useful to understand the behaviour of your main cohorts of customers. And you might extrapolate this further by creating customer personas where you can better understand how you might meet their needs more effectively by having a deeper understanding of how and when you can be accessible to them.
Source: Monday.com
The Customer Journey
Let’s also not forget that the customer journey is not linear! We don’t go from point A to point B. We often engage with many different channels and touchpoints before deciding on whom to buy from.
There are many benefits of turning up where your customers are and where they want you to be:
– Consumers are exposed to your brand more frequently
– They’re given a bigger choice of products
– Recency, frequency, and value increases
– Fewer customers churn
– Customer lifetime value increases
– Capture both planned and spontaneous purchases
– Customers move towards being fans
– They become advocates for your brand
The ownership of channel strategy:
Finally, you need to ensure the right people are making decisions about your channel strategy and how best to deliver the experience customers seek.
Otherwise, you risk making the wrong decisions that are short-term focussed and cause customer attrition and a loss of sales and profitability.
If you want to learn more about channel strategy how to put the customer at the heart of all that you do, check out my Mini MBA in Customer Centricity.