What an Omnichannel Approach can do to Build Customer Loyalty
Technological advancements are driving disruptive and transformative impact on the global retail industry. The emergence of multiple shopping channels – brick-and-mortar, Web and mobile, among others – is forcing organisations to transform product-centric business models into customer-centric ones to ensure a seamless shopping experience across all retail channels. Businesses employing the traditional multichannel retail approach in adopting customer centricity are struggling to build customer loyalty. Customers are demanding this change and the Omnichannel approach has enabled businesses to harness the shift by focusing entirely on customers instead of single-point solutions for individual channels.
The Omnichannel approach essentially unifies the brand story across all retail mediums to provide a consistent customer experience, and integrates the customer-facing and back-end operating models with agile technologies.
Revamping the Business Model
Present-day customers are more tech-savvy than an average brand advocate, and in more control to make appropriate purchase decisions with the proliferation of digital technologies and the resulting internet economy. Customers are therefore empowered to choose any path on their purchase decision journeys. As a result, conventional competitive differentiators such as manufacturing, processes and to some extent, service quality have been commoditised.
The Omnichannel approach enables businesses to focus on enhancing loyalty across all stages of the customer lifecycle. This strategy helps businesses to interconnect all touch points of the purchase funnel by ensuring seamless shopping experience across all channels, and therefore contributing to the overall customer journey.
Customer loyalty is no longer just about offering discounts and coupons. Businesses have to incorporate loyalty well before engaging them in sales by offering the right information and offer at the right time, which is the primary purpose of Omnichannel practices.
Omnichannel retail solutions leverage big data and analyse customer behaviour to yield actionable insights that empower businesses to deliver personalised shopping experience to every individual customer. Understanding varied customer behaviour is crucial to optimising shopping experience across all channels. This customer-centric approach strengthens existing customer relationships as they are incentivised to respond positively, encouraging the additional personalised services that set brands apart from the competition.
The Omnichannel approach is used as a coordinated strategy aimed at maximising cumulative benefits across all channels. The returns are measured across campaigns and tactics spanning multiple retail avenues. The improvements are therefore reflected simultaneously across multiple channels, allowing businesses to strengthen relationship with a growing pool of customers seeking relevant information via different retail media and sources before making purchase decisions.
Enhancing Customer Experience
Enhancing customer user experience across all channels is at the core of these improvements. Mass digital disruption has forced a significant shift in customer purchase journeys and decision patterns. At the same time, businesses are expected to address these changes efficiently, integrating disparate retail channels for a seamless user experience. The loyalty loop therefore spans across all touch points of the consumer decision journey, enabling customers to participate in cross-channel retail simultaneously, which is necessary in the modern consumer-driven retail industry.
The channel optimised approach not only engages customers during the initial stages of the purchase funnel, but also drives brand advocacy upon successful engagement. With the Omnichannel strategy, brands serve appropriate information to potential customers well before they are engaged. Customers therefore respond by placing more trust and advocating the approaching brands to their wider social network. The Omnichannel strategy also enables businesses to track brand advocacy from each customer and reward them accordingly.
And the results are staggering, to say the least. A recent Aberdeen Group research concluded that businesses employing the Omnichannel strategy achieve 91 percent greater year-over-year increase in customer retention rates and five times higher average profit margin per customer as compared to competitors incorporating conventional consumer engagement strategies. The IDC Group also finds Omnichannel customers spend 30 percent more than multi-channel customers, who spend 30 percent more than single-channel customers.
The end result is a mix of highly coordinated and compelling cross-channel engagement, relevant business interactions and incremental growth of loyalty among existing and potential customers.
Call us at +65 64382006 or click here for enquiries. if you want to find out more on Omnichannel.
OMNICHANNEL – YOUR KEY TO BRINGING YOUR BUSINESS TO THE NEXT LEVEL
Have you missed the boat?
I was surprised and overwhelmed by the response I received from my 2 recent posts on the need for businesses to adopt an Omni- Channel approach. Since my first post, more than 20 companies have contacted me requesting advice on how to strategize or embark on this new game changing approach.
While I welcome the response with open arms, there is still something that deeply bothers me. You see, I am greatly concerned by the growing number of SMEs not being aware of this concept. Even worse, it seems that many businesses have been led down the wrong path by many vendors or partners.
THE COMMON PROBLEMS
The most common feedback I hear is this ‘Ben, I invested a lot of money to develop a Mobile App, however, 6 months down the road, my mobile app has given me very little returns’ Another story that pops up frequently; ‘Ben, I did my website revamp and integrated it with a CRM solution. However, my sales appears to be the same as before’. These are the stories that I hear every single week. They are being told that ‘a mobile app is your solution to drive sales’, ‘an e-commerce platform is the answer’, ‘SEO is the thing you should be looking at’. It is interesting that whatever advice they give, seems to coincide with the services they are offering. And this is a shame! Good money has been thrown into the development of these systems that promise much but deliver little.
Let me share with you a simple concept.
Customers are not buying from a mobile app, ecommerce platform or just a physical store. Customers are buying your BRAND that has been communicated across MULTIPLE PLATFORMS!
YOU NEED TO TELL A CONSISTENT STORY
Creating an omni-channel experience is crucial to ensure that you succeed in the marketplace. It is not about choosing one channel over the other. It is about communicating a consistent experience and message across all these platforms. I am not saying that we take the same material and copy and paste it and spam your users. What I am saying is that we need to take the essence of a message and adapt it in a manner that best suits the platform. If needed, you can even deliver different aspects of the story across different platforms to further engage your audience and even increase participation.
A MOBILE STRATEGY IS A GOOD STARTING POINT
Again, let me qualify this statement. If you are going to build a mobile app that just shows your services, your store location, your contact number, don’t waste your money. Go get a Mobile Responsive Website and invest in a good SEO strategy. It will cost you a fraction of the cost. A good mobile application needs to be rooted in utility. You need a good loyalty program strategy. This ensures that you are able to further entrench your customers and immerse them in your brand experience. It is also a good way to get all your existing customers to quickly download your mobile application.
Now, we have a mobile application with a good loyalty program, so what’s next? Consider integration with your POS and CRM. The number one rule in marketing. Drive your decision with DATA. When you integrate all your touch points together, you are able to collect valuable data. You will know every segment of your market and understand what makes them tick. You will know which age groups like which products, you will know which gender responds better to which promotions, you will even know which group of people staying in which areas visit which outlets. And as any business person or marketer knows. Once you can get such information… the battle is half won. From there, it is about optimizing your offerings and products. You will save heaps of marketing costs and instantly get much better ROI.
YOUR MOBILE STRATEGY IS KEY
Take out your phone. Within this device lies all means to contact you (except physically visiting your home or workplace). People can call you, text you, email you, whatsapp. If you have a mobile app, people can send you a push notification. That is why, we need to strategize properly to send the right message, using the right platform, at the right time, telling the right stories, to the right people. That is why data and a mobile strategy goes hand-in-hand.
I know that the tonality of this post is a little on the strong side. But that is because I see so many business owners making the critical mistake of blindly throwing money into technology. Too often, they just blindly follow what their vendors (who are obviously selling their services) ask them to do without having a strategic plan. They end up wasting a lot of time and money but don’t get the results they were promised. This happens in the market all the time… But don’t let that happen to you!
Call us at +65 64382006 or click here for enquiries. if you want to find out more on Omnichannel.
The changing landscape of business
A big change is coming yet again, especially for B2C businesses. Consumers have changed, and so have their demands on businesses. It is clear that businesses which successfully navigate these changing demands will get a strong competitive advantage over their competitors, and capture greater market share and profits. Conversely, those who do not will be left behind and quite possibly fade away. The smartphone revolution has more than affected the mobile phone industry. With it, a new generation has arisen – one that is constantly connected to the Internet.
Such a generation is changing the world of business. Being pampered by instant and increasingly perfect information, they search for information about any product and service they intend to consume before deciding to purchase.
According to Google, 95% of smartphone users use search engines on their phones, 92% seek local information, and 89% take action based on what they find, with 79% using their smartphones to help with shopping. A more recent report from Nielsen finds that 89% of people use smartphones while shopping in a store, with 40% comparing prices on their smartphones while shopping.
Research shows that consumers today are better informed, more selective, more prone to move from one brand to another and less loyal than ever. One clear phenomenon of this is “showrooming”, where shoppers view an item in-store but buy it cheaper online on competitors’ sites such as Amazon and eBay.
Through this, retailers have come to understand that people are always going to compare prices, and have launched their own eCommerce sites or mobile apps to try to capture the increasingly nimble and unloyal customer. To reach customers with a combination of various platforms, such as a physical store, an online store and a mobile shopping app, is to offer multiple channels or what is known as the multi-channel approach. This, however, is just reacting to changing consumer demands and habits, and has its own problems.
For one, these channels often act independently of one another, and the retailer’s knowledge of each channel exists in separate technical and functional silos. Businesses’ understanding of customers are also limited to each channel, and are unable to put all their customer data together in a coherent manner to understand their changing consumers. As an example, in-store associates do not know what customers have been viewing on the online store, and are unable to advise the customer according to their preferences.
To obtain a unified single view of their customers, businesses need to integrate their various channels together, such that all systems across the various channels communicate with one another. Having an integrated channel approach is called an “Omnichannel” approach.
The rise of Omnichannel
Such an approach comes with many benefits. Businesses are able to understand their customers through their interaction across the various channels and touchpoints, and are able to base their decisions on real data and analytics. From that, businesses are better able to serve customers and provide more value, which will spur customer loyalty and increase profits.
For example, Nike integrated their mobile app, Customer Relationship Management (CRM) backend system as well as their in-store point-of-sale (POS) kiosks to capture customer interactions and match it with transaction data. With it, they built detailed customer profiles and pushed irresistible personalised offers to upsell customers through their mobile app, increasing sales by almost 6% with these in-store offers alone. With such customer engagement programmes, Nike has gained 15x ROI.
Wal-Mart was also badly hit by showrooming, and has started to embrace aspects of the Omnichannel approach – it has built on its value offering of convenience by integrating their online store with their physical store. When a customer cannot find an item at their location, Wal-Mart encourages in-store clerks to refer the customer to Walmart.com, where customers can purchase the item and have it delivered to their homes.
Wal-Mart has also discovered that half of their online customers choose to pick up their purchases in the stores, and has created a designated pick-up desk in stores – customers can seamlessly and conveniently pick up their purchases, as compared to slowly picking up their items from the aisles and queuing up to make their purchases at the cashiers.
Clearly, businesses are realising the value of adopting an Omnichannel approach, and are starting to embrace it to meet the changing demands of consumers.
What this means for your business
In the face of changing consumer demands, businesses should not mistake phenomenon such as showrooming as the threat – the real threat is failing to create a differentiated and compelling experience that engages customers. Studies from Columbia Business School and Gallup find that for most consumers, getting the absolute cheapest price is not the highest priority, and that customer engagement is important to drive the eventual sale of a product.
An Omnichannel approach can definitely help a business to successfully understand and engage consumers, and thus drive profits. Here at Balanced Consultancy, we believe in listening to our clients’ needs and building fully-customised solutions from the ground up for each client. This ensures that our solutions are completely tailored to the needs of each business and delivers maximum value to each client.
At Balanced Consultancy, we do not try to fit your business into pre-existing systems; we build the solutions around your needs. Talk to us today to find out more about what we can do for your business.
Call us at +65 64382006 or click here for enquiries.