Omni-channel vs Multi-channel Strategy

 

Omni-Channel and Multi-Channel are two Marketing and Sales approaches. Omnichannel is Customer Centric and Multichannel is Product-Centric.

Channel:

Any medium where a brand can interact with a customer. Simply put, a channel facilitates a customer touchpoint. It can include physical touchpoints, such as a pop-up store, or digital touchpoints such as a mobile application, website, chat, or social platform.

Omni-Channel Strategy:

Omnichannel is a communication and sales approach allowing customers, integrated customer experience. Broken down to elements, omnichannel customer experience allows users to consume (shop, communicate, research) brands having the same level of experience regardless of the device, platform or communication channel. Omnichannel strategies take into account all retailing activities involved in successfully selling through channels simultaneously.

Omnichannel retail focuses on every customer and their experience with your product and brand. Customer Phenomenon is where all sales and marketing channels are looked at as one single entity.

Why Omnichannel:

1. 7% shopped online exclusively

2. 20% were store-only shopper

3. 73% used multiple channels

4. Customers interacting with an omni-channel experience spent 4% more in-store and 10% more online, too.

5. Companies with omni-channel retail strategies retain an average of 89% of their customers from channel to channel. Meanwhile, businesses with weak omni-channel integration retain 33%.

Benefits of Omnichannel:

1. Convergence of in-store and digital shopping experience

2. Treasure trove of information.

3. Enhanced customer satisfaction

Omni Channel strategy Impacts Customer Experience:

An omnichannel customer experience strategy can create better engagement and increase loyalty among customers. Using the right omnichannel software tailored to your business needs, you can craft an integrated experience for your users allowing them more personalized interactions with your brand.

Seamless customer experience is the ultimate request from digitally advanced users. To achieve it brands, need to combine the right set knowledge – analytics, helpdesk, CRM, customer service tools, etc. But an omnichannel strategy well-crafted and executed will provide companies with more personalized marketing campaigns, improvements to their website shopping journey and better communication with their customers.

Multichannel Strategy:

Revolves around your product and lets customers engage and purchase natively wherever they shop but often treats channels as silos independent from one another. Each channel in a multichannel strategy exists as a separate purchase opportunity.

Why Multichannel:

1. 74% of businesses increased sales with a multichannel strategy — 64% increased consumer loyalty/acquisition — 57% reported better customer experience. — SAP

2. 72% of customers prefer an integrated marketing approach. — Gartner

3. 40% of consumers say it’s very important to be able to purchase from a retailer via different channels. — Econsultancy.

Benefits of Multichannel:

1. Increased awareness

2. Channel Preference

3. Higher Revenues.

4. Better Customer Knowledge

5. Elevated brand consistency

6. Expanded content reach.

Omnichannel Vs Multichannel

Challenges:

Omnichannel:

1. Technical Barriers:

Complete integration increases the complexity of managing operations and supply chain.

2. Warehouse management:

Retailers need to have and advanced warehouse to track inventory in real time, to ensure a high rate of delivery.

3. Recognizing shopper and their unique profile:

Data has to be collected at every touchpoint providing the user a unified experience among every platform.

4. Synchronize data:

Retailers need to synchronize data in the integrated process as omnichannel is the integration of ERP, sales, channel, CRM, Social Media, and Market.

Multichannel:

1. Cross channel management:

Working on many channels at a time and working on requirement on every channel is challenging. It mostly works on a product on different channels.

2. Inventory Management

Management of inventory at a time from every channel the buyer uses. There has to be a good and real time inventory management process.

3. Different Shipping and Return Policies:

Due o different channels working as different selling opportunities, they have different shipping and return policies creating hassles to the retail business.

4. Being Consistent:

Keeping data and information updates across all the channels is another challenge that retailers face while using multichannel marketing. Being consistent to modify and monitor all the channels is essential.

Examples:

Omnichannel

Amazon Acquisition of Whole Foods.

Amazon is taking their digital marketplace to the streets and creating an experience that flows naturally from online to offline (O2O). You can now order your groceries directly on AmazonFresh and pick them up at local stores.

The experience transcends typical barriers and allows the customer to keep their experience the same throughout each touchpoint. They no longer have to go to the store and spend hours looking or forget to buy.

Instead, they just log in to Amazon and order their groceries, finding the same, seamless pickup experience when they arrive. That data then gets transferred back to their app or account online for even deeper integration.

Walmart Acquisition of Bonobos

Walmart is looking to expand their typical sales (brick-and-mortar) into new online channels.

Previously, Bonobos eschewed the typical brick-and-mortar retail strategy for “Guideshops” and pop-up shops. Customers wouldn’t actually walk out with any inventory. Instead, they could try on clothes, place an online order, and their goods would be immediately shipped out to their home or office. Walmart’s one-stop grocery and goods changes the game for Bonobos, too. Their distribution outlets just received a massive upgrade.

Starbucks

This company showed its ingenuity through an application for rewards. Its works concept consists of a free rewards card that you can use whenever a purchase is made. It is possible to check and reload the card with your smartphone, on the website, on the app and in the store itself. All changes are in real-time and are updated across platforms.

Glade:

Glade took their omnichannel experience a step forward. The fragrance company decided to open up the “Museum of Feelings” with which they decided to link emotions and scents. They popped up a 5,300 square foot building in Manhattan with several different rooms, every carrying its specific scent, sound, and visuals for a complete experience. In the end, visitors found out that every room had a scent of a new Glade line and was lined to impulse buy while they were still under the euphoria of the experience. This campaign was recognized for its ingenuity and got awarded several times for it.

Walgreens:

Walgreens decided to go all-in on their mobile experience. Customers can use their application to track, check and refill prescriptions in just a few clicks, without having to go to the pharmacy. The application also allows to set up reminders, so you get alerted if prescriptions need to be renewed. While it is not something groundbreaking, it sure helps customers to use their time more productively then waiting in line at the local pharmacy store.

Multichannel

Sephora

Beauty retailer Sephora takes a hands-on approach to the in-store customer experience. Consultants give free makeup lessons and match customers to their ideal cosmetic products. Sephora's omnichannel strategy extends to online beauty pass members and beauty insider special offers.

Sephora brand news, beauty industry insider tips and beauty bag accounts are accessible across several channels, including email, mobile apps, store website and in-store purchases. This strategy nets the brand user contact information across many channels.

Users can browse the site on their phone, tablet or computer. With email marketing, one click takes them to the Sephora app to purchase an item or get more information. The interconnectedness of customer experience increases conversions and brand loyalty.

The idea here is to make shopping at Sephora simple for consumers, and the brand has done an excellent job of doing just that.

Apple: Customer service and Education

Apple is considered a “click-and-mortar” retailer which means Apple operates both physical and online stores. However, the situation with Apple’s physical retail stores is unique. Rather than being designed for sales, Apple Stores are primarily designed to complement Apple’s eCommerce business which accounts for the majority of total sales.

In this way, Apple’s physical stores function as customer touchpoints that support the overall Apple experience. Since the physical stores aren’t necessarily focused on retail, customers can visit Apple Stores without feeling like they need to make

purchases. And with customers making more frequent trips to physical stores, Apple is able to drive more brand immersion.

Beyond advertising and using retail stores for customer support, Apple has focused on developing services to build more demand for Apple hardware while providing additional revenue streams. Prime examples include Apple News+, a premium news subscription service available only on Apple hardware, and Apple TV+, a Netflix-esque streaming service that will primarily be available on Apple hardware.

Also of note, Apple’s multi-channel marketing strategy is built around specific branding guidelines. This allows Apple to maintain a consistent visual style across all marketing materials in addition to Apple’s website, apps, services, and retail stores. Even Apple’s computing devices and other hardware share elements of a common design language. This does a lot to give consumers a very “Apple” experience no matter which sales channel is delivering it.

Asos: 

Online retailer ASOS was hip to the social media revolution and adapted with a variety of touch points for its younger shoppers. First, it released its Facebook integrated shopping app to boost ecommerce amongst the Facebook community. Rather than depart the social site, the 11 million unique visitors per month get to access their brand on the channel of their choice with a first-class experience.

ASOS is also active on Instagram with 2.5 million followers. Sharing a wide range of lifestyle photos helps improve brand consistency while new products are unveiled to expand the shopping experience. Being available to users via social, a specialty app, the website (which has monthly sales over 1 million dollars) makes the brand accessible wherever users go and promotes easy shopping.

Future of Multichannel and the shift to Omnichannel:

As customer expectations rise and technology evolves, the shift from multichannel to omnichannel will become even more important for brands. Customers want a seamless experience, and that experience has to be across multiple platforms.

As mentioned previously, while multichannel allows businesses to reach customers on various platforms, it does not offer the unified experience customers expect. Omnichannel on the other hand, does just that.

It may take some time for brands to catch up and siloes to be torn down, but for businesses who want to succeed, they need to shift to an omnichannel strategy.

Sources:

https://tinyurl.com/y5qrjz6b

https://www.paldesk.com/omnichannel-strategy-what-why-and-how-guide/

https://www.shopify.com/enterprise/omni-channel-vs-multi-channel

https://www.shopify.com/enterprise/omni-channel-retail-strategy#:~:text=An%20omni-channel%20retail%20strategy%20is%20an%20approach%20to,their%20overall%20experience%20of%20your%20product%20and%20brand.

https://www.evanik.com/omnichannel-versus-multichannel-in-depth-strategic-analysis/

https://emarsys.com/learn/blog/what-is-multichannel-marketing/

https://www.shopify.com/enterprise/what-is-multi-channel-retailing

https://www.hcltech.com/technology-qa/what-are-key-benefits-omnichannel-approach