Multichannel or multiple channel? - Paul Mason, CEO, PMC.
There are some good multiple channel retailers but few multichannel retailers and it seems that multichannel remains more aspirational than real.
Paul Mason, CEO, at retail IT specialist PMC argues that despite much research and discussion, there remains a huge lack of understanding around multichannel what it means, what retailers should expect, how to approach and implement it.
Many retailers believe multichannel retailing is adding a web site, kiosk or SMS texting to their physical store or catalogue. The expectation is that customers who want to shop online or via mobile phone will do so. Retailers give little thought to driving business to their online presence, the relationship between the channels or how customers will interact across them.
What retailers are doing is creating multiple channel retailing. Although this has been successful, the majority are spending money pointlessly, causing internal company strife and running the risk of having unhappy customers.
Customers who experience a retailer’s multiple channel approach will inevitably try to interact across the channels. An immediate issue is cross-channel service failure. For example, an item bought online cannot be returned to a local store, or a product displayed in the store is not available in the catalogue. In such cases customers will be dissatisfied and the multiple channel strategy turns into a liability rather than an asset.
Failure to create an effective multichannel experience wastes money and alienates customers
An effective multichannel operation is impossible to achieve if parts of it work alone or from different perspectives. Research continues to state that retailers do not view physical stores and online sites as mutually exclusive. Retailers state that they accept the need for an integrated multichannel strategy across all channels, interacting with their customers when and where the customers choose. So why doesn’t it happen?
Most online channels were built in reaction to competitive pressure and to get online as fast as possible, not to deliver an integrated multichannel experience. These sites, built in isolation without any consistent overview of the retail operation were built, implemented and run by IT, not store operations. The result is a different look and feel between a retailer’s online and physical presence - product details, merchandising approaches, range descriptions and even pricing structures can be different.
Also, despite their best efforts, retailers still struggle with the basics such as purchasing in multiple channels, returning merchandise to a channel other than the one used for purchase, answering customer service questions, asking for in-store pickup, and using offers and coupons across channels.
Effective multichannel strategies remain hampered because ‘online’ is seen as different from ‘in-store’
Many retailers see the web as different from the store. It’s just a store with a different postcode – www - rather that WC2. Unfortunately, most retailers who add an online presence to their physical store do not present a unified approach and historical issues keep things apart. Many retailers online presence is developed in marketing, created in IT and that’s where it remains.
The store management knowledge base and merchandising skills, which dictate how the retailer uses the store is often missing from an online presence. It’s possible, indeed it’s easy to see examples, for different channels such as web, catalogue, mobile phone and store to describe products in different and sometimes contradictory ways
It is also clear that channel competition results from a non-unified approach. A culture grows up where store management see the website as cannibalising the store. A multiple channel strategy should increase potential contact points with customers - it should not increase competition within itself. Everyone agrees how the channels should support each other and cut out emotional competition, after all the customer is always the same, unfortunately it’s in practice where the principle falls down.
While the web site is a ‘bolt on’ to the physical store and handled by a different management team, these problems will not go away. While multichannel is seen as ‘nice’ but not necessary there will never be an integrated strategy. To remove this conflict retailers must bring all channels under the control of store operations with a common management structure.
It’s a question of many folk who won’t understand rather than a few who don’t understand
In the same way the online channel must use the effective skill set of the store, the store may well have to evolve. It’s not so much the ‘death of the high street’, as the death of certain high street formats and developing formats that compliment the online presence.
The first step to understanding a true multichannel approach is to accept that it’s not a bolt on, realise what’s involved in making it work and set a strategy.
It’s not nirvana to have an integrated multichannel strategy, with customers interacting freely across all channels – of course it demands the technology - but it is achievable. It’s working with how people work rather than the marketing team’s vision of the future.
For further information please contact enquiries@paulmasonconsulting.co.uk |
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