Have you heard that omnichannel is the future of retail? Do you read case studies and blog posts about being everywhere for your customers, all the time? Maybe you’ve even seen that omnichannel is the next evolution of multichannel.
I’m here to tell you that you’ve been misled!
Omnichannel retail “strategy” insists that you be everywhere–all possible channels. It focuses on customer touchpoints, like mobile, web stores, etc. Some of the ideas and concepts that omnichannel enthusiasts present are correct and useful. But, attempting to use “omnichannel” as the basis of your strategy will lead you down the wrong path.
You can’t be everywhere.
The prefix “omni-” literally means “all”. In an era of consumers who interact with brands via a whole bunch of different channels, it sounds really powerful to insist that retailers be in “all” of them. This approach is more hyperbole than it is an actionable strategy.
Trying to be everywhere is unfocused. It means you aren’t thinking about your customers, where they need you to be, and where you can best invest your time and money. Every channel, approach, or idea will not be equally effective building long-term, profitable relationships with customers. It’s up to you to understand your customers and how different options for your business will improve that relationship.
Jon Caron, Managing Director at PYMNTS.com, talks about how “omnichannel” is dead:
The reigning buzzword champion–omnichannel–is dead…It’s an unrealistic goal. It’s not a consumer path or form of engagement. Consumers don’t shop omnichannel. They simply shop. What they do want, however, is a singular view of each retailer based on what matters to them.
Recognized content marketing experts Robert Rose and Joe Pulizzi bring up the same debate in episode #49 of their This Old Marketing Podcast. They discuss “omni-” in the context of marketing, not retail, but the point is the same. It is not an actionable strategy to be everywhere. It’s just hyperbole.
Hyperbole gets clicks for the writer. Actionable strategy helps you transform your business.
Omnichannel only focuses on touchpoints.
Our team attended Rendezvous 2014, a conference for retailers in the outdoors industry. Mark Lavelle, SVP and Head of Global Product and Strategy at eBay Enterprise, gave a keynote speech about the future of retail. He impressed (maybe even intimidated) the retailers in attendance with his descriptions of the amazing customer experiences some companies offer.
What he talked about was helpful, insightful, and inspiring. But, he only focused on customer touchpoints.
A customer touchpoint is any place your business interacts with a customer: the sales register, the website, the support number. In retail, your customer touchpoints play a big part in crafting your customer’s impression of your brand. Omnichannel retail is about providing high quality touchpoints everywhere your customer may want to interact.
The problem is that optimizing customer touchpoints is only solving part of the problem. While they do heavily influence your customer experience, they are not exclusive in doing so. A lot goes on behind the scenes, where the customer never sees, that hugely impacts customer experience.
You cannot provide advanced shipping options, exceptional customer service resolving order issues, or competitive prices that don’t destroy your margins by only focusing on touchpoints. You need to focus on optimizing your supply chain, your supplier network, and the operations that actually run your business. Omnichannel doesn’t talk about these critical parts of your business.
Why You Need to Go Multichannel
Multichannel doesn’t mean blindly focusing on being everywhere. It means understanding the multiple places you need to be for your consumers and the multiple suppliers you need to integrate into your business. It’s not about fuzzy mediaspeak. It’s about building a business that specifically addresses today’s challenges in retail.
To be a successful brand, you need to implement that front-to-back multichannel strategy. It will encompass all of the customer touchpoints that experts like Mark Lavelle mention. It’ll also accommodate for the “behind the scenes” changes you’ll need to be successful.
That multichannel vision goes beyond what an omnichannel strategy generally accounts for. Here’s what I’m talking about:
- If you want to sell products across different channels with different marketing and listing requirements, you need a place to consolidate product data.
- You also need a place to centrally manage product categories and pricing, some of which will be unique to specific channels.
- Customers see your multiple touchpoints as a single brand. You need the ability to manage customer and order data regardless of what channel the customer chooses at a given time.
- You’ll also need a consolidated picture of customer orders and logistics data.
- To improve your customer experience and competitive pricing and shipping options, you’ll need to build a dynamic network of suppliers who can source your products.
- You’ll need the facilities to optimize how you use those suppliers, implementing strategies like drop shipping and dynamic order routing.
- You need the agility to expand to new channels (as your customers demand) quickly and affordably. The faster you can execute on those opportunities, the better positioned you are against competition.
While it’s inspiring to look at what the top retail brands in the world are doing, know that you don’t need hundreds of thousands of dollars to go multichannel. You need the right vision and the willingness to invest in the technologies that’ll help you get there.
There’s a lot of hype out there around the future of retail, and much of it is caught up in the “omnichannel” term. While it encompasses many ideas that you should be thinking about as a retailer, the term is incomplete. Only a multichannel retail strategy truly encompasses all of the customer touchpoint and back-end operational requirements for being a successful retailer.