Omni-channel is a strategy that aims to integrate and align all available channels in order to provide a homogeneous and consistent customer experience.
To understand what omni-channeling is, let’s differentiate it from another similar but different concept, which is multi-channeling.
- In multichannel, the company chooses. It segments the channels it offers and targets its different types of customers according to their value. Lower-value customers will have to use low-cost channels such as the telephone channel or self-service, while higher-value customers will be able to access the more expensive channels, which the company will have reserved for them.
It is the company that decides for the customer which channel to use and it usually does so on the basis of efficiency criteria.
- In omni-channel, it is the customer who chooses. They may be a high-value customer and choose to shop through a more efficient channel because they prefer self-service to having to rely on a service person.
Omni-channel offers all channels to all customers and it is their choice and they can switch channels at any time, unpredictably, according to their convenience. Channels must be consistent so that the customer does not notice the change. In multichannel, the company segments customers and assigns them to the different channels according to criteria of efficiency and commercial effectiveness. On the contrary, in omni-channeling, the company makes all channels available to all customers, and it is the customer himself who chooses the channel through which he wants to relate to the company at all times.
Omni-channel customer behaviour
The key to omni-channel is therefore to encourage customers to switch channels at their own convenience, without perceiving any inconsistency and without causing them any pain.
Some possible omnichannel customer journey combinations may include the following:
- Research On Line, Purchase Off line. This is a customer who searches the Internet for what they need and then goes to the shop to buy it.
- Showrooming. This is a customer who goes to the shop to find out about the product and then orders it in shop.
- RTB (Research, Testing and Buying) the customer researches online, tests in physical shops and finally buys online.
- Click and Collect. The customer buys online and collects in shop.
Conditions for omni-channeling to exist
For a company to be able to say that it offers its customers a truly omni-channel experience, the following conditions must be met:
- The offer of products and services has to be exactly the same and at the same prices in all channels.
- The customer must be able to start a transaction in one channel and continue in another seamlessly, and the customer experience must be absolutely consistent.
- All channels must have the same information about the customer and this information must be updated in real time.
Some of the challenges retailers face in providing a 100% omni-channel experience for their customers.
- Systems not prepared. Contact point staff from different channels (shops, telephone, digital, etc.) do not have the same information, or the information is not updated in real time. The best way to solve this problem is to have CRM solutions in the cloud that, like Salesforce, integrate service, marketing and sales for all channels, offering a 360º view of the customer.
- Organisation by channels. The different channels are set up as independent business units that “compete” for customers. Each channel has the power to set its own prices and run its own commercial campaigns. The result is that the channels that are considered more efficient, such as the telephone or digital channels, cannibalise the shops, taking away customers with discounts that the shops cannot offer.
- Remuneration of the sales force. Derived from the previous one. When the objective is constructed as the sum of sales from all channels, sales are computed exclusively in the channel that has materialised the order, leaving without incentive all the previous work of investigation or after-sales work, which is carried out in other channels. This is aggravated when the company has both direct and indirect channels and financiers manage to impose the fallacy that cutting commissions to the indirect channel means cost savings for the company.
Some companies are understanding omni-channel. They are changing their organisational and remuneration structures and moving towards cross-channel collaboration models. In doing so, they are not only delivering the best customer experience, but also maximising sales opportunities by encouraging cross-channel traffic.
A good example of this is the Inditex Group companies.
At the other extreme are companies that continue to organise themselves by channels and make them compete, giving more and more weight to the channels that, from the narrow point of view of their financiers, seem to be more efficient.
The reality is that digital transformation has radically changed customer behaviour, with different expectations and a different way of shopping. Going against customer preferences and expectations is often a guarantee of failure.