I would argue that this is the only type of marketing there should be. Businesses should be looking to implement omnichannel marketing as much as possible, especially in the post-pandemic world when training customer loyalty might be harder than ever. The sudden push to online shopping due to the pandemic has sped up what many thoughts was inevitable, the death of the high street.
With H&M closing 130 stores and John Lewis and Boots also announcing closures across the UK, retailers are – more than ever before – forced to understand those customers who are still shopping.
Online retail sales have been rising for years now, but in March, the pandemic caused a dramatic 74% growth year-on-year across the globe. The result? Retailers concentrating most of their efforts around e-commerce. And we can’t blame them. But that’s only one part of the jigsaw – whilst focussing on online shopping and removing the concern around closing the online/offline loop might remove one complexity, to fully understand the customer journey, retailers need to increase and record customer touchpoints to get a view of the different ways that consumers browse, consider and finally buy.
The pandemic put a spin on consumer behaviours
In recent years, there seems to have been a general lack of urgency around implementing omnichannel, with retailers either thinking that someone will make them a plug and play solution, or maybe that it’s a fad which will pass. The reality is that they no longer have a choice: it’s a requirement for survival. The pandemic has highlighted the need for retailers to provide seamless experiences across all channels – more than anything ever before.
It’s been a rollercoaster, and the ride isn’t over yet. When the Covid-19 storm hit, people stopped shopping for a short period of time, then the online shopping spike came, now shops have reopened and whilst some retailers are closing stores, we saw massive queues in front of many others. So what’s coming next? 67% of shoppers say they currently feel comfortable buying online – while only 29% feel comfortable being in-store, a recent study suggests. According to fashion-tech meepl, one in five UK consumers will never return to the UK high street.
So how has omnichannel changed under COVID-19?
The real change is in the form of realisation amongst retailers. Those who used to think that their customers preferred an in-store experience have had to change strategy rapidly or become extinct.
Brands like Lululelemon have excelled themselves by buying Mirror, making themselves part of their customer’s everyday workout experience at home – this is true omnichannel. Some retailers have set special shopping appointments online to ramp up interest in their clearance sales, playing on the psychology of queuing to get the best ‘early bird bargains’. There are companies who offer this technology out of the box. It’s a great way for getting customers’ details (‘register to book your slot’) and to try to shift last season’s stock.
Most shopping experiences begin online – around 60% before the pandemic – even those which end up finalised in-store. However, in-store appears to be more successful when it comes to actual spend: a 2019 report from online merchandising company First Insight found that during a typical shopping visit consumers spend more in store than they do online. There will be many factors at play in the upcoming months changing all the statistics quoted in here and that means one thing – retailers have to cover all fronts.
Omni-, multi-, cross- and other channel marketing
Stores think in terms of multichannel. Most of us have been into a store to be told: “…we don’t have those in our warehouse, but online might do as they are on a different system to us”. Businesses often distinguish between offline and online, and internally the two teams are often pitted against each other in terms of targeting – which screams out that retailers are not putting themselves in the customers’ mindset.
Pandemic or not, these kinds of differentiation are irrelevant to customers and their aims. They don’t think of their behaviours on different devices, or online and in-store, as separate entities, they just see it as ‘shopping’. And marketers should do the same.
Dior does this very well in-store – any Dior store I go into, I’m on their system with everything I’ve ever purchased, even down to the colour of foundation I need. Almost every store asks to email my receipt to me, but rather than harvesting my contact details just to spam me, why not use this opportunity to give me an awesome experience, by building up a picture of me as a consumer, and discovering when and where I shop and why. The customer ultimately benefits from what could otherwise be seen as a ‘creepy’ approach – as a truer picture of the customer allows the retailer to serve them better and get a higher CLTV in return. Win-Win!
Interestingly, a recent survey of companies asking what they look for most in a marketer has shown that the demand for ‘Data measurement and analysis’ goes over anything else. This is because there isn’t a lack of data in marketing teams, what holds companies back is the lack of understanding and ability to create data-based insights for data-driven decisions. There are ways and means of doing this as a tech stack: Tableau/GoodData + Segment/mParticle + Redshift/Bigquery. But many solutions still require a level of data science or some statistical analysis to avoid making decisions based on the wrong data. This is key for implementing omnichannel.
So why is implementation of omnichannel so slow?
Desire is high and adoption is low which suggests that the issue is in understanding and skillset and there is a market gap for anyone who can solve this problem for retailers.
Loyalty cards are often the glue that holds the omnichannel experience together for some retailers. Nectar specifically, shows where else a Sainsbury’s customer might be shopping and helps to build a view of them, but it’s still not quite complete. Other companies have their own Mastercard with a view of getting all the holistic data on their customers, but many shoppers won’t use their credit card for everything.
For the retailer, stitching together information from different sources can be baffling. Much of the data is often stored in third-party SaaS products, meaning that many companies don’t own their data – a dangerous scenario to be in as the value is often in the data. There’s so much data, sifting through it to clean it takes up so much time, they barely get to analyse it to extract the value.
The answer is to move towards frictionless commerce using Open Banking and collaboration. Open Banking has been discussed widely in the fintech space, but rarely in marketing conversations. This shows, again, the general lack of skills and knowledge when it comes to data. The market needs an innovative fintech which will utilise the power of Open Banking to shortcut the issue of customers using different devices and clear up all the noise in the middle – the ads and clicks attribution.
Brand advertising will always have a place in the journey, however, if brands can see that a sale has taken place with a customer via Open Banking, instead of by customer email address as the unique identifier, all of a sudden, metrics such as CAC, Churn and CLTV become more accurate as does the ROI. This is the kind of solution Open Banking was made for, and if linked with other systems through SSO, the understanding of a customer and the whole market view could truly deliver the omnichannel results that so many retailers chase. Open Banking and AI have the opportunity to help retailers clarify the ever-changing customer behaviour and help in the challenging post-pandemic world.
Knowing your customer is key
There is only one king in business and that’s profit, no matter how you get to it. The problem is that measuring these metrics often makes companies confused internally. Let’s look at a little brain teaser: If I visit a site from an affiliate link, have a cookie dropped, then click on a YouTube advert, add something to my basket, leave to find a discount code, get distracted and then later click from an Instagram advert or even go into the store and finally buy. Which channel does that sale belong to? Which leaves us with the same – omnichannel marketing has its place and to be able to maximise it, retailers need to be able to work with data and know their customers.