Increase revenue through Sales Excellence
The terms are applied in B2C as well in B2B but it is easier to introduce the concept when considering an end consumer:
Multi-channel describes the experience of a customer who shops using the different channels made available by a company, such as brick-and-mortar stores, catalogues, website, mobile applications, TV shopping or call centers.
Cross-channel describes the experience of a customer who has used a combination of several different channels for the same purchase. For example, a customer prints a product configuration on a company’s website and then goes in-store to make the purchase. A customer may also choose the product he or she wants to purchase from a company’s catalogue, and then buy the product directly on the company’s website. Another example is a customer who purchases through his or her TV set, and then collects the product from the nearest store.
The term Omni-channel describes the simultaneous use of two channels, like using a mobile phone while in-store, or a tablet while watching TV.
In multi-channel, the analysis of the different experience when shopping in the various channels is important. In cross channel we see the customer journey taking central stage: it is now the way the customer navigates across the channels that is crucial: where does he take the information, when and how does he checks the product, how does he closes the deal and buys the product or service and finally how it physically receive it?
In omnichannel, it is a step further: the consistency of the message is the key. It is also the easiness of accessing the same information. It is the alignment of pricing or promotional activity. All driven by the mobile accessibility.
Challenges for manufacturers and retailers
Defining where to play and how to win by adding the right e-commerce strategy to the traditional sales channels is a challenge for many companies. Choosing the right way to reach their customers, existing and potential, is not easy because it concerns different levels of control and cost to serve.
Do they try to establish their own web site to sell, do they rely on their retailers to expand to internet sales or they cooperate directly with the mega market places like TMall or Amazon? Depending on the industry one competes, the time pressure for such a decision varies: consumer products like staple food may need to decide now while airliners have definitely chosen their strategy many years ago.
Cross channel however is the hot topic for retailers nowadays with Amazon testing a brick and mortar shop in their effort to facilitate their customers pick up (and possibly return) their purchases. Best Price has successfully used their network of stores to allow customers of their web site pick up their products locally and start using them to their best convenience. This seems to be one of the current key battlefields between pure etailers and traditional retailers.
The back end operational challenges can also be significant with silo mentality and the need for new collaborative processes. Imagine the way to incentivize a sales force which may have merely informed a customer on the product characteristics and benefits who, however, finally buys the product or service on line, not affecting the direct sales target set for that person.
Omnichannel is increasingly a major challenge for fashion and promotional driven industries where consistency of messaging is extremely difficult, taking into account so many intermediary, independent players. That forces even closer cooperation between sales and marketing in creating and implanting content and promotions effectively.
Omnichannel for B2B
In a recent study by Forester Research, nearly half of B2B buyers now make work related purchases on the same websites and mobile apps they use to do their personal shopping. 52% expect at least half of their purchases to be made through digital channels in the next three years. 93% of B2B buyers say that they prefer to buy online rather than from a salesperson when they have decided on what to buy.
They start on line, as everything nowadays. They use a variety of devices including laptops, smartphones and tablets. They use search engines while they are on a manufacturer’s website. In their case, content is more important because of the often technical side of the choice. They usually need to involve more persons in their organization and may want to close the deal with a sales person on the order they have started. They want reordering and delivery to be fast and efficient.
In order to illustrate the complexity and the challenges, please consider the different needs different clients have with some wanting to be the first to receive the innovations and their need to integrate them quickly and seamlessly while others want a reliable reordering system of a spare part or a staple product.
What is certain is that they are more informed than before and they have higher expectations from their traditional sales reps or key account managers.
A good document to introduce you in the omnichannel thinking is that of CAP Gemini, presented in the Recommended Reading section of the blog: Channel Strategy: Framework for Success
Also McKinsey has recently published one more article on the subject, indicating the increased interest on the subject: Omnichannel not omnishambles
Steps towards Omnichannel
Forrester found only a small minority of business executives confident in executing the digital side of Omnichannel selling, in having the right culture (21%), technologies (19%), people (16%) and processes (14%).
These are the 4 steps to help you establish an omnichannel strategy.
1) Evaluate Product Portfolio for Complexity
Create a list of your products or services and assess them, according to each channel, on their need for support and technical assistance. Some products can be bought as stand-alone, some others are sold in bundles and some others require configuration. Attach to each product the need or not of a personal assistance and distinguish it between remote and on the customer premises.
2) Map Out Customer Journeys
Trace customer buying behaviors by recording the multiple channel touchpoints used to complete a single transaction and anticipate how channels are traversed, from brick-and-mortar to online, or partner to direct, to understand customer preferences. Do that for different target groups and identify commonalities which will help you focus there where cost to serve is lower. The differences can be huge as this example shows:
Typical Relative Transactional Costs for Checking Bank Balances and Recent Transactions:
3) Match Buying Phases with Channels
Look at key process steps for marketing, sales and servicing, to determine “best channel” by buying stage. Ideally, moments of truth can be identified by buying stage (with (e.g., discovery, education, evaluation, etc.) and channel preference, when mindshare is consistently captured, when client interest turns often serious (the client is hooked) when commitment to make purchases rises dramatically. Understanding such moments will help any effort to increase conversion rates.
Activities to look at include how prospects and clients are browsing and researching products, their use of online reviews, when or if live persons are solicited for information, where purchases are made, and how reordering products or renewing relationships are done. A big issue is uncovering buying activity (often a majority of legwork in making a decision has already gone undetected) as well as moving prospects from researching products online to channels best suited to close deals.
4) Proactively Address Channel Conflict
Put in place the right communication, education and rules to curtail uncertainty, anger and doubt among partners and sales. Partners will need to be reassured that they are not being undercut. Sales people will fear that their territories will be gradually taken away if customers don’t go through them; and that their prospects for making their quotas will be hurt.
In both cases the value of Omni-channel strategies in improving lead quality should be highlighted. Similarly, highlight the information that will get captured from different channels to strengthen their hands (both partners and internal sales) in accelerating sales cycles. In addition, consider having reordering activity count towards quotas of sales people during transition periods, when customers are getting shifted to online channels.
These are the steps to take when looking What to do next!