The Real benefits of Omnichannel and why the timing is now... Episode II Attack of the Inside-out approach

EPISODE II Attack of the Inside-out approach

Following our last week episode where we established the risk of a multi-channel centric model, our second episode addresses some of the main learnings acquired over the years completing various multi, omni or channel transformation projects (here are the first fourth ones)

1.  An Omnichannel strategy is NOT a technology roll-out. It starts with defining business problems and determining desired outcomes.

Solving an omnichannel experience is first and foremost a business imperative, way before charting out an omnichannel technology strategy. It is critical to start thinking first about the business outcomes and the omnichannel use cases and user journeys.

This is why it will be critical to deploy a multidisciplinary approach and gather collaboration from different functions (including business, digital architects and a strong sponsor from leadership).

2.  Omnichannel involves a cultural shift and an outside-in view.

Unlike the multichannel, internally-centric strategies we did 10-15 years ago, where we just ‘pushed’ our solutions onto the customer (these strategies were mostly addressing a unique goal: cost optimisation); the real opportunity for omnichannel relates to a fundamental cultural shift in how companies conduct customer engagement to boost their customer experience.

This modern channel model means thinking about successful channel uses cases and customer journeys first and aligning the organisational model and culture to deliver consistent and tailored channel experience to all customers.

It also means that sectors that still have traditional approaches to customer engagement - for example energy, utilities, waste management, financial services, travel, hospitality, education, healthcare, and government - will clearly benefit from following a different engagement model.

3.  The benefits of Omnichannel are not about operating cost reductions but about growth, differentiation and revenue uplift.

While there is often lower operating expenditure from digitalising some touch points (for example the cost of a single customer contact via an online service is less than $0.1, compared to more than $12 via a call center) or from just having significantly less in-bound calls into your call centre (actually a too high volume there is often ‘multichannel syndrome’). You will also be able to improve internal efficiency – thanks to automated process. But to be honest, in complex models (typically industries with a high number of touchpoints like telecommunications) in the short term (one to three years), the cost of transformation may often exceed the savings. Cost optimisation is a long-term benefit.  

The real benefits of a strong channel strategy lie in acquiring a new and sought-after competitive advantage, a clearly superior customer experience and, with this, the corresponding reduced churn and increased cross-sell and client acquisition capabilities.

Omnichannel is about much more than channel management; it’s about ensuring service quality and supporting specific business outcomes and, along the way, capitalising on the unique, and state-of-the-art marketing capabilities your new channel architecture enables.

4.  Reaping the full benefits of the omnichannel opportunity will involve modernising your marketing and customer strategy (how to):

•  Treat your customers as human beings that may not fall into very broad segments or persona types. This is where the techniques used to capture and make senses of the ‘outside-in view’ become critical. Most businesses are obsessed with digitising touchpoints, but they often fail to understand ‘why’ a customer engages with a brand at a particular phase in the customer journey. The customers decide what the priority channels should be, not the business. Hence, understanding customer jobs-to-be-done is critical. And it is certainly not only about self-service channels. Digital augmentation of face-to-face channels is an important part of a successful channel strategy.
•  Once this first understanding is achieved, the architecture must allow you to create live profiles of your customers, in order to provide ultra-relevant and mass-customised recommendations. Rule-based event engines play a fundamental role in making real-time and relevant offerings available. Recommendations focus on presenting the right offer to every prospective or existing customer while ultra-personalisation is about “live” interaction based on customer behavior and service status. The latter can also consider factors relating to specific actions and stages in the customer journey
• Context is key to create emotional experiences that will surprise and delight, and to provide the best contextual content. You must be able to gather where your customers are at a given time, when they engage with a business, which device the customer is using for the engagement, and what they are trying to achieve. Context plays a very significant role in developing emotional offerings for real-time customer engagement. Emotional bonds and experiences are also key in creating customer advocacy.
• 360-degree customer view and rich contextual understanding are also a prerequisite to anticipate customer requirements, especially before they crystallise into customers’ problems. Preventive and proactive care are some of the most advanced possibilities offered by omnichannel and some of the best tools to manage your CLV, churn or even your call centre’s volumes. Therefore, understanding the customer profiles and real-time behavioural and experience-based data are critical to all successful customer care programs.
• Finally, improved marketing possibilities do certainly not translate into more push marketing. On the contrary, the power of big-data analytics is the possibility to only interact with your customers at the time they need it, and only when its relevant to them. And it’s the same with your new channels, what we learnt over years of customer research is that customers want your channels to easily and quickly facilitate their lifestyle, but they do not want them to be “sticky”.

The right channel/omnichannel and marketing approach will engender warm feelings in your customers – and a sense that your brand does care about them (without just pushing more, irrelevant content – the 101 of digital marketing). We know how much it means for your customer, and even more if they use a digital or self-service channel.

Please see our next week final episode ‘Revenge of the Cross-channel order’, for some more channel transformation learnings and an illustration clarifying the typical journey toward omnichannel.