Retail Multichannel Consistency and Customer Experience

By Kiran Kumar MN, Kiran_kumar@mindtree.com

The emerging shopping patterns of consumers using online portals like mobile, social media and networking, as well as the increasing use of new technologies by consumers, are driving integration of the multichannel business. Retailers who do not provide seamless service and create an arena for good shopping experiences are already off the pace. Research firms such as Gartner, Forrester and NCR have indicated that consumers expect interactions to be fully aligned across all channels which leads to customer satisfaction and results in a boost in sales and growth.

Online retail sales have grown at a steady pace and continue to grow steadily. In 2007, more than one-third of U.S. consumers were shopping online. In 2010, 60% of the population was shopping online according to one Gartner study. The trend is expected to continue. Predictions are that by 2014 online retail sales in U.S. will be nearly $250 billion.

More than half of the 177 million U.S. online adults; 105 million — have two or more different types of devices connected to the Internet. One third has at least four devices; these are “super connected” consumers. Those who dominate mobile usage, according to Gartner, represent 21% of U.S. adults, accessing information as never before across the expanse of these rapidly changing consumer technologies. And online retail sales are growing at a compounded rate, around 10% every year with Europe growing a bit more than US.

Google, Apple, Microsoft and other companies are coming up with interactive devices like iPads, iPhones, Tablets, Xbox, which can be carried from kitchen, living room, bedroom to elsewhere. Desktops and laptops are being replaced by tablets. Social media and networking, home automation, podcasts, tablets and Internet have changed lifestyles everywhere influencing online sales.

Results of multichannel inconsistency
Disconnect among channels leads to increased call center activities, angry customers, poor customer satisfaction scores, change in consumer perception of retailers, increased costs, brand damage with decreased incentives for customer stickiness and conversion.

When consumers cannot switch between various convenient channels, they have fewer choices which leads to low scores on shopping experience. Unless consumers are provided with the ability to connect between channels, anytime, anywhere it negatively impacts the customer base.

Another Gartner research reveals 76% of multichannel retailers don’t fully coordinate brand marketing, and 74% of them don’t fully coordinate promotions across channels. Customer centric merchandising and seamless shopping experiences across various touch points cannot be provided to customers if there is no harmony between channels. Retailers stand the risk of operating several channels independently while serving the same customer base. 

Multichannel convergence
Many retailers are facing challenges in standardizing, creating collaboration and convergence between catalog, data, policies and customer experience and bringing in common structure across channels. Integration of channels has to be decided by taking into consideration, a company’s history, organizational structure, legacy systems, adaptability with new systems, branding, compatibility in each channel, staff, a retailer’s strategy and its future plans.

To enhance customer experience, retailers have to offer a consistent set of products, information, descriptions, promotions, prices, delivery charges and identical return polices regardless of the shopping channel. Consistency across customer touch points will give the customer "a unified view of the retailer." This allows consumers to switch across desired channels with ease and thus drives loyalty and satisfaction. Multichannel integration will create greater sharing and reduce redundancy of data, processes and business rules to allow customers to purchase through a variety of channels.

Benefits of multichannel consistency
Integration of assets and systems, offering consistent catalog, managed repositories, identical return policies, personalization, unified pricing, use of open technologies, multichannel promotions and flexibility makes it more convenient to adapt to the ever-changing market demands.

With convergence of channels, a holistic approach to information architecture, user experience, understanding of customer touch points will be in a structured manner and data can be interpreted to make business decisions.  

With effective sharing of processes, technology and information across channels improves. Greater focus can be given to customers in response to unique competitive situations in each channel and adjust its retail mix to serve different customer segments.

Investing in multichannel
A quick look at the years 2008 and 2009 shows the economic down turn resulted in declined sales by major multi-store retail chains. These numbers improved towards end of 2010, and an upward trend continued through 2011. While western economies are recovering, many US and European retail chains are expanding globally with an increase in technology investments. Greener products, services, facilities, and green activism are heavily publicized and being accepted across the globe. Considering these factors, retailers should focus on the primary drivers of growth - ubiquitous connectivity.

Retailers should use multichannel analytics (text, voice, image, video, social media sentiment analysis) to gain a better view of how customers are shopping various product categories across channels to prioritize technology investments. Any smart business should invite social media conversations about company and brand, distill conversations into precise insights, and act to be successful in an ever-evolving marketplace.

Focus should not be on providing all things in all channels. Retailers should prioritize investments and channels based on structured analytics. Potential sharing of resources can be achieved through an integrated channel strategy. Furthermore, mapping of high-value customer usage and preferences can help identify channel areas of over/under-investment, optimum ROI, channels that require some form of asset reallocation.

Through multichannel consistency, retailers can respond faster to market changes, pricing can be adjusted within minutes, products can be made available within a day across the channels and many more advantages can take root.

Centralized multichannel content management and interaction processes, scenario-driven communications and marketing automation consistency should be part of global strategy planning. Research has shown shoppers in the financial services and retail sectors represent an increasingly large proportion of influential buying population. Retailers should look for long-term value and competitive advantage rather than short-term profits. Ultimately, they have to strike a balance between continued budgetary pressures, increased need to grow and revenue and profit bottom lines by providing access to products, pricing, promotions, stock availability and store location with providing options for multichannel shopping with ubiquitous connectivity.

Kiran Kumar MN, is senior project manager, retail solutions at MindTree Ltd., with 12 years of experience in service delivery, customer relationship management, consulting and pre-sales support in retail and services domains.  Kumar can be reached at Kiran_kumar@mindtree.com.