Omni-Channel vs Multi-Channel: Understanding the Crucial Differences to Help You Meet Rising Customer Expectations

Contributor: Shay Khosrowshahi
Posted: 04/04/2016
Omni-Channel vs Multi-Channel | Customer Expectations
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What is the difference between creating and implementing multi-channel strategy vs an omni-channel strategy? How can you use the concept of omni-channel in your customer experience strategy?

Multi-channel refers to companies using multiple channels (e.g. social media, email, PPC) to engage their customers, giving them an option to choose the channel of their choice. Omni-channel, however, is about viewing the entire experience and journey through the eyes of the customer, optimising across all channels (online or offline) so that it is seamless, integrated and consistent.

Omni-channel realises that customers vary in their journey to purchase and that they may start at one channel and move through various others before they reach the end point. So what the difference? In simple terms, omni-channel is multi-channel done the way it’s supposed to be.

Still Not Sure?

The internet has changed the way consumers interact with brands. They now have numerous options and channels, which they can use to make and influence their purchasing decisions.

To add to this, the increase in electronic devices such as laptops, tablets and mobile phones has given consumers various options to satisfy their shopping needs. A consumer may be introduced to a new product via an email, then visit the website on their laptop, review the product ratings online and visit the store to gain further advice, before finally purchasing the product on their mobile.

This offers multiple opportunities for marketers to connect with their audience, but also raises a challenge in that they must ensure interactions with their customers are kept consistent and seamless across all channels. In summary, omni-channel marketing is about putting the customer at the center of your strategy and if you’re not focusing on it as much as you could be then now is the time!

Omni-Channel Insights Across Vertical Markets

Omni-channel is proving to be one of the most prominent tools for reaching consumers, particularly the millennials who have, in a short time period, become the ones to watch. Extensive research points to omni-channel as the marketing and sales strategy of the future. However, there are many challenges in implementing an omni-channel strategy.

One of the leading barriers is the lack of familiarity associated with digital platforms. For omni-channel strategies to be successful customer trust not only needs to be enhanced, but educational efforts must be employed to ensure that consumers are comfortable using emerging digital technologies.

A study by strategic marketing consultants at Imperial College Business School looked at omni-channel shopping behaviour of millennials across vertical sectors, including electronics, sports clothing and footwear, and toys. The study, which consisted of both quantitative and qualitative analysis, revealed some interesting findings.

• Electronics

Shopping behaviour differs based on the tangible and intangible costs associated with the purchase. Young consumers tend to inform themselves thoroughly before purchasing expensive and more personal electronics.

Interviewees revealed that they typically need reassurance on products such as TVs, laptops and cameras, preferring to go in store to see these items first. Additionally, a number of respondents revealed that they attempted to research these products in store but struggled to understand the “technical lingo” surrounding them.

The consulting team recommended brands to use short one minute “how to” videos, clearly demonstrating the benefits and limitation with specific products in comparison to others.

The research found that for high involvement products, helpful staff with extensive product knowledge is highly valued, whereas less expensive electronics purchases tend to be done online, as the evaluation is more focused on price and face-to-face advice is not needed.

• Sports clothing and footwear

The clothing and footwear market was extremely popular among the millennials who were surveyed with 64 per cent of respondents buying clothes once a month or more. A majority of 75 per cent of respondents prefer to purchase in store, the main reason being down to the shopping experience, the opportunity to test the product and see how well it fits.

The majority of respondents revealed that a typical journey for more expensive products involves the consumer first researching the item online, then visiting the store and finally purchasing the product online if available at a better price.

• Other Key Findings

The research found a number of features that act as a bridge between online and offline shopping behaviour and helps accelerate consumers purchasing decisions. In the retail sector, flexible return features was mentioned quite frequently, with a number of respondents using ASOS as an example of a company that allows their customers to conveniently return products by sending a package that includes all deliveries and requires very few steps.

Delivery option innovation is another area, which could help set retailers apart. More than 90 per cent of respondents claimed to have used smart delivery at least once before in their purchases and 80 per cent confirmed that they facilitate their decisions when shopping online. The majority of these respondents had tried various delivery options, such as next day delivery, economy delivery, click and collect and scheduled home delivery. 63 per cent of respondents would choose an e-commerce platform over another if it offers smart delivery options.

When asked about click and collect, consumers recalled retailers Argos and John Lewis and the next day delivery option was associated with Amazon Prime by a number of respondents. The research revealed growing expectations for these delivery options, with consumers demanding more accurate, cheaper and convenient service.

Conclusion

Many organisation struggle to see the difference between an multi-channel and omni-channel strategy. If this difference is not understood, companies will inevitably fall behind. Omni-channel is about understanding that although they have similarities, every consumer is different in regards to their journey and their expectations are greater than ever. Organisations must ensure that the customer experience is consistent across the right channels, whether that be online or offline.

The experience – and more significantly expectations – are diverse across various markets. As an organisation, you must ensure that you have an understanding of your audience’s expectations for your products and firm. In other words, have an understanding of what they value, narrow down the common journeys and ensure that you are providing them with a consistent experience that will enable them to trust you.

Companies must go above and beyond to meet the rising expectations their customer have ensuring that they are always looking ahead in order to exploit innovative opportunities. The research conducted by Imperial Consulting Group, found that organisations that go the extra mile to make the customers life easier, will be rewarded.

Special thanks to the Imperial College Strategic Marketing Consulting Group for sharing their research findings with us: Mayssa Abed, Irene Casaburi, Salma Gaber, Shay Khosrowshahi, Devora Mateeva and Karim Mamlouk.

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Contributor: Shay Khosrowshahi