Multichannel marketing: A survival skill

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In many marketing departments, the concept of traditional "campaigns" still pervades, using direct mail, e-mail marketing, advertising and many other marketing disciplines. But in the future, it won't be about what we throw at them. Our key role will be to coordinate smaller, more relevant dialogs and interactions -- on the customer's terms. And our survival will depend on it.

The introduction of new channels and media has resulted in desperate marketers creating more and more marketing campaigns to get their messages heard over the noise from intense national and global competition.

At the same time, customer experiences are changing specifically through the advent of the Internet, where access to information and products is available 24/7, largely on the customers own terms. Against this backdrop, customers increasingly begrudge any attempts to invade their privacy, as evidenced by more than 60 million people who have added their phone numbers to the "Do Not Call" registry.

Marketers now have to deal with the fractionalization of mass media. Think about the change just in television channels. If you go back five years, most people had four, possibly five channels. Now with satellite and cable TV, most of us have access to well over 100 channels at the touch of a button. And if you walk into a convenience store these days and take look at the sheer plethora of different special interest magazines and the growth of special interest sites on the Internet, the means of accessing people through their interests has compounded dramatically.

For many marketers, this fundamentally undermines the principles of their organization, largely based on the concept of mass marketing. The day of mass marketing is actually long dead.

But probably the most fundamental change that has taken place is the fact that product is now no longer enough. For instance:

I recently saw a television interview with the general manager of Tribeca Grill, the restaurant in New York City, and I was quite startled to hear him describe his product. When asked why he has a six-month waiting list, more than any other restaurant in the city, he said, "It's the mood, not the food." They invest well over a million dollars a year in just the ambience of the restaurant. Food is a threshold requirement for them. Actually they want more than that, they want to be entertained, they want mood; they want an environment that is stimulating and different. That is true now of pretty much any product.

This trend means that marketers must understand how to construct their messages carefully; think through what an interaction means to both the customer and the organization; and create and manage content that is compelling and personal.

The Internet has now led us to a situation that economists said could never happen - consumers equipped with perfect information. One of our clients, Moneysupermarket.com, is a great example. On Moneysupermarket.com, they run what they call an aggregation service where you register all the products that you have with various institutions and every day they scan the market for a better product to meet your needs and then prompt you with an e-mail when they have found one. "You are currently getting 4 percent interest on your savings; this new product has arrived on the market and can pay you 4.5 percent would you like to change? If yes, click on this button."

The disintermediation that is taking place in that environment is being replicated in most product lines today. What price is loyalty in that market? As an organization you might well be able to satisfy your customers, but is satisfaction enough these days? In many organizations, the answer is a resounding "no." The only way that you keep and retain customers is if you consistently outperform their expectations at every single interaction point.

As the Moneysupermarket.com example shows, if the value derived from switching outweighs the cost of switching, and it is easy, then it is very difficult to maintain loyalty in that market.

When set against these market shifts, it is not surprising that many marketing campaigns are not working any more, as customers increasingly interact on their own terms.

In today's multichannel environment, customer interactions increasingly start with the customer, being there for the customer at the point the customer wants or needs the company's support, products or services. It requires:

· An environment where the customer can initiate an interaction to request information, seek advice or explore options and features

· Company-initiated communications that are timely, relevant and personalized to specific needs, interests, preferences and aspirations, recognizing that customers are interested in different things

· Companies to use channels and communications with better ROI in different ways. For example, e-mail is cheaper than direct mail, and public relations is cheaper and can more rapidly connect a brand with fast moving market trends and issues

· Companies to develop communications and messages that are intelligent, innovative and empathetic, proactively predicting and acting upon customers' needs and providing offers and solutions that meet them

· Companies to initiate communications that are consistent and that build in a holistic way

· Organizations need to recognize that customers have different preferences. For example, a customer buys product 1 from channel A; then buys product 2 from channel C; but wants to be serviced for both products from channel B.

This shift in requirements and the need for flexibility requires the marketing organization to think more holistically about integrating online and offline communications and how to use multi-channel marketing to orchestrate communications seamlessly.

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