Multichannel, Omnichannel, and Alice in Wonderland
Down the rabbit hole
I'm pretty fond of the Lewis Carroll adventure Alice in Wonderland. As a young child, it was my go-to book when I was either sick or playing hooky from school. It's also regarded as one of the best examples of the literary nonsense genre that for me illustrates that smoke and mirrors can often hide what's really going on.
You're probably wondering what this literary reference has to do with a multichannel or omnichannel discussion. Well, I've had a lot of business associates either tell me they think that deploying an omnichannel strategy qualifies as the best thing since sliced bread—or as utter nonsense. In fact, as both a marketer and a supply-chain professional, I've come to recognize that we sometimes rush to embrace a new strategic approach—like omnichannel—only to create unexpected, redundant, and confusing results. And Alice, I think, can provide some context for that discussion.
Down the rabbit hole
Essentially, proponents are defining omnichannel as the next step in multichannel retailing—its logical evolution, but one that's more focused on creating a seamless consumer experience across all available shopping channels.
My contention is that, metaphorically speaking, blindly latching onto the term “omnichannel” is like diving down the rabbit hole—in an attempt to address the changing expectations of consumers and our own shortcomings, we're missing the fundamental issue. And I have to ask some basic questions. Are customer expectations really an issue? Are we trying to solve an organizational and alignment problem that's always existed but has gone unacknowledged by traditional retailers, or are we really responding to actual changes in consumer behavior?
In my opinion, we've just found a new way to describe legacy organizational structures that remain misaligned. And if this is the case, you probably have some organizational problems to repair that have been some time in the making.
When Alice meets the incessantly grinning Cheshire cat, she says, “Would you tell me, please, which way I ought to go from here?” The cat famously responds, "That depends a good deal on where you want to get to.” It would benefit retailers to consider this qualifying answer in the context of their own strategies. In the purist sense, they want to:
- Increase sales
- Increase retention and loyalty
- Lower operating costs
- Optimize inventory
- Increase supply chain efficiency
- Use resources wisely
The caterpillar and the mushrooms
I was too young during my early enjoyment of Alice's adventures to question what the caterpillar was smoking, but whatever it was, it forced the poor guy to spend an inordinate amount of time navel-gazing. He never looked at the world around him and its reality. For retailers, today's customer is the reality, and all the marketing in the world can't compensate for an inwardly focused strategy or a backend process that doesn't deliver on the brand promise or meet customer needs.
So, what can you do if you have an alignment issue?
1. Don't eat the hallucinogenic mushrooms that lead you to try to sell your customer what you can't deliver. Some basic rules for success:
- Research your customers and truly understand their needs.
- Assess your organization's current ability to address those needs and take any steps necessary to ensure you're capable of meeting them.
- Understand, define, and promote your unique value proposition, including why you're different and/or better.
- Break down internal silos by assembling a cross-functional team to handle all these tasks. Team members should include those responsible for ensuring sales and loyalty both before and after the customer hits the buy button.
2. Forget the fact that your operations folks are on the bottom half of the P&L and support them with the tools they need. For example:
- Align performance metrics and incentives on both sides of the buy button. There's a direct correlation between incentives and performance.
- Make real-time a reality in everything you do, including providing real-time reporting and feedback to your team.
- Unify your inventory management systems for all channels and extend visibility throughout the organization.
- Build a team culture where people think systematically so they're able to look at the entire chain and flow to identify and fix friction points that upset customers.
- Become obsessed with defining and delivering operations excellence. Embed this obsession into your retail and fulfillment culture.
So, multichannel or omnichannel?
At the end of the day, I see little difference between these two strategic initiatives. Great companies focus on the customer. Period.
Catalogers have understood for years that retention and loyalty are earned at every customer touchpoint. They've also long understood the simple fact that cross-channel customers spend more money, and the most successful among them have morphed their businesses into multichannel enterprises.
Regardless of what you call it—multichannel or omnichannel—a focus on the customer ensures that you're not going to be Alice in Wonderland.