GUEST COMMENT 2012 – The year of the dragon

by Kees de Vos

2012 is the year of the Dragon – the undisputed king of Chinese astrology. It signifies, amongst other things, opportunity. It could be coincidence, but in my opinion, no better sign could represent what we are dealing with for the coming year. Yes, we live in difficult economic times, but multichannel is where big gains can still be had.

In 2011, the consumer demanded multichannel – recent research from Econsultancy shows that across Europe the majority of consumers now prefer to buy from sellers that offer their products through multiple channels. In more mature markets such as the UK this percentage is as high as 73% and no doubt rising.

But change doesn’t stop here – in 2014 internet access through mobile phone will surpass the home or work computer as the primary device to access the internet. Social networks continue to grow at quite astonishing rates. Information is closer, more immediate than ever and this is continuing to change consumer behaviour; they are more and more demanding and are looking at retail to keep up. Today’s customer is less loyal, always looking for a deal, as well as a great level of service.

The customer is expecting to be served in whatever channel, at whatever time they fancy. And with the barriers to switch from one retailer to the next lower than ever, you will have to meet and possibly exceed their expectations more than ever before. This means we need to constantly challenge ourselves, understand how the customer wants to interact with us. A good example is mobile. Where our initial instinct told us we needed to transplant our transactional capabilities onto a mobile device, it turns out that only one in eight consumers use their mobile to buy something online, where one in four consumers use their mobile to find their local store and one in five use it to compare prices in store. Mobile is a multichannel shopping aid, not necessarily a shopping cart.

Yes, the ‘customer is always king’, but now we will have to live up to that statement. It is no longer about being present in all of the channels to market, it is about tying these channels together to such an extent that the customer doesn’t notice the difference in experience between the channels. And that experience needs to be world class.

So, the multichannel customer experience needs further attention. This is no news – the industry is already reacting to this and terms such as CXM (customer experience management) will soon take over multi/omni/cross-channel as the most overused word in retail. Both new and existing solutions that have been around for years get re-branded as CXM solutions and seen as the best thing sliced bread. A quick fix? I doubt it. The new demands that a cross channel multichannel experience puts on the IT department and its systems go beyond the some of the point solutions we see emerge and often only deal with part of the problem.

These new demands fall into roughly four categories.

Data needs to be consistent, relevant and accurate across all channels

Consistent data will enable the same messaging across all channels, that being price, promotion, stock levels or product description. Increased relevancy will help to target the message better towards the customer and of course it has to be correct. We should probably also include timeliness in our definition of accuracy, as these days the customer uses multiple channels at the same time, for example when checking prices on their mobile in-store. This means that ‘batch’ synchronization of data across channels will become less and less appropriate for data provision in each of the channels.

Understanding of customer behaviour across channels

Only when we understand customer behavior across channels we can start optimizing the multichannel customer experience. Shooting in the dark makes it much harder to hit our target.

Managing the customer experience effectively across all channels

From an operational perspective, you will need a single place to manage this new customer experience. The complexity of running multiple channels from multiple systems, and the synchronization of data between those systems will make it nigh on impossible to manage this effectively from more than one place.

Improved reaction time to change

Multichannel as a whole, and the associated customer experience, has most certainly not reached its end game yet. It will continue to develop over the years to come. IT teams are more than aware that ecommerce systems change at a rate much faster than traditional systems. As multichannel spans the entire organization, a new approach to system development and indeed a different breed of IT systems will be required to keep up with this rate of change.

The first three points made above are sequential and, depending on where you are, signify to a certain extent, the level of maturity you have reached in managing the multichannel customer experience. In order to effectively mature from the first stage to the next, a single view of a number of data points will need to be established; a single view of product, customer, order and stock data. Without these, an effective multichannel experience will be hard to manage and the rich opportunities that multichannel has to offer will be lost.

Kees de Vos is VP Business Consulting at hybris