The New Rules of Multichannel Marketing

Apr 23, 2008 8:10 PM  By

Does it seem like when you understand how everything works, they change the rules? If so, you had better get used to it. Right now, this second, someone is thinking about new ways to entice your customers. New technology opens doors to new channels and opportunities. Business as usual will never be the same. The rules have changed and will continue to evolve. Are you ready to play to win?

New channels and technology are creating a virtual marketplace when, where, and how the consumer wants it. Instead of replacing traditional shopping outlets, these additions increase our opportunity to connect with our customers. Growth and profitability goes to the companies who integrate their channels into a seamless shopping experience.

Business as usual doesn’t work anymore.

Promotional marketing created by a designated department isn’t enough to engage empowered consumers. They require a 360° approach that includes every department and touch point.

Consumers love the ability to shop, buy, and return at their convenience. At the same time, they long to connect with others. Unfortunately, the technology that provides do-it-yourself service has removed the personal touch. It is time for all companies to start using their tools to build relationships instead of simply processing promotions and orders.

Rule 1: Leave Everything Better Than You Find It

The days are gone where people operate in their own little world, oblivious to things happening elsewhere. The smallest change in one area can have a huge effect on another. The old rule, “Every man (or company or department) for himself!” is outdated.

Adopting the “leave it better” rule reduces interdepartmental surprises. When the philosophy is accepted throughout the company, people think about the needs of the whole instead of the individual. It benefits every area from housekeeping to profitability.

Rule 2: Disrupt Business as Usual

The old rule, “if it isn’t broken, don’t fix it,” has been successfully challenged by a few disruptive thinkers. Amazon, Netflix, and Apple changed the way we buy books, view movies, and get music. They built their unique business models by combining working strategies with new technology.

Disruption has to have a purpose to be effective. Change for the sake of change is not productive. There are different levels of disruption. Most companies won’t hit product homeruns like iPod or redefine an industry like Netflix. They will quietly make changes that improve customer interaction. And, they will enjoy substantial success in the process.

Rule 3: Your Best Customers & Products Are Losing Value

And, their value will continue to decline as channels and shopping opportunities expand. B.G. (Before Google), most consumers were confined to local or catalog shopping. Space and cost restrictions limited product selection. Pareto’s rule worked in that environment. Consistent buying patterns emerged. Marketing teams used them to predict sales. Inventory management teams used them to predict demand.

Everything changed when those boundaries disappeared. Consumers are free to choose where, when, and how they shop. (Not to mention what they pay.) New buying patterns that affect every business are starting to emerge. This means that principles we have used for decades to refine our priorities and manage our resources don’t work in the global market.

Rule 4: Use the Shopping Experience to Keep Customers Coming Back

Deep down, everyone knows that a quality experience is powerful. Have you ever seen a corporate mission statement that didn’t include service? If we know that it is important, why does the American Consumer Service Index (ACSI) continue to decline?

If you are not increasing your corporate value, you are not building a multi-generational company. Return on investment is important, but it is a short term gain. A campaign that adds value, builds wealth. Even if it breaks even or loses money, the long-term gain offsets the loss.

If you don’t understand your customers, you won’t add value to your company. When everything revolves around sales and response rates instead of building relationships, your business is transaction based. Long-term success requires loyalty. It begins by clearly defining your customers’ needs. Then you will know how to meet their expectations consistently.

Rule 5: Design Business Processes to Improve Customer & Employee Satisfaction

The new global economy demands efficiency throughout the organization. Low incremental costs allow extended product lines and competitive pricing. The automation of business processes improves productivity and reduces costs.

Your employees are the key to customer satisfaction. They need to have the tools and empowerment to resolve issues, answer questions, and interact with your customers. Without them, your business is a commodity instead of a brand.

The purpose of every business is to fulfill customers’ needs at a profit. The business ceases to exist without customers. This reality is often forgotten in the hunt for more sales at a lower cost.

Adapting Rule 5 is a three-part process: Analysis, Elimination, and Enhancement. Your goals throughout this exercise are to enhance the customer experience, improve employee morale, and reduce costs.

Create Your Own Masterpiece

Our world is evolving. The rules that we use to manage our businesses have to change to match the global market. Our success is dependant on our ability to adapt. Years ago, Charles Darwin warned us. He said, “It is not the strongest of species that survive, or the most intelligent, but the one most responsive to change.”

The barons of the industrial age are extinct. The programmers of the information age are dated. The future belongs to the few who can merge the best of both ages into economic advantage. The access to information provided by the Internet empowers consumers. Ignoring this is corporate suicide.

If you create your own masterpiece, then you are the master. It is impossible for anyone to duplicate your strategy and corporate culture. It doesn’t matter where you are today. You can start building the foundation for tomorrow’s success. It isn’t a project. It is a process that requires attention every day to move forward.

The rules will continue to evolve. If you create a flexible corporate culture that adapts to changing customer demands, you will have a sustainable strategy. Begin with the basics and build a flexible organization.

Debra Ellis is president and founder of Wilson & Ellis Consulting, a management, marketing and operational solutions consulting firm based in Barnardsville, N.C. Her new guide, “The New Rules of Multichannel Marketing” redefines the rules of the multichannel marketing game. For more information, or to get a copy of the guide, visit www.wilsonellisconsulting.com.