Sugar & Spice

Feb 01, 2002 10:30 PM  By

But is everything nice? Your multichannel customer service offerings need to be as splendidly complete and as thoroughly organized as Wolfgang Puck’s spice racks. Any collection of seasonings belonging to a world-famous chef would never be without basil, paprika, and garlic, regardless of whether the culinary master was serving his family or a visiting dignitary, so never let your multichannel enterprise have great live agent service but spotty Web chat capabilities. Customers have never been known to lower their service expectations, regardless of how they buy.

Experts point to inconsistencies in customer relations and internal procedures and processes, information gaps, and weak crossover between channels as obstacles that need to be overcome. In a comprehensive study on multichannel business, Shop.org, a division of the New York City-based National Retail Federation, found that the opportunities for companies who embrace a synergistic strategy for different channels are exceptional, but that most merchants have a long way to go to achieve their multichannel objectives.

Companies participating in the study included 22 retailers with combined sales exceeding $125 billion in 2000. The findings include the following:

  • Multichannel customers spent considerably more with the same company than in-store-only shoppers (an average of $600 more).
  • Most online shoppers have also purchased from the same retailer’s stores, and 45% of online shoppers have purchased from the same retailer’s catalogs, where that option was available.
  • Online shoppers were the most likely to purchase both from the store and the Web site, and to research their purchases online.
  • The catalog sales channel will not disappear. It may even hold the keys to multichannel success because many catalog businesses were among the first to successfully add the Web to their strategies.

“It’s critical to understand that there can be a negative impact on any company’s brand equity if multichannel activities are not done well,” says Elaine Rubin, chairman of Shop.org. “Most traditional companies originally approached the Internet as a separate business rather than as an additional channel. They mistakenly saw it as having less focus on the customer and more on the merchandise.”

Paul Bascobert, senior vice president of New York City-based Braun Consulting, agrees. “The failure of many dot-coms has shown that it is very difficult for an Internet business to generate revenue on its own.” Bascobert suggests that for every dollar of technology money spent, a company should put some pennies into primary research on customer behavior and reactions to specific brands.

Home cooking

The Home Shopping Network (HSN) has a unique business model, but many of its multichannel requirements are similar to those of other companies, says Norman Wright, senior vice president for customer care. The company, based in St. Petersburg, FL, has a strong Internet presence, and will soon be adding a catalog to the mix.

Across all channels, Wright says, there is a constant awareness of customer expectations. “Our television image is interwoven with entertainment to make people feel good. We understand that we need to duplicate that feeling with our other channels. To do that, we have utilized programs like a chat café online, bringing celebrity guests from our television programming together with our online shoppers. Every channel is personalized to our shoppers.”

Wright says that HSN makes a great effort to capture customers’ attention at the Web storefront, which drives business at peak times to the Internet when phone support could be under heavy pressure. HSN does about 25% more business with the same customer in various channels. One of the companies it uses for specialized support is Miami-based Precision Response Corporation (PRC), which employs a multi-lingual staff for its inbound call centers and provides the same training and work environment for its people that HSN does.

Alicia Miyares, vice president of marketing for PRC, says that this approach is critical to the success of the relationship. PRC’s Home Shopping Network team is surrounded by HSN logos and TVs showing HSN programming, and service reps have access to the same intranet as HSN employees. “We take total integration very seriously,” Miyares says.

Spice your touch points with CRM, she advises, and provide a consistent environment so the brand message is never lost. “Look to technology to create click-to-chat and click-to-talk capabilities within Web sites,” Miyares says. “This technology will be even more robust in the future and will allow continuity between channels.”

Fresh pepper anyone?

Sustaining brand excellence in multiple channels requires different levels of touch, according to Greg Martin, vice president of marketing for InfoNow, based in Denver. “The bottom line is that everyone is looking to have his or her needs met,” says Martin.

Marlene Yanovsky, executive vice president of Willard & Shullman Group in Greenwich, CT, urges multichannel retailers to embrace a single business plan for all sales avenues. She says that separate plans that compete for customers dilute a company’s effectiveness. And Yanovsky points out that “it’s the customer who picks the channel.”

Yanovsky encourages sharing information across channels, pooling response guidelines to ensure consistency, implementing certification programs, and distributing rewards built around customer satisfaction to help the transition to an effective multichannel strategy.

Richard Buckingham, author of Customer Once, Client Forever, and president of Bethesda, MD-based Goalstar Business Strategies, agrees that the capture of information is extremely important in a multichannel business environment. “It’s critical to see the sale as being the beginning rather than the end of the relationship with the customer,” he says. “The combination of hard data and feedback can help companies to bridge multiple channels.”

Information in a multichannel environment can be an exceptional tool, but information overload can be a tremendous problem for the customer, points out Mandeep Khera, chief marketing officer of Mountain View, CA-based Maaya Corporation. He recommends creating specialized content for each customer.

“It takes only a few seconds to create an information ‘Weblet’ for an individual customer, and that information can be duplicated across channels so that the customer is identifiable when business is being done in any of the channels,” Khera says.

Tea time

Successful multichannel companies don’t always shift from traditional channels to newer venues such as the Web. Todd & Holland, a purveyor of premium teas and tea accessories headquartered in River Forest, IL, began with a catalog in 1994, added a Web presence, and then opened a retail store about five years ago.

“We understood that both a printed catalog and a Web site would open a broad geographical marketplace for us, while a retail store provides a strong local presence,” says president Bill Todd.

The company’s Web site operates 24/7, and an inbound contact center addresses catalog inquiries. Because Todd & Holland strives to have a tea expert on-site to field questions, the contact center operates only during regular business hours. Visual treatment of the retail store, catalog, and Web site is consistent, as is the product content, because many customers use all three.

Clearly this is a hands-on business, but not one without technology to back it up. Todd & Holland uses analytical CRM tools from CustomerCentric Solutions, a software provider in Chicago, to make behavior-based suggestions for its customers. The data can be accessed through any channel, and personalized customer histories are readily available. These efforts have boosted shopper loyalty, and the company’s research indicates that all service criteria are being met. Most of his customers are repeaters, Todd says. “The only time we are asked to remove a name from our mailing list is when someone dies.”

Linda Water Nelson is an Austin, TX-based writer and founder of The Writing Source, a consortium of writers. She can be reached by e-mail at waternelso@aol.com.

A Taste of Tomorrow

What’s cooking for multichannel business? Sample these challenges:

  • Solve internal branding problems
  • Develop customer-centric profit-and-loss statements
  • Rationalize in-store space
  • Integrate information in a clear, consistent, and concise way
  • Segment customers using analysts and technology
  • Find a balance between high- and low-risk projects
  • Create real-time inventory solutions
  • Manage expectations to match capacity

Source: The Multichannel Retail Report 2001, Shop.org; research conducted by J. C. Williams Group and BizRate.com; study underwritten by MSN eShop and R. R. Donnelley