Over the last 20 years, there have been significant changes in how a customer is contacted and how a customer can interact with the seller/retailer. The world has moved from the concept of Single channel to Multi-channel to Omni-channel. Let us understand how these differ from each other.
The customer had only one mode of interacting with the seller – going into a shop to buy a product. The seller had to be present physically i.e.,open a shop in order to engage with the customer hence limiting the reach of the seller. Information about the product was also not freely available.
With the evolution of technologies the multi-channel concept was introduced. The customer could interact with the seller or get information about a product in various ways, through a website (e-commerce), calling a call centre (telephony), and mobile applications.
The main advantage for the customer was the easy access to information about the product and greater availability. The reach of the seller also was increased multi-fold. Individual channels could be evaluated for effectiveness and marketing strategies could be aligned accordingly.
However, the limitation of the multi-channel concept was that each channel may not be aware of what other channel is doing, thus limiting the customer engagement experience.
Business scenario of a multi-channel interaction
Mr Smith, a loyal customer received a promotional offer of a 20% discount on a LED TV from the Marketing department. He logs in to his customer account, searches for the specific product. He is not convinced. He calls the Customer Sales representative and explains that he has received the promotional letter for the LED TV and mentions the discount of 20%. The sales representative searches for the product, makes sure Mr Smith is eligible for the discount, and confirms this to him. After some more clarification, Mr Smith places the order.
We notice that each of the channels is unware of the interactions that have taken place with the customer over other channels. Although the LED TV was marketed and was eventually sold to Mr Smith, the Customer Experience was not seamless and smooth.
Limitations of the multi-channel concept led to the evolution of omni-channel (comes from the Latin word ‘Omni’ which means all or universal).
In the Omni-channel concept, each channel will track and react to customer interactions that take place over other channels. It is designed to provide a seamless approach to the consumer experience through all available shopping channels, i.e., mobile internet devices, computers, radio, direct mail, catalogues and so on.
Business scenario of an Omni-channel interaction:
Using the same example as before, Mr Smith, a loyal customer received a promotional offer of a 20% discount on a LED TV from the Marketing department. He logs into his customer account, and sees on his normal welcome page a banner indicating the LED TV promotion. He reviews the product but wants to know more. He calls the Customer Sales representative who identifies him, and knows that he has been sent the promotional offer for the LED TV. He also knows that Mr. Smith has checked out more information on the website. The sales representative thanks Mr. Smith for his interest in the promotion (instead of being told) clarifies some further details and continues to take the order.
The transition of information from one channel to the next, results in a smooth and seamless Customer Experience for Mr. Smith.