The ABCD Of Channel Strategy In Consumer Retail
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<div style="text-align: justify;"> </div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">Lucky are those who get to be consumers in the 2020s. In a handful of years, we consumers have experienced shopping at Mom ‘n Pop stores, hyper and super marts, in-store pickup, home delivery, hyperlocal q-commerce, social media purchases, and shopping in the metaverse, among many other interesting, active and unique channels.</span> </p><p> </p><h2><span style="font-size: 14pt;"><span xml:lang="EN-US" data-contrast="none">Omnichannel to Multichannel Strategy</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></span></h2></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">Not too long ago, ‘Channel strategy’ evolved into the buzzword ‘omnichannel strategy,’ signified by access to a common inventory from different channels for the end consumer. While it made sense on paper, offering better availability, improved inventory turns, common price & experience, among other benefits, it came with its own set of operational challenges. Few brands can lay claim to have successfully implemented it in spirit.</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">This slowly gave way to a subdued yet effective concept of ‘multi-channel strategy’—an evolution of ‘omnichannel,’ if you will, removing the restrictions of omni and yet retaining its major benefits. In simple terms, a multi-channel strategy indicates the presence of the brand and its products across multiple channels, thereby enabling discovery and purchase from most, if not all, of these channels.</span> </p><p> </p><h2><span style="font-size: 14pt;"><span xml:lang="EN-US" data-contrast="none">Effective Roadmap towards a Functional Multi-channel Approach</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></span></h2></div><div style="text-align: justify;"><p><strong><span xml:lang="EN-US" data-contrast="none">All Channels</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></strong></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">The products should be visible to consumers across all channels, even beyond where the users can buy. Akin to the 360-degree approach for marketing, a good multi-channel strategy will ensure the consumer is able to see and engage with the products and, therefore, the brand, regardless of which channel the customer chooses at any point in time. These could include stand alone outlets, multi-brand outlets, horizontal ecommerce platforms, vertical / niche digital platforms, social media (including Instagram and Facebook shops), Google and traditional media. </span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">View-only channels will enhance visibility, while purchase-friendly channels are likely to bump up conversions.</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><strong><span xml:lang="EN-US" data-contrast="none">Benchmark</span></strong><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">With limited resources and bandwidth, it is easier said than done to create a fruitful presence across a growing number of channels. This is where the effectiveness of strategy comes into play, which can be further bolstered by external benchmarks, i.e., direct and indirect competition and the extent of their presence on these channels, and internal benchmarks, i.e., the brand’s own performance across these channels, to craft an appropriate allocation across each. This is likely to be an iterative and dynamic process that should be closely monitored for results & feedback.</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><strong><span xml:lang="EN-US" data-contrast="none">Communication</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></strong></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">As with most things in business, shall be key. Mere presence across channels is unlikely to yield any significant benefits to the business if key stakeholders, especially end consumers, are unaware of the same. Via direct communication from the brand (mail, WhatsApp, notifications, Socials, SEO, etc. - and indirect showcase (ads, sponsored listings, banners, priority search, etc.), both discoverability and conversion of the products can be significantly enhanced. Eyeballs, intent (clicks), and conversions can be tracked by channel to refine the strategy and determine which channel is likely to yield better results for which KPIs. This may also be a great way to tag customer segments to channels and refine the marketing levers accordingly.</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><strong><span xml:lang="EN-US" data-contrast="none">Digitize</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></strong></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">Offline channels remain the largest contributor for most categories and rule the roost in major geographies, including metros. But, the first touchpoint for discovering the brand, knowing about a new product, reading reviews, or comparing it to other products, is quite likely via digital interaction. </span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">Additionally, a digital footprint gives faster access to a wider scale of target audience than an offline endeavor. Digital technology also gives a unique opportunity to track customer behavior and tap into real-time analytics with much greater accuracy and detail. </span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">Additionally, digital monitoring of multiple channels can quickly highlight red flags, price mismatches, customer satisfaction scores, and more.</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">The above list may not be exhaustive, but it can put you on track for growing your brands and penetrating new segments, somewhat independent of the choice of channels you use for your approach. This also gives you the flexibility to fail fast or scale fast, depending on feedback from individual channels. </span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">At the end of the day, rest will of course come down to your and your team’s ability to execute; but maybe with better odds!</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":279}"> </span></p></div><div style="text-align: justify;"><div><p xml:lang="EN-US"><span style="font-size: 10pt;"><em><span xml:lang="EN-US" data-contrast="none">This article was contributed by our expert </span><a href="https://www.linkedin.com/in/singhangad/" target="_blank" rel="noopener">Angad Singh</a></em></span></p></div><div><p xml:lang="EN-US"><span xml:lang="EN-US" data-contrast="none"> </span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":1,"335551550":6,"335551620":6,"335557856":16777215,"335559738":0,"335559739":0,"335559740":375}"> </span></p></div><div><p xml:lang="EN-US"><span xml:lang="EN-US" data-contrast="none"> </span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":1,"335551550":6,"335551620":6,"335557856":16777215,"335559738":0,"335559739":0,"335559740":375}"> </span></p></div><div><h3 role="heading" xml:lang="EN-US" aria-level="3"><span style="font-size: 18pt;"><span xml:lang="EN-US" data-contrast="none"><span data-ccp-parastyle="heading 3">Frequently Asked Questions Answered by </span></span>Angad Singh</span></h3><h3 role="heading" xml:lang="EN-US" aria-level="3"> </h3><h2 role="heading" xml:lang="EN-US" aria-level="3"><span style="font-size: 12pt;"><span xml:lang="EN-US" data-contrast="none">1. How can consumer retail brands leverage emerging technologies such as augmented reality (AR) and virtual reality (VR) to enhance the in-store shopping experience and drive sales?</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></span></h2></div></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">In the short term, both are likely to serve as a unique marketing opportunity that is futuristic and differentiated from the competition. Both can help solve specific friction points in the buyer’s journey in the medium to long term. AR reduces the time and effort that goes into either trying on the products or visualizing them at home or office, etc. VR helps bridge the gap between offline and online by facilitating an in-store experience in a virtual environment. </span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">Once the technology to access both these media effectively becomes cost-effective and more efficient, they might just become the norm!</span> </p><p> </p><h2><span style="font-size: 12pt;" xml:lang="EN-US" data-contrast="none">2. How can consumer retail brands navigate channel conflicts and maintain positive relationships with both online and offline partners, such as wholesalers, distributors, and franchisees?</span> </h2><p><span xml:lang="EN-US" data-contrast="none">That is a billion-dollar question, quite literally. For a multi-channel approach to work, each channel must willingly participate and contribute to the brand’s growth. If one channel sees another as a competitor either for consumer attention or resources, then conflict is bound to surface. The approach must be collaborative, with shared risk and rewards. This can be enabled via common inventory access, pricing parity, well segregated TG, equitable promotions, and other commercial tools. Transparency in channel performance and ROI of spending may also reduce conflicts, while shared benefits from different channels (e.g., involving offline players as online sellers for their geo-locations) can also be a great incentive.</span> </p><p> </p><h2><span style="font-size: 12pt;"><span xml:lang="EN-US" data-contrast="none">3. What are the key considerations for businesses looking to expand their digital footprint into new channels and platforms, and how can they prioritize investments and resources to achieve their multi-channel marketing goals effectively?</span> </span></h2><p><span xml:lang="EN-US" data-contrast="none">Given the number of variables – channel effectiveness, target customer segments, price sensitivity, demographics, season, competition, and others – it may not be possible to have a definitive answer to this question. Prioritization of investments and resources may be optimized iteratively, with real-time feedback from the market across channels. While benchmarking competitors’ efforts across channels may serve as a nice shortcut, the playbook toward iteratively improving the channels is best designed and utilized for the best results.</span> </p><p> </p><h2><span style="font-size: 12pt;" xml:lang="EN-US" data-contrast="none">4. How can businesses leverage customer journey mapping and touchpoint analysis to identify key moments of interaction across different channels and optimize the customer experience for each segment?</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></h2></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">Customer journey mapping, if done right, can provide a wonderful bird’s eye view of multiple user stories and specific use cases across channels. Understanding different TGs and their interface with channels can give invaluable insights into how to market and build the channel and acquire and retain customers for the channel. </span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p></div><div style="text-align: justify;"><p><span xml:lang="EN-US" data-contrast="none">An overlay of touchpoint analysis and tracking via the right metrics can help gauge the effectiveness of these efforts and levers to enhance customer satisfaction by channel further.</span><span data-ccp-props="{"134233117":false,"134233118":false,"201341983":0,"335559738":0,"335559739":0,"335559740":279}"> </span></p><p> </p><p> </p><p> </p><p> </p><p> </p></div><div><p style="text-align: justify;"><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":279}"> </span></p></div>
KR Expert - Angad Singh
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