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Omnichannel Haters: Why Aren’t Retailers Implementing Omnichannel Strategies?

Lindsay Tjepkema
Lindsay Tjepkema , Marketing Director, Americas , Emarsys

The term “Omnichannel” is, understandably, an overwhelming concept for many marketers. The thought of expanding into more than one marketing channel—but also maintaining unified, consistent, personalized experience across them all—is abstract.

Regardless of how unprepared or unequipped you may feel, the time has come for all businesses to establish an omnichannel strategy.

Why? Because there’s so much at stake, and so much to gain. Armed with an omnichannel strategy, your business can present shoppers with more opportunities to engage, interact, buy, and return to buy again. Additionally, with the right omnichannel strategy in place, customer data can be collected from a wide range of interactions across a variety of channels. All that data lives in a single database (the much coveted unified customer profile), ultimately helping you create marketing gold.

omnichannel marketing

Think omnichannel marketing is only for major enterprises that can dedicate massive resources and budget to launching sophisticated strategies? Think again. The path to omnichannel success is now illuminated for mid-market businesses and smaller brands, too.

Getting Your Omnichannel Strategy Started

Today, most brands begin their journey to omnichannel from a single channel: email. While this isn’t the only way to begin, it will afford you the most options for expansion and the best data quality. However, it requires two things:

  • Change Your Mindset: Literally alter how you think about where your business is right now, and what it will take to add or optimize web, mobile, and social media channels.
  • Establish A Plan: If you don’t already have omnichannel up and running, you’re lost in the woods, and the omnichannel roadmap is your only way out of the e-commerce wilderness. Before you start down that road, set expectations for what you hope to accomplish with omnichannel.

Key Challenges of Omnichannel Strategies

If omnichannel is so great, why aren’t all retailers implementing it? The short answer: because it’s not a quick or easy proposition.

Today’s concept of omnichannel marketing has only been around for a relatively short time. A 2010 report from IDC Retail Insights foresaw the emergence of an overarching omnichannel strategy, based on the observed success of multi-channel tactics where retailers realized a 15% to 35% increase in average transaction size.

By 2014, only 6% of retailers reported no significant barriers to becoming an integrated omnichannel company, while the other 94% cited the following obstacles as blocking them from implementing a strategy:

  • Only a third of retailers could set up basic omnichannel operation, such as store pickup, cross-channel inventory visibility, and store-based fulfillment.
  • A mere 32% of surveyed retailers were capable of letting shoppers view inventory information for in-store products.
  • 10% of the companies who offered in-store pickup could not fulfill those orders due to inaccurate store inventory.
  • Only 39% of retailers had trained their in-store sales staff to look up product information for online-only products.

By 2015, only 45% of companies believed that omnichannel was a priority, and one year later, in a 2016 study by Retail Systems Research, companies cited a host of obstacles barring their path into this arena:

    • Outdated infrastructure: 39% of the retailers surveyed stated that their existing technological framework was too outdated and/or incompatible for them to move forward with email, let alone other channels.
    • Organizational silos: Another 39% said that siloed departments made it impossible to effectively communicate or achieve marketing goals across the company. When you have eight different departments competing for budget and resources, each with its own work flow procedures, platforms, and analytical and info-gathering programs, there are going to be serious problems in building each channel’s strategy.
    • No single view of the customer: 36% of companies reported that the lack of a unified profile was crippling their attempts at segmentation, automation, and ultimately, omnichannel.
    • Insufficient e-commerce resources: Whether it’s a suite of e-commerce tools that would make collecting customer data easier, or an email automation program, 33% of retailers said they do not have the resources to take advantage of available opportunities.
    • Not enough budget: One third of surveyed retailers complained of having little to no capital investment available.
    • Intransigent platform: 31% said that updating their e-commerce platform to meet changing needs was difficult.
    • Can’t integrate online and offline: 28% of surveyed companies with physical stores said they didn’t understand how to make the most of mobile or cross-channel opportunities.
    • Can’t justify the investment: 26% reported that ROI was too difficult to quantify, which can lead decision-makers to hesitate about wading into the omnichannel river.
    • Zero understanding of omnichannel strategy: 21% of companies admitted that their marketing department did not understand the digital strategies necessary to support e-commerce expansion into multiple channels.

Notice that most of these problems were experienced by a third of surveyed retailers trying to make the transition to omnichannel, and that most companies were thwarted by more than one issue. With so many retailers dragging their feet to get on board, any company brave or smart enough to take on omnichannel stands to gain an incredible competitive advantage.

Using Email as the Foundation of Your Omnichannel Strategy

Just like putting together an actionable roadmap, overcoming omnichannel obstacles is a step-by-step process. Solving organizational silos and budget issues requires the combined efforts of your entire company, but obviously, the leadership team has to be the primary driver of these initiatives.

The big question is where to begin. If your marketing strategy already relies heavily (or exclusively) on email, then your path to omnichannel success can start by optimizing that channel first, then building upon email as the foundation. The problem can be getting staff excited about email, a channel many marketing firms take for granted. Some may need a few reminders about why email is still the killer app in the digital world, and so critical to omnichannel success:

  • Email channel is the #1 ROI digital channel. The next closest competing channel is pay-per-click (PPC), which only drives about half as much revenue as email.
  • Email is the largest social network on earth. That’s right, even bigger than Facebook.
  • Because every online shopper has an email account, our email addresses have logically become our digital IDs, a form of identification verification required every time we make a purchase, sign up for a loyalty program, or apply for a job.
  • Personalization is the dream of every marketer, and now email automation software is revolutionizing the marketer’s role by enabling them to strategically focus on leveraging customer data to interact with customers on a one-to-one basis, including incentive and product recommendations.
  • Deliverability directly impacts revenue. After all, if an email doesn’t make it to an inbox, it doesn’t matter how personalized or timely it is, it’s a missed revenue opportunity. As a marketing channel, email is unique because it is a giant global delivery and communications platform whose technology works the same no matter where you are on the planet. That makes it the best channel to reach the greatest number of customers around the globe.
  • Email offers marketers 100% targeting – an innovative way to identify gaps in audience responses to email. Data about customers who don’t respond to an email campaign can be used for continued attempts to engage across other more effective channels. While a customer may ultimately end up responding to a CRM ad or SMS notification, it was email data that helped the marketer understand there might be a better way to interact with them.

By the time you complete this stage of the omnichannel roadmap, your basic email system should be optimized to target the right individuals, with the most relevant messages and incentives, at the most opportune times.

Final Thoughts

As your most valuable asset, data will fuel your company’s journey throughout the omnichannel roadmap, so it’s imperative to get your data optimized in conjunction with your email before you head out to the web. Remember, the omnichannel roadmap is a step-by-step process, and each step must be thoroughly executed before moving on to the next one.

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Ready to learn more about how to become omnichannel? Get the free white paper: Omnichannel Marketing Excellence Starts with Email First


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