Retailers can measure and attribute interactions during customer journey to channels, and create a unified and consistent experience
21st Century Customers Are a Moving Target
Consumers are enjoying channel choices, both online and offline and are shopping everywhere, thus appearing to be a moving target for the retailers. The path to purchase of today’s customer is non-linear. She could browse on her desktop, consult with the service representative over a call, order through her mobile device, and collect the product from store.
However, most retailers continue to have distinct teams driving channel-specific customer experiences, be it Store Operations, Ecommerce, or Customer Service. Separate teams also mean that respective set of targets and metrics would govern functional performance. This is sometimes coupled with differing objectives by design, e.g., based on whether the channel is responsible for sales or service. That may limit the retailer’s ability to offer a truly joined-up experience.
For instance, menswear e-retailer Bonobos has set up 30+ guide-shops across US which they exclusively use for showrooming, while orders can only be placed online – by customers in-store or outside. If the channels lack synergy and do not complement each other well, the retailers run a risk of eroding brand equity and losing customers to competition.
How can you realign your teams in a way that all your channels are cohesively oriented to drive customer loyalty, enabling a smooth and unified experience across the entire buyer journey?
A Path Towards Unified Customer Experience
The retailers need to adapt and align their organizations to promote the true spirit of Omni-channel. The first step in this direction would be to start measuring and maintaining a heat-map of evolving customer interactions by channels, which could be achieved by end-to-end mapping and ongoing analysis of customer journeys.
By leveraging journey analytics, retailers can track and analyze the way customers use a combination of available channels to interact with an organization, including channels with human interaction (store or call center), fully automated (website or mobile), operated by third parties (franchise stores), and those with limited two-way interaction (display advertising).
Retailers with a deep understanding of their customers' journeys will gain competitive advantage to successfully exploit business moments. Customer journey mapping analytics solutions provide a wide variety of benefits to retailers, such as providing critical insights that can be leveraged to increase the effectiveness of customer engagement and to improve the customer experience.
The channel-affinity and relevance of different types of customer interactions can be derived from the analysis. This can then be leveraged to set the right objective and goal for respective teams at an enterprise level, and individual targets and performance parameters can then be defined accordingly.
As an example, if the warehouse operations is assessed based on throughput (units/day) and sales is quantified by dollar/day, a warehouse associate might be busy pushing volumes for a low dollar value-per-transaction order – while the one for a higher dollar value gets tardy!
In order to avert such situations without losing the ability to give due credit to the actual contributors, the KPIs of different teams should be connected towards common Omni-channel goals to foster coherence and collaboration between multiple stakeholders orchestrating the purchase journey of the consumers.
Some retailers give attribution for online sales initiated in stores to the ecommerce division, and the associate doesn’t get recognition. This will not motivate the store associate to ‘save the sale’ by digitally capturing the order of a visitor who did not find the right colour or size in store. There are also some examples, where ecommerce sales is attributed to stores based on the deliveries done in the store’s catchment area.
It’s important to capture cross-channel data across the entire ‘Seek-Discover-Evaluate-Purchase-Engage’ cycle and measure the interactions to create an attribution model. While Sales is an important metric, you should look beyond and design KPIs prioritising on customer experience.
For example, you could track associates walking customers to a trial room, or interacting with a customer and then “starting a trial room” for her while she continues to shop the store. This reflects the employee’s ability to shape the journey of the shopper with “guided selling”. Using RFID, you can then see the items entering the fitting room and which ones are converting. On top of that, you can rate employees on the conversion rate of articles they bring for the customer to try, in addition to what the shopper picked out initially.
Similarly, you could measure the usage of mobile-POS systems at the store, which will indicate how effectively your associates are exploiting the devices to reduce waiting time for the customers. As a strategy, it will make sense for you to adopt a ‘test-and-learn’ model and use the framework to identify what works well for you, before scaling it up with full-fledged investments.
Some of the major retailers are undertaking significant restructuring initiatives to consolidate their online and offline divisions into a single retail group, with a focus on company-wide, and not channel-specific metrics. In early 2015, Macy's announced a major shift in its corporate structure. The highlight was that Macy's and its upscale sister-chain, Bloomingdale's, merged their store and online teams for merchandising and marketing. Previously, separate groups within Macy's corporate structure were responsible for planning and marketing in-store and online product assortments. This was a major step for them in erasing the boundary between in-store and online sales, and improved efficiency by eliminating overlapping functions while also speeding up decision-making.
Omni-channel shopping behaviour now makes it difficult to accurately measure net store sales because retailers are often unable to account for cross-channel sales and returns. As a result, organisations such as Macy’s have stopped reporting their online sales separate from total sales, saying that the way consumers move between stores and the web today blurs the line between store and online sales. However, implementation of the right customer journey mapping analytics solution would not only help them in doing sales attribution but also in identifying the strategic customer-centric KPIs to assess their Omni-channel retail performance.
Development of improved Omni-channel KPIs, can be done with three key steps:-
- Measure and reward levers that drive consumers down the path to purchase, rather than just the outputs of a transaction
- Align channel engagement and staffing metrics
- Transition to a true Omni-channel P&L and organization
Instead of focusing solely on channel-centric transaction metrics, retailers need to elevate KPIs to drive overall cross-channel brand performance by consolidating their store and digital P&Ls, expanding key performance metrics to measure all the levers that drive customer behaviour across the entire customer journey, and recalibrating labour metrics to account for the full set of activities store associates perform. Measuring and attributing cross-channel customer interactions to respective stakeholders orchestrating the journey would go a long way in ensuring greater synergy and intra-organisational collaboration to secure customer loyalty in Omni-channel retail ecosystem.
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