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Advantages of Multichannel Marketing
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Presented by:Jeffrey GraueMarketer Senior Analyst
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Jeffrey GrauSenior Analyst
M A Y 2 0 1 0
The Advantages of Multichannel Marketing
It is all about “leveraging the strengths of each channel to create an overall customer experience that is greater than the sum of its parts. It’s 1+1=3.”—Kevin Ertell, VP, retail strategy, ForeSee Results, September 2009
What is multichannel marketing?
Topics we will cover
Research online, buy in-store
Buy online, pick up in-store
Shop in-store, look up online
Shop the catalog, buy online
Research Online, Buy In-Store
The online channel excels as a source of product reviews, personalized recommendations and 24/7 shopping convenience.
Multichannel marketing marries the best of e-commerce and stores
Stores are a place to see and touch products, get answers from sales associates and satisfy immediate product needs.
Online research influences a significant amount of store sales
Consumers often research household products online
Sequential
Interactive
Smartphones change how consumers research online, buy in-store
How smartphones create an interactive in-store shopping experience
See product ratings and reviews.
Receive real-time personalized offers and rewards.
Keep a wish list.
Share activities and products with friends on Facebook.
Check store inventory.
Compare competitors’ prices.
Retail beauty chain Sephora brings customer reviews to in-store shoppers
The first retailer to create a mobile site for ratings and reviews in late 2009.
Has over 1 million reviews across almost single every product.
In-store shoppers retrieve reviews by typing in the product name or SKU number.
“The mobile site is driving sales in stores. It’s keeping some customers in stores longer by giving them this information at their fingertips.”—Julia Bornstein, senior VP, Sephora Direct, in Internet Retailer, November 2009
Gen Y leads other cohorts in using mobile phones while shopping in a store
Females are catching up to males in their mobile Internet usage
Buy Online, Pick Up In-Store
Buy online, pick up in-store
Pick up in-store
Ship to store
Nearly one-half of online shoppers say buy online, pick up in-store is important
Avoid shipping fees.
Satisfy an immediate need for a product.
See and touch a product in-store before purchase.
Avoid time shopping and checking out, since the item is already paid for.
Be confident that the product is available and waiting for them.
Eliminate concerns about letting a package sit on a doorstep while away.
Benefits to consumers of buy online, pick up in-store
Retailers have the metrics to prove strong customer usage
Ace Hardware. 73% of Web orders are shipped to stores and 80% of online revenue goes to ship-to-store (eMarketer interview, November 2009).
Borders. Every week, 25,000 to 30,000 customers use the option to reserve online and pay in-store (Internet Retailer, January 2009).
Wal-Mart. 40% of Web orders are shipped to a store (Internet Retailer, November 2009).
Systems. Knowing what inventory is in stock in all stores and sharing that information in real time with its Website operations.
Personnel. Deciding who should pull stock off the shelf and training employees to run the program.
Process. Ensuring there is enough store space to stage online orders waiting for pickup.
Retailers face hurdles executing this service effectively
Retailers must consider many elements when planning the program
Where on the retailer’s Website will the service be promoted?
What types of confirmation and notification messaging will be used?
What information will be given in the order notification message?
Where in the store will customers pick up their online orders?
Shop In-Store, Look Up Online
Shop in-store, look up online
Web access
In-store kiosk
In-store POS
terminal
Buy items online that are either out of stock or part of an expanded assortment of what is in stock (e.g., additional colors or sizes).
View detailed product information, customer ratings and reviews, and product videos.
Access wish lists and gift registries.
Check the status of loyalty points.
Benefits to consumers of shop in-store, look up online
Most Web access terminals are used by store associates, not customers
Who should be the primary users of in-store Web devices?
“Our kiosks are ‘guided selling’ led by an outfitter, which is what we call our associates.”—Kari Blankenship, retail systems manager, Cabela’s
“I am not a big fan of in-store kiosks that consumers can use because it’s a lousy consumer experience.”—Fiona Dias, executive VP, partner strategy and marketing, GSI Commerce
“Our associates are trained to take the customer to the kiosk and help them look up a product.”—Pete Howard, senior VP, Staples Business Delivery
Sales associates need to be trained and incentivized to use kiosks to help customers.
Signage should be generously displayed to let customers know employees are ready to help them.
Retailers should use self-service kiosks to tout other store promotions and services.
Retailers should tie together their mobile commerce program with in-store shopping to create a good cross-channel customer experience.
Key points: Shop in-store, look up online
Shop the Catalog, Buy Online
Shop the catalog, buy online or by phone
Buy online
Buy by phone
Shop the catalog
Catalogs have advantages over other marketing tools
Attractive displays and light weight make them enjoyable to browse.
They are hard to ignore because they arrive in the mail and must be dealt with.
By lying around the house, they serve as a constant reminder of a product of interest.
They create product awareness by exposing consumers to unfamiliar brands and products.
They emphasize product groupings which lead to higher order values.
Catalogs are driving e-commerce sales
Shop the catalog, buy online is most popular with consumers ages 40 to 54.
Retailers encourage this shopping behavior because they can feature more merchandise and product information on their Website.
Website customers who arrive from a catalog are more valuable than those from a search engine because they buy at a higher rate and better understand the retailer’s value proposition.
Catalogs accommodate the needs of certain types of shoppers
Shop the catalog, buy over the phone is most popular with consumers ages 55 and older and those living in rural areas.
Catalog shoppers who need hand-holding while buying high-priced items also prefer to order by phone.
The average value of a phone sales order is higher because skilled call center agents can stimulate upsell and cross-sell opportunities.
Cataloging: A tale of two retailers
Shifting resources to its e-commerce business.
Replacing its semi-annual “big books” with specialized catalogs such as “Rooms Babies Love,” “Little Red Book” for women and “Matters of Style” for men.
Mailed 750,000 catalogs during 2009 holiday season to retain lapsed customers and attract new ones.
Recognized that customers respond to catalogs in a different way than they do online.
Key takeaways: The advantages of multichannel marketing
Optimize your mobile commerce program for in-store shoppers.
It is not too early to think about how Apple’s iPad can be used by sales associates to assist customers.
In developing multichannel services take the time to understand your customers’ shopping behavior.
Thank you
Jeffrey GrauSenior Analystjgrau@emarketer.com(212) 763-6051
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Learn more about multichannel marketing with eMarketer Total Access.
Visit: www.emarketer.com/productsCall: 800-405-0844 Email: sales@emarketer.com
Recent Reports:Consumer Packaged Goods Take E-Commerce Path
How Retailers Handle Negative Buzz on Social Media Sites
US Retail E-Commerce Forecast: Room to Grow
The Role of Catalogs in a Multichannel Model
How Moms and Retailers Interact Online
Buy Online, Pick Up In-Store
Shop In-Store, Look Up Online
All reports are available to Total Access clients.
Powering a Better Internet © 2008 Akamai
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Advantages of Multichannel Marketing
Presented by:Jeffrey GraueMarketer Senior Analyst
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