Demystifying: omnichannel and multichannel
By Nick Stacey, Director - Corporate Customer Solutions
Mon Dec 04 2017
In a nutshell
- ‘Multichannel’ refers to giving your shoppers a choice of channels to engage with your brand – including online and via mobile devices, and in your physical shops. This means when it comes to shoppers paying for things they have a choice of different payment channels through which to buy. Retailers often manage these channels independently of each other, and they may have different business goals. This doesn’t lend itself to a joined up brand experience. Omnichannel starts to address this.
- ‘Omnichannel’ means your shopper’s experience with your brand is consistent no matter what channel they’re using. All your channels are connected and often managed centrally, so shoppers can move between devices without their experience being interrupted.
What’s the difference between multichannel and omnichannel?
Say you offer your shopper the option of paying online or via a mobile app. Your website may have a beautifully designed, easy-to-use process. But when your shopper switches to the mobile app, they’re forced to re-enter their card details and are given different information about what’s in stock.
The two channels may work well independently, but they don’t share information, so your shopper’s experience could be entirely different and probably not that positive.
So, in essence, your ability to offer shoppers a consistent service – without disrupting their experience – everywhere they meet your brand, is a key distinction between being a multichannel retailer and an omnichannel one.
Shoppers’ expectations are changing as technology advances. Many now expect their mobile experience to echo that of a physical store, and want all their interactions with a brand to be personalised to them – and consistent across all channels.
They also want to be able to pay in the way that’s most convenient to them – in the store, online, over the phone, or using an app or mobile device. In short, they want an omnichannel experience, but delivering it isn’t necessarily straightforward. Understanding omnichannel is the first step.
Why it matters to your business
Your shopper’s journey is no longer a linear progression; they probably use several devices and maybe visit a store before paying for something with their card. They might read reviews on their phone, compare prices on social channels, fill their online basket on their laptop, and speak to staff in a physical store.
Knowing how your shoppers move or progress along the buying journey can help you connect with and retain them – particularly if your competitors are already embracing omnichannel techniques.
Tokenisation can be one element of an omnichannel approach. This is the process of encrypting shopper payment card data and holding it securely in a database. It can allow you to recognise that a shopper has bought from you before, regardless of the channel they use, and you may be able to use the information already held on that shopper to improve their experience, and boost loyalty to your brand.
It could also encourage people to spend more. A 2017 study by the Harvard Business Review showed that shoppers who have had an omnichannel experience are more valuable to retailers. That’s because they point not towards the impulse purchases we might expect in an increasingly mobile-first shopping environment, but to deliberate searching. And also towards ‘webrooming’ behaviour, which sees people shopping around online before committing to a purchase. Shoppers who engage with a retailer on more than one channel spend around 4% more on every shopping occasion in-store and 10% more online than single-channel shoppers.1
What’s more, with every extra channel they used, the shoppers included in the study spent more money. For example, shoppers who used over four channels spent 9% more in the store compared to those who used just one channel. So there’s a clear advantage to centralising your interactions.
How to plan and set up an omnichannel approach
If you’re looking to set up an omnichannel experience for your shoppers, it can be pretty daunting to know where to begin.
But as a business, one of the most critical steps in the whole buying process is when your shopper actually pays you. So it makes sense to start with your payments process, before focusing on your other interactions with shoppers, such as brand, marketing and sales, as well as backend processes, such as inventory management.
Most of your shoppers are likely to have similar expectations when they’re paying: is it quick and easy? Is it secure? Is it convenient?
So check that the payments systems you’re using – from contactless terminals to mobile apps and taking payments online – are simple, speedy and safe. Ultimately it’s important to consider how payment technology could ease the shopping experience, and meet any concerns they might have.
For example, Barclaycard’s omnichannel service, Barclaycard Smartpay, uses award-winning technology to help you accept payments whenever, however and wherever your shopper wants to buy – and uses the most robust anti-fraud tools2 to help keep your business’ and shoppers’ data safe.
You should also check that your omnichannel payments system complies with the Payment Card Industry Data Security Standards and can encrypt sensitive data to protect your and your shoppers’ information. Barclaycard Smartpay also includes the world’s first accredited Point to Point Encryption (P2PE) security on in-store terminals, meaning shopping in person is super secure.
Use omnichannel to give your shoppers a better experience
Giving your shoppers the same payment experience across multiple channels can make for smooth purchasing journeys. A critical part of the payment experience, behind-the-scenes, is tokenisation. This is the process that, if a retailer is opted in, encrypts shopper payment data. In short, it means no cardholder data is stored by you. Instead, a unique code is created to identify the payment card data for future visits and the shopper remains anonymous at all times.
Good news for the cyber-aware shopper, for your business when it comes to cyber-security, and for your marketing, sales and buying teams when it comes to drawing out insight from shopper journeys and buying patterns.
So consider whether omnichannel payment options such as ‘one click’, could help you generate more sales. Speeding up your shoppers’ payment process can lead to a better experience, and encourage return shopping.
Also ‘click and collect’ options – where shoppers collect online purchases from a brick-and-mortar store – can be a smart way to mesh your online and in-store experiences to be more convenient for your shopper. With this approach, your buyers don’t need to wait at home for a delivery, while you, the merchant, don’t need to arrange shipping through third parties.
What you should do now
Embracing an omnichannel approach could help you attract and keep shoppers. They are likely to move from one shopping channel to another, so you need to make sure you’re supporting them consistently through every step of their buying process.
If you want to bring your shoppers the best experience possible, and make sure you’re getting the most out of omnichannel retailing, check out Barclaycard’s Smartpay omnichannel gateway.