What comes after omnichannel?
by Kirsty Bisset. I don’t believe social commerce – which isn’t a new phenomenon – is being harnessed effectively in South Africa.Wednesday, 13 Oct 2021
by Kirsty Bisset. We all know the difference between omnichannel and multi-channel when it comes to retailing, right? Just as single-channel commerce means selling via one sales channel only (like your brick-and-mortar store, your website or an online marketplace), multi-channel commerce means selling on different channels, including online and offline.
And, much like single-channel commerce focuses on a great consumer experience in whatever ‘place’ you have opted to retail through; multi-channel involves optimises the consumer experience in whatever ‘places’ you have decided to trade. Single-channel marketing strategies focus your business on a single means of reaching your customers. For example, Jamba Juice uses the single-channel strategy of franchises located in multiple regions of the US (and the beginnings of international franchising as well). By contrast, Starbucks uses a multichannel distribution system by selling in their own stores, grocery stores, and their own online site.
Like multi-channel commerce, omnichannel commerce takes place on multiple channels. The big difference is that omnichannel commerce connects all channels and omnichannel experiences account for all devices and platforms. The crux of the matter is that you can have amazing mobile marketing, engaging social media campaigns, and a well-designed website. But if they don’t work together, they don’t create an omnichannel experience for customers.
Disney is one of the best omnichannel examples. From a responsive website to its My Disney Experience tool, to its theme parks, and its Magic Band program, its interconnectedness throughout the user journey (from online to real life) is seamless. Sephora uses an omnichannel experience to strengthen customer relationships via its Beauty Insider Rewards program. With the ability to scan in-store, collect points, and engage with product tutorials, this program has seen members spend 15 times more online than the average user.
According to Harvard Business Review, 73% of all customers use multiple channels during their purchase journey. The State of Commerce Experience 2021 shows that almost half (44%) of B2C buyers and 58% of B2B buyers say they always or often research a product online before going to a physical store. Even when in-store, they will still go online to continue their research. But, according to UC Today, 9 out of 10 consumers want an omni-channel experience with seamless service between communication methods. A study of 46,000 American shoppers shows that omnichannel customers spend more money than single-channel customers. Omnichannel customers spend on average 4% more instore and 10% more online. And customers who used more than four channels spent an average 9% more in the store compared to those who used just one single channel.
So, we agree that omnichannel strategies revolutionised retailing? If we agree on that, we have to be asking ourselves, ‘What’s next for South African retail?’
Social commerce must be done right
My answer is a laser focus on social commerce. Please understand, I didn’t say, “My answer is social commerce”; I said, “My answer is a laser focus on social commerce”. There’s a big difference there, and the reason for the distinction is that I don’t believe social commerce – which isn’t a new phenomenon – is being harnessed effectively in South Africa. Social commerce is a subset of electronic commerce that involves social media and online media to support social interaction and user contributions to assist online buying and selling of products and services.
So, if ecommerce is simply the buying and selling of goods and services over the internet, social commerce is the use of social network in the context of ecommerce transactions. China’s ‘Singles’ Day’ shopping extravaganza, created by Alibaba and subsequently copied by competing retailer JD.com, has really mastered social commerce, aided by one key technology that we’ve yet to see blossom and bloom in the Western World; and by one critical behaviour pattern enabled by that technology.
First, Chinese mobile shopping apps are highly interactive and optimised for engagement. Consumers can join chat groups, watch live streams and share recommendations with friends, all in one app. This means there are a constant discussion and appraisal happening around products. Second, as a result, unlike Western consumers who begin their journeys with a search engine, Chinese shoppers start with a mobile shopping app, engaging with brand content, interacting and sharing recommendations with friends before making a purchase. Consequently, it is easier, faster and more convenient to shop.
According to CNBC, Alibaba and JD.com racked up around $115 billion in sales across their platforms during the last Singles Day shopping event, both setting new records. For both, foreign brands were a big focus as shoppers who would usually be going abroad to buy foreign products, were expected to purchase them in China due to travel restrictions.
My advice? If you’re going to develop a laser focus on social commerce, read all you can on how brands conducted themselves on Single’s Day and put the lessons you learn into play in Africa.
Main image credit: Pixabay.com.
Kirsty Bisset is Managing Director of HaveYouHeard Durban.
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