Is Multichannel Marketing Really “Dual-Channel” Marketing?

With the clamor in the marketing world about multichannel marketing, it recently dawned on me that most so-called multichannel marketing is more like “dual-channel” marketing.  The campaigns that I’ve seen usually combine two symbiotic channels such as website and email, website and bricks and mortar, email and phone, direct mail and phone, print and PURL, etc.  My guess is that way over half of all multichannel campaigns actually involve only two channels.

Why is this important?  Well, for one thing, we’ve all heard the statistics that multichannel customers are more profitable than single channel customers.  Forrester estimates that “multichannel customers spend five times more on their in-store purchases alone, compared with the retailer’s average customer.”  Also in the same Forrester study, “Seventy percent of US online consumers research products online and purchase them offline.”

There are three critical components in any multichannel marketing campaign:

1. Coordinating and managing multiple marketing channels
2. Developing channel-appropriate communications focused on the customer (and not the channel)
3. Matching campaign objectives with the right channel.

In my opinion, these three components are so difficult to do that early pioneers are implementing dual-channel campaigns because it is much easier given the existing barriers to successful multichannel marketing campaigns.

What are the barriers to real multichannel marketing?

Multichannel marketing is not easy and there are roadblocks at every turn.  There are four things that continually seem to block marketers from using more than two channels in their campaigns.

• It’s difficult to get data from several channels. In most cases, offline and online data are stored in separate databases.  And the advent of social media has further complicated the issue because it’s difficult to connect with a consumer on a one-to-one basis when the only data you have is a profile or cookie.   Also, the data that we do have is often suspect.  To illustrate, Forrester said that “nearly 45% of direct marketing respondents …told us that they lack an email and postal address for the majority of their entire database.
• Customers are not asked for channel preference. It’s almost sad that in this day of one-to-one and multichannel marketing that most marketers don’t ask nor maintain information on what channels the customer prefers.
• Organizational silos inhibit the sharing of information across channels. Most companies are organized functionally into groups such as marketing, sales, operations and e-business.  Social media is now blurring the lines between these functions as it becomes incorporated in them all.
• IT organizations are challenged by online expertise. Internal IT shops are much more comfortable with offline and CRM data than online data.  They don’t show the same level of expertise or enthusiasm for online marketing applications.

7 tips for practicing multichannel marketing in the real world.

Here are some things you can try as you ramp-up your multichannel marketing.  My advice is to use 2011 as a year to experiment and see how you can overcome these barriers.

1. Embrace dual-channel campaigns. They are easier to implement, so try using two channels when applicable.  You can add on more when possible.
2. Identify “can’t miss” opportunities. When you have a proven business case and well-defined metrics, use this opportunity to try communicating in more channels than you have  in the past.
3. Use web analytics to understand channel effectiveness. By studying how online visitors behave, you can get a better idea of channel effectiveness and cross-sell opportunities.
4. Run predictive models to score for “most likely channel.” It’s possible to use the same scoring techniques that are used in other marketing programs (i.e., most-likely to buy, most-likely to defect) to determine which customers would be multichannel customers.
5. Profile online and offline customers and compare. Customer profiles can determine how consumers behave differently online and offline and how they transition from one channel to another.
6. Use loyalty programs to see how customers behave over multiple channels. Loyalty programs are a good way to gather historical information of how consumers purchase in multiple channels.
7. Invest in multichannel marketing software. There are several new SaaS tools available which allow marketers to execute marketing programs in many channels from one web-based platform.

Hopefully, by experimenting with multichannel marketing campaigns, you will begin seeing some of the ROI improvements mentioned by Forrester.

Resources:

“Moving from Multichannel to Cross Channel Marketing”

“Developing Effective Multi-Channel Marketing Strategies”

“Profiling the Multichannel Consumer” (Forrester Research)

“Creating a Multichannel View of Your Customer” (Forrester Research)

“Using Digital Channels to Create Breakthrough Multichannel Relationships” (Forrester Research)

About the Author:

Kenyon Blunt is the CEO of the database marketing analytics firm: SIGMA Marketing Group.  Connect with Kenyon on  or follow him on .

Related Articles:

Customer Engagement:   a New Spin on Customer Intimacy

Tagged as: Kenyon Blunt, Multichannel marketing