E-Marketing and Multi-Channel Marketing: Seamless or
Seamy?
In Chapter 00, we considered whether opening up an e-channel
for customers used to dealing with a company through branches, mail or call
centres meant that the same experience
should be offered through different channels, or that the experience should be
in some way consistent (eg based on the same set of customer data).
As with all marketing questions, the answer is found through a
combination of analysis of customer value, behaviour and needs (for example, how
much value do customers have available, what products and services do customers
need, how much are they prepared to pay for them, how does the availability of
an additional channel change the picture?) with decisions about objectives,
strategies and implementation (for example, which customers do you want to
serve, how does using an additional channel change the picture, what do
different channels cost to use, how can the approach of different channels be
combined, what systems and data are required to underpin combining their use
rather than using them separately, and what are the costs?).
These are serious questions, and you may really need consultants
to help you answer them. However, we should heed the lessons of channel
management before the e-age or from its early stages. In many industries,
customers are already managed through many channels - for example, physical
branches, mail order, telephone, field sales and/or service force. Channels can
both complement and compete with each other. The 1980s saw the introduction of
telemarketing to support and compete with many industrial sales forces. In most
large industrial companies, a relatively stable state now exists, in which
direct marketing media (mail, telephone) are used as the main channel of
distribution for smaller customers, but also a valuable channel of communication
for larger customers. There is often a zone of contention with mid-market
customers, sometimes resolved by having specialist tele-coverage operations in
which field sales people work closely with telemarketers, the former only
visiting when the latter identify the need for face-to face calls.
Interestingly, the least integrated experience is usually that of
the largest customers, where many decision makers and influencers are exposed to
so many different supplier staff and marketing/sales initiatives that
consistency is hard to achieve. However, this is not seen as catastrophic by
either customer or supplier - customers realize that they have complex needs and
that big suppliers can meet them in many ways. Insisting on an over-structured,
seamless experience may lead to opportunities being missed on both sides, and
also to customers feeling that they are being 'controlled' by the supplier. 'Why
can't I just pick up the phone and talk to anyone in your company?' they might
ask.
In consumer markets, the same arguments apply. Most major banks
are so worried about branch costs that they are diverting all customer calls to
call centres (sometimes dressed up as virtual branches). Customer surveys
already show how much customers hate this approach. Despite the advent of branch
based 'personal advisers', one of the results has been that wiser, higher value
customers know that there is often little hope of talking to anybody sensible in
the branch. So they take their most profitable business elsewhere, leaving the
bank with the rump transaction business, often so managed by these wise
customers as to be unprofitable for the bank (free in-credit accounts, any
surplus funds whisked off to a high interest deposit account with a direct
bank). If they are referred back to the
branch by the call centre, it is often because the call centre can't answer a
particular query, rather than because it makes sense (to either party) for the
customer to be talking to someone in the branch.
Along come e-mail and the Web. Great, says the customer, at last I
can e-mail someone in the branch. This means that I don't have to wait for them
to answer, and they can answer my query at leisure - next day is usually fine.
But what do customers in many (thankfully not all) banks discover? They can't
e-mail some or any of the staff in their branch. Branch staff are often not
trusted to e-mail, and they may not even have the systems to do it. For the
bank, e = Web, so if customers want to talk to the bank electronically, they
have to do it via the Web site, where their experience can be controlled. The
branch has no Web site - the customer can only talk to the national Web site.
The same is true of many other consumer service businesses.
Surely, however, one of the great strengths of e-mail as a channel
is that it allows people to correspond in a controlled, non-invasive way. As
government is discovering, text messaging and e-mail might be great channels for
communicating with most of the population, as older media simply don't get
through. Much better, therefore, to get each channel going in ways that suit the
customer (of course cost-effectively), and let the customer show the supplier
how they want to use each channel. Wise customers also learn to use the channels
that give them the best experience. Of course, customers may occasionally
complain about different experiences in different channels, but they already
complain vociferously about lack of access. Perhaps marketers ought to be
arguing for rich, seamy communication between suppliers and customers rather
than a controlled, seamless, multi-channel experience?
Of course, marketers have always dreamt of integrated marketing
communications. This used to refer just to outbound messages and targeting -
marketers controlling the messages received by different customers through
different channels - telephone, mail, broadcast media etc. However, customers
pop up in many places through different contact media, and often want to control
the dialogue, so even if companies managed to achieve this great consistency, it
was of doubtful value to us or to our customers. The Internet brought this home
to us, although this was not a new requirement - just one that many companies
had allowed customers to express. The idea of the customer-managed relationship
(CMR) was not just a consultant's play on acronyms, but represented a real
customer need.
There are two new forces at work, however - customers' desire for
convenience and our desire for effectiveness (whether pure efficiency or
achieving more with less). Take convenience first. One reason for declining
customer perceptions of service levels is higher expectations. Variety and speed
of access is more important to customers than we thought - whether in the
context of sales or service. There is a generation difference too - witness the
success of text messaging with younger customers and its likely adoption by
government as a prime channel for keeping citizens informed about, eg
entitlement. In this world of higher expectations, even if customers concentrate
their side of the dialogue into one main
channel, they expect to be able to use other channels with equal ease, and to be
handled as well in each channel that is open to them.
The implication is not necessarily to make everything available in
every channel, which could be very expensive, but to make the best level of
service available in those channels that most target customers want to use. This
is where the second force - effectiveness - comes into play. For example, in
banking, customers may want to use branches not for transactions but social and
commercial interaction. However, banks cannot afford to make this available all
the time through the branch. Could the same customer need be met by combining a
branch Web site with telephone support? Technically, there is no barrier to
this, as systems and software are available to support it. The issue is one of
strategy, organization and processes.
All this requires a change to the campaign management mindset of
direct marketers, who tend to influence decisions in this area. More can be
achieved with less if customers experience relevant offers in each channel, and
can choose or be helped to choose between them. If these offers come from
different departments or product units, then rather than allocating a channel
slot to each unit, it might be better to treat the whole multi-channel system as
a 'client' for each unit, with the unit marketing to the multi-channel system,
and the multi-channel system adjusting offers so as to achieve the company's
profit objectives, taking into account customers' needs and propensities.
If this approach is to work, profit targeting rather than
sales targeting is required, as this gives the multi-channel system a clear
basis to prioritizing offers. Sales targeting tends to promote volume, lower
profit and a lower quality customer base. For this reason, in the world of
multi-channel customer management, measurement is absolutely critical, and this
measurement must be based on profit or contribution, rather than just sales.
Companies also need pretty sophisticated software to ensure that the right
offers are made (in either the CRM or CMR situation) to the right customers at
the right time. Interestingly, the measures must also include risk, and need to
work not just overall but for individual branches.