June 21, 2009

Gliebers Dresses: Multiple Channels

You're listening to the Executive Meeting.

Glenn Glieber (Owner): "... so I say to the guy next to me, 'how many times do I have to watch the same episode of 30 Rock'? I've been on a half-dozen flights in the past two months, and every flight has the same episode of 30 Rock. And have mercy on the folks who sit in Seating Area 4 --- we're all lined up twenty-deep to get onto the plane so that we can find a place for our luggage. Those poor souls in Seating Area 4 have no chance. Travel, what a mess!"

Meredith Thompson (Merchant): "Kevin, is that you?"

Kevin: "Yup, it is me."

Roger Morgan (Operations): "We're interested in your thoughts about multiple channels, Kevin."

Kevin: "Sure, what do you want to know?"

Sarah Wheldon (Marketing): "Well, we believe we are a multichannel company. We have our catalog and all of the heritage associated with that. We have a website, we do paid search, we have an affiliate marketing program, we have e-mail, we use shopping comparison sites, we have a Facebook presence, we have a company blog, we're on Twitter, and we're developing a mobile website."

Roger Morgan: "That's a lot of channels. We're mega-multi-channel!"

Sarah Wheldon: "So why isn't it working, Kevin?"

Kevin: "What isn't working?"

Meredith Thompson: "Why is it that we have all of these channels and our sales are decreasing?"

Roger Morgan: "Every research article I purchase says that if you have all of these channels, then your sales will increase and your customers will be happier. A recent Neptune Research report suggests that 74% of customers prefer brands that offer a superior multichannel experience. So we must be doing something wrong."

Sarah Wheldon: "Obviously, we offer a superior multichannel experience, don't we?"

Kevin: "Define a superior multichannel experience?"

Lois Gladstone (Finance): "I think a superior multichannel experience delivers breakthrough sales and profits".

Sarah Wheldon: "I think a superior multichannel experience allows a customer to shop however she wants wherever she wants."

Pepper Morgan (Creative): "I think a superior multichannel experience offers the same look and feel across channels, the same promotions across channels, basically, the same exact experience across all channels. If you do that, the customer will love you and not become confused. I mean, if we offer a customer 20% off her order in the catalog, then we have no choice but to offer the customer the same 20% off promotion on Twitter, right?"

Lois Gladstone: "But we cannot offer the same merchandise in each channel --- heck, we can barely do anything with Twitter, while the catalog allows for an easy way to visually display merchandise, and e-mail allows you to really focus on just one item. So if you can offer whatever merchandise you want in any channel, then you can have a different look and feel, and different promotions in every channel, right?"

Roger Morgan: "Seems like you would create separate brands if you were going to do things different in different channels. I don't see any way you could be successful if you did things different in each channel."

Kevin: "How would you measure if your multichannel efforts were successful?"

Meredith Thompson: "If our e-mail campaigns and paid search efforts and Twitter presence caused catalog response rates to increase, then multichannel efforts are successful."

Pepper Morgan: "I think you measure total responses across all activities during the course of an integrated campaign."

Roger Morgan: "Do you measure multichannel success on a campaign level, or based on sales and profit generated over time? I think if you don't achieve success over time, then campaign level success is irrelevant."

Meredith Thompson: "I don't think that stuff matters so much --- periphery channels support our main channel, the catalog. I mean, the reason we do paid search is to capture the catalog customer who is doing comparison shopping, right?"

Sarah Wheldon: "We do paid search to acquire new customers."

Roger Morgan: "I thought we rented lists to acquire new customers?"

Lois Gladstone: "Let's take e-mail as an example. Kevin, you said that for e-mail subscribers, we could mail fewer catalogs and generate more profit. But this flies in direct opposition to established industry best practices. Roger tells us that research papers indicate that multichannel customers are best customers. Your advice is to have us send fewer catalogs. That will make the customer 'less multichannel', and by definition, that will result in decreased customer value, right?"

Roger Morgan: "Oh, we don't want to do that!"

Sarah Wheldon: "Do what, become more profitable?"

Meredith Thompson: "If all of the other channels support the catalog, then the catalog will work better, and we'll be more profitable."

Kevin: "Multichannel marketing is a mystery, isn't it? It is our job to determine the role every single channel plays in our business. Meredith believes that other channels support the catalog. Roger believes that multiple channels increase customer value. Pepper believes that channels work in a synergistic manner to communicate a message. Sarah sees multiple channels as a way to acquire new customers. Lois thinks multiple channels increase profit."

Sarah Wheldon: "So who is right?"

Kevin: "Tell you what, over the next few weeks we'll use the Multichannel Forensics framework to understand how your customers interact with advertising channels. I'll come to each meeting, ready to share with you how your customers interact with advertising micro-channels. As a team, we'll figure out the role of each channel in your business."

Glenn Glieber: "Ok Kevin, sounds good, thanks for your feedback. On to the next topic. As you know, we are hosting our annual fashion show next Thursday. I need one volunteer to be the Master of Ceremonies, and I need one volunteer to manage the music selection. Who wants to take some ownership, how about it?"

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