Omnichannel in the digital-first economy

It has been a decade since omnichannel first became a buzzword for companies and customers alike. Visionary retailers like Best Buy and Macy's were among the first to spearhead the initiative, recognizing the need to provide a seamless customer experience across all channels.

The rise of omnichannel was largely attributed to the widespread adoption of mobile devices, including smartphones and tablets, and the growing popularity of digital channels. As customers began to use their mobile devices to shop and interact with companies, businesses were forced to adapt to the changing landscape and provide a consistent experience across all touchpoints.

The Covid-19 pandemic has accelerated the pace of digital transformation in ways that were previously unimaginable. With lockdowns and social distancing measures in place, businesses were forced to rapidly adapt their operations to a remote, digital environment, in order to stay afloat. This included digitalizing customer journeys as businesses sought to continue serving customers in a safe and convenient way. According to data from McKinsey & Co, ecommerce grew in the first quarter of 2020 as much as in the previous 10 years.

While the pandemic was a challenging time for businesses, it has also created new opportunities for innovation and growth. Many companies seized this opportunity to reimagine their customer journeys and create new digital experiences that meet their customers’ evolving needs and expectations.

From virtual consultations and contactless payments to online ordering and home delivery, businesses have rapidly adapted to the new normal with digital technologies at the heart of their strategies.

Today, omnichannel has become the norm and customers expect to be able to interact with companies seamlessly across a wide range of channels, from social media to email to mobile apps. This expectation has led to an explosion of new digital channels and customers demand a consistent experience across all of them.

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The race to digitalization

To meet these ongoing, changing customer expectations, businesses had to adapt their strategies and invest in new technologies that enabled them to deliver a personalized, seamless experience across all touchpoints. This included building out robust mobile apps, optimizing their websites for mobile devices and developing new tools for customer support, such as chatbots and AI-powered assistants.

Companies invested in powerful servers and advanced technologies and were in a race to build faster journeys. Many businesses, however, made the mistake of simply replicating their existing offline processes in the online environment without considering how their customers’ needs and behaviors changed in the new medium.

Two of the most important differences between the offline and online journeys are related to cognitive load and empathy. In the physical journey there is usually someone that can help the customer out; handhold them if required until they reach their goal. That person plays an important role in reducing the customer’s cognitive load, by removing uncertainty and providing indications. In the digital journey, on the other hand, there is no one to help you out if you get stuck. There is no empathy. You are on your own and should you need help, there might be a chatbot available but rarely a real person. For customers who are not digitally savvy or are unfamiliar with the journey, this situation can be cognitively taxing, leading them to abandon the journey.

From our experience, lack of empathy and high cognitive load are the major experience blockers across digital journeys. These are probably overlooked by companies when building their digital journeys, because they are difficult to measure.

"Furthermore, companies usually build a single journey for all customers and fail to take into account specific cognitive load needs and tolerances that their customers might have."

This inside-out approach may have worked in the past, but today's customers demand more. For most industries, the exit barriers are lower than in the past. Therefore, customers expect a seamless, personalized experience across all touchpoints, from initial engagement to post-purchase support.

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Customer perspective: convenience

While this omnichannel approach may seem like a positive development, from a customer's perspective it is simply a matter of convenience. Customers do not care about omnichannel; they care about getting the job done in the most convenient and efficient way. Whether that means starting a conversation on social media or using a mobile app to make a purchase, customers will choose the channel that best meets their needs at any given moment.

The blurred boundaries between channels make it more challenging for businesses to deliver a seamless customer experience. For example, when a customer starts a conversation on social media and then switches to email halfway through, they expect to be able to seamlessly continue the conversation and the company should provide the same level of support, regardless of the channel. If the company fails to deliver on this expectation, the customer gets frustrated and considers that a negative experience.

When done right, however, digitalization can greatly enhance the customer experience. For example, customers can now access a wealth of information about a product or service before making a purchase thanks to online reviews, product demos and interactive content. They can also use digital tools to track their orders, receive real-time updates and provide feedback, all from the convenience of their mobile device.

While customers do not care about omnichannel, they do care about convenience and saving their time through efficient interactions. The digitalization of customer journeys made it easier for customers to get the support they needed, but it also raised the bar for businesses, who must now deliver a seamless and personalized experience across all channels. Despite this, CX Network’s own research has found that only 13 percent of organizations have a fully implemented omnichannel model and strategy.

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Why omnichannel is a necessity

Ultimately, the rise of smartphones and digital channels has made it clear that omnichannel is no longer an optional strategy for businesses. In order to compete and succeed in today's digital-first world, companies must adopt an outside-in approach, where the customer journey is at the center of their digital strategy. They need to invest in technology that provides a seamless, personalized experience across all touchpoints, from the physical store to the mobile app to social media and beyond, rather than simply speeding up internal processes.

By understanding the needs and expectations of their digital customers – and investing in the right digital technologies – businesses can build stronger customer relationships, drive sales and foster loyalty and advocacy among their customers. They will thrive in the new normal, creating a more resilient, agile and customer-centric organization for the future.