Omnichannel

Key takeaways

Omnichannel belongs to science; place it in that map before memorising details.
Learn the definition first, then one example that makes the definition concrete.
Connect Omnichannel to a quantity you can measure, compute or draw — that is where exam questions come from.
Reproduce the core statement of Omnichannel from memory before moving on to harder problems.

Reference excerpt

Omnichannel is a neologism describing a business strategy. According to Frost & Sullivan, omnichannel is defined as "seamless and effortless, high-quality customer experiences that occur within and between contact channels".

History "Omnis" is Latin for "every/all" and here suggests the integration of all physical channels (offline) and digital channels (online) to offer a unified customer experience. The effort to unify channels has a long history across all market sectors. Efforts like single-source publishing and responsive web design, however, were usually focused on internal efficiencies, formatting consistency, and simple de-duplication across channels. As the number of channels proliferated, the potential for a disjointed experience when switching or working with multiple channels increased. Channels like mobile devices, the mobile web, mobile apps, contextual help, augmented reality, virtual reality, and chatbots are used in addition to traditional physical and human interaction channels. This creates a complex matrix of possible ways an individual can engage an organization and its offerings or complete a task. Retail, until the early 1990s, was either a physical brick and mortar store or catalog sales where an order was placed by mail or via telephone. Sale by mail order dates back to when British entrepreneur Pryce Pryce-Jones set up the first modern mail order in 1861, selling Welsh flannel. Catalog sales for an assortment of general goods started in the late 1800s when Sears & Roebuck issued its first catalog in 1896. In the early 1900s, L.L. Bean started its catalog business in the United States. AOL, CompuServe and Prodigy experimented with selling through their proprietary online services in the early 1990s. These companies started sales channel expansion, while general merchants had evolved to department stores and Big-box store electronic ordering. In August 1994, NetMarket processed the first Internet sale where the credit card was encrypted. Shortly thereafter, Amazon.com was founded and the eCommerce sales channel was established. Mobile commerce arrived in 1997, and multichannel retailing really took off. Omnichannel's origins date back to Best Buy's use of customer centricity to compete with Walmart's electronics department in 2003. The company created an approach that centered around the customer both in-store and online, while providing post-sales support. Omnichannel was coined as a form of "assembled commerce" and spread into the healthcare and financial services industries.

Finance Omnichannel banking was developed in response to the popularity of digital banking transactions through ATMs, the web, and mobile applications. The most popular parts of omnichannel banking include 'zero drop rate' channel integration, individualizing channels for customers and marketing other channel options. Banks receive in-depth research about customers to build relationships and increase profitability.

Government In 2009, the omnichannel platform started to be used in governments through Twitter interaction. Governments are developing web and mobile-enabled interfaces to improve and personalize the citizen experience. The United States government digital strategy includes information and customer-centric shared platforms that provide security and privacy. Omnichannel is used to communicate with citizens through the platform of their choice at their convenience and use feedback to analyze the citizen experience to better serve.

Healthcare Due to fragmentation between health providers, hospitals, pharmaceutical companies and patients, omnichannel is developing to improve the customer experience in the healthcare industry. Omnichannel healthcare focuses on integrating data, technology, content and communication, while coordinating patient's results through digital channels. In September 2015, the University of Pittsburgh Medical Center received media attention for its customer service technology, which was integrated in 2009. The UPMC Health Plan uses an omnichannel system to improve customer engagement and contact resolution.

Retail

Omnichannel retail strategies are an expansion of what previously was known as multichannel retailing. The emergence of digital technologies, social media and mobile devices has led to significant changes in the retail environment and provided opportunities for retailers to redesign their marketing and product strategies. One of the challenges that retailers are facing as a result of increased channels, is to provide a personalised experience for customers. Put differently, in retailing omnichannel marketing has come to be understood as "hyperpersonalization". Another challenge is to track users' behaviors both online and in the brick and mortar stores, an option that is being made available by using AI platforms. In omnichannel retailing, one main backend handles all the customer data whether on the Web, mobile or a brick and mortar store.

Customers tend to be looking for information in the physical store and at the same time they are getting additional information from their mobile devices about offers and possibly better prices. Omnichannel allows organizations to allocate inventory availability and visibility across locations vs. each channel holding specific units. A number of features, like size charts, easy return policy and same-day delivery, have boosted ecommerce and promoted omnichannel shopping. An omnichannel retailer has traditional methods of mass advertising integrated with emerging interactive channels. Websites, email offers, social media messaging and physical stores all show the same messages, offers, and products. The omnichannel concept not only extends the range of channels, but also incorporates the needs, communications and interactions between customers, brands and retailers.

See also Multichannel marketing Omnichannel order fulfillment

References

Worked examples

Example 1 — a first encounter with Omnichannel

Start with the simplest possible case. Write down what Omnichannel claims or describes in one sentence, then invent the smallest concrete situation in which that sentence is true. In science, the smallest case is usually a single object, a single equation or a single measurement. Check that every symbol or term in your sentence has a meaning in that case.

Example 2 — changing one variable

Take the situation from Example 1 and change exactly one quantity: double it, halve it, or set it to zero. Predict what should happen to Omnichannel before you calculate. Comparing your prediction with the result is the fastest way to find out whether you understand the idea or only the words.

Example 3 — an exam-style question

Typical questions about Omnichannel ask you to (a) state it precisely, (b) apply it to given data, and (c) explain a limitation. Practise writing all three answers in under five minutes; the third part is what separates a full-mark answer from an average one.

Applications of Omnichannel

In research: Omnichannel appears in science research whenever the underlying quantities have to be modelled precisely. Papers usually cite it as a starting assumption and then explore where it breaks down.
In technology and industry: Engineering practice reuses Omnichannel in design rules, simulations and safety margins. Knowing the idea lets you read a specification sheet and understand why the numbers look the way they do.
In the classroom: Omnichannel is common in secondary-school and first-year university syllabi. It links to neighbouring topics E-commerce, Marketing, so understanding it makes those chapters shorter.
In everyday life: Look for Omnichannel outside the textbook — in sport, cooking, traffic, electronics or the sky above you. An example you found yourself is remembered far longer than one you were given.

How to study Omnichannel in 20 minutes

Read the reference excerpt below once, without taking notes.
Close the page and write down what Omnichannel means in your own words.
Compare your version with the excerpt and mark what you missed.
Work through the three examples above with pen and paper.
Explain Omnichannel out loud to somebody else — or to Teacher Smith in the lgStudy chat.

Frequently asked questions

What is Omnichannel in simple terms?

Omnichannel is a neologism describing a business strategy. According to Frost & Sullivan, omnichannel is defined as "seamless and effortless, high-quality customer experiences that occur within and between contact channels".

Why does Omnichannel matter?

Because it connects several science ideas at once: it gives you a definition you can apply, a quantity you can calculate, and a way to check whether a result is plausible.

How should I study Omnichannel?

Read the excerpt, restate it from memory, then work through the examples and applications listed on this page. The five-step study plan above takes about twenty minutes.

What does this page cover?

It gives you a compact reference excerpt plus original lgStudy explanations, examples, applications and study material on Omnichannel.