Total retail – beyond multi channel

Posted: Tuesday 8th May 2012 in Retail Strategy, Thought Leadership.

Ajax Amsterdam 1973-74

In the 70’s Dutch football side Ajax invented a new way of playing football which became known as “Total Football”, abandoning traditional positions and tactics, allowing players the freedom to play anywhere on the pitch, as long as the team covered any gaps. It was sensational; Captain Johan Cruyff and his band of merry men took the football world by storm, winning everything in sight for years until opponents found a way to counteract the tactic. Ajax tore up the rule book, found the game changer that changed the face of football. It’s time for retailers to do the same.


Moving On From Multi-Channel Retail

Not so long ago there were just stores for retailers to operate, perhaps even a shopping catalogue or two, then online came along and after a few false dawns it has proven it is here to stay. Things will never be the quite same again. Retailers now operate several routes to market and the pace of change gets ever quicker as consumer expectations rise higher and technology advances feed the desire for instant service and continual innovation. The phrase “Multi-Channel Retailing” was born to describe the situation but what does that really mean? The diagram below charts the journey retailers have been on in recent years;

The Retail Journey

In reality multi-channel means multi-company. Businesses have different systems, processes, P&L’s and even management teams for each one and therefore a different customer experience. Don’t think so? Try buying a click and collect product online and having collected it on time of course, then arrange for it to be returned to the retailer via their delivery network. Pour a very strong coffee first. Do you phone the store, the online team or customer services? Where is the number? Oh no, automated call centre! What about the courier on the website? Try them all and marvel at the different answers. Can you do it on your mobile? Who contacts you to arrange collection? What about packaging? Who pays for the return? Then there is the refund itself if you still have the energy to pursue it…..

I know quite a few large so called “multi-channel” retailers who would cringe if they really saw what happened to their customers in this scenario.

Improving the Retail Experience

Retailers routinely test systems but not the real retail customer experience. They need to think differently in order to behave differently and stop planning and organising themselves in channels. The channels compete with themselves rather than the real competition and cannibalise sales. Cross channel is an evolution of multi-channel but is primarily aimed at marketing to customers across the business units rather than addressing the real issues. Businesses often declare they are multi- channel or cross channel after a meeting or two but don’t actually change their behaviour accordingly. What does it all really mean?

In order to break free from the channel model and to give customers what they want retailers need to focus on customers and proposition, not disparate internal “channels”. They need to become TOTAL RETAILERS. The services they provide need to be channel agnostic and internal data needs to be consistent across the business. Internal teams need to be fully integrated and the traditional organisation structures do not support this. IT systems need to be able to agile and able to adapt rapidly to evolving customer needs. Forget about store systems, websites, portals, kiosks etc and start thinking about customer facing systems. Why does each channel need something different? CIO’s need to drive this change relentlessly. Fully co-ordinated marketing campaigns are required rather than budget holders operating independently and guarding funds for a pet project or rainy day. Deliveries are when the customer wants, not when the route planning software says it is allowed.

In the future, TOTAL RETAILERS will behave this way because it is the only real way to differentiate and innovate in the new world. Those who don’t or live in denial will end up like Kodak, once with a 90% market share in photographic film but too slow to recognise and embrace the digital age, finally filing for bankruptcy protection in January 2012. One thing is certain, if you don’t give customers what they want, their demands won’t change, they will just go somewhere else.

Try this simple test; imagine the perfect customer journey and experience, what would TOTAL RETAIL look like in your business? Now really think hard about whether you are delivering on that vision. What do you need to change and who do you need to persuade? What order should the changes take? Where are the big wins? Now compare your list to the current list of projects your business has signed off…….

Makes you think doesn’t it?

Customers want TOTAL RETAILERS, not poor imitators. Time to start thinking like Cruyff and becoming the game changer.