Omnichannel vs Multichannel: What’s the difference?

Omnichannel and multichannel are two buzz words regularly thrown around marketing circles. But what’s the difference and are there pros and cons for each?

To  get to grips with the difference between the two, first we need to understand what each of the terms are referring to.

Put simply, omnichannel marketing puts the customer at the centre and creates a seamless shopping experience, from the first point of contact to the last, no matter what channel the customer has chosen
to use.

Multichannel marketing is more focused on customer engagement and puts the channels at the centre of its strategy. The company interacts with customers via multiple channels to sell them what they
have to offer.

A channel in this context refers to a medium through which a brand or organisation communicates directly with its audience or customers such as a website, a physical store, a billboard or even a flyer or product packaging.

As with most things, there are pros and cons for each strategy, and they are suited to different brands and audiences depending on the desired outsome.

Omnichannel Pros

Omnichannel marketing presents more of a smooth customer experience where customers can move between communication, support, and marketing channels without taking much notice. 

It can also allow for higher customer expenditure and sellers can more easily collect vital customer data which can be used to provide customised offers across different channels.

Other positives include increased purchase rate on products and services and boosted engagement. When customers move between channels without interruption, they are more engaged and increases their customer lifetime value which flows into more customer loyalty. This is because the more active the customer is, the better the info gathered. This can then be used to personalise campaigns meaning there is more chance of the customer returning.

Businesses using omnichannel strategies are also more likely to acquire more customers and better inventory tracking. This means sellers have access to more detailed information on their current inventory and in turn, avoid shortages. This also provides insights that can shape future investments based on customer’s buying habits.

Kim Walbridge, Global Marketing Director D2C for Les Mills International, says omnichannel will mean different things to different businesses depending on the focus.

Kim Walbridge.

“For Les Mills International, we look at omnichannel through a customer experience lens, such as connections between experience of our workouts across touchpoints – for example in an instructor-led class at a partner gym in California, versus at home streaming the workout with the LES MILLS+ app – and how each is meeting a related but different set of needs. And it’s also about consistency of experience with the Les Mills brand more generally.

“[The] upside of omnichannel is achieving cohesion in delivery of campaigns, interactions and messaging, meaning experiences with a brand reinforce each other, across a marketing ecosystem.”

Tama Sweetman, Head of Sales New Zealand at Yahoo, says some of the main benefits of the programmatic omnichannel approach is the connection between the physical and digital worlds at scale.

“It also enables brands to support connected brand experiences, leverage media channel data interoperability, approach marketing efficiency and wasted media much better and create a consistent approach to reporting metrics and effectiveness measurement.

“Research by Analytic Partners shows that the connection between additional media channels as part of an omnichannel approach can drive up to +35 percent incremental impact within a campaign, and this is without it even being run through programmatic means.”

Omnichannel Cons

Sellers need more technical skills to ensure the seamless purchasing experience and to ensure the front end is simple and easy to navigate. These sorts of skills come with a price tag also known as software engineers. Omnichannel also requires excellent communication across teams so businesses where there is less of this might struggle.

Tama says it’s also important to note that omnichannel programmatic marketing only covers the channels which can be accessed within the technology.

“Omnichannel isn’t just media, it is also point of sale, traditional media channels, and owned media channels. So whilst we talk about all of the pieces above in our Yahoo platform, in isolation, it is one part of a larger omnichannel behemoth which takes time to plan, and also needs to be working in unison to drive the outcomes that brands want.”

Multichannel Pros 

A big drawcard for Multichannel is that it often leads to increased customer engagement as more channels can translate into more potential customer touchpoints.

It also means brands can reach consumers on their favourite channel. As these channels become increasingly fragmented it’s valuable for brands to understand where their customers are most engaged and meet them there.

Multichannel Cons

With more channels comes more responsibility. This means more time and resources need to be put into creating multiple strategies for each channel. 

It also becomes difficult to know what message was most effective. Companies need to ensure they have a firm grip on analytics as multi-channel marketing can uncover ineffective tactics.

Tama Sweetman.

Marketers using a multichannel strategy open themselves up to needing to understand all the various platforms quickly and it can be challenging and time consuming to nail a new platform every year.

Multichannel also puts more emphasis on the messages communicated. Customers need to not only see the message but also feel that it aligns with what they care about. This means messages need to take into account demographic, purchasing history and the other channels the customer is using.

The disruption and lack of routine in people’s lives caused by the pandemic has meant consumer behaviour has been tipped on its head over the last three years says Tama.

“On top of this, brands can’t 100 percent say that they know where their consumers will be physically or digitally right now due to the lack of enforced routines by 9-5 working days. This underpins the need for significant omnichannel operations from not just a media point of view but also a wider marketing point of view. 

“If we go back to 2019, prior to the pandemic, media buying still heavily sat in silos across programmatic and traditional channels. Come 2022 it’s a very different story. These consumer behaviour changes have driven a much more blended approach to media buying across digital and traditional channels, but the one thing that has grown in importance is the usage of data to plan and target your consumers in the market.”  

This article was first published in the 2022 June/July issue of NZ Marketing magazine.

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