02/08/2010

By Robert Oostergetel, Director of WW Channel Sales & Partnerships

Gone are the days when a clear divide existed between the offline and online world for researching and purchasing products. Increasingly we live in a non-line world where our physical and digital lives combine. And, this is hugely relevant to vendors and the channel.

Understanding this blurring of the line is essential to how we develop and measure an effective channel strategy moving forward, irrespective of whether we’re selling a business or consumer product.

What we’re already experiencing is how the online platform is having a huge impact on the way we do business beyond e-commerce. We can see its effects on trade, in changes in efficiency and effectiveness, as well as the transformation of business processes.

So what’s changing? The major new factor at play is the rapid rise of social networking sites and how they interact with established e-commerce. Twitter and Facebook have become accepted channels for engaging directly with key audience. They drive measurable revenues from promotions and competitions.

These tools can encourage brand ambassadors who influence their peers - to varying degrees depending on the relationship - and increase awareness to ultimately drive potential customers to our website.

What ecommerce practitioners routinely fail to understand is how important our online presence is to the 98% of shoppers who don’t visit to purchase. More and more evidence is showing that people research online before purchasing offline. Why they do this doesn’t matter, what matters is that we deliver an integrated strategy that bridges on and offline to meet the needs of all of our customers.

So this relationship is not one-sided. ‘Unfashionable’ offline is still proving to be effective in its own right — but much of online is converging with offline to help us gain market advantage. For example, according to OMD Metrics more people listen to digital radio on PCs and TVs than on DAB radios. People are watching television with a laptop and mobile to hand.

Outdoor advertising, such as billboard or poster campaigns, have also looking to activate customers through the use of mobile barcodes, Bluetooth downloads and RFID technology.

The effectiveness of traditional offline or “faith based” initiatives has also historically shown to drive traffic to online entities such as websites or microsites by using techniques such as vanity URLs or traceable coupons. Whilst software vendors like us who have successfully built their brands online have in more recent years embraced offline promotions. Experiential marketing and print advertising are used to reach new market segments or activate potential customers through multiple touch points.

Having a physical presence on the high-street has its benefits - customers have the opportunity to “see” the product, or ask a “neutral expert” any questions they may have.

However there is a challenge to ensure companies convert in-store research into sales, a point in case is the challenge faced by high-street book retailers in the UK. There is increasing evidence that a good proportion of their customers are researching their purchases in-store, taking a picture of the cover and then going online to find the cheapest price. Several of these chain stores have reacted by expanding their digital footprint, using social networking sites such as Facebook and Twitter, and attempting to build online brand loyalty. This has not been limited to traditional discount codes and loyalty schemes, but has also included the introduction of value-added content such as video book reviews and interviews with authors, plus social media competitions that encourage readers to submit multimedia content to promote further brand participation.

Companies can strike the balance between their on and offline channels. For example, a number of electronic retailers in the United States are increasingly looking to knit online and offline together to add customer value. This includes providing a range of content on products, recycling and gift ideas via social networking sites such as Facebook and blogs, whilst Twitter is used to seed promotions and activate customers to come in-store. Store policies have also been introduced to incentivise staff to give advice and assistance rather than simply clock up sales. The end result is these companies are increasing market share and customer loyalty by adding value beyond product discounts.

When factoring in online and offline revenue it is therefore important to consider what symbiotic relationship exists. Review which multiple product touch points feature in the purchase decision making process. Having a single route to market today isn’t enough. We need to understand and act on how our target audience interacts in various ways and then craft an integrated channel strategy to reach today’s digital consumer tribes and convert this nonline research into revenue.