Organizational Channel Optimization Challenges

By Barton Goldenberg

To succeed at channel optimization, organizational management must overcome the challenges of finding the right balance between delivering desired customer channel preferences while simultaneously driving customers to the lowest cost-to-serve channel that is acceptable to them. The key challenge for organizations is to find the right balance between delivering desired customer channel preferences while simultaneously driving customers to the lowest cost-to-serve channel that is acceptable to them.  No easy task, and complicated further by a number of additional challenges:

• Single or multi-channel strategy? While many customers and organizations work in on a few channels today, this will not be true in the future.  All organizations wishing to survive will have to put into place a multi-channel strategy whereby a customer or prospect begins their customer journey in one channel (e.g., via the Web), then moves to another channel (e.g., the Contact Center) to get answers to questions they could not find on the Web, and finally move to say a third channel (e.g., your retail store) to make a purchase.
• Will a customer’s channel preference(s) change? Think about how customers’ preferences have changed in the book, music and travel and shopping industries over the past decade.  If customer preferences begin to change within your industry, how will this impact your organization’s ability to serve these customers?
• Ease of moving customers to other channel? I remember years ago working with a global footwear and apparel company who sought to put into place a ‘lowest cost-to-serve’ strategy.  To accomplish this, they encouraged certain customer segments to move over from full service to digital channels.  The strategy hit considerable resistance because customers were not ready for the change and needed considerably more training than initially anticipated.
• Channel costs – learning curve implications? While certain channels may seem expensive to work in today, as these channels get used more and more, costs come down due to something called the ‘learning curve’, e.g., think about the cost to start up a Social Media community five years ago and how much that cost has decreased in price today.

Each individual organization will have to find their own unique way to overcome these channel optimization challenges as all organizations have different needs and attributes. However, any organization wishing to be around in 10 years will have to execute a sound channel optimization strategy in order to survive against its competition.

In my next blog post, I will discuss the second crucial component of channel optimization: optimizing each selected channel through the use of integrated processes and technology.

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  Barton Goldenberg, is the founder and president of ISM Inc., customer-centric strategists/implementers serving best-in-class organizations globally. As a CRM leader for 30 years, he was among the first three inductees in the CRM Hall of Fame. Recognized as a leading “customer-focused” author, his latest book, The Definitive Guide to Social CRM, is hailed as the roadmap for Social CRM success. Barton is a popular speaker on “maximizing customer relationships to gain market insights, customers and profits”. He is a long-term columnist for CRM Magazine and speaker for CRMevolution and frequently quoted in the media.