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IT’S ALL ABOUT THE CONSUMER: THE WAY TO A SUCCESSFUL OMNICHANNEL STRATEGY
IT’S ALL ABOUT THE CONSUMER: THE WAY TO A SUCCESSFUL OMNICHANNEL STRATEGY
The omnichannel concept has gained traction in recent years. Certainly, the e-commerce side of retail has grown significantly, not least due to the ongoing Covid-19 pandemic, while brick and mortar stores have also had to adapt. But what makes a good omnichannel strategy? What are the challenges involved, and what role can packaging play to ensure a smooth customer experience? Elisabeth Skoda speaks to Elin Li, Business Development Manager at Iggesund Paperboard, and Uwe Melichar, president of the European brand and packaging design association.
Elin Li Uwe Melichar
Putting the product centre stage
There is a big difference between what’s needed from an e-commerce pack and a traditional brick and mortar pack, as Mr Melichar points out.
“In an e-commerce product features and benefits have already been communicated online and no further information is needed on the pack while in brick-and-mortar stores the packaging has to sell the product.”
Well-packaged goods often have to be put in another box to make them ready-to-ship.
“This is an exciting challenge from a design point of view. Protection is key but the right dramaturgy for the unboxing process is also important. If you open the package and the first thing you’re facing is the return voucher or the operating instructions, it’s the wrong message. The product is the hero and should be dramatized and staged,” Mr Melichar adds.
A colourful and impactful package that stands out in the store could have its design ruined by adding a shipping label, or even a space for it.
“This gives us a hint on the disadvantages of omnichannel packaging. If you are trying hard to make a beautiful package shippable you may ruin the design, and if you put a perfectly constructed e-commerce package on the shelf it’ll be invisible and dull. Sometimes it may be better to have two separate solutions. I can imagine modular hybrid packaging solutions, where we solve the problem of having a box in a box by adding a ‘light’ pack element to upgrade a shelf-pack for shipping.”
Conversely, creating just one pack for all channels offers the advantage of not creating unnecessary SKUs, says Ms Li.
“When you use the same packs for all your channels, you can ensure that you have a full crossover to support an omnichannel strategy, and thus are able to service customers whether they buy in the shop, place an order online and pick it up, or if they want to have it shipped home.”
Another challenge is the difference in supply chains. “With e-commerce, the pack goes through many more touchpoints. The more handling the more risk – it’s often the last mile of the delivery process where damage occurs.”
Ms Li underlines the challenge of keeping the product safe and points out that even if the product itself isn’t damaged, but the packaging is, it doesn’t leave a good impression.
“It’s really about understanding all different touchpoints that packages go through. For an optimal omnichannel strategy, you are developing a pack strategy that works for all channels at each point, working with a lot of data, and implementing that into the packaging strategy, so that at the end you will have a pack that supports whatever channel you choose.”
Branding strategies
There are a lot of things that brands can do to support the shopping experience and convenience, and one of them is connection and transparency, enabling consumers to see in advance whether a product is available in store or can be shipped, Ms Li says.
“Another useful feature is to simplify returns, making sure that the box or bag can be reused. Consumers like a fuss-free experience. A good omnichannel strategy is about having the same brand experience throughout all your channels. For example, if a brand says that sustainability is important and talks about it in its branding, it needs to be shown in all of the packaging.”
It can be useful for brick and mortar and e-commerce to learn from each other, and newer, less established brands lead the way.
“We see a lot of online, digital native vertical brands, which have built a business model on selling on the internet. They then open a pop-up store or a showroom. They understand they need to be both online and in physical stores and are using data, with the purpose of increasing customer experience and brand loyalty,” she adds.
In simple terms, online shopping equals orientation, overview and price comparison. In brick and mortar stores, the focus is on inspiration, testing, trying on and sensual experiences, adds Mr Melichar.
“We have to look at the complete touchpoint map and the various customer journeys and options. To satisfy customers, brands need to play on both channels with the best possible instruments.”
Engaging packaging
Balancing out product safety, functionality, aesthetics and sustainability is key when it comes to all packs, whether they are designed for shipping or for stores.
“Modularity and simplicity are key. In many cases manufacturers have no influence on the retail channel. Retailers are selling their products online and offline, there are resellers and major platforms in between brand and customer. The more flexible the packaging, the easier it is to distribute,” says Mr Melichar.
Unboxing videos enjoy continuous popularity on social media. Unpacking should be like the opening act of a concert, Ms Li says.
“We already see many companies working with custom, branded transit packs, which gives that extra brand experience. Brands like Chanel are known for giving consumers a luxurious unboxing experience. Korean sunglasses brand Gentle Monster offers its customers an exciting, luxurious unboxing experience that comes in layers like a Russian doll. It’s important to really think about adding a tactile experience and add different levels to unboxing.”
There are several examples of successful omnichannel packages in the market that Mr Melichar draws our attention to.
“Examples can be found at Beiersdorf with their ‘Nivea Care Box‘ or from the Austrian brand MAM that puts their small soothers and baby products in a cute silkscreen printed box for shipping. I also appreciate the efforts from Samsung. They are using ‘ready to ship’ packages and for the big cardboard boxes they recently launched a competition, asking for the best second-life solutions. People created 3D animals, a shelf or a magazine rack out of the empty boxes.”
E-commerce vs brick and mortar
The Covid-19 pandemic has resulted in a return of packaging materials that were on the way out previously.
The return to the ‘to-go cup‘ and to single-use plastic plates, bags, boxes due to hygienic reasons and millions and millions of shipping cartons are creating enormous mountains of rubbish. But there are many examples showing the positive examples of packaging that can help entice consumers to shop ‘offline‘, Mr Melichar says.
“For example, think of the experience of entering a Lush store. The smell, the choice, the staging of the product and the service and checkout… no packaging needed. Other examples that add value for bringing customers back to the stores are luxury products like perfumes, champagne, confectionery or wine. There are many products that wouldn’t have any recognition without packaging. Their outer shell is part of the brand story and defines the product. These multi-sensual experience stories are hard to be told online.”
Sustainability considerations
Initiatives such as Terracycle’s loop can be part of an omnichannel strategy. Currently, the scale is small, but there is certainly potential for growth.
“There is a huge potential in refill and return systems paired with services. The English milk-man gives us the blueprint for more of those concepts. For example, in the UK ‘Milk & More’ presents a curated offer of fresh local sourced dairy products delivered to the customer’s door. ‘Packaging as a Service’ by Finnish company RePack offers resistant bags that can be used several times. The offering includes cleaning and a free return service via regular mailboxes,” says Mr Melichar.
The future of omnichannel
Ms Li anticipates developments in automation and AI, and possibly deliveries by drone that could push the industry forward.
“Looking towards Eastern Asia, the e-commerce and omnichannel world is a lot more developed there. For example, in some department stores in Japan, you can shop for lipsticks in the restroom mirror by trying them out through augmented reality, buy there and get them delivered to your home. You can buy products and have them delivered the same day, within hours, and that is probably something we will see coming more over in Europe. Packaging could support that.”
She points out that in the future, more and more brands will pursue omnichannel strategies and will also want a piece of the fast-growing e-commerce market.
“We will probably see more traditional retail going online, and conversely digital companies going more physical. It’s all about a seamless brand experience. Whether you buy in store or online, the brand experience should be the same. Above all, omnichannel is about having a marketing strategy and supply chain strategy to support the experience.”
Mr Melichar predicts that omnichannel will be the new normal, and that the boundaries between the different sales channels will blur.
“There are many good examples already. Amazon opens their 4-star stores and many retailers and brands coming from brick and mortar (like H&M or Adidas) already have functional and exciting online shops and are present on platforms. If they all manage to deliver the perfect match between showroom, online services and inspiration, we’re basically there.” n
