Strategic considerations for omnichannel digital customer experience

Transformation from communication service provider (CSP) to digital service provider (DSP) is becoming a pressing priority for telcos. Digital innovation creates new digital ecosystems, where consumers of telecommunication services are increasingly expecting enhanced digital customer experience.

Within telcos, early embracers of digital strategies will benefit from building digital ecosystems and gain considerable competitive advantage. An important challenge in the digital ecosystem is to build business models which foster omnichannel digital customer experience.

Bricks and clicks convergence and the omnichannel experience require retail digitalization and lead to new optimized shopping experiences. Enhancing digital capabilities around retailing is necessary to succeed in delivering a seamless and consistent shopping journey, based on fully integrated channels. Recently, Worley J. (2016) conducted research on new trends in retail. He concluded that unifying online and offline retailing would give a more comprehensive picture of customers’ shopping journeys.

Ern-Stockum D. et al (2015) believe that the retail trade recognized that e-commerce and omnichannel offer the chance to vary and rethink retail concepts and that omnichannel is not necessarily a danger to physical retail, but rather offers a chance to reconfigure.

Meanwhile, TM Forum’s Rob Rich believes that omnichannel needs a different approach across strategy, processes, applications and resource allocation, and it has to be consistent with customer centricity strategies. Ribeiroa R. & Florentinob T. (2016) argue that companies are transforming their ways of doing business, not only around internal agility and efficiency processes, but also external interactions with their customers and prospects.

Customer-centric digital strategy based on omnichannel is an organization-wide project, not limited to transforming technology. Implementing omnichannel requires organizational alignment based on a clear customer-centric strategic vision – one that considers internal and external factors. It must also encourage building of resources and capabilities, leveraging creation of a digital ecosystem towards enhancing digital customer experience. Marketing then needs to build innovative offerings that take advantage of the digital ecosystem. In the figure below, I explain some important considerations when building customer-centric strategies based on omnichannel.

Building an effective customer-centric strategy based on omnichannel has to take a variety of factors into account. Firstly, it has to consider the organization-wide impact and implications at different levels of the company; the most important is to adopt a customer-centric strategy while providing the means to build resources and capabilities at different levels of the organization.

Most importantly, strategy must consider SWOT and PESTEL in planning and controlling the customer-centric strategy. Building on the strengths, while considering internal and external factors. Secondly, there must be an alignment on the business processes of the organization as well as the technology -- each plays its role in building the organizational and technological resources and capabilities that delivers the best outcome of an omnichannel digital customer experience.

Adopting the best retailing strategy in a digital transformation towards omnichannel is a key success factor. First question is whether to outsource retailing or not (the ‘make or buy’ dilemma). It’s something that is influenced by whether the company is vertically integrated or not. The general practice of telcos shows that the majority go for a mix of in and outsourcing in retailing strategy, a fact that influences the ‘transaction cost economics’ of telcos, meaning balancing complexity and cost considerations. “In” vs. “out” sourcing has a direct impact on implementing clicks and bricks convergence based on omnichannel. Digital capabilities based on smooth and real-time interactions need to be built, whatever the choice is.

Overall, CSP to DSP transformation is a matter of survival in a disruptive technological environment characterized by an increasing number of OTT (over the top) players. Within a few years, the choice will be: transform or perish. Telcos must be prepared. Providing an omnichannel customer experience is an important aspect in implementing digital strategies. However, many factors might influence implementing customer centricity such as the management’s appetite to transform, enabling people to go digital, preparing the organization, considering internal/external factors and obviously taking advantage of best-in-class technological advancements