Designing end-to-end experiences necessitates stepping into these channel-org dynamics. As an orchestrator, you need to understand how deeply engrained channel thinking (vertical ownership) can deter innovation and value creation. Your objective is to reframe channels as coordinated role players in the greater story of serving customers’ journeys (horizontal servitude). The following four concepts will arm you to take on this challenge:
• Organizations are structured by channels.
• Channels don’t exist in isolation.
• Channels are defined by interaction, information, and context.
• Channels should support the moment.
Structured by Channels
All companies start somewhere to market, deliver, and support their products and services to customers. For example, Lowe’s Home Improvement started as a small storefront in a small town. Sears sold watches by mail order catalogs. UPS distributed paper forms filled out in triplicate to pick up, transfer, and deliver packages accurately. Netflix sent discs by mail. Amazon sold books on the web.
Over time, companies adapt and expand to engage with customers in new ways and new channels. Take Lowe’s Home Improvement, a U.S. retailer, as an example. For decades, Lowe’s primarily interacted with its customers through hundreds of retail stores and thousands of associates supported by television, radio, newspaper, outdoor and direct mail marketing, and advertising. In the 1990s, Lowe’s (and its competitors) began moving into the digital realm both online and in the store. Now, two decades later, Lowe’s has an expansive digital footprint including websites, apps, kiosks, associate tablets, and even a wayfinding robot (see Figure 1.2) that exists alongside the same channels that Lowe’s has operated in from the first day it opened its doors. Lowe’s answers customer questions through online chat, Twitter, in store aisles, and on the phone. It promotes sales on radio, via Google AdWords, in direct mail, and on physical and digital receipts. It teaches how to do home improvement projects in workshops, on YouTube, and in iPad magazines. That’s a lot of channels.
PRESS RELEASE PHOTO FROM: HTTPS://NEWSROOM.LOWES.COM/NEWS-RELEASES/LOWESINTRODUCESLOWEBOT-THENEXTGENERATIONROBOTTOENHANCETHEHOMEIMPROVEMENTSHOPPINGEXPERIENCEINTHEBAYAREA-2/
FIGURE 1.2 LoweBot, developed by Lowe’s Innovation Labs, opens a new channel to help customers find products in the store while also tracking and managing inventory.
Lowe’s went online. Sears opened retail stores. UPS put digital tablets in its associates’ hands and self-service websites in its customers’ browsers. Netflix shifted to streaming. Amazon now sends their own delivery drivers (and drones!) to bring items to your door. Over time, organizations determine which channels to invest more or less in to meet their business objectives and connect with the evolving needs and behaviors of their target customers.
A good example of this evolutionary pattern can be seen in marketing. As the number of communication channels expanded in the last century, marketing groups (and their external agencies) formed teams to own newer channels, such as web, email, search engines, social media, and mobile. A typical marketing campaign, as a result, requires a lot of coordination. Multiple channel experts must align around a common strategy, the channel mix for tactics, and a plan on how to get all the right messages to all the right people at exactly the right time. Then they must coordinate with internal and external partners to define, design, and develop customer touchpoints for their channel.
That’s a lot of people and a lot of coordination, and marketing is only one group among many looking to leverage the same channels to deliver value to customers.
NOTE WHAT’S A TOUCHPOINT?
That’s a good question. Definitions—and whether it’s spelled touchpoint or touch point!—differ as much as they align in disciplines from marketing to service design. For now, think of a touchpoint as what facilitates an interaction within or across channels between a person and a product or service. But, it’s a little more complicated than that. Chapter 2, “Pinning Down Touchpoints,” will delve into how to understand and codify your touchpoints.
These dynamics have only accelerated over the past 30 years as new digital channels—web, email, mobile, virtual reality, and so forth—have emerged as new ways to communicate, interact, and deliver products and services. The bright and shiny digital world often overshadows older media and channels. Yet, companies still invest in physical retail, direct mail, call centers, outdoor advertising, television, radio, and the like. (Just look at Amazon’s 2017 acquisition of Whole Foods.) A greater focus on digital doesn’t mean that the other channels go away—rather, it means that companies have more ground to cover than ever before.
NOTE PRODUCTS VS. SERVICES
Throughout this book, you will see the phrase “product and services” as a nod to the applicability of these approaches to multichannel, multitouchpoint systems. Services—such as traveling by air, staying at a hotel, or seeing your doctor—contain many products, and products—a digital camera or an automobile—can have many supporting services. Labels aside, if your offering operates in more than one channel with many touchpoints, you’re in good hands.
Regardless of which channels it began operating in originally, a company’s organizational chart often reflects this type of channel or business expansion (see Figure 1.3). With each emerging channel, companies typically follow a pattern of leaning on outside experts and then building those capabilities and skills internally as it becomes clear that they are core to the business’ long-term success. New groups get built and slotted next to existing channel teams, each with its own strategies, visions, plans, and incentives for creating customer experiences. This redundancy leads to fragmented channel experiences, as well as more complexity in connecting touchpoints across functions and channels.
Channel proliferation (and its resulting effect on organizational structure) has made life complicated for even relatively small companies. How much should be invested in each channel? How can traditional channels be maintained while shifting into emerging channels? How do you manage all these channels? Who owns which channel and how do you get on their priority lists?
FIGURE 1.3 A representative organizational chart reflecting