Research Shows 96% of Senior Marketers believe Cross-channel Sales & Marketing will Become More Important, but Only 32% Understand It and Its Relevance to eCommerce

May 17, 2005 -- We define cross channel sales & marketing as not only reaching customers through multiple channels of distribution (direct and indirect), but taking advantage of one channel to drive sales in another, e.g. using online sales to drive customers to a retail store, in-store activity to drive direct response sales, or direct sales to drive reseller sales. Historically, channel conflict was a major concern, which has caused some companies to lose sleep and market position. Now we can use technology and multiple channels to benefit revenue and profit. A few companies have moved beyond simple eCommerce to reach customers through one channel so that they may buy through another.

We asked 81 senior marketers in April, 2005, from Fortune 1000 companies about their perceptions and usage of cross-channel sales & marketing. While 73% said they were aware of it, and 65% said they had used it, only 32% defined it correctly. Many defined it as the same as “multi-channel,” and some defined it incorrectly as “common data-base,” or even “price-fixing.” This suggests that there are many overlooked opportunities to grow business..

Nevertheless, once the definition had been provided to the respondents, an overwhelming 96% believed that cross-channel sales & marketing would grow in importance. The respondents, who came from a broad range of industries, believed that consumer technology and entertainment would show the largest growth. Other industries with high expectations included: retail, gifts, consumer finance, telecommunications & cable, apparel, B2B services, and B2B goods. Ratings for sophistication of each industry were generally well behind the potential.

However, they expected even lower rated industries, such as Consumer Packaged Goods or automotive, to show substantial growth. Other industries with high expectations included: retail, gifts, consumer finance, telecommunications & cable, apparel, B2B services, and B2B goods. Ratings for sophistication of each industry were generally well behind the potential.

When asked which companies were doing a particularly good job, Dell was rated highest, with Amazon, eBay and Apple close behind. On an open ended basis, “none” scored higher than any company! There are specific categories which have a major advantage in building cross-channel synergy. This includes any business which reaches end-users via multiple distribution channels, e.g. online, retail stores, telephone, supermarkets, department stores, drugstores, gift shops, and mass-merchandisers. Examples of companies which have the greatest advantages, but have not fully exploited them, in these areas include Oreck, Hallmark, Godiva, and Tiffany & Co, Richard Guha, Principal of the New England Consulting Group, who spearheaded the study, stated that, “Cross-channel sales and marketing is an essential ability for all companies over the next ten years” He went on to point out that, “most companies perceive it as channel conflict and struggle to balance them, often automatically giving preference to the longest established, whether right or not. Business does not fully grasp the opportunities cross-channel strategies open up.”

Richard Guha, with Bachelor’s and Master’s degrees from Cambridge University, has been a corporate officer in three major global corporations, President of Reliant Energy Retail, CMO of MediaOne/US West, and Remedy/BMC enterprise software. He founded several companies and has been on the Board of three. He brought his experience and insight, gained in fifteen years in the rigorous and competitive world of consumer packaged goods at Procter & Gamble and Mars, Inc., to other industries, and played pivotal roles in the transformation of several major corporations. Richard created the consumer broadband market and he has advised many Fortune 500 corporations and well-known CEOs. His thoughts on a wide range of business issues are expressed regularly at http://takecontrolof.blogspot.com/ Contact him for more information on this subject.

The New England Consulting Group has been the premiere management consulting firm specializing in strategic and tactical marketing management for twenty-four years providing expert services both domestically and globally to Fortune 500 companies, including Procter & Gamble, General Electric, Kraft/General Foods, and PepsiCo, among many others. Innovators of such ideas as The Marketing RoadMap, Six Sigma Marketing, and practitioners of the Principal Principle, the New England Consulting Group continues to seek new avenues for the expression of insightful and innovative ideas.