The Omnichannel Forum is a monthly series that poses a single question to a panel of industry experts. This month’s host is industry analyst Joanna O’Connell.
Russ Dieringer. Founder & CEO, Stratably
Gemma Spence. Global Vice President, VMLY&R Commerce
Margo Kahnrose. CMO, Skai
Mert Damlapinar. Principal, CPG Business Consulting, EPAM Systems
Lauren Bennett. Director, Performance Solutions, Rakuten Advertising
Alex Else. Head of Omnichannel Product Solutions, Group M Nexus
Aaron Goldman. CMO, Mediaocean
Katia Colston. Sr. Dir of Garden eCommerce Sales, Central Garden & Pet
Peter Galli. Director of Digital Marketing, HART Consumer Products
In this series’ first installment, respondents were asked to contemplate the meaning of “omnichannel”. Many nodded toward the consumer experience as being central — and I couldn’t agree more. But there was also plenty of variability, demonstrating our natural inclination to see things through our own lens (Am I a Retailer? A marketer? An agency media buyer? A tech provider?).
This go-’round, contributors were asked to give the collective “we” a grade in terms of omnichannel maturity. And responses were super interesting, with a few things catching my eye:
There’s broad agreement that the pandemic and its knock-on effects accelerated many brands’ omnichannel journeys. Its impact on consumer behaviors — a move toward at-home grocery delivery, an increase in online shopping, and a massive uptick in the adoption of streaming as examples spurred “omnichannel” acceleration as organizations were forced to meet increasingly high consumer expectations of utility, expediency, and convenience. That said, there’s also an acknowledgment that some sectors — like retail — adapted faster than others, like CPG.
But how about advertising? What grade does the industry deserve?
The consensus is there’s been plenty of progress, but we have a long way to go. As Mediaocean’s Aaron Goldman rightly points out, “We’re doing pretty well when it comes to deploying consistent brand messaging that spans multiple platforms.” But everyone sees an opportunity to improve an industry that’s described both as “young and vibrant”, and “mostly chaos”. And it’s also clear that “omnichannel” will be a constantly moving target as new environments, formats, and ad models continue to emerge.
That said, there are some big considerations that merit far more attention, from my point of view. The “privacy” conversation should be front and center. That is, what should “omnichannel” look like in a world where consumer data is far more fragmented, protected, and controlled? The changes happening today in the name of privacy challenge many classic notions of what a “good” omnichannel marketing strategy looks like. Relatedly, and aptly, Peter Galli of Hart Consumer Products points out, “The advertising industry has been shifting from horizontal (across platforms, devices, apps, etc.) to vertical (walled gardens, retail media networks, etc.).” These shifts will affect everything we do. And, of course, what of the consumer experience itself?
– Joanna O’Connell, Industry Analyst
How would you rate the industry in terms of omnichannel maturity?
If I were grading on a curve, I’d give the industry a solid B.
There’s room for growth, but we’re operating at a fairly sophisticated level compared to other sectors. We’ve figured out ways to stitch together identity signals across channels and deploy ads at scale in privacy-friendly ways. That’s no easy task. Of course, we’re just scratching the surface in terms of AR, VR, Web3, and the Metaverse. But for now, just looking at the places where consumers spend most of their time, I’d say we’re doing pretty well when deploying consistent brand messaging that spans multiple platforms.
Sr. Dir of Garden eCommerce Sales, Central Garden & Pet
It is difficult for me to accurately rate the current CPG industry in terms of its omnichannel maturity, as the industry is quite large and diverse, and different companies within it may have different levels of omnichannel maturity. However, it is generally acknowledged that the CPG industry has been slower to adopt omnichannel strategies compared to other industries, such as retail and financial services.
This may be due in part to the fact that CPG companies have traditionally relied on physical stores and traditional marketing channels to reach customers and may not have had as much experience with digital channels. However, as the importance of omnichannel strategies becomes increasingly clear, more CPG companies will likely begin to adopt them to remain competitive and meet the evolving needs of their customers.
Director of Digital Marketing, HART Consumer Products
In certain areas, we have seen incredible progress in targeting, measuring, and optimizing various marketing campaigns on an omnichannel scale. Simultaneously the advertising industry has been shifting from horizontal (across platforms, devices, apps, etc.) to vertical (walled gardens, retail media networks, etc.).
It feels like we are at a crossroads, and the omni-ad industry is still trying to identify which method of measurement is most impactful.
Director, Performance Solutions, Rakuten Advertising
The performance advertising industry as a whole has proven itself resilient in unformidable economic climates. At times, we see a heavier focus on driving revenue while still managing the ever-changing landscape of social media and the complexity and massive growth of retail media entities.
As performance marketing continues to be a major strategy for all brands, some have put sophisticated systems in place that help them be more agile and view their data more comprehensively. The maturity of the term “omnichannel” is robust and something that marketers and executives are interested in talking about and incorporating into overall strategies for a brand. The conversation hasn’t necessarily changed, but the methods and industry changes (such as collecting PII) has changed dramatically.
Head of Omnichannel Product Solutions, Group M Nexus
I think it’s in a phase of experimentation and innovation – so, it’s young and vibrant rather than mature and somewhat staid.
There is a huge amount of curiosity – with solutions being created based on conversations between clients, agencies, data providers, third-party technology, and research within the industry at a fast pace.
I think there’s also uncertainty as to how it will evolve. There’s no doubt that this represents a positive change in how advertising may be conducted in the future, and the pace of that evolution will be high. But it’s also whether it will act as a catalyst for further change in the advertising ecosystem – for example, to further automation via AI and data-based decisioning, or whether, in fact, it also means the subject matter expertise of the human-based planner will be even more important in the complex ecosystem that Omnichannel may deliver.
Global Vice President, VMLY&R Commerce
The very nature of the advertising industry means that marketers have to be innovators when it comes to omnichannel as it operates across many industries, in markets with varying capabilities and maturity that include a combination of leading and nascent brands & industries.
The consumer funnel has not only collapsed but, in many cases, is dead (!), and this has given rise to interoperable ecosystems and devices, interdependency between commercial aspects (price, promotion, availability), and marketing (creativity, audience, search) which means that advertising networks and industry, in general, has to take a data-driven and highly creative approach to help brands stand out from any shelf, whether it be static or dynamic.
Therefore agencies must stay ahead of the curve and continue to innovate ahead of what feels comfortable to build insightful activations that fuel growth through omnichannel retail.
After a decade of a slow burn, there’s been a marked evolution in the last two years toward interest in the move to omnichannel. Certain macroeconomic factors, like a pandemic-induced acceleration in digital shopping and advertising and data privacy regulations making marketing measurement more opaque, have increased competition in many categories and generated less predictable customer relationships.
Brands already thinking omnichannel have matured their marketing methods and programs quickly enough to adapt to new challenges in obtaining and managing data while staying nimble with their media mix. Brands that were knee-deep in channel silos are in catch-up mode. Ad tech is in catch-up mode, too, evolving from point solutions to platforms that can help marketers connect the dots and do more with less, and the world of open-web programmatic is facing an existential crisis with the death of the third-party cookie. So I’d describe the current state as mostly chaos, with a few outliers that are in better shape.
2023-2025 are going to be transformational years for the industry in which we’ll start to see new job titles, more cross-functional collaboration within marketing, and technologies that become marketing platforms of record for omnichannel brands. We’ll see ad formats converge and overlap. With AI driving more content and creativity, lower production values, giving businesses resources back that they can reinvest into customer experience and product. Ultimately, this is going to improve the value exchange between brands and customers in new and exciting ways.
Principal, CPG Business Consulting, EPAM Systems
It is challenging to accurately rate the advertising industry as a whole in terms of omnichannel maturity, but I can confidently say that we have a long way to go.
Different companies and brands may be at different stages of adopting and implementing omnichannel strategies.
Overall, the advertising industry is becoming increasingly omnichannel in nature, with more and more companies recognizing the value of integrating their marketing efforts across multiple channels and devices. This includes traditional channels like television and print and digital channels like social, search, OTT/streaming, and retail media.
Founder & CEO, Stratably
The industry gets a B grade in terms of omnichannel maturity. Consumer brands and retail partners have come a very long way in recent years, spurred by the pandemic.
Nearly all growth initiatives at retailers are tied to digital, and consumer brands have started to build and communicate their longer-term digital visions, adding more people, technology, and capital to bring it to life.