Pioneering in the new omnichannel environment How beauty brands differentiate themselves with cross-channel synergies

Recently the retail- and beauty industry is experiencing major transformations due to the emergence of newer technologies and changing consumer behavior. Consumers are increasingly using complementary channels and touchpoints in their shopping journey. As a result, a shift took place from multichannel towards omnichannel, where both consumers and companies continuously use a variety of channels and touchpoints at the same time and interchangeably in order to enable a unique customer experience. Consequently, brands need to rethink their competitive strategies and reshape value propositions. However, traditional companies struggle to transform to this new environment and are challenged by implementing a differentiated omnichannel experience. As a result, frontrunners are exploiting cross-channel synergies to differentiate themselves from competitors and the gap between pioneers and laggards is growing. Hence, through conducting a multiple case study, this study tried to answer the question on how beauty brands use cross-channel synergies to differentiate themselves in an omnichannel environment. Ten omnichannel leaders in the beauty industry were evaluated through observations and desk research based on a theoretical conceptual model. The research included four dimensions of cross-channel synergies, including organization, brand experience, customer experience and engagement. The research revealed some key findings. First, legacy beauty brands are experiencing a digital transformation to meet the demands of the omnichannel environment and to keep up with newer direct-to-consumer and digital-first beauty brands. Second, beauty brands employ a strategic system of activities with crosschannel synergies to enhance differentiation within the omnichannel environment. The activities include the complementarity of channels through considering the strengths of each channel and providing strong interactions and seamless transitions, offering one-to-one services and highly personalized experiences, while communicating a harmonized brand identity. A sustainable competitive advantage arises from the whole system of activities, resulting in difficult-to-replicate advantages. This study contributes to the existing literature by giving a more holistic and comprehensive view on how the combination of activities within omnichannel emphasized by different previous scholars are depended on and connected to each other. Overall, this research adds to the shift to an omnichannel focus in literature, but also illustrates the potential of crosschannel synergies.