Multi-channel retailing involves selling to customers through offline outlets, like brick-and-mortar
stores and pop-up shops, and online channels, like direct-to-consumer (DTC) ecommerce sites, mobile
apps, and Amazon.
The channels available for multi-channel retailing have broadened significantly in recent years.
Instagram powers shopping through stories and posts, and Facebook Messenger has added
Multi-channel retailing gives your target customers the choice of where to buy, optimizing their
experience on the most relevant sales channels based on shopping behavior.
How to Build an Effective Multi-Channel Retailing Strategy
Selling on more than one channel is a wise investment for fast-growing businesses. A 2018 National
Retail Federation holiday study revealed that 54% of consumers shopped for gifts both online and in
store during the busiest shopping season of the year, up 40% year over year.
The Profitability of Multi-Channel Retailing
An IDC Retail Insights report revealed that multi-channel consumers spend more money, including:
15–35% higher average transaction
5–10% higher loyal customer profitability
30% higher lifetime value than single-channel shoppers
But not all multi-channel retailing innovation is for profit.
Tips for Overcoming Five Multi-Channel Marketing Challenges
Multi-channel marketing places your product at the center of a multi-spoked wheel, where your customer is never more than a click or sales clerk away from buying.
There are pricing discrepancies between channels too. Many hotel brands will promote a lower price
on sites like Expedia and Hotwire than on their website. In doing so, they teach their customers to buy
from those sites, leaving the hotel with a lower margin booking.
Going from offline to online, or vice versa, often creates a significant challenge because many
consumers, even millennials, still prefer to buy products in store.
Customers can try on products, work with stylists, and order online for same-day, in-store delivery.
How can smaller DTC businesses do the same with fewer funds or resources?
An IMS offers three key benefits :
Streamlining the fulfillment process to procure, organize, ship, and arrive quickly at a customer’s
door (or retail location)
Helping you prepare for unexpected sales spikes or seasonality
Avoiding inventory shortages when products are sold simultaneously through multiple channels
Serving your customers’ buying habits better is possible through a multi-channel sales and marketing
approach. But internal systems don’t always integrate data from various channels back to a single
If this is the case and your sales rapidly scale from 1,000 to 100,000 per month, or those sales are split
between your site, a physical location, and Facebook, you might find yourself in a messy situation.
Hot Tip: Combine Your IMS with an Order Management System
One way to protect your business from an unexpected cross-channel sales spikes is to combine the
best of an IMS with an order management system (OMS). An OMS pulls your sales data from
marketplaces and other third-party sites into your enterprise ecommerce platform. That way, you can
investigate which channel produces the highest value customers, like those with the highest repeat
purchases or lifetime value.
Your ecommerce platform admin panel should break it down for you at a glance. Otherwise, try
drilling down into your reporting section to analyze the details.
It’s also important to think of your marketing and promotional strategies from a channel perspective.
It might be counter-productive to drive customers from Facebook to your website with an ad, when
they can often purchase faster and more conveniently through Messenger.
An ad budget of, say, $15,000 allocated to Google Shopping to drive sales through your online store
sounds logical. But if you decide to add a Facebook store, Buyable Pins on Pinterest, and shopping
through Instagram Stories, then you’ll need to divide your ad spend by four.
Hot Tip: Divide Resources by Funnel Stage, Rather than Channel
A good solution is to allocate your budget and resources by funnel stage, rather than channel. For
example, your social and display ad budgets can work together to build brand awareness. Then, you
can retarget previous site visitors of your Google Shopping campaigns or Facebook Dynamic Product
ads to get similar results for less money than investing in general campaigns farther down the funnel.
Together, those platforms allow you to create templated ads that will automatically pull in product
data based on each shopper’s experience. For example, if someone browses a “rainbow colored
umbrella” on your site but doesn’t buy before leaving, you can retarget ads to them on Facebook.
The only challenge with this approach is that it’s going to interfere with your ability to attribute sales
Let’s go back to the $15,000 ad-spend example. Assume you have the budget to spend at least that
much on each channel you’ve identified to grow your business. You still have to figure out how to
measure the return on investment for each.
The challenge with multi-channel retailing attribution is that one channel will assist a sale that
happens through another channel.
There’s no right answer when it comes to selecting an attribution model. If your job is to run
Facebook ads, you might prefer a first-touch attribution model that emphasizes how customers
discover your products, so you can connect a direct line between your campaigns and results.
The Assisted Conversions report in Google Analytics indicates how many conversions (and the overall
revenue amounts) were assisted by other channels.
You can also choose a linear attribution model that assigns equal weight across all channels, or a
position-based option that lets you customize the credit given to each.
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