03 Jan
The old days of single-channel retail are history. We now live in a world where customers expect to be able to interact and transact with retailers across multiple channels – online, mobile, brick-and-mortar stores, call centers, social media, etc. Multichannel retailing offers customers convenience, flexibility, and choice in how and where they research, evaluate, and purchase products and services. For retailers, implementing a coherent multichannel retailing strategy across all customer touchpoints is no longer a “nice-to-have” but an absolute necessity for survival and growth.
In this post, let’s explore what multichannel retailing means, why you need it, and what benefits it brings to both consumers and businesses.
What is Multichannel Retailing?
Multichannel retailing refers to the practice of selling products and services across more than one sales channel. For instance, a retailer could have physical store locations, a website, mobile apps, catalogs, and call centers all operating together in a coherent ecosystem. When done right, these channels harmonize harmoniously to meet diverse customer needs and preferences.
A true multichannel strategy provides a unified brand experience and seamless transitions across touchpoints. So when a customer interacts with a retailer across channels, the messaging, offers, products, prices, services, and policies are consistent. Data and insights on the customer also flow freely between channels to enable personalized service.
As a multichannel retailing example, you walk into your favorite clothing store, try on a few fab outfits, snap some selfies in the dressing room, and ask the clerk to hold that darling dress behind the counter while you think it over. On your drive home, an email pops up on your phone reminding you about the dress and tempting you with a 10% off coupon. After dinner, you browse the store’s Instagram feed filled with celebs sporting the latest trends and spot a familiar face wearing that dress you tried today. Just like that, they pull you back in and you click to purchase.
This is multichannel retailing in action. And it’s quickly becoming the norm, not the exception for savvy retailers.
This is quite different from retailers merely having a presence across channels but working in organizational or operational silos. Multichannel retailing requires integrated channel management, coordinated teams, and unified systems/processes across the enterprise. Technology plays a huge role in enabling this integration.
Also Read: The Key Features of Point of Sale for Multichannel Retailers
Why is Multichannel Retailing Important?
Several key drivers make having a multichannel retailing strategy invaluable today:
Changing Customer Expectations
Today’s consumers are incredibly sophisticated. Empowered with information, they expect rich, personalized cross-channel shopping experiences tailored to their individual needs and contexts.
Importantly, their buying journeys are no longer linear or confined to one channel. Research shows that most shoppers use multiple channels during their path to purchase. They may research products online, try them in-store, compare options via mobile, and ultimately buy online for home delivery.
Retailers must thus meet consumers wherever they choose to interact and enable seamless transitions across channels.
Operational Agility
A multi-channel footprint allows retailers to adapt faster to market changes. Stores can compensate when the website is down. Call centers can absorb order volumes when mobile apps crash during peak seasons. Omnipresence across channels provides operational agility and resilience.
Access to a Broader Customer Base
A multi-channel approach allows retailers to access a pool of customers across various demographics and geographies. Stores provide physical access and brand experience to local shoppers. E-commerce opens up new markets nationally or globally and mobile commerce targets an on-the-go audience. With these channels working together, retailers can acquire different segments and turn them into loyal customers regardless of their preferred shopping channels.
Also Read: Optimize Your Checkout Process for More Sales
Benefits of Multichannel Retailing for Customers
Multichannel retailing transforms the shopping experience for customers by offering:
1. Convenience and Flexibility
With multiple channels to interact with, customers enjoy round-the-clock convenience. They can shop online while commuting via mobile, or visit a store on weekends to experience products first-hand. Multichannel retailers enable consumers to shop whenever and wherever it suits individual lifestyles.
2. Broader Product Selection
A retailer’s online store faces no space constraints and can offer a wider, deeper variety of products compared to a brick-and-mortar outlet. Customers can thus access the full product portfolio easily across channels. Out-of-stock items in one channel can also be sourced instantly from another channel.
3. Access to Exclusive Promotions and Content
Savvy retailers create channel-specific offers to generate interest across their ecosystem. For example, special sales available only on the mobile app or exclusive member prices in stores. Such promotions and personalized content keep customers engaged across touchpoints.
4. Seamless Shopping Experiences
Leading multichannel retailers like to offer customers flexible fulfillment options based on their context and preferences. Shoppers can order products online and pick them up from a nearby store without waiting for delivery. Or return online purchases at physical stores instead of shipping them back from home.
They also leverage customer data and shared order/transaction histories across channels to deliver contextualized experiences. You might discover an online product recommendation based on an item purchased at the store!
Also Read: Retail Inventory Method
Key Benefits of Multichannel Retailing for Retailers
Adopting multichannel retailing brings several commercial advantages:
1. Higher Revenue and Sales Growth
A multichannel presence opens new revenue streams while leveraging physical assets and store traffic better. Retailers can better fulfill demand by moving inventory to where customers want it. Research shows multichannel shoppers also tend to spend 15-30% more on average compared to single-channel shoppers.
2. Improved Customer Acquisition and Retention
More channels allow retailers to reach wider audiences for accelerated customer acquisition. Existing buyers also gain more opportunities to interact and transact, improving satisfaction and loyalty. Multichannel retailers enjoy 20-30% higher customer retention rates.
3. Deeper Customer Insights
With customers engaging across touchpoints, retailers gather richer behavioral data and purchase history. These cross-channel insights help merchants personalize experiences better and fuel innovations.
4. Increased Operational Efficiency
Multichannel retailers can optimize processes across channels to lower costs. For example, leveraging store associates and physical stores to facilitate online order fulfillment or returns handling without additional overheads. Channel capabilities can also compensate for weaknesses in other channels.
5. Competitive Resilience
As mentioned earlier, seamless multichannel shopping capabilities are now baseline expectations for most retail categories. Not having them puts merchants at an enormous disadvantage relative to omnichannel players. Those slow to enable multichannel shopping also risk losing customers permanently to nimbler competitors.
As customer expectations and market realities evolve, multichannel retailing strategies are vital not just for growth but for the survival of retailers. The good news is technology advancements and falling solution costs have made sophisticated multichannel capabilities more accessible for modern merchants. Solutions like Hana Retail cater especially to the needs of small and mid-sized retailers with their affordable, cloud-based platforms. We make unified inventory management, customer data integration, and omni-order fulfillment achievable for retailers of all sizes. Be sure to check us out!
