Multichannel retailer
Encyclopedia
A multichannel retailer is a company that sells directly to the public via more than one distribution channel. Most multichannel retailers sell through mail order catalogs
and "brick & mortar" retail stores
. Some multichannel retailers sell online as well.
Typically, a multichannel retailer begins with a traditional retail storefront, then adds a mail order catalog and finally, once those two channels prove lucrative, expand to a third selling channel by establishing an online presence.
Although this is the normal sequence of events, there are other successful multichannel retailers, who have started with either a web channel or direct mail channel first and then expanded their marketing
efforts into the "real world" of traditional retail storefront selling environments.
Establishing more than one way for their customers to shop for their products, is a method for retailers to attempt to grow their monthly revenue
s and gain new customers, who in turn can be marketed to via other channels not used during their initial purchase. For example shoppers at traditional retail storefronts may also be encouraged to join customer loyalty programs, which may allow further marketing to the customer via direct mail
and / or online via E-mail
.
It's not only marketing that pushed the topic to the top of retailers agenda. Nowadays more customers use various channels for an informed purchase decision. While they do so, they easily change channels within the purchase process. In fact they have no idea of that concept as it is rather an internal topic amongst retailers than widely known to the public. Customers just want to shop with the brand, regardless how a retailer might have organised himself internally.
It's important that retailer support and encourage customers when they change between channels. Retailers who don't do so risk to lose customers as they might wander of to a competitor who has a better presence in the other channel. Retailers must also strive to reduce disruption and confusion while customers swap channels. Both will hamper the customers purchasing process; prolonging sales cycles, with an increase risk of losing the customer all together.
However, multichannel is not a retail topic only. In fact it's a topic relevant to anyone who sells goods or services. Hence this is also relevant to manufacturers that sell directly to consumers or enterprises who sell to other businesses (B2B). In those situations customers will also use various channels for their purchase.
Whilst store, catalog and direct sell (over the phone, sometimes regarded as the 4th traditional channel) have not developed many more customer touch points, online has done the opposite. In recent years the number of customer touch points, that piggy backing on online, has exploded. The Internet of Things will accelerate this growth even more. Mobile, Facebook, Twitter & Co. are just the beginning. Thus the term agile commerce
is increasingly used to describe the next stage of multichannel retailing
.
Mail order
Mail order is a term which describes the buying of goods or services by mail delivery. The buyer places an order for the desired products with the merchant through some remote method such as through a telephone call or web site. Then, the products are delivered to the customer...
and "brick & mortar" retail stores
Department store
A department store is a retail establishment which satisfies a wide range of the consumer's personal and residential durable goods product needs; and at the same time offering the consumer a choice of multiple merchandise lines, at variable price points, in all product categories...
. Some multichannel retailers sell online as well.
Typically, a multichannel retailer begins with a traditional retail storefront, then adds a mail order catalog and finally, once those two channels prove lucrative, expand to a third selling channel by establishing an online presence.
Although this is the normal sequence of events, there are other successful multichannel retailers, who have started with either a web channel or direct mail channel first and then expanded their marketing
Marketing
Marketing is the process used to determine what products or services may be of interest to customers, and the strategy to use in sales, communications and business development. It generates the strategy that underlies sales techniques, business communication, and business developments...
efforts into the "real world" of traditional retail storefront selling environments.
Establishing more than one way for their customers to shop for their products, is a method for retailers to attempt to grow their monthly revenue
Revenue
In business, revenue is income that a company receives from its normal business activities, usually from the sale of goods and services to customers. In many countries, such as the United Kingdom, revenue is referred to as turnover....
s and gain new customers, who in turn can be marketed to via other channels not used during their initial purchase. For example shoppers at traditional retail storefronts may also be encouraged to join customer loyalty programs, which may allow further marketing to the customer via direct mail
Direct mail
Advertising mail, also known as direct mail, junk mail, or admail, is the delivery of advertising material to recipients of postal mail. The delivery of advertising mail forms a large and growing service for many postal services, and direct-mail marketing forms a significant portion of the direct...
and / or online via E-mail
E-mail
Electronic mail, commonly known as email or e-mail, is a method of exchanging digital messages from an author to one or more recipients. Modern email operates across the Internet or other computer networks. Some early email systems required that the author and the recipient both be online at the...
.
It's not only marketing that pushed the topic to the top of retailers agenda. Nowadays more customers use various channels for an informed purchase decision. While they do so, they easily change channels within the purchase process. In fact they have no idea of that concept as it is rather an internal topic amongst retailers than widely known to the public. Customers just want to shop with the brand, regardless how a retailer might have organised himself internally.
It's important that retailer support and encourage customers when they change between channels. Retailers who don't do so risk to lose customers as they might wander of to a competitor who has a better presence in the other channel. Retailers must also strive to reduce disruption and confusion while customers swap channels. Both will hamper the customers purchasing process; prolonging sales cycles, with an increase risk of losing the customer all together.
However, multichannel is not a retail topic only. In fact it's a topic relevant to anyone who sells goods or services. Hence this is also relevant to manufacturers that sell directly to consumers or enterprises who sell to other businesses (B2B). In those situations customers will also use various channels for their purchase.
Whilst store, catalog and direct sell (over the phone, sometimes regarded as the 4th traditional channel) have not developed many more customer touch points, online has done the opposite. In recent years the number of customer touch points, that piggy backing on online, has exploded. The Internet of Things will accelerate this growth even more. Mobile, Facebook, Twitter & Co. are just the beginning. Thus the term agile commerce
Agile Commerce
Agile Commerce was first coined by of Forrester. It’s the logical evolution of multichannel commerce and actually helps to solve some of the confusion around it. Brian’s postulation of multichannel is dead made some believe that he had made a u-turn without really grasping Brian’s true meaning...
is increasingly used to describe the next stage of multichannel retailing
Multichannel ecommerce
Multichannel ecommerce consists of selling products or services through third party retail partners. Multichannel ecommerce can be differentiated from traditional retail distribution partnerships in that the manufacturer usually maintains a single product management system that electronically...
.