As traditional retail channels dwindle in popularity, more businesses are turning to multi-channel retailing to provide an extra income stream and keep business ticking over. If you're interested in knowing more about diversified retail, this guide is for you.
As with any business term, multi-channel means different things to different people. So, what do we mean by multi-channel retailing?
Multi-channel retailing is when a company provides numerous ways for customers to purchase goods and services at all touch points throughout the buying process. For example, many retailers have a traditional, brick-and-mortar store where customers can come and purchase their goods and services. To accompany this, many now also have an online website where customers can purchase the same goods and services from the comfort of their own home. These are just two channels (of the possibly hundreds channels) available to businesses to reach their customers. Increasingly in recent times, businesses will use social media, like Facebook or Instagram, to also sell their products. In essence, a multi-channel retailing strategy is a selling strategy allowing their customers to purchase their offerings through every possible channel, often partnered with online inventory management software to result in a near fully automated process.
But isn't this the same concept as omni-channel marketing? Not quite. Omni-channel sales takes a multi-channel approach to sales but with an emphasis on providing a seamless shopping experience, whether customers are in a brick-and-mortar store, shopping online, on Facebook or through email. Like a multi-channel retailer, an omni-channel strategy can be increasingly effective when partnered with online inventory management software to act as a centralised sales hub across all channels.
Whilst a multi-channel strategy basically entails serving and interacting with customers on numerous channels, an omni-channel strategy seeks to create a seamless integration for the customer. It is much more customer focused as opposed to product-focused, merging the various channels available to business owners. Websites, email, social media, brick-and-mortar stores, display advertising and retargeting advertising are all used in tandem with one another to create a seamless, personalised and fully integrated experience for the customer.
Which approach is right for my business?
After comparing a multi-channel and omni-channel retail strategy, businesses often think an omni-channel strategy is better and more “joined up”. This seamless experience is a major advantage of an omni-channel approach.
The major downside of implementing an omni-channel retail strategy is the significant technological investment it takes to ensure everything is working as it should. Often, an in-house IT team is required to implement an effective omni-channel strategy and with them, a fairly complex vision, skill set and strategy are required to correctly implement.
By contrast, a multi-channel strategy is often much more effective for retailers simply because of the comparatively simple nature. All that is really needed is an understanding of what platforms and channels your customers are on and an understanding of said platform/channel. For most small to medium retailers, starting with a multi-channel strategy may be appropriate.
Why take advantage of multi-channel retail?
Many studies have shown the increased sales businesses can experience by investing in a comprehensive digital sales strategy (whether it be multi-channel or omni-channel). For example, in 2015, an analysis was performed revealing that retailers who sold through two channels averaged double the revenue of retailers who only sold through one. Another study shows that 47% of consumers who come into contact with a business across 10+ channels purchased from them once a week whilst only 21% that come into contact with businesses across one to four channels a week say the same. It is clear that operating across multiple channels is great for business and, when used in tandem with online inventory management software, the entire digital sales process can be near fully automated resulting in more sales done more simply.