- What is multichannel?
- Online marketplace or your own online shop
- Multi-channel, cross-channel and omni-channel
- Advantages of the multichannel strategy
- Trend 2021: Sales in social media
- Challenges of the multichannel strategy
The focus on stationary trade as the only sales channel is no longer up to date. Changing market conditions demand a high degree of mobility and flexibility from retailers if they want to improve their sales opportunities. A well thought-out multichannel strategy with the right choice of marketplace for your product is an obvious solution in our digital age.
What is multichannel?
Multichannel is a strategic approach in which products are offered through multiple sales channels in order to reach a larger number of customers. Traditional sales channels used to be mail order via catalog, teleshopping and brick-and-mortar shops. E-commerce has slowly pushed out teleshopping and catalog trading and is making a large number of its own sales channels available.
Possible sales channels today are online shops, mobile apps and social media such as Facebook or Instagram as well as sales representatives and franchising systems.
Online marketplace or your own online shop
There are two ways for an online shop to offer products or services: either on their own homepage or via digital marketplaces such as Amazon, Ebay, kaufland.de, etc. Both strategies have advantages and disadvantages.
Having your own web shop allows maximum freedom of design and precise calculation of the monthly costs. The competitive pressure is less pronounced than on digital sales platforms. However, logistics and fulfillment must be organized independently. That requires a lot of effort.
With the digital marketplace, your products can be quickly and inexpensively integrated into the existing system. With multiple marketplaces,
there is also the option to store products and then ship them directly to customers.
Both variants are by no means mutually exclusive. Online retailers who are active on both channels benefit from the advantages of both sales options.
Multi-channel, cross-channel and omni-channel
There are three different approaches to the sales strategy, namely multichannel, crosschannel and omnichannel. In addition to the physical point of sale, multichannels allow products to be sold via other sales channels such as online shops or mobile apps. With cross-channel, the customer has several channels that are already linked to one another. For example, the customer can obtain information online and shop offline or vice versa. For some industries and products it is extremely necessary to use both sales channels and to connect them closely. Omnichannel marketing goes one step further. It attempts to adapt all possible communication channels to customer behavior, regardless of where they are and when they want to shop.
Advantages of the multichannel strategy
Using several sales channels at the same time can help you to achieve greater market coverage. Through the specific adaptation of sales channels you can make new customers aware of your products.
The advantages of virtual shopping are obvious: online shops are permanently available and visible. With a few clicks, customers can find out about the availability of goods and order them right away. This eliminates the need for additional staff to provide hotline service. Online shops
also allow you to email customers about discounts and promotions and build a longer-term relationship with them.
Trend 2021: Sales in social media
With a multi-channel strategy, industries that previously run only physical stores can spread the risk across multiple channels and minimize losses. With a presence in social media such as Facebook or Instagram, for example, young people can be addressed who might never go to a specialty shop. It offers you a chance to establish strong customer relationships by showing genuine interest in person. This is the only way to build
trust towards the product you’re selling.
Another opportunity that social media offers is the interaction between customers during the shopping process. Many people have got used to not only seeing customer reviews, but also sharing impressions about the product with friends.
Sales via social media have become more important, especially since the coronavirus crisis has restricted stationary trade everywhere. Lockdowns are driving customers to shop online. This trend will continue in all possible industries and social media can greatly support the sales strategy.
Challenges of the multichannel strategy
Companies that opt for a multichannel strategy must reckon with a number of challenges. For example, having multiple distribution channels
makes logistics and warehousing more complicated to manage. In order to correctly and efficiently handle all sales and communication
channels, retailers not only need to invest time and money, but also hire the right staff who can cope with the multitude of tasks
Building an effective sales strategy also requires appropriate software that ensures
consistent multichannel communication with the customer.
Online trading also involves dealing with a large amount of personal information. Although this offers the opportunity to get to know your own target group better in order to build the right marketing strategy, it requires clear responsibilities when maintaining the data. The first
stumbling blocks can already arise when creating a contact form.
The retailers must also be ready to adapt to the increasing demands of customers and to differentiate the variety of information channels.
Multichannel sales is a suitable solution for constantly growing customer requirements and offers high growth opportunities for online retailers. However, successful implementation requires a clear strategy that has been worked out down to the last detail. On the one hand, it implies good planning and organization so that different work areas can be optimally coordinated. On the other hand, effective information
management should be ensured.