AlanMorris refutes the common perception that 'Multichannel' is an entirely newphenomenon and discusses the opportunities and challenges this avenue presentsto retailers.


Oflate, multichannel retail has been discussed in a way that suggests it is somethingof a new phenomenon. This is largely due to the advent of online stores andmobile technology. Certainly, E-commerce and M-commerce are the latestadditions to the multichannel mix and are fresh and interesting avenues forretailers to explore. However, the concept of multichannel existed long beforethe first online shopping basket or mobile app were twinkles in an exciteddeveloper's eye. The simple way of defining a multichannel retailer is thatthey sell to the public via more than one distribution channel - through mailorder catalogues, bricks and mortar stores, online, and via mobile technology;the latter two being the most recent, and currently fastest growing channels.


Anothercommon misconception surrounding multichannel is that retail always starts witha bricks and mortar presence, but again that's not true. If you look back atthe history of Sears in the United States, who have long been established as aretail giant, they opened their first store in 1925 to complement theircatalogue channel, which they launched in 1886.


Thekey benefit for retailers of being multichannel is that it gives them moreopportunities to get their product in front of customers whom they wouldn'thave been able to reach with a single channel. This allows them to increaserevenues and profitability, which is fundamentally what being in business isall about. Customer loyalty is one of the biggest challenges in today's retailmarket regardless of whether you're a single or multichannel retailer,therefore the more opportunities you have to get customers engaged with yourproduct, the bigger your advantage. Consumers are now bombarded with so manymessages persuading them to buy that, if retailers dont take this seriously,theyre effectively conceding defeat to the opposition.


Integrationis one of the primary challenges to multichannel retailers in the eternalbattle for customer loyalty. When a customers makes contact with a retailer-whetherit be online, via a mobile application, via a catalogue, or in store- it'simportant that they are treated in the same way; and that the high level ofservice that a customer receives face-to-face is replicated via other channels.To provide that service, the retailer must have the right product in the rightplace at the right time. That may be an old retailing cliché, but itsabsolutely critical. For example, there's no point in having a fancy websitethat seemingly allows the customer to buy products if the items never turn up.That bad experience wouldn't just put off the customer from visiting thewebsite again, it would probably also deter them from shopping in theretailers stores on the high street, or using their catalogue. So whilstmultichannel retailers are able to get to more customers, the chance of gettingit wrong is also greater.


Furthermore,retailers must either fully invest in each new opportunity presented, or notenter that route to market at all. For example, if a retailer with two hundredhigh-street stores suddenly thinks that adding a website is going to increasesales, it may be right, but it will need someone to manage that web site justas it would need a shop manager to manage a 'bricks and mortar' store. Atransactional website has got to be seen as an integrated part of the business,and the nuances of that part of the business have to be understood.


It is by no means myintention to deter anyone from considering multichannel retailing. In terms ofwhether it is the right approach for retailers, I think it certainly is.However it's

absolutely vital that they plan how multichannel is going to work for their business and how theyre going to deploy their resources. These resources include products, people, marketing and IT systems, and need to be spread across each channel.


IT acts as a facilitator for retailers, in the sense that it makes processes better and can improve business practice. It's not true that without IT you wouldn't have bricks and mortar retailing, because this existed and was part of the retail landscape many years before there were computers. However, internet shopping and mobile retailing have obviously been facilitated by technological advancement. Retailers have sometimes been classified as being late to adopt different technologies; historically they have tended to try a development when it was no longer cutting-edge and its real advantages had been proven. For example, when the internet was first used to sell products and services, not everybody had a home computer, so many thought this route to market wouldn't take off because there werent enough computers out there. Nowadays, retailers who have adopted this technology and are managing their online stores well are making a great deal of money.


In terms of where multichannel is going, it's very difficult to say. If we wound the clock back ten years to the year 2000 and were asked to forecast the technology that would be in use in 2010, at best, we might have got it approximately right. What's important is that IT providers should always be looking at their product from a retailer's perspective and understanding how the product underpins multichannel retailing. This is because, however it may develop over the coming months and years, multichannel is here to stay.


Alan Morris is Co-founder and Managing Director of Retail-only IT services and solutions provider, Retail Assist.


Views presented here are those of the author


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