A Multi-Channel Approach to Marketing
In the past, companies were generally focused on a single distribution channel to sell their merchandise (what is now called the “single channel”). It is then the supplier, not the customer, who decides where, when, and how products and services can be purchased.
Then came the digital revolution: the existing channels changed, new ones were added thanks to e-commerce and mobile shopping.
With the new information and communication technologies, consumer behavior has also developed.
In addition to a wide choice of products and 24-hour service, customers demanded a wide choice of sales channels to choose their favorite. To stay competitive, businesses and traders could no longer afford to market their products through one channel. This is how multichannel marketing was born. But what does this mean exactly?
What is Multi-Channel marketing?
Multi-channel marketing is a business communication and sales strategy that aims to reach all potential consumers simultaneously, across multiple communication channels. From the customer’s point of view, the multi-channel approach makes it possible to establish contact with a company through different channels, to obtain information on the products and services offered, and finally to buy them.
The different distribution channels are vast:
- Subsidiaries of manufacturers
- Stationary commerce (stores, shopping centers)
- Itinerant trade (mobile outlets, street vendors, sales agents)
- Catalog/mail order
- Internet and online shopping
- Mobile Shopping (has become the engine of multichannel marketing)
- Graphic: example of a multi-channel marketing strategy
In a multi-channel strategy, all sales channels are separate from each other and tailored precisely to the needs of each target group.
As part of a tiered business approach, a business responds to consumer demand: being able to make itself independent of predefined contact channels and select certain channels based on their standards (e.g. convenience or need for ‘information).
The main objective of a multichannel marketing strategy is therefore to maximize the performance of each channel offered, that is to say, to adapt it specifically to the needs of each target group. In stationary commerce, for example, a customer expects personalized advice from a specialist, while online shopping focuses on speed and attractive pricing policy.
Benefits of a Multi-channel strategy
A sign of a company’s flexibility, multi-channel improves customer satisfaction and, consequently, strengthens their loyalty.
Additional sales channels can be used to reach target groups that previously could not be covered by a single channel strategy. At the same time, it allows the opening of completely new business sectors, within which new products and services can be offered, which allows to reposition itself in the market. In the long term, a multi-channel strategy aims to increase the sales of the company.
This type of multi-channel selling approach has now become the norm in the economy. Even small and medium-sized businesses usually have at least one online store in addition to their fixed business. After all, only having a presence in as many channels as possible can prevent potential customers from migrating to the competition if their preferred channel isn’t available.
Disadvantages of a Multi-channel marketing strategy
- Communication, advertising, distribution, and sales are handled over multiple channels instead of just one, resulting in more complex logistics and higher control costs. If the different channels do not present a consistent corporate image, potential customers may be confused and no longer recognize that the products and services offered belong to the same company.
- Another disadvantage of multichannel is that the different sales channels exist only side by side, but are not linked to each other in terms of organization and information technology. Not being able to switch from one channel to another at will within a single transaction may therefore be unattractive for some consumers. Which takes them to a competitor who offers a more complete shopping experience
The multi-channel strategy is found mainly, but not exclusively, in the retail sector and in the B2C sector where, in this context, the link between online and offline activities is usually mentioned. Many retailers are establishing an online store in addition to their physical outlets, which typically offers a wider, if not complete, product selection that would not be logistically possible in stationary commerce. So even rarely requested goods can be offered for sale at any time and from any location.
Both channels have their cost structure and pricing policy due to their inherent characteristics. This is unfavorable insofar as the customer wishes to have a seamless shopping experience as possible.
One solution to this problem is, for example, to offer the same price point on all channels, but to advertise online with exclusive specials. Synergy effects should also be exploited: email newsletters can, for example, refer to sales in the stationary trade, and store managers can distribute leaflets with information about the online store.
In summary, while some marketers are still a bit skeptical of multi-channel marketing, it seems obvious that if you don’t reach the customer on their preferred channel, he or she will migrate to the competition for ease. He will then be able to extend his power in the commercial world.
For some industries, products, and businesses, therefore, it is almost imperative to be ubiquitous in their communication, advertising, distribution, and sales efforts.
However, small and medium-sized businesses that do not have the technical capabilities to have a consistent and centralized customer database should at least adopt a selective multi-channel strategy.
The minimum today is to combine physical sales and online stores.
If you have any question do leave a comment.