Posted: Friday 24th February 2012 in Performance Marketing.

I met two large multichannel retailers last week. One will succeed and one will most definitely fail in their desire to offer true multichannel retail to their customers. Actually, it’s easy to pick the winners from the losers in just a few comments. “The web’s our biggest store,” is always an Oscar winner that makes me want to reach for the emergency chain. “Our stores don’t like the Internet as it takes away the sales which they’re measured against,” is another iceberg. However, these two comments clearly reveal the problem within many large multichannel retailers. Quite simply, there’s a lack of understanding or priority about the customer’s multichannel expectations – and a lack of clarity within the organisation as to who’s responsible for driving this change.

I believe there are three keys factors that must be in place for a modern day multichannel retailer to succeed:

  • The right team and culture
  • The right technology
  • The right product and availability

The winning retailers are actively addressing each of these areas within their organisation and have an overview of the customer experience they want to deliver. It’s absolutely fundamental that Europe’s retail boardrooms understand the complete shift in customer behaviour that’s happened over the last five years – and which is continuing to evolve. Retailing is now a different sport, driven by the internet. No longer is a retailer’s website its largest store. Actually, it’s the channel that influences sales across all other stores. The website now shapes the entire decision making process for the customer. A study by Forrester suggested that, in the electrical products category, over 70% of customers researched online before making an offline purchase. Clearly this creates opportunity for smart retailers, but should strike fear into those whose website is merely a ‘bolt on’ to their offline business.

It’s wrong to blame the failings of multichannel retailers on the erosion of market share by pure play start-ups. Yes, on one hand they have taken away some sales, but their most damaging blow to high street brands has been their ability to re-adjust customer expectation around price, availability and convenience. Amazon, and ASOS offer a contagious proposition to consumers – one that has helped them build loyalty among their growing customer bases. They’re just so damn good at what they do, and work on improving their proposition to customers every day. These are businesses that have grown up in the ‘new world’ and understand the new rules of customer engagement. Given that most purchase decisions are starting online, it’s no wonder that many customers don’t make it to the bricks and mortar stores of our traditional multichannel retailers.

The other behaviour that pure-plays exhibit is speed and agility in response to change. On one level, this means that the best pure plays are trading their websites every hour. They know exactly what their online sales numbers need to be and trade their sites and propositions aggressively every day. They understand the importance of conversion rate, the power of email and the cost of every sale. They are aware of competitor pricing and the power of social media to drive a great offer. But remember, they only have one store, which should put them at a disadvantage when customers want a choice of how they purchase. So I don’t for a minute believe that the pure play specialists have it ‘in the bag’.

So what should multichannel retailer focus on to be successful? Let’s look at the three key factors that must be in place.

Team and culture

In many retail organisations, the team structure and culture mitigate against any chance of success. This definitely starts at the top of the organisation, where the board must be able to clearly articulate what they believe multichannel retail success looks like and then manage this vision down through the business. The question is: who owns the multichannel customer journey? Most retail organisations have clear divisions between their offline and online teams, fragmented further between offline and online marketing.

The final nail in the coffin is the lack of engagement between the trading teams and the website. Without a clear multichannel vision, online and offline teams are set up to compete with one another for a sale, rather than earn a reward for assisting the customer throughout his or her journey. This journey can be as complex, so both the teams and the information must be able to flow freely and be able to anticipate the customer’s next step. Companies such as Comet, part of the Kesa Group, have moved with the times. Traditionally a store-based retailer, Comet has evolved its structure to put the web team at the heart of the business with a mission to drive a customer sale regardless of channel. This is a business where change is being led from the top, by a board that absolutely understands that the company’s future success starts on the internet.


Technology has been labelled as the saviour of multichannel retail for too long. Although partly true, without direction it’s as good as a plane without a pilot. Having a single view of every customer is vital to success, as is enabling the customer to be recognised across any channel. For example, customers should have access to their entire purchase history, offline and online, from the website. The retailer should track and append every interaction with the customer, whether a purchase in store or a browse on the website, against that customer’s record. IT directors should be empowered by the board to provide their business with a sound, future-proof infrastructure where data is easy to access.

Carpetright is a great example of a business that’s recognised this requirement. When its new website goes live later this year, customers will have access to the entire product range while executives will be able to track the effectiveness of their online marketing – all the way to the point of sale in store.

Products and availability

One of the most significant successes in multichannel retail has been the adoption of ‘click and collect’ or ‘check and reserve’. The single biggest drivers of conversion rate online are whether the product is in stock and when it can be delivered. Customers have grown to expect it now and, in many cases, not even next day! Retailers must respond to this change in expectation, even if only to allow a customer to check product availability in store. This is now a most basic ‘must have’ for any retailer serious about winning.

A good example in the UK is Argos, which offers customers the option of collecting the product(s) in store within minutes of reserving on the web. Argos considers convenience as a key element of its competitive advantage and the retailer has executed this brilliantly, using the website and special collection points in store.

In summary, I believe that retail has changed irreversibly. Customers have more freedom than ever before and it’s now a 24-hour sport. The winners will be those that listen to the needs of their customers, drive continual improvement and realise that they’re not in the same business as three years ago. The best starting point for retailers is to try out their own multichannel experience – it might come as a surprise!

Want to discuss your multichannel proposition with us? Email [email protected].