Marketing often talks about multichannel e-commerce. But what exactly does the term mean? The following article answers this question, highlights interrelationships and gives practical advice on what should be considered when implementing a multichannel concept for an online shop or when integrating several sales channels and marketplaces (e.g. Amazon and eBay).
What is multichannel e-commerce?
Multichannel e-commerce refers to sales-oriented marketing concepts that use several sales channels. As usual in e-commerce, the main aim is to use suitable platforms, portals and marketplaces (e.g. eBay, Amazon or WooCommerce) to achieve additional conversions and thus generate higher sales. The products on offer are listed in the retailer’s online shop, whereby the Internet shop is directly linked to several distribution channels and thus made multichannel-capable. This is done with a multichannel e-commerce software solution that establishes the connection to the various sales channels. Alternatively, especially when integrating larger online marketplaces, own interface variants are possible.
What potential does multichannel e-commerce have?
Both consumer behaviour and the customer journey of the individual distribution variants are subject to fundamental change due to the ongoing digitalisation and globalisation of markets. Numerous new digital distribution channels open up undreamt-of possibilities in marketing, distribution and logistics.
Without profit-oriented marketing and sales concepts that take into account not only the traditional channels but also newly added e-commerce channels, companies run the risk of losing their competitiveness sooner or later, since the margins required for profitable business operations can no longer be realized under increasing competitive and cost pressure. There are ways out for entrepreneurs who make use of new technologies to achieve their marketing or sales goals. With innovative online search services such as Google Shopping and the integration of online shops into a multichannel e-commerce solution, it is possible to address previously untargeted groups of buyers whose representatives are on the lookout for products or offers offered by the advertising merchant.
In this way, both established companies and start-ups increase the reach of their e-commerce activities as well as the reputation, awareness and search engine ranking of their Internet shop and are therefore equipped for the challenges of digital online business.
Multichannel e-commerce: online marketplaces as a sales boost!
In a digital marketplace, products can be presented to a wide circle of interested parties with high purchasing power and then immediately change hands. Such public online marketplaces are attractive above all because they allow a broad mass of interested parties to be addressed without a costly marketing campaign, which is an interesting sales option for SMEs and start-ups in particular.
Larger marketplaces represent a flourishing “point of sale”, where almost sensational conversions can be achieved with a little flair for the right products. However, online traders who generate most of their sales via cut-throat prices or who offer goods that can be found in the range of numerous shops should be prepared for a fierce price war or competition if they offer their goods in public online retail markets. On the other hand, products that have unique selling points, are of high quality workmanship and are offered at reasonable prices have a good chance of finding a buyer in busy online marketplaces.
Strategic concepts for optimizing the external perception of a shop and branding that is consistently implemented in this regard help to positively anchor the Internet shop itself and the merchant behind it in the consciousness of target customers in addition to the product portfolio.
Price comparison portals – market places for bargain hunters!
UAn online price comparison portal is a web presence that sorts and clearly lists various products from different providers or online shops according to product categories. Consumers can thus easily compare the quality and price of individual offers and select the offer with the best price-performance ratio. Price information as well as product descriptions are usually read directly from the retailer’s website via an interface and compared software-controlled with offers that are evident in the database. Some consumer information platforms, on the other hand, act like search engines and have prices and product specifications of relevant products displayed by a specially programmed crawler on the web or stored in the portal’s database. In today’s e-commerce, product placements on price comparison portals should be a natural part of any professional online marketing concept.
Online shopping as an economic factor
Shopping on the Internet is not only very popular among German citizens. No wonder, as the advantages of this type of shopping speak for themselves: it is possible to compare offers around the clock from the comfort of your sofa and order what you want straight away. Online trade has been generating sales volumes in the billions for years, so that the company’s online sales channel often subsidises a stationary shop that is suffering from customer loss due to digital competition. Clothing (especially haute couture), shoes, handbags, electronic and telecommunications products and computers are particularly popular online. The economy has adapted to this development and created or enabled the establishment of short logistics channels and sufficiently secure payment systems.
Multichannel for online shops
When setting up a multi-channel concept for the online shop, the operator or the digital agency commissioned by him or her will be faced with challenges related to the process. After all, marketing and sales-related processes and tasks that arise in the day-to-day business of an online retailer must be converted to “multichannel mode”. In particular, the following agendas are at stake:
- Launch of advertising messages or Google Ads
- Assortment and article maintenance
- Procurement and warehouse or inventory management
- Order processing & invoicing
- Customer traffic and order acquisition
- Shipping, Logistics, Tracking
- Performance review
Since it would be uneconomical to perform all the activities involved several times per channel, synergy effects are required. In this respect, the advice of an online agency specialising in multichannel e-commerce can provide valuable support. From a procedural point of view, the launch of advertising messages and ads can be controlled automatically, e.g. via cookies. Multichannel-capable software solutions also exist for article and portfolio maintenance as well as order processing and invoicing. Procurement and inventory or warehouse management can be easily managed via an ERP system.
In a large-scale marketing campaign it is already more difficult, since the correct timing of the individual measures for each target group plays an important role. Such projects are therefore best placed in the hands of an experienced digital agency. What remains is the customer traffic. However, for reasons of sales psychology, this can only be partially standardized, which means that the retailer has an important task. In general, care should be taken to ensure that the quality of the performance of individual channels is not impaired by competition from apparently more profitable sales channels or attractive marketplaces.
Progressive digitization has also left its mark on sales and marketing. Today, business processes are handled digitally and highly automated, and innovative search services such as Google Shopping help potential buyers find the products they want. Innovative strategies are in demand from entrepreneurs, especially among SMEs, in order to withstand the increasing competitive pressure of globally active corporations and to secure long-term competitiveness.
The solution to this problem is multichannel e-commerce. Here, the online shop is connected to several sales channels or popular online marketplaces such as Amazon and eBay via special software or specially installed interfaces. The resulting multiplied reach of the shop makes it possible to address completely new groups of buyers and to elicit buying impulses from interested parties. Although this increases the organizational effort, it leads to a massive increase in conversions or to sales figures that would hardly have been possible with competitive products. It was not without reason that multichannel proponents coined the slogan: “More channels – more of everything!”