Multi-channel Retailing: Definition, Benefits & Challenges

What is multichannel retailing?

Multichannel retailing is a business model that offers customers different sales channels. These channels include brick & mortar stores, eCommerce stores, marketplaces like Amazon or Walmart, and social media platforms like Facebook Marketplace and Pinterest.

66% of online buyers rely on more than one channel before they can make a purchase. Research done by Bazaarvoice indicates that channel loyalty is now a thing of the past.

Amazon shoppers compare prices and ratings on different channels before they decide to buy.  Here is the breakdown;

  • For Walmart its 46%, across major consumer electronic websites 45%, on Target 40%, home improvement  websites 39%, and branded websites 39%

Again, a report released by IDC indicates that multichannel shoppers spend more money when shopping;

  • 30% higher (LTV) lifetime value than single-channel shoppers.
  •  Up to 10% loyal customer profitability.
  • 15-35% higher value transaction.

How can a business benefit from multichannel retailing?

79% of smartphone users have made an online purchase through their phone in the last six months. 82% want to start their catalog selection on any channel.

Retail embracing multichannel shopping in this modern technology with over 1.5 billion online and growing who spend around 3.5 hours on their smartphones, come so many benefits with the primary being; growth of their business. Here are some  benefits of multichannel retailing;

1. Target customers across their buyer’s journey

Understanding your customer’s journey till they purchase your products is critical in this age of fierce competition online.

 A buyer won’t buy immediately from you when they see your product for the first time. For instance, a customer sees your product on Instagram, is promoted by an influencer, or through a Facebook ad.

6 out of 10 consumers start the online product searches on Amazon. Also, 48% of product searches like “best product” begin on Google search engine, making the most attractive platform for retailers to optimize.

Ensuring your online store has a multichannel approach from your website to the top marketplace and social media branding, you can know where your target customers are buying from most, so your focus more on that platform.

Again, you can track prospective buyers across the buyer’s journey till they convert.

2. Better data collection for sales optimization

From offline with your physical store, third-party to your online store, a vast amount of data gets generated every day.

Doing data analytics for your business comes with lots of benefits. For example, you get to use the data to predict your market trends and improve customer experience. 

In this modern commerce, speed and convenience are the main factors for online stores to stay ahead of the competition.

 With enough data collected from different sales channels for your product, you can know your customer expectations like fast delivery or easy returns to build trust in your customer service.

3. Leverage the marketplace to increase sales

53% of units sold on Amazon in Q2 2020 were from third-party sellers. With over 300 million active users on the platform, you should create a store on the platform if you haven’t.

Other platforms like eBay, Etsy, and now Walmart have enormous potential to generate your business sales. One single-channel doesn’t scale anymore.

You don’t have to sell your product on only one marketplace when you can sell as many with a simple built for your integration software.

What are the challenges of multichannel retailing?

Multichannel shopping comes with complex challenges that most online stores might find costly to solve.

Here are some of them;

1. Cross-channel branding and messaging

How you position your eCommerce store on social media channels or marketplaces needs to match your core messaging and branding seamlessly.

However, these platforms limit how you control your messaging. Again, if you are promoting a new product, you need to paint the right picture to a new audience, from your product promotion to complaints handling.

To get it right the first time, you must keep each platform’s requirements on a strategy and adjust your messages to deliver the desired results.  Here is a list of examples like Oasis and Apple; you can shadow how they articulate their brand across multiple channels.

2. Inventory management

To keep up with the inventory of sales across multiple channels is critical to your business success. And building an inventory management system for your online store when starting is expensive.

You need a system to keep track of factors like;

  • Stock and sells depending on the supply and demand of each product.
  • Visibility of all inventory in the multiple warehouses
  • Seamless integration with multiple sales channels when scaling.
  • Shipment tracking and returns.

As a merchant, you can get this built-for-you system from NextSmartShip that you integrate with your store without any software background.

With NextSmartShip, you get to keep track of all these factors from a dashboard on your tablet or desktop screen.

Additionally, you gain insights on how to grow your business from the data collected by our Inventory Management System (IMS) across all significant multichannel platforms like Amazon, Shopify, eBay, or Etsy that your eCommerce is selling on.

3. Customer service experience

Nurturing and supporting your customers with any issues is challenging with multichannel retailing. Every online marketplace has a different way of handling customer service.

Mapping your customer journey for every channel is essential. Always look for opportunities to delight your customers as an instant response to complaints.

This goes a long way to build customer loyalty. Check this blog by Shopify on mapping your customer’s journey.

Again them being giant companies, they may not reach every customer’s complaint. You need to hire the right customer service team or use automation tools.


Multichannel retailing is the best way to grow your online store. You get fast scalability and spread the risks on single-channel shopping. For instance, your store gets suspended by a marketplace for minor customer claims.

With the right partner to help you integrate all your operations using multichannel retailing without knowing a line of code, you get the same starting point as other developed online stores for a little.

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