The way that retailers sell their products has changed. It used to be that when you had a product to sell, you had to have a brick-and-mortar shop where customers could come in to browse and buy. Now, many shoppers browse and buy while at home, in their pajamas, in front of a screen. Gone are the days when having all of your merchandise in one place was an effective – and profitable – way to do business.
Let’s talk about multichannel selling and how it changes the game in today’s shopping world.
What is Multichannel Selling?
To reach today’s customers, you have to meet them where they live. That means on their smartphones, tablets, and laptops. Shoppers are tech-savvy. They know how to find the products they want, when they want them, and at the best possible price. They don’t put all of their eggs in one basket, or rather, they don’t spend all of their money in one place. They jump at perks: faster shipping, lower prices, or a more varied selection.
So what does that mean for today’s retailers? It means that you not only have to stay competitive in regards to price and service, but you have to make your products more visible. You must abandon the idea that you can sell everything in one place. You need multiple sales channels to do that. Simply put, multichannel selling consists of listing products and completing sales on several channels including marketplaces like Amazon, eBay, Walmart, etc. Multichannel selling is the only way to truly compete in online retail.
Let’s take some time to focus in on using multichannel selling to increase your visibility and grow your sales.
Benefits of Multichannel Selling
If you sell on several sales channels, it makes it even easier for more customers to find and buy your products. The two big reasons you should consider multichannel selling are:
- To reach new customers
- Increase your sales
Multichannel selling lets you reach more customers. For example, if you open your own online store, you can reach customers who may not live in the same area as your brick-and-mortar. If you also sell your products through a marketplace, like Amazon, you can reach customers who haven’t heard about your online store or brick-and-mortar. Each additional channel allows you to grow your customer base grows, which will increase your chances of gaining more revenue.
Multichannel Best Practices
As with everything good, there are some challenges to overcome when multichannel selling. These are the issues you need to be aware of:
- There are rules and restrictions for each marketplace. Sometimes this means you can’t brand your store the way you want to. You may not be able to sell all products on each marketplace. For instance, Etsy has rules about sellers using outside manufacturers. Check out our side-by-side comparison of the marketplaces and their restrictions.
- Managing inventory can be complicated. Having your products for sale on multiple sales channels means that you have to manage the inventory across all of them, and that you’re able to fulfill every order. The good news is you can easily obtain online inventory management software that tracks everything for you in one place.
- Don’t cannibalize your own sales. Part of capturing ecommerce sales is offering promotional pricing to compete with the other merchants and compel shopper action. What that doesn’t mean is having a simple “across-the-board” approach, where all the channels receive promotions at the same time.
- When retailers do this, it decreases the impact of the promotion because customers see all the same pricing. Customers don’t register this as a “deal” and it lowers the urgency with which shoppers need to convert. Also, this generally doesn’t make your marketplace partners happy if they have specific campaigns aligned around promotional pricing.
- Planning out a promotional schedule that aligns with your product roadmap is important, and avoiding overlap ensures that everyone is a winner. Your partners will be happy they’re getting “exclusive” pricing, the conversions will increase because customers will see the price as an actual deal, and your bottom line will be happy because you’re increasing sales across each channel.
- Tax season can be challenging. You have to pull information from each sales channel when you do your taxes. Don’t let these challenges deter you from multichannel selling. They can be overcome. It’s worth the time and effort if you have the right strategy.
- Fulfilling orders is a headache. When merchants sell on proprietary sites, multiple marketplaces, and additional channels, order fulfillment, and returns can suck up a huge amount of time and add complexity. Leveraging a retail partner that has a solid fulfillment system in place allows you to take advantage of their rates, which are generally far lower due to the sheer volume of packages being shipped.
- Another huge benefit to having a fulfillment partner is being able to utilize them for multichannel order fulfillment, which handles all inbound orders from one, centralized portal. While you continue expanding, adding new channels becomes a simple and hassle-free process. Some platforms even offer returns and customer service assistance to further facilitate a smooth expansion process.
Define Your Multichannel Selling Strategy
Each channel you sell on has different strengths and offers specific growth opportunities. Clearly defining what your strategy is for each marketplace or retail channel will help to paint the long-term picture for your company’s growth and success. Don’t just think about this, document it and circulate it throughout your team so everyone is on the same page.
Your ecommerce strategy should include goals for each one of your channels, with actionable steps to achieve those goals.
- Does one channel offer branding opportunities and editorial content?
- Does another channel offer partnership initiatives for improving your business operations?
Incorporate these aspects into your strategy for each platform. This goes beyond establishing a promotional schedule with your marketplace partners and defines how you approach those individual platforms and demographics in a targeted approach.
The ecommerce strategy you create should be a healthy balance of brand-building and promotional activities, to create a holistic increase in sales and brand recognition to sustain long-term, natural growth. Think about how you can leverage the tools on marketplaces to have consistent exposure in different forms. Your channel partners have the data on what works and what doesn’t on their platform, so leveraging their guidance can give you a leg up.
Understand that this strategy will help to define the actions you take today, tomorrow, and several months down the road. Not all product listings or channels will be home-runs right off the bat, and in fact, many might take a deeper dive to find the right customer demographic. Succeeding in ecommerce is a marathon, not a sprint; so don’t be discouraged if the first few months start out a bit slow.
Deciding Which Marketplaces are Right for You
There are many marketplaces out there for you to consider, and deciding means you’ll have to do some research before you start multichannel selling. It’s important to strategize, you don’t want to make more work for yourself by choosing a marketplace that isn’t right for your products. As you compile your list of potential marketplaces, keep these two key points in mind:
- Your buyers – Attracting new customers is the goal, so look at marketplaces where you are most likely to find the type of buyer you’re looking for. Consider your niche – where do people search for your products?
- Your products – Research what type of products are sold on each marketplace on your list. Will yours fit in, but stand out? Are your prices competitive?
Once you consider these things, you should be able to narrow down your list to the marketplaces that might be right for you and your products. Then look at the fine print and choose the marketplaces whose fees you can afford, and whose regulations you can comply with. Make sure your products can compete and your target customers will be able to find you.
Ecommerce Success with Multichannel Selling Software
It’s really not as complicated as it sounds. Putting in the time to make the right choice of marketplaces can make all the difference in your business’s bottom line. While mutichannel selling takes time and effort, there are ways to reduce that time and even save some money. Multichannel selling software makes it easy to list products across several marketplaces and manage your inventory. With hard work, determination, and a little help from automations, you too can own a successful multichannel ecommerce store.
Editor’s Note: This blog post was originally published September 2016 and was updated in March 2021 to reflect more accurate and relevant information.