The case for ecommerce is clear. Global sales have been on an upward trajectory for the last decade, and the COVID-19 pandemic only accelerated the trend. According to the International Trade Administration, ecommerce will account for nearly 22% of global retail sales in 2024. For many retailers, the question isn’t whether or not to sell products online—it’s which channels to use to increase sales.
Today’s consumers shop through several digital channels, so for many businesses, the optimal solution involves multichannel ecommerce. Here’s how this business model can help you increase potential reach, boost customer satisfaction, and maximize touchpoints throughout the buying journey.
What is multichannel ecommerce?
Multichannel ecommerce is a business model that involves selling products or services through more than one sales channel. Multichannel ecommerce retailers frequently sell through online storefronts, mobile apps, social media platforms, and online marketplaces, and some also operate brick-and-mortar stores.
Multichannel ecommerce sales in the US have increased yearly since 2020, and industry experts expect revenues to total more than $575 billion in 2023.
Benefits of multichannel ecommerce
Multichannel ecommerce opens up huge benefits for retailers. Here are just a few:
Increased sales
Optimized customer journey
Increased brand exposure
Selling through multiple commerce channels empowers businesses to meet consumer expectations and optimize their sales and marketing reach. Let’s take a closer look at each of these benefits.
Increased sales
Multichannel businesses see an average revenue increase of 38% when they add a new sales channel—and 190% when they add three. Additional channels can also increase sales across the board. One study found that customers who consumed information about products online before visiting a store spent 13% more in-store than those who didn’t.
Optimized customer journey
According to Harvard Business Review, 73% of consumers shop on multiple channels during a buying journey. This means multichannel businesses can maximize the number of times a consumer encounters a brand during this period to encourage conversions. Conventional wisdom holds that a customer needs to interact with a brand seven times before making a purchase—and contemporary marketing professionals agree that the more times a consumer sees your brand, the more likely they are to take a desired action.
Increased brand exposure
Different user groups are more active on different channels. For example, younger consumers spend more time on TikTok and Instagram, while older consumers are more likely to be active on Facebook or X.
Channel preferences can also vary by transaction type. Some consumers prefer making initial purchases from online retailers and repeat purchases from marketplaces. This means brands that are active on more channels can improve total reach and increase the likelihood of converting new customers on their preferred channels.
Challenges of multichannel ecommerce
On the flip side, there are certain challenges to be aware of:
Inventory management
Channel management
Customer experience
Adding sales channels can also complicate managing inventory, maintaining a consistent brand experience, and running a quality customer satisfaction program.
Let’s get into the details of these common challenges of multichannel ecommerce:
Inventory management
Business owners selling items through their online stores only need to maintain one inventory database. But if you sell through multiple sales channels, you must manage multiple databases in real time to avoid accidental overselling.
Imagine a customer purchasing all your remaining in-store product stock, but your ecommerce software doesn’t immediately update your online inventory. You might end up with more orders than you can fulfill.
Channel management
Going multichannel can increase your infrastructure needs and require more time to create channel-specific brand and marketing materials. Suppose you sell products through an online store, two social media platforms, and a brick-and-mortar location. In that case, you’re responsible for maintaining a consistent brand experience and processing and fulfilling orders for each.
Customer experience
Adopting a multichannel strategy requires your customer experience team to manage multiple channels to avoid missing critical customer communications, which can increase its overall workload. Without a properly trained team, this can also contribute to an inconsistent customer service experience.
Strategies for successful multichannel ecommerce
Here are a few key steps you can take to successfully get your multichannel ecommerce approach off the ground:
Choose the right channels.
Optimize your sales and marketing strategies for each channel.
Seek key integrations.
Use a centralized inventory management system.
Successful multichannel ecommerce requires knowing where to find your target audiences, understanding the differences between channels, and using ecommerce software to reduce your team’s workload and provide a consistent customer experience.
Here’s a closer look at four strategies to get you started:
Choose the right channels
Successful multichannel ecommerce starts with choosing the proper marketing channels for your target audience and business model. Consider how and where your customers shop, what channels they frequent, your specific product type, and your business capacity.
For example, if you sell stylish enamel cookware to a target audience of design-conscious home cooks between 18 and 45, you might consider selling on social channels like Instagram and TikTok. Social commerce is particularly popular with younger consumers, and social platforms are friendly to image-driven marketing and influencer campaigns, which could be promising strategies for your product.
Opening a brick-and-mortar store typically carries the highest overhead of any commerce channel, so whether or not you decide to open a store depends on your revenue, budget, and your customers’ geographic distribution. If your sales volumes are relatively split across all 50 states or you want to increase revenue before increasing spending, you might wait until sales volumes increase. In the meantime, try pop-up shops or explore partnerships with local retailers to target consumers who prefer to shop in person.
Optimize your sales and marketing strategies for each channel
Customer expectations differ by channel—and different sales channels serve different customer segments. Use this to your advantage by optimizing marketing strategies and product listings according to channel norms.
For example, TikTok and Instagram are popular with younger customers, who tend to be more receptive to influencer recommendations—so you might focus your influencer marketing strategy on these channels. Since short-form videos and swoon-worthy product images are effective on Instagram and TikTok, you might create more visual sales and marketing materials for these channels by partnering with a graphic designer, photographer, or videographer and save detailed product narratives for your online store.
Seek key integrations
Multichannel ecommerce software can reduce your labor through order management and customer service integrations. Look for software that provides multichannel sales integrations to automatically sync catalogs from your online store to social media platforms like Facebook, Instagram, and TikTok, as well as online marketplaces like Amazon Marketplace, Walmart Marketplace, and Etsy. These integrations can also help you provide quality customer service across multiple channels by managing customer experience across locations from one centralized database.
Use a centralized inventory management system
An ecommerce platform that supports multichannel ecommerce can help you manage inventory and avoid discrepancies. Look for a software provider with a centralized inventory management system for multichannel ecommerce businesses like Shopify. This software can automatically update inventory regardless of the channel on which a customer makes a purchase and monitor stock across multiple inventory locations, eliminating the possibility of accidentally overselling.
Multichannel vs. omnichannel ecommerce—what’s the difference?
Omnichannel ecommerce is a specific approach to multichannel ecommerce. A business uses one back-end system to power sales on multiple sales channels, resulting in a seamless transfer of customer data across sales channels for a more streamlined and personalized shopping experience.
Under an omnichannel strategy, a customer might browse certain products in a business’s mobile app and visit that same business’s website later from a desktop computer. Because the same system powers the mobile app and the desktop store, the online store can use mobile customer data to auto-recommend products through the desktop interface.
Learn more about how Shopify can power your multichannel ecommerce strategy—and bring your business to life.
