Shopify blog
Retail channels are the platforms businesses use to sell products to consumers. Salsify found in 2025 that shoppers are using both digital and physical shopping channels in the same buying journey. They report 51% of shoppers use physical stores for product research, and 30% use a smartphone to buy a product while shopping in-store.
These trends show digital and physical channels are complementary forces that satisfy buyer demands.
This guide explores common retail channels and how they’re evolving with retail technology and shopping habits. Learn about retail channel trends and how to choose a channel for your business.
What are retail channels?
Retail channels are the avenues brands use to deliver goods and services to their customers. Sales channels focus on how people pay, and distribution channels manage how products move.
Retail channels are the final touchpoints. They’re the physical storefronts, digital marketplaces, and mobile apps where brands and buyers connect.
Types of retail channels
Store owners use multiple channels to reach customers where they shop:
- Brick-and-mortar stores
- Online retail or ecommerce
- Mobile retail
- Social commerce
- Pop-up shops
- Omnichannel
Brick-and-mortar stores
A brick-and-mortar retail store is a physical location where buyers can visit to browse, buy products, and interact with your brand face to face.
Adyen’s 2025 Retail Report found that in-store shopping remains the preferred channel for 44% of consumers, and shoppers value stores for the hands-on experiences online shopping can’t replicate.
Wholesale is a complementary channel to physical retail. In this model, manufacturers sell products to other retailers to reach new markets and move inventory in bulk. Wholesale increases sales volume, but it has lower profit margins (as low as 1.1%).
Physical stores are living advertisements for a brand. Julie Brown, cofounder of Province of Canada, says in a Shopify Masters episode that moving into physical retail transformed their brand identity and fueled digital growth.
“It really propelled our business,” Julie says. “It made it just an online brand to a physical living, breathing thing that people could experience. And not only did obviously our sales grow from the store, but our online sales grew in a huge way. Our sales are literally like a radius around our stores.”
Physical retail offers several benefits:
- Build trust through personal interactions
- Provide immediate product access
- Simplify returns and exchanges
- Control the customer experience
- Establish brand presence in high-traffic areas
It also presents specific challenges:
- Manage higher operational costs like rent, utilities, and staff
- Navigate limitations on geographical reach and operating hours
- Handle complexities in inventory management
Brick-and-mortar stores use point-of-sale (POS) systems, such as Shopify POS, to streamline checkout, track inventory, collect customer data, and unify data with online stores.
Take Vestique, a fashion retailer that used Shopify POS to unify their online and offline sales channels. This led to an 18% year-over-year sales growth and the opening of three new specialty stores.
“A lot of retailers are frustrated because they’re trying to integrate their legacy POS systems into other platforms like their social media and they weren’t built to work that way,” says Vestique’s owner Mike Reiss. “On Shopify, most of these systems have an integration out-of-box.”
Online retail or ecommerce
Online retail is the act of buying and selling goods over the internet through digital platforms. Ecommerce platforms provide 24/7 access, global reach, and virtual storefronts.
eMarketer’s 2025 forecast estimates global retail ecommerce sales will reach $6.419 trillion in 2025 and account for 20.5% of total global retail sales, up from 19.9% in 2024. It also forecasts continued growth through 2028.
Ecommerce as a retail channel has several benefits:
- Global accessibility and 24/7 availability
- Supports reasonable price and product comparison for customers
- Allows flexible fulfillment options like home delivery and click-and-collect
- Scalability—attracting multiple customers at once
The channel also has drawbacks:
- Higher shipping costs and longer delivery times than physical stores
- Cybersecurity and data privacy concerns
- High competition in the industry
- Lack of face-to-face interaction
Ecommerce platforms like Shopify help businesses create professional online stores and unify online sales with offline transactions. Choose a professionally designed theme, process online payments securely, and localize the online experience for international shoppers when you start an online store with Shopify.
Mobile retail
Mobile commerce (m-commerce) involves buying and selling goods through smartphones and tablets.
This retail channel has mobile-friendly ecommerce websites and apps with responsive designs that adapt to different screen sizes. Mobile commerce has one-click ordering and mobile wallet integration for secure payments.
Salsify found in their 2025 Consumer Research report that 69% of shoppers have made an online purchase while doing something else, such as scrolling social media or watching a show.
Mobile retail has several benefits:
- On-the-go shopping—anywhere and at any time
- Integration with other mobile activities like social media and messaging
- Personalized experiences through location-based marketing
- Faster transaction speeds with apps like Shop, which store customer details for checkout
The channel also has common challenges:
- Limited screen space that makes product browsing difficult
- Security concerns for mobile payments
- Inconsistent experiences across different devices and operating systems
- Unreliable mobile networks that disrupt shopping
Shopify’s mobile-responsive themes and optimized checkout help expand mobile retail capabilities. Combine Shopify with Shop to reach more than 250 million buyers already using their app to buy from brands.
Social commerce
Social commerce blends social media with online shopping. It lets users discover, research, and buy products without leaving their favorite social platforms.
DataReportal’s Digital 2025 report found that there are 5.24 billion active social media user identities worldwide, up 4.1% year over year. In the US, eMarketer forecasts that social commerce sales will surpass $100 billion in 2026.
Social platforms are evolving from discovery channels to places where people complete purchases.
According to a November 2025 Shopify Merchant Survey,* building a social media presence was the second most common growth strategy for businesses in their first year (35%), behind only word of mouth (53%).
Social media as a sales channel has these pros:
- Collect data on consumer behavior
- Communicate directly with customers
- Encourage word-of-mouth marketing
- Use targeted advertising
Cons of social commerce include:
- Manage platform dependency
- Address negative feedback
- Maintain content creation and community management
- Stand out in busy social feeds
- Respond to algorithm changes
Social commerce is great for building community and works especially well for visually-driven industries like fashion, lifestyle, and beauty.
For example, DBL Jewelry founder Liz Portio used TikTok to build a two million follower base, growing her business to $1.2 million in three years with just $40 initial capital.
Pop-up shops
Pop-up shops are temporary retail spaces that run for a limited time, from a few days to several months. They let brands create unique, short-term experiences, test new markets, or generate buzz around products.
“It was so great to do pop-ups, because you get to talk to the customer, you get to learn about them in real life, and then you get to see how they interact with the brand and your product,” Allegra Shaw, founder of Uncle Studios, explains.
Brands use this channel strategy because it has:
- Lower costs for market or product testing
- Brand experiences without fixed overhead
- Market testing without permanent space commitments
- Excitement around limited-time events
Cons of pop-up shops include:
- Generating sales in a limited window
- Managing high setup costs
- Handling logistical challenges in setup and teardown
- Accounting for factors like weather or local events
Omnichannel
Omnichannel retail connects shopping across physical stores, online platforms, mobile apps, and social media. It syncs data across platforms for real-time inventory updates, personalized recommendations, and cross-channel customer service.
Shopify’s survey* found that among Food & Beverage businesses, 68% operate both B2C and B2B sales models—the highest dual-channel adoption of any vertical. This reflects the natural omnichannel fit of products sold across retail, wholesale, and food service contexts.
Omnichannel retail has several benefits:
- Customers receive unified service across all channels.
- Retailers use options like buy online, pickup in-store (BOPIS) and ship-from-store.
- Brands gather data to personalize marketing.
Retailers also face challenges with this model:
- Data security and privacy concerns
- Consistency challenges across channels
- Extensive staff training requirements for multi-channel operations
Shopify POS integrates in-store and online sales. Toby’s Sports moved to Shopify to use their omnichannel capabilities. They experienced a 13.5 times increase in sales and 50% conversion growth.
“Implementing Shopify has been pivotal in delivering a superior omnichannel experience to our customers,” says president Toby Claudio. “The platform is incredibly straightforward to use, and thanks to its seamless integrations we can easily manage our online and in-store operations, ensuring consistency and convenience at every touchpoint.”
Retail channel trends
Follow these channel trends to grow and keep your customers:
Blend digital and physical retail
Retailers use omnichannel strategies to connect digital and physical shopping, including marketplaces and social media. They establish inventory visibility so customers view real-time stock across locations. It’s how shoppers confirm availability before visiting or ordering.
Omnichannel retail also expands fulfillment options. Menswear brand Belstaff used Shopify POS’s endless aisle feature to keep inventory in sync across channels, allowing associates to sell items from other locations and ship them to customers. The approach helped the brand generate an extra $250,000 in sales in the first six months.
Omnichannel retail has flexible fulfillment options like BOPIS (buy online, pickup in-store), endless aisles, and curbside pickup. Retailers can also experiment with phygital retail—immersive, tech-advanced physical stores with smart shelves, virtual fitting rooms, beacons, and smart carts.
The rise of retail media
Retail media involves brands advertising directly on retailers’ platforms through in-store promotions, digital displays, and sponsored ads.
Retail media networks (RMNs) like Amazon Ads, Walmart Connect, and Kroger Precision Marketing are growing quickly. Walmart Connect, for instance, grew by 24% in 2025. Amazon’s advertising services revenue reached $56.2 billion in 2024, up from $46 billion the year before, according to Amazon’s SEC filing.
Shopify Audiences is a valuable RMN for Shopify Plus businesses in the US and Canada, with users having cut customer acquisition spend by up to 50%. It’s helped brands like BUBS Natural, Happy Hippo, BlenderBottles, and more to significantly improve their returns on ad spend.
AI-driven personalization
According to the Shopify Merchant Survey,* 75% of established businesses use AI tools to run their businesses. While many businesses have adopted AI, it’s shallow for most. Sixty-nine percent of businesses use AI to generate content, and one-third have expanded it into customer service, data analysis, or automation.
There’s a divide based on revenue. Businesses earning more than $100,000 annually are more likely to use AI to automate processes and scale with smaller teams.
These businesses use several techniques to move beyond content:
- Product recommendations. AI suggests relevant items based on browsing and purchase history.
- Dynamic pricing. AI adjusts prices in real time based on demand and other factors.
- Chatbots. Offer 24/7 customer support with personalized responses.
- Predictive analytics. AI forecasts trends to help with inventory and marketing.
- Visual search. Customers can upload images to find similar products.
Shopify offers AI tools for businesses of all sizes. For example, Shopify Sidekick helps create custom product descriptions, emails, and social media posts. Other useful Shopify apps include Boost AI Search & Filter for product recommendations and Rep AI for personalized customer service.
How to choose your retail channels
Follow these four steps to identify the best retail distribution path for your brand:
1. Know where your customers shop
According to the November 2025 Shopify Merchant Survey,* growth strategies vary by revenue level.
It’s common for first-year strategies to include word of mouth (53%) and building a social media presence (35%). Businesses earning less than $100,000 find organic social media most effective, and those earning more than $1 million cite paid advertising (31%) as their main growth driver.
Channel effectiveness also varies by industry. Health and beauty and home and garden businesses find paid advertising most effective, and arts and entertainment businesses see the lowest return from paid advertisements.
Tique Chandler, founder of Chandler Honey, discovered that their product performed better in unconventional settings than in standard retail.
“I’ve learned what stores my honey does well in,” she says in a Shopify Masters episode. “That is not grocery stores, not your traditional food stores. That’s where I thought I would hit it big, but no. It’s actually the gift stores and it’s the souvenir stores and things like that that I do very well. So, I’ve kind of retargeted where I want to go.”
Use market research, customer surveys, and focus groups to find out how your customers prefer to shop. Look at demographic data to see which channels are popular among your target age groups, locations, and lifestyles.
2. Consider your product
Decide if customers need to examine your product in person, like clothing or furniture, or if your products are easy to sell online, like digital goods or books. Shopify’s 2025 survey* found that competitive advantages align with sales channels.
Retail sellers cite customer relationships as their edge, marketplace sellers cite price, and wholesale sellers cite relationships with wholesale clients.
The survey highlights how brands in different industries prioritize their strengths:
- Home & Garden: Product quality
- Food & Beverage: Brand trust
- Clothing & Apparel: Social media presence
3. Determine costs
Run a cost-benefit analysis to ensure chosen channels have a good return on investment. Consider expenses like store leases, website development, or platform fees for online marketplaces.
Factor in staffing, inventory management, and maintenance costs for each channel. Include the cost of promoting products in each channel and any shipping or handling expenses.
Store owners have blind spots in channel economics. According to Shopify’s survey,* while 77% of businesses track total revenue, less than half track profit margin, traffic, average order value, or conversion rate.
The gap widens at lower revenue levels. Only 5% of businesses earning less than $100,000 track customer acquisition cost (CAC), compared to 30% of those earning over $1 million. Businesses who don’t know their unit economics by channel risk investing in unprofitable sales channels.
4. Understand scalability
Check how channels support expansion, like opening new physical stores or adding product lines on ecommerce platforms.
Evaluate whether they handle higher product volume and variety while supporting more customers. Master one or two channels that fit current goals and resources before expanding.
Overexpansion risks include stretched budgets, fragmented inventory, and inconsistent customer service. Business stage and operational readiness determine when to add new channels. Scale when the timing’s right.
A November 2025 Shopify Merchant Survey* found that 65% of businesses scaled because of customer demand—but 20% later wished they’d waited for consistent cash flow, and 19% wished they’d waited for profitability. Businesses earning more than $1 million took a strategic approach, waiting for a strong team, expanded production capacity, and available investment capital before growing.
*Based on a 2025 survey of 500 Shopify merchants conducted in English across Australia, Canada, the United Kingdom, Ireland, New Zealand, and the United States. Respondents were established merchants with two or more years on the platform. Results reflect the experiences of this specific sample and may not be representative of all merchants.
Retail channels FAQ
What is the traditional retail channel?
The traditional retailer channel includes brick-and-mortar stores like department stores, supermarkets, and shopping malls where buyers physically go to browse and buy products.
What is the difference between retail channel and wholesale channel?
Retail channels sell directly to consumers, while wholesale channels sell products in bulk to other businesses or retailers. Retail also focuses on individual sales, whereas wholesale deals with larger quantities at lower prices per unit.
How many retail channels should a business use?
Retailers master one or two channels, such as an online store and a social platform, before expanding. Overextending a brand across many channels leads to fragmented inventory if they don’t have the staff to manage them.
How can actions be automated across retail channels?
Retailers can achieve automation through a unified commerce platform that connects sales, inventory, and marketing data in one place. They can also use tools like Shopify Flow to create “if this, then that” workflows, like notifying a team whose stock is low or tagging high-value customers for personalized rewards.
What is the difference between multichannel and omnichannel retail?
Multichannel retail uses various platforms where channels operate as independent silos with separate data and inventory. Omnichannel retail connects touchpoints so customer data and inventory levels sync in real time across digital and physical locations.
