December 28, 2005, 12:00 AM

The multi-channel customer buys more – and may cost more to keep

28% of U.S. online buyers shop multiple channels of the same retailers, buying 14% more than those who shop only one channel. But they use retailer cost centers such as customer service more, a Jupiter study finds.

It’s no news that customers who shop multiple channels of the same retailer buy more than the customer who shops a single channel. But there’s a flip side: they can be more expensive for the retailer to maintain, according to new findings from Jupiter Research.

The multi-channel customer of the same retailer is a small, yet sought-after segment of the online buying population, according to a new report from Jupiter, “Cross-channel retail strategy: Assessing opportunities and risks presented by same-store multi-channel buyers.” Only 28% of U.S. online buyers make purchases at the same store across multiple channels, the report found. Such customers buy on average 14% more per year.

Yet the same customers are more likely to use a retailer’s cost centers. Compared with single-channel buyers, they’re 28% more likely to contact customer service reps after making a purchase and 26% more likely to say store coupons are among the factors most influencing their decision to keep buying from retailers they’ve purchased from previously, according to Jupiter. Those findings underscore Jupiter’s recommendation to retailers to measure customers on gross-margin and lifetime value bases to accurately determine their true value and to allocate spending accordingly, says the report’s principal author, analyst Patti Freeman Evans.

83% of online users research offline purchases online. Yet the relatively small size of the same-store multi-channel buyers group indicates retailers` efforts to drive sales across channels are only moderately successful. To leverage their multi-channel presence as a point of differentiation from online-only retailers, multi-channel retailers should closely scrutinize the channel behavior of their customers to mine the data they provide and execute promotions accordingly, says Freeman Evans.

 

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