PetSmart acquired Pet360 for $130 million in cash and up to $30 million more in future performance-based payments.
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aim of the campaign is to create a consistent marketing and merchandising message across its online and in-store sales channels, regardless of the
promotional media used.
“Prior to this we did not really package the idea on our web site that we had 1,000 stores and home delivery on
out-of-stock items, or let shoppers in our store know they could access the web site to search our entire inventory,” says Jennifer Stack, vice
president of relationship marketing at Famous Footwear.
Millions of shoes
At the center of the campaign is a pilot program in
which access to the web store is available in 15 store locations. Customers online can access Famous Footwear’s catalog of one million shoe styles
compared with the 11,000 to 12,000 typically carried in a store. This broader access to products is a major benefit because footwear shoppers
typically understand their size may be out of stock or carried in another location; as a result, they expect to have to hunt for what they want. By
extending online access to stores, shoppers can view an item first hand then immediately order it on the web site if the store is out of a style or
“This is the kind of capability multi-channel shoppers want,” says Tocky Lawrence, a vice president at consulting firm F. Curtis
Barry & Co. “The more multi-channel integration retailers have, the better off they are when it comes to serving multi-channel
More important, the strategy has created a stronger awareness of the web store and helped put Famous Footwear on track for
record sales in 2006, Stack says. It also has encouraged in-store sales associates to become more accepting of the web store and direct store shoppers
to it. “Our stores no longer view the web site as a competitor, but as a friendly complement to the business,” she says.
While retailers such
as Wal-Mart, Target and The Home Depot are among the leaders in capturing offline sales from multi-channel shoppers, and Amazon.com, eBay
and Overstock.com capture the largest share of cross-channel shoppers’ online spending, retailers need to keep in mind that loyalty is not a
dominant characteristic of the multi-channel shopper, Forrester Research concludes. “About 50% of shoppers that research online at retail sites buy
elsewhere,” says Tamara Mendelsohn, an e-retailing analyst at Forrester. “These are shoppers that typically want the right product at the right
Before retailers can adequately serve and retain multi-channel shoppers, they must develop a 360-degree view of them, industry
experts say. Without gathering the necessary metrics across each shopping channel that indicate the behavior of the multi-channel shopper,
retailers will not present a consistent image of themselves or marketing message, Mendelsohn warns. “Multi-channel shoppers tend to be more
demanding, and if they are not served satisfactorily across each channel, selling to them can be a pain,” she adds.
The discerning nature
of multi-channel shoppers makes them less tolerant of mistakes made by retailers during the online shopping process. Mistakes made in this
channel are more apt to negatively impact customer loyalty. Research by Gartner reveals that 32% of multi-channel shoppers will not return to a
retail web site if they have an unsatisfactory online shopping experience. Multi-channel shoppers purchasing through a catalog are even less
tolerant: 43% of those surveyed will not return after a bad experience. Multi-channel shoppers that purchase in store are the least likely to abandon
a retailer when it comes to a bad experience, with 25% of those surveyed saying they will not return.
Sales associate’s fault
resiliency of the in-store shopper is due in large part to blame for a bad experience being deflected onto a sales associate rather than the store itself,
Gartner’s LeHong says. “There are vulnerabilities at every service point within each sales channel and retailers need to understand what they are
and how they impact the loyalty of the multi-channel shopper,” he says. “The best retailers understand that multi-channel strategies require better
service across all channels.”
Although some retailers disagree with industry studies that say multi-channel shoppers are less loyal, they
acknowledge that consistent service and branding messages across all sales channels are essential to properly serving multi-channel shoppers. One
way to achieve this goal is to coordinate product codes across all sales channels, making it easier for customers to buy through one channel and
return in another. It also streamlines the return process for the customer and sales associate.
Industry observers point to JC Penney as a
retailer that consistently delivers a high level of customer service across all sales channels. The retailer is noted for coordinating product codes
across all channels, making it easier for customers to buy through one channel and return in another. Uniform product coding also streamlines the
return process for the customer and sales associate. In addition, consistency in product labeling makes it easier for multi-channel shoppers to locate
and view the same item as they move between sales channels.
Retailers in general are determined to eradicate such problems to capture
more sales from the lucrative multi-channel demographic. “Our focus is to find out who our multi-channel shoppers are and what they want, then
apply that information to create better marketing strategies to serve them,” says Radio Shack’s Mansker. Once armed with that information, he
adds, the retailer can convert more single-channel shoppers into the more valuable multi-channel shoppers.
Peter Lucas is a Highland
Park, Ill.-based freelance business writer.
How to win over the multi-channel shopper
Research firms Gartner and Forrester Research come to similar conclusions regarding how
best to address multi-channel customers. Boiled down, they are as follows.
Brand consistency-Create a consistent look, feel and brand
message, as well as SKU codes, across all sales channels.
Multi-channel returns-Enable shoppers to buy in one channel and return in
Avoid channel conflict-Integrate all channels and run them as a single business.
In-store promotion-Promote the
multi-channel retail experience in-store using web kiosks to connect shoppers to an entire product catalog.
Cross promotion-Use online
ads, e-mail, in-store signage and mass media to increase awareness of all sales channels.
Know the customer-Track behavior metrics of
multi-channel shoppers to learn their preferences and where service to them has broken down.