The State of Retailing Online 2015 report finds search and email leading the pack with e-retailers.
How multi-channel retailers achieve consistent merchandising across the web, the catalog and the store—and why it’s important.
Customers of The Sharper Image may react with that old Yogi Berra-ism as they log onto SharperImage.com, visit a Sharper Image store or flip through the Sharper Image catalog: It’s déjà vu all over again.
Sharper Image customers coming to the web site are greeted by the Quadra Air Purifier in the upper left of the home page and in the rotating Flash presentation of featured products in the center of the page. If they pick up a catalog, there it is spread across two inside pages upfront-one of the few products receiving this much space. And if they walk into a store, there’s their old friend the Quadra Air Purifier right at the very front of the store flagged with special signage and a demonstration video.
The Sharper Image has called the Quadra Air Purifier the most important product in its 25-year history and is making a major push to present the product in as many ways as possible to its customers. But the merchandising of the product is also a prime example of The Sharper Image’s approach to cross-channel merchandising: Utter consistency. When Sharper Image customers show up to shop, they find an assortment that’s presented in near-identical fashion, whether they land on the home page, flip through a catalog or walk through a store’s front door. The San Francisco-based retailer doesn’t let the varying physical requirements of each channel get in the way. It’s figured out how to give featured merchandise near-identical prominence and positioning, whether it’s in the two-dimensional framework of its web site and catalog or the 3D of its 110 stores.
“We get the most leverage off each channel by making it a similar experience for customers, no matter where they are,” says President and COO Tracy Wan. “It really benefits us that they know exactly what they are going to get and they have the same experience no matter which channel they are visiting.”
The Sharper Image makes decisions on where and how to display products within its web site, catalog and store with a well-honed sense of what particular pieces of real estate in each channel can deliver in terms of sales. The retailer specifically calculates ROI for each page of its monthly catalog, and it’s now measuring the click-through performance of each position in the 12 thumbnails that anchor its home page. And while it’s measuring ROI on store floor positions less specifically, it’s developing an increasingly fine-tuned sense of which areas within the store and what kinds of store displays and signs most capture shoppers’ attention.
The comfort factor
Smart multi-channel retailers know that the web, catalog and store offer unique marketing opportunities, and they’re experimenting with ways to play off each channel in integrated marketing efforts. But when it comes to merchandising, they are much more cautious about doing things differently across channels. The reason: They want to make multi-channel shoppers-the ones retailers universally deem the most valuable to their business-as comfortable as possible by placing them in familiar surroundings.
Today’s multi-channel shoppers are increasingly savvy about picking up differences among channel offerings-and that can have a harmful effect on sales and expenses, analysts say. Randy Covill, senior retail analyst with AMR Research Inc., cites a recent misfire at a major retailer he won’t name. A point of purchase display offering customers a free toy with purchase when ordering online had shoppers bailing out of store checkout lines to go home and log on to make the same purchase on the web. “It had seemed like a good way to drive people to the retailer’s web site,” says Covill. Instead, it became a hard lesson in cross-channel management.
With opportunities to leverage channel differences on the one hand and arguments for channel consistency on the other, what’s a multi-channel retailer to do? The short answer is, nothing radically different-at least on the surface-in the web, store and catalog assortment and presentations. Kmart Corp.’s stores and its BlueLight.com web site were on two different tracks, and shoppers struggled with the mixed message. It was one of many problems that drove the retailer into bankruptcy in January, analysts say. “BlueLight ended up being a great vehicle for giving away web access but not a great vehicle for selling merchandise or getting people into Kmart stores,” says Ken Goldberg, managing director of the consulting firm AnswerThink. “Contrast that with Target and Target.com, which has consistent messaging and offers a consistent customer experience.”
That said, savvy merchants are discovering it pays to dig down deeper into what defines “consistency” among channels in the shopper’s view. While successful cross-channel merchandising demands that a retailer give customers the sense they’ve had the same brand experience whether they’ve shopped the store, catalog or web site, retailers are finding there’s plenty of room for differences and ways to harness each channel’s unique strengths under the brand umbrella.
“The trick is to define what your brand is about and stick with it,” Goldberg says. “If you’re about incredible prices, then you have to have incredible prices everywhere. If you’re about incredible service, then you need to carry that through.”
The image, the product
Consultants such as Ken Cassar, senior retail analyst with Jupiter Media Metrix, say one of the elements that defines brand across channels for shoppers is image. That means that at Banana Republic, for example, the web site and catalog must augment the hip, young cachet Banana Republic has established in its stores.
Visual presentation also is key to unifying the perception of brand across channels. “When you talk about brand imaging, things like logos need to be consistent-fonts, colors, copy voice, things that people associate with the brand visually,” says Sally McKenzie, division vice president, interactive media at The Spiegel Group’s EddieBauer.com, a retailer with one of the longest tenures online.
The core merchandise offering and basic price value are other critical elements that need to be consistent among web site, catalog and store to convey brand. “At the end of the day, the online store needs to support the value system of offline channels,” Cassar says.