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Changing ChannelsBy: Kim T. Gordon Alert TV viewers who catch the on-screen tag – "call, click, come by" – at the end of Office Depot’s spots probably don’t realize they’re witnessing a marketing revolution. And the emergent leader is a new, totally integrated approach, called multichannel marketing. Customers decide where, when and how they want to shop. But unlike the old days, when each marketing channel might take a different approach and in-house departments maintained unique customer databases, now all channels strive to present a single point of information for and about customers. Direct-mail, e-mail, print and broadcast campaigns are linked. Instead of multiple customer databases, companies view customers as single individuals, taking into account all their buying activities and preferences in order to customize offers and increase sales. From the customers’ perspective, having the option to shop via catalog, in-store or online represents more choice and available information, not to mention round-the-clock ordering 365 days a year. They can place an order online at midnight, call a toll-free number for customer service during the week, and return merchandise purchased online at the store. For retailers, multichannel marketing results in increased sales. Trouble is, entrepreneurs are just beginning to catch on to the concept of cross-selling. While large businesses, from retailers such as Circuit City to cruise marketer Royal Carribbean and cataloger Land’s End, excel at integrating offline marketing with online efforts, not so for entrepreneurs. According to the Direct Marketing Association, over 80 percent of large businesses target offline buyers through online advertising and Web sites, while less than half of small businesses do. Multichannel Shoppers Spend More A study by Forrester Research showed that over 60 percent of retailers expect to use three or more sales channels this year. If you’re not among them consider this: Offering customers multiple channels significantly increases their spending, and multichannel shoppers purchase 70 percent more frequently than the average store customer. In a holiday shopping study conducted last year by DoubleClick, shoppers using one channel spent $591. But shoppers using two channels spent $894 and those that used three channels spent significantly more at $995. If you’re concerned that adding new channels, such as online sales, will detract from your in-store traffic, this hasn’t proven to be the case. According to the National Federation of Retailers, nearly three-quarters of shoppers do online research before making in-store purchases. In fact, while sales in existing channels may decline temporarily when new channels are added, it’s usually a short-term effect. The key is to use what you learn about customers while they’re in your store to cross-sell and build additional sales. A shopper who registers for the customer reward program while purchasing camping gear at REI, a chain specializing in outdoor gear and clothing, will soon receive an e-mail offer as well as a print catalog, for example, and there’s a high probability he or she will make additional purchases. Three Tips for Cross-Selling 1. Build Customer Relationships Stay connected to your customers using advertising, public relations and promotions to draw them in and direct-mail, e-mail, call centers, and Web sites to cross-sell. This will allow you to build solid relationships from when customers first consider your products, through their first and repeat purchases. 2. Capture Spending Activity Instead of using multiple databases to track direct mail, online and in-store sales, have a single unified view of your customer. Ideally, it’s best to construct a database that allows you to capture spending activity for each channel so you can compare and measure shopping and browsing activity. 3. Have a Consistent Message Take a cue from big business, and cross-promote in all channels. Carry through your campaign message into all media and cross-train your employees so you have a consistent theme and message. Get In-depth Coaching on this Topic>> Kim T. Gordon's columns and articles are read by nearly 3 million small and home-based business owners each month. She is the author of two books, including Bringing Home the Business: The 30 Truths Every Home Business Owner Must Know. Copyrighted material. May not be reproduced in whole or part without expressed permission from the author. |
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