RealTime IT News

Are Multi-Channel Shoppers a Liability?

A new industry study, running contrary to the conventional wisdom, contends that active multi-channel shoppers are not inherently more valuable as customers and in fact may be something of a hindrance to retailers.

The report from Jupiter Research, entitled "Redefining the Online Retail Consumer," says that while 52 percent of the U.S. online population (82 million consumers) has used the Internet both to purchase and to research purchases ultimately transacted off-line, only 10 percent (16 million consumers) have done so across channels of the same retailer.

"The results uncover a surprising trend: these `active multi-channel shoppers' are actually a liability," said Juliana Deeks, associate analyst at Jupiter Research.

"While they account for a disproportionately high share of Web-related purchasing volume overall, this group is more deal-driven, is more aware of price in every channel and consumes more in terms of costly site features such as live help," she said.

Still, multi-channel retailers continue to play a more prominent role in the e-commerce arena at the expense of many pure-plays, according to another recent report, this one from Retail Forward's annual study entitled "Top 50 E-Retailers."

The study from the management consulting and market research firm indicates that 8 of the top 10 e-retailers are multi-channel players, an increase from only five in 2000 and three in 1999. Additionally, multi-channel players comprise 42 of the Top 50 e-retailers on this year's list.

Amazon.com remained the largest e-retailer in 2001, according to Retail Forward. The company generated nearly 22 percent of the Top 50's revenue and 8.7 percent of total retail e-commerce sales.

Still, Amazon and Buy.com were the only e-commerce pure-plays in the top 10, which included, in order, Office Depot, Staples, Gateway, Costco Wholesale, Barnes & Noble.com, Buy.com (the other pure-play), QVC.com, Spiegel Group and J.C. Penney.

Jupiter Research, basing its report on a survey of 2,268 people, said that the findings show that retailers should be encouraged to make customer segmentation the basis for allocating resources towards shoppers who purchase across their channels.

"Retailers are confronted with a difficult dilemma: how much do customers who shop across their channels merit attention and resources beyond those allocated to other online shoppers?" Deeks said.

Jupiter Research is a division of INT Media Group , publisher of internetnews.com.