By John Barrington
Further to yesterday’s blog on internet disintermediation, I read some recent Wharton research (source: http://knowledge.wharton.upenn.edu/article.cfm?articleid=3083) that highlights the importance of bricks and mortar retailers pursuing a multi-channel or omni-channel distribution strategy. This suggests the imperative of providing multiple access points to interact with customers. In fact, this builds loyalty.
The research quoted shows that on average, customers who visit both the physical location and the website of retailers, spend twice as much as people who shop at just one channel outlet. Moreover, if the customer issues three channels through which to spend their money, that spend can be up to 4x as much as the single channel shopper. The proposal is that retailers think of their stores as a marketing expense, i.e. a tool to generate interest and excitement or a way to provide the service that I mentioned yesterday, being the Apple Genius Bar.
The old AIDA model still holds true, but retailers must think about how their distribution channels interactively create Awareness, then generate Interest, taking it to Desire to purchase and then, of course, concluding the transaction through Action.
In this new world, the fourth ‘P’ of Place, being distribution, has never been so important and has never seen the fundamental erosion of traditional channels that is currently taking place.
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