Multi-channel retailing

GUIDE

Multi-channel Retailing:
An Introduction
New technologies, such as mobile, touchscreens and tablets, are offering
retailers more ways to connect with customers. Learn what technologies
are available and how to maximize their effectiveness.

Developed and published by Sponsored by

Contents Multi-channel Retailing: An Introduction

Page 3 About the sponsors

Page 4 Introduction: What is multi-channel retailing?

Page 5 Chapter 1 | Benefits of multi-channel retailing
customer perception Improved
sales Increased
collection Better data
productivity Enhanced
Best practices

Page 9 Chapter 2 | Tablets
Benefits

Best practices

Page 12 Chapter 3 | Mobile
Benefits

Best practices

Page 14 Chapter 4 | Touchscreens
Benefits
Best practices

Page 16 Conclusion | The future: Omni-channel retailing

© 2012 NetWorld Alliance LLC | Sponsored by Frank Mayer and Associates Inc. 2

About the sponsors

Frank Mayer and Associates Inc. designs, engineers, prototypes
and produces retail merchandising displays, interactive programs,
kiosks, store fixtures and promotional marketing programs that engage
the customer at the point of sale, provide a competitive advantage in the
retail environment, maximize client objectives and increase sales. Its in-
house resources of design, engineering, production, prototyping, assembly,
distribution and customer service provides an environment of tightly in-
tegrated resources for complete project management from creative design
through store delivery. These resources allow the company to be flexible to
program changes, compress timeframes and deliver a final product that
is on-time and on-budget, with quality results.

In an ever changing marketplace, Frank Mayer is the constant that
provides clients with a creative, responsive and thorough approach to
every in-store merchandising or interactive kiosk program. The com-
pany’s mission is to create an environment which focuses on turning
targeted in-store merchandising initiatives into guaranteed results.

RetailCustomerExperience.com, operated by Louisville, Ky.-
based NetWorld Alliance, is the leading online publisher of news and
information on how retailers can differentiate their offerings, create
customer excitement and loyalty, and increase revenue by improving
the customer experience. The content, which is updated every business
day and read by professionals around the world, is provided free of
charge to readers.

Published by NetWorld Alliance
© 2012 NetWorld Alliance LLC
Written by Emily Wheeler, contributing editor, RetailCustomerExperience.com.
Tom Harper, president and publisher
Joseph Grove, vice president and executive editor
Emily Wheeler, managing editor of special publications
Courtney Bailey, assistant managing editor of special publications


Introduction:
What is multi-channel retailing?

D
espite a still-weak economy, retail
sales are showing a rebound. Ac- The channels
cording to the U.S. Department of
Commerce, total retail sales for the third Multi-channel retailing involves using
quarter of 2011 were $1,052,734. Sales a variety of engagement points to
improved even more during the holiday create a seamless shopping experience
season. The National Retail Federation said for customers. Those engagement
retail sales for the 2011 holiday season rose points include:
4.2 percent from 2010, reaching $471.5 bil- Brick-and-mortar stores
lion. Clearly, people are still shopping. Websites
But how people shop is changing. In the Tablets
third quarter of 2011, 4.6 percent of retail Kiosks
sales were ecommerce sales, according to Smartphones
the U.S. Department of Commerce — an Digital signage
increase of approximately 13 percent from
the previous year. Call centers
Social media
Not only are people shopping more from
their home computers, they also are using
new technology within a store. Approxi-
mately 35 percent of American adults own
Retail, the retail arm of global communica-
a smartphone, according to a recent survey
tions company Verizon. “But the dirty little
by the Pew Research Center, and 11 percent
secret is that usually, those channels are
own tablet computers. And sales are con-
all operating as different silos, not as one
tinuing to grow; Apple, maker of the popu-
unified brand. It’s up to the retailer to blur
lar iPhone and iPad, posted record profits
those lines and create a unified experience.”
for 2011, due in large part to the sale of
those devices. Shoppers not only are using This guide, sponsored by Frank Mayer
their smartphones and tablets to purchase, and Associates, will discuss the benefits of
but also to do research within a store. multi-channel retailing and how to imple-
ment it across various engagement points.
The challenge for retailers, then, is to incor-
We would like to thank Frank Mayer and
porate new technology with their existing
Associates for allowing us to provide this
sales channels, to create a seamless omni-
guide at no cost to the reader.
channel experience for shoppers.

“To the consumer who uses multiple en-
gagement points, such as the Web, a call
center and digital signage within a store, it’s
all one brand,” said Ravi Bagal, vice presi-
dent for Washington, D.C.-based Verizon


Chapter 1 Benefits of multi-channel retailing

C
reating a successful multi-channel tomers, especially as the digital generation
experience can seem intimidating to gains even more buying power.
many retailers, who may wonder if
the effort is worth it. They may not have a Stores who do create a seamless experi-
choice, however. ence that integrates all different forms of
technology, however, can gain significant
“Consumers are expecting this kind of in- customer loyalty. Those brands are per-
tegration already,” said Ron Bowers, senior ceived as forward-thinking and responsive
vice president of Frank Mayer and Associ- to customer’s needs — qualities that will
ates, a Grafton, Wis.-based merchandising keep customers coming back.
company. “They expect that if they order
an item online, they can return it in the That improved perception offers another
store, that kind of thing. It’s up to retailers advantage, as well. In a world of big-box
to make sure that expectation is met.” stores and online shopping, finding the
best price is easier than ever for customers.
But multi-channel retailing also offers A store that is perceived as responsive to
plenty of benefits to retailers, benefits that customer needs and gives customers easy
make investing in the strategy worthwhile. access to a variety of channels can differen-
tiate itself in a crowded field. That allows
the brand to compete on the experience
Improved customer perception offered, rather than just price. Customers
“Channels are disintegrating for custom- might be willing to pay a little more for the
ers,” said Jeremy Gustafson, vice president convenience, and will come back repeat-
at KSC Kreate, a digital commerce agency edly, and brands don’t have to slice their
based in Hollywood, Fla. “People are watch- profits just to keep up.
ing television and using their tablet at the
same time. They expect the same kind of
integration with their shopping experience.” Increased sales
The primary driver for a retailer adopting
Brands who don’t provide that kind of any strategy is, of course, increasing profit,
experience, he said, are likely to lose cus- most frequently by increasing sales. Multi-

Shopping no longer takes place exclusively in brick-and-mortar locations. Customers are blurring the lines between touchpoints, and they
expect retailers to keep up.


CHAPTER 1 Benefits of multi-channel retailing

channel retailing, by offering a variety of Multi-channel retailing, by offering a
engagement points for the customer to variety of engagement points for the
make a purchase, increases the convenience
customer to make a purchase, increases
and ease of sales, thus boosting profit.
the convenience and ease of sales.
A customer who thinks about buying a
pair of pants, for example, may not want to
drive to the mall, park, walk to the store,
find the pants and try them on. For that likely to enter their email address into a
customer, she can go online at home and kiosk than give it to a cashier. At the same
order the pants from the store’s website. time, by having that information available
Another customer, however, might be in across a variety of channels, the retailer has
the store trying on the pants and decide more opportunities to capture the infor-
she’d like them in a different color. In mation, and more of it.”
that case, she can use an in-store kiosk
to find the pants in the preferred color, If a retailer can track what a customer is
order them and have them delivered to her purchasing, and where, more targeted
home. Still another customer can use her marketing can be introduced. Someone
smartphone to take a picture of the pants, who tends to browse online and then pur-
send it to a friend and discuss whether to chase in-store, for example, can be emailed
purchase them or not. Having a variety of an invitation to a private showing in a
engagement points gives retailers more store, and the list of products to be shown
tools to make a sale. can be sent before the event, increasing the
likelihood of purchase.

Better data collection Not only is it more likely that the customer
Knowing the customer is a key tenant for will provide important information, but if
successful retailing, and multi-channel en- all the different channels are communicat-
gagement points provide more opportuni- ing, then the information only needs to be
ties to gather information about customers. entered once.

There are two benefits to the data collec- “If you’re going to ask someone for infor-
tion offered by multi-channel retail: First, mation about themselves, it needs to be
the possibility for gathering more infor- available whenever they come to you,” said
mation exists, and the information can be Verizon’s Bagel. “Otherwise, it feels intru-
used more effectively. sive and annoying to have to repeat the
same information over and over again.”
“People usually are more comfortable
entering information themselves, rather
than giving it to a salesperson,” said Steve Enhanced productivity
Deckert, marketing manager for Sweet Multi-channel retailing offers benefits for
Tooth, a Toronto-based provider of loyalty more than shoppers. Workers, too, can
programs to retailers. “So they are far more benefit from the use of new technology,



because it arms them with more informa-
tion and increases their efficiency.

A tablet, for example, frees employees
from the point-of-sale system, instead
allowing them to carry the register with
them. Employees can go directly to the
aid of customers, helping them to find out
what is in stock, what is available at other
stores and when new products might be
launching. The tablet also can contain
information about the loyalty program, When all the different retail channels are communicating
with each other, information only needs to be entered
so a frequent customer can be given VIP once (i.e., a shopper can sign up for a loyalty card online
status. Then, when a purchase is ready to and use it in the store).
be made, the customer does not have to
stand in line, but rather can simply con- ample, is not bringing anything unique to
tinue talking to the salesperson and make the customer; instead, she can check the
her purchase via tablet. website at home, on her own. The same
is true of a tablet. If the salesperson with
the tablet does not have access to more or
Best practices better information than the customer can
While every type of channel has its own access via her own tablet or smartphone,
unique set of challenges, there are some the application will not bring much value
strategies that are true across all engage- to the transaction.
ment points.
Security. There is a fine line between be-
Be consistent. Messaging across all chan- ing helpful and being intrusive, and it’s a
nels should have the same look and feel; line that easily is crossed. Customers are
the customer should always know exactly aware of security issues, and are wary of
what brand she is interacting with. providing too much personal information.

“Traditionally, retailers have approached “There has to be a clear connection be-
each channel individually,” said Gustafson. tween the information collected, how it’s
“What is needed, though, is to create a used and what value the customer receives
single marketing message, and then figure from it,” said Bagel. “Understand your
out how to deploy it across all channels. brand strategy and what level of intimacy
The messaging doesn’t have to be identical, is appropriate. Depending on your clien-
but it all needs to be clearly related.” tele, privacy might not be as important —
digital natives tend to be far less concerned
Provide a value-add. Make sure each with privacy than Baby Boomers, for
engagement point offers something to the example. But everyone wants to know that
customer. An in-store kiosk that simply they will receive a benefit from giving you
accesses the company’s website, for ex- information.”



Be committed. Multi-channel retailing
requires an investment in time and money.
There needs to be a clear strategy across all
teams, and cooperation is critical to success.

“In order to have a totally seamless solu-
tion, all stakeholders need to be involved,
giving their insight and taking ownership
and having support and understanding as
to what is being done, why and how,” said
Bowers. “This is not a sometime commit-
ment; this is a total marketing strategy for
the retailer to invest in the future of the
customer acquisition, retention process
and loyalty programs.”


Chapter 2 Tablets

T
here are more than 30 different
tablets available on the market
today. Some of the most popular
include Apple’s iPad, Amazon’s Kindle
Fire and Samsung’s Galaxy Tab, according
to PCMag. Tablets are an increasingly
popular option for both consumers and
retailers, due to their relatively low price
point and powerful computing capabilities.

Benefits
Tablets can be used by both customers
and in-store personnel. For customers, the
tablet serves as an extension of the website,
and as a comparison shopper. Custom-
ers can access the company website to see
what’s available. At the same time, and the
challenge that retailers need to overcome,
a shopper can find a product she likes, and
then see if another vendor offers it for less.

For the salesperson, tablets can be a pow-
erful customer service and line-busting
tool. If a retailer develops a specific tablet
application, it can provide more informa-
tion than simple access to the website. A Tablets can be powerful tools for employees, creating
tablet application can integrate with inven- a more dynamic sales experience and serving as a POS
tory management, give the salesperson system.
access to the customer’s loyalty program
and connect the salesperson with similar
stores across the country, as well as corpo- makes for a more dynamic, interactive and
rate headquarters. convenient sales experience.”

“The benefit of a tablet at retail is that it A tablet also can serve as a POS system.
allows the customer (and salesperson) to This most famously is occurring at Apple
bring it right to the product under con- stores, where there no longer is a tradi-
sideration, initially providing information tional check-out counter. Instead, Apple
that the consumer can ‘double-check’ on associates roam the floor with enhanced
the item itself, and possibly complete the iPod Touches, and can process payments
transaction without having to spend time directly on the devices. Customers no lon-
at a sales desk or in a check-out line,” said ger have to wait in line, and the perception
Dave Zoerb, senior vice president of mar- is that the check-out time is much faster.
keting at Frank Mayer and Associates. “It


CHAPTER 2 Tablets

Training also is a benefit of a tablet system. Best practices
According to the U.S. Department of Com-
Usefulness. As discussed in Chapter 1
merce, employment in the fourth quarter
it’s important that the tablet application
of 2011 rose by 200,000 jobs, much of that
being used by the salesperson offer more
seasonal retail work. Seasonal workers
than simply the standard information on
need to be brought up to speed quickly,
the website. If a customer approaches the
and even long-term workers need to know
salesperson with a question, she wants to
about special deals or promotions. Tablets
feel she is getting information she could
can offer access to that information, get-
not have as easily found for herself. Make
ting workers onto the floor more quickly.
sure the tablet application is integrated
with other systems.
“Salespeople are excited to work with tab-
lets,” said Tom Tamulewicz, vice president
Security. If used as a POS system, make
of research and development at Columbia,
sure the system is as secure as a standard
Md.-based MICROS-Retail, a provider
POS application.
of enterprise applications for retail estab-
lishments. “People are comfortable using
“The same best practices for security apply,”
them, even if they haven’t before, and they
said Tamulewicz. “Make sure everything is
think they’re fun to use. That gets people
encrypted, restrict access only to those ap-
eager to work with them, and eager to get
plications that need it and restrict the num-
out on the floor and sell.”
ber of systems that touch anything critical.”
In addition to training seasonal workers,
Wi-Fi enabled. It seems simple, but to en-
tablets also give retailers flexibility in pay-
courage tablet use in the store, make sure
ment acceptance. Because tablets are less
Wi-Fi is enabled, and free. Customers are
expensive than a traditional POS system,
becoming used to having Wi-Fi access,
a few can be purchased for known busy
and may become resentful if they can’t
times and shipped to a store. The store can
access their tablets on demand. This is
have extra registers when needed, without
especially true for the new class of tablets,
having to worry about installing a complex
such as the Kindle Fire, that do not have
system, including finding space and paying
any 3G capability.
for wiring. And of course, when the busy
season has evaporated, the tablets can be
put away, unlike a permanent installation.


CHAPTER 2 Tablets

Seva Beauty: A tablet success story

One chain that has successfully integrated tablets is
Seva Beauty, a salon located in Walmart stores that of-
fers a full range of services, including manicures, pedi-
cures and eyebrow threading. Seva Beauty operates in
nine states, with plans to open more.

Each Seva Beauty location has at least one iPad, used
for check-in and check-out. A secondary iPad also is
used as a POS system.

“Because customers can check themselves in and out,
it’s created a really dynamic in-store aspect,” said Vas
Maniatis, co-founder of Seva Beauty. “The iPads also
changed the aesthetics of the salon.”

The iPads also encourage upselling. When customers One salon is taking advantage of tablets to
check in, any daily specials can be promoted on the encourage upselling, promote loyalty programs
welcome screen, as well as the loyalty program. Cus- and improve training.
tomers are guaranteed to see that marketing, and since
they are already using the iPad, they are more likely to
agree to sign up for the loyalty program.

Monitoring is easier with the iPad, as well. Since the entire POS system can be accessed re-
motely via an iPad, a manager can check sales numbers, notice any deviations and determine
solutions. The Facetime ability also allows a manager to see how an aesthetician is performing
a service, without having to be onsite.

Training is another benefit. With the iPad, workers can download training videos whenever
there is downtime. The system can track who has watched the videos, and can administer
tests after the video has been watched to ensure the information has been retained. The train-
ing is dynamically tied into the POS system, so a worker only can perform a service once she
has been certified.

“The iPad just gives us more flexibility,” said Maniatis. “And we’re always finding new uses for it.”


Chapter 3 Mobile

A
ccording to an August 2010 survey Uses of smartphones in retail, 2010
by Dublin, Ohio-based research firm
Sterling Commerce, 15 percent of 30
U.S. consumers have used their mobile de- 30%

vices to make purchases. Ann Arbor, Mich.- 20
based ForeSee Results found that, in 2010,
30 percent of shoppers used their phones for 10 15% 15%
research, such as comparing product details,
looking up prices and using store loca-
0
tors. Fifteen percent of shoppers compared Comparing Make Research
products and prices while in-store. Clearly, product purchases
details
mobile is an important part of the shopping
experience, and growing.

and Twitter. People can “like” a brand on
Benefits Facebook instantly via a smartphone, and
Mobile apps differ from simply accessing a Twitter conversation can share a cus-
the website. Mobile apps offer retailers the tomer’s view of a store (whether positive or
opportunity to do targeted marketing, such negative) in real time.
as delivering coupons based on location,
and can encourage on-site purchasing. QR codes are another use for mobile. A
code can be attached to an item, and the
“People use mobile phones for conve- user takes an image of the code with her
nience,” said Jonathan Cook, head of new phone, which brings her to a website. That
media at Valtech UK, a digital consultancy website might have a special offer for that
firm providing strategic results using engi- item, or provide more information about
neering muscle and creative edge. “Mobile it. QR codes make shopping a more inter-
can be used for everything from geo-loca- active experience between customer and
tion opportunities to advice within show retailer.
rooms or shops in the vicinity of a user, to
ease of payment or ease of product feature As with tablets, mobile applications can be
comparison.” used as a POS system. Using a smartphone
as a POS system offers flexibility, especially
Mobile also starts a conversation. People for small retailers, and can decrease wait
use their phones for more than just dial- time for customers. It is important, how-
ing friends; they also use smartphones ever, for there to be a clear system in place
to access social media, such as Facebook for customers to check out. Having to seek

“Mobile can be used for everything from geo-location opportunities to ad-
vice within show rooms or shops in the vicinity of a user, to ease of payment
or ease of product feature comparison.”
— Jonathan Cook, head of new media, Valtech UK


CHAPTER 3 Mobile

out a salesperson to pay can feel frustrating
and chaotic to some customers. Make sure
salespeople are easily identifiable, and keep
the check-out process efficient.

Best practices
Design. It may be tempting to use the
website as a mobile application. However,
it’s worth it to invest in a specific mobile
app, one that is designed for smartphones.
Doing so will ensure a better user experi-
ence, and decrease the chances of crashing,
leading to frustration on the part of the
customer and salesperson.

Security. As with tablet applications, it’s
important to implement security stan-
dards. Encrypt information whenever
possible, and restrict access only to people
who need it.

Be part of the conversation. Because
smartphones encourage the use of social
media, it is important for a retailer to be a
part of that conversation.

“Anywhere someone can say something
negative about your company, you should
be there,” said Sweet Tooth’s Deckert. “It
actually can present an opportunity to be
extraordinary. Say someone tweets some-
thing negative about their experience at
your store. If you’re paying attention, you
can see that tweet, and approach them to
fix the problem before they leave. With
that kind of attention to detail, they’re
likely to tweet about that, too, leaving the
customer (and their friends) with a positive
feeling about your service.”


Chapter 4 Touchscreens

T
ouchscreens can form an integral
part of the in-store experience.

Frank Mayer and Associates
They come in two forms, which
can be used either separately or together:
kiosks and digital signage.

Benefits
A touchscreen encourages interactivity
and engagement on the part of the user.
People are becoming more used to them,
thanks to the prevalence of smartphones
and tablets, and feel comfortable using a
touchscreen.

“Touchscreens are really changing tech-
nology,” said Chad Wagner, industry
marketing and PR manager for retail store
solutions at Palo Alto, Calif.-based HP, a
provider of technology solutions. “People
expect it now. I’ve seen them walk up to
a kiosk with a keyboard and try to touch
the screen, and get frustrated when that
doesn’t work.”
Kiosks can be used to engage with customers, for way-
finding purposes, to sign up for loyalty programs or to
In addition to interactivity, kiosks and find out more information about items in stock.
digital signage both can be used to convey
information to customers. Digital signage
can advertise sales or promotions, and at- of marketing, which can make it more
tract the attention of passersby. Kiosks can effective and give it a broader reach.
be used for wayfinding purposes, to sign
up for loyalty programs or to find out more
information about items in stock. Best practices
Content. Content on digital signage and
One of the advantages of both digital kiosks must be kept fresh and be relevant
signage and kiosks is the technology is to the customer. Advertising high-end
provided by the retailer. Instead of hav- luxury items at a big-box store will not
ing to depend on the customer having a have an impact, because that’s not what the
smartphone or tablet, the retailer installs customer is looking for in that particular
the kiosk or digital signage and runs it. The shopping experience. If the content is static
customer is sure to see it simply by enter- or repetitive, though, the customer easily
ing the store, and it requires no previous will learn to tune it out. Consider partner-
buy-in by the customer to see the messaging with a content provider to ensure the
ing. The technology is a more passive form best content possible is displayed.


CHAPTER 4 Touchscreens

Durability. Kiosks, especially, can see
hard use from a variety of customers. But
if the kiosk is inoperable when the cus-
tomer goes to use it, it will leave a negative
impression. Make sure to choose a durable,
ruggedized kiosk.

Ease of use. Kiosks must be intuitive and
easy to use. Don’t have too much informa-
tion on any one screen, and make sure
there are large buttons that clearly indi-
cate what the customer is supposed to do.
When using a touchscreen that requires a
customer to type information, make sure
the buttons are large enough that typos
don’t occur, and sensitive enough that it is
not difficult to type the information in. If
the loyalty program requires an email ad-
dress, make sure the “@” button is clearly
visible when typing in the address.

Easy to read. Digital signage only has a
few seconds to grab a customer’s attention.
Don’t fill the screen with small text. Keep it
simple and eye-catching.

Integration. Integrate social media and
QR codes with the digital signage. Perhaps
keep the Facebook page posted on the
digital signage, or let tweets be displayed
in real-time. That allows customers to
interact directly with the brand, and keeps
them engaged.


Conclusion The future: Omni-channel retailing

A “The shopping experience will ultimately become
s multi-channel retailing becomes
more prevalent, retailers are look- omni-channel retailing, where each engagement
ing to the future.
point is so integrated together that it offers an ab-
“It’s not really about multi-channel so solutely seamless experience across all channels.”
much,” said Frank Mayers’ Bowers. “It — Ron Bowers, senior vice president, Frank Mayer and Associates
will ultimately become omni-channel
retailing, where each engagement point
is so integrated together that it offers an
absolutely seamless experience across all “New technology and applications keep
channels, which will allow the consumer coming and going at a blistering pace, but
to shop the way they want, where they the faster the flow of new elements, the
want and when. This shopping experience more opportunities there are to create
engages rather than touches and turns sales,” said Frank Mayers’ Zoerb. “Retailers,
loyalty into customers that are evangelists and even brand marketers, will need to
for their store.” develop the capabilities and skill sets to
manage this new technology and create
MICROS-Retail’s Tamulewicz agrees. responsive, coordinated programs to
maximize the results.”
“Today, people are focused on punching
through silo holes to accommodate Partnering with a technology provider who
near-term business objectives,” he said. has a deep understanding of all the retail
“But eventually, there is going to be a engagement points can help a brand know
consolidation of systems. Instead of one how to take advantage of the available
system in charge of customers and one in technology and create a program that not
charge of promotions, for example, there only will work today, but also can grow and
will be one system with a lot of different change as customer behavior does.
functionality.”

According to Stamford, Conn.-based
research firm Gartner, sales of smartphones
will reach 1.1 billion by 2015, and more
than 408 million tablet computers will be
sold by 2014. It is incumbent on retailers
to integrate these technologies into their
marketing efforts. Doing so may seem
intimidating, but these technologies
also present an opportunity for retailers
to create a personalized, one-on-one
relationship with customers that engenders
loyalty and ultimately boosts profits.


Multi-channel retailing

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