Multichannel marketing refers to the practice by which companies interact with customers via multiple channels, both direct and indirect, in order to sell them goods and services. Companies use direct channels, or ones in which the company proactively reaches the customer – such as physical stores, catalogs or direct mail – or indirect ones in which they push content via websites or social media, also known as inbound marketing. Other means of reaching customers with multichannel marketing include via mobile devices, text messaging, email, company website, social media, search engine optimization (SEO) or GPS to track customers' proximity to goods and services. Multichannel marketing combines the practices of inbound and outbound marketing with the goal of reaching customers on the channel of their choice. In this way, the buying process is more controlled by the customer than the marketer.
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Multichannel marketing is based on the fact that customers have more choices than ever in terms of getting information on products. The spread of available channels, including the growth of email, social media and mobile, has caused marketing departments to increase their presence on these channels in order to develop their customer relationship management (CRM) efforts. The old ways of marketing, such as using print sources, telemarketing or broadcasting on radio and TV are no longer the sole focus of marketing departments. These methods are still present, but are part of a bigger strategy that includes new media and evolve along with changing customer tastes and communication preferences.
Companies strive to develop analytics in order to determine which customers get which messages based on their demographic information and other behaviors. Beyond knowing who the customer is and what he/she wants, companies try to understand which channel a particular customer prefers to maximize the visibility of their messages. This enables companies to target the right audience with the right content to facilitate sales.
To have success in multichannel marketing, or any other digital marketing, efforts, companies aim to devise campaigns that span multiple channels easily. Since expecting customers to adapt to the company's preferred channel is an unrealistic hope, companies cater to the customer and tailor campaigns to fit multiple channels. Another goal of companies is to know which campaigns on which channels lead to the most sales, enabling them to determine the effectiveness of their efforts and measuring the return on investment of their presence on each respective channel.
Companies can coordinate their online and offline marketing efforts in order to optimize both. For example, keyword testing from online marketing can inform the effectiveness of certain campaigns before they are made into print ads or other advertisements.
Main benefits of multichannel marketing include:
- Management of sales through feedback: By maximizing marketing efforts through promoting a message through as many channels as possible, companies have the potential to collect feedback from different customer segments. Overall performance can be determined through this feedback and improvements can be made by crowdsourcing information. By ensuring that resources are being used effectively and efficiently, operational costs decrease.
- More sales: The more visible a message is the more potential customers a company can attract. By concentrating efforts on a single channel, the potential to reach the most prospective customers is diminished. Companies can use their presences on various channels to mold a personalized image that can build a customer following and boost retention and loyalty.
- Achieving a 360-degree view of the customer: When companies collect feedback from customers, they can better understand what is expected by their customer bases and how to improve product and service offerings. Companies can then augment marketing efforts and identify which channels work best for certain customer segments and strategize to cater to the needs of that group of customers.
Companies struggle to centralize goals and figure out things like measuring the message's reach or frequency when devising multichannel strategies. Difficulties stem from the inability to coordinate the message across all departments and brands to make sure it is consistent on each channel. Due to a lack of common technology to satisfy every channel, staff and IT support is another painpoint in developing multichannel campaigns. General challenges companies struggle with in developing overall CRM, such as getting a single repository for customer data, is also a hindrance to multichannel marketing.