Multichannel Buyers, And The Migration From The Catalog To The Online Channel

In the process of writing my next book, I ran across a situation that caused me to rethink what "multichannel" means.

Here's the deal. I was forecasting the mix of catalog and online buyers, I started with a customer file that was almost exclusively catalog buyers. Then, customers began to migrate to the online channel. Pundits believe that these "multichannel" buyers, those who purchase from both catalog and online channels, are more valuable than single channel buyers.

The simulation indicated that eventually, almost all customers convert from the catalog channel to the online channel. As a result, almost all buyers are now "single channel" customers. They only buy online, they don't purchase via the telephone/catalog.

This suggests that "multichannel buyers" are not really more valuable. They are simply customers who are going through the process of migrating from catalog to online. Once everybody has migrated, there is only one channel, the online channel.

This process has occurred in the past. Prior to the days of call centers and credit card purchases, customers wrote down the items they wanted to purchase on an order form, and mailed their check. In four to six weeks, their merchandise arrived. The arrival of call centers and credit card processing created a new "channel".

At first, there had to be early adopters who mailed their orders in with a check, and purchased over the phone, via credit card. These customers were using two purchase channels.

Eventually, everybody purchased via the phone, using a credit card. The channel where customers mailed a check disappeared.

It seems reasonable to assume that the majority of customers will convert from catalog to online. When this happens, the term "multichannel" should disappear ... and then reappear when the hologram channel replaces the internet!

As a result, "multichannel buyers" are not more valuable than single channel buyers. They are simply going through the transitional process from catalog to online.