A Brief Guide to Multichannel Selling

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Think back to the last time you bought something online. Did you do any research before you made your purchase? Did you look up reviews of the product and compare prices on Amazon, eBay and other online stores? Did you visit a brick-and-mortar store to get a better idea of the product before you purchased?

If you did any of those things, then you engaged in multichannel commerce. And you aren’t alone. According to one study by Forbes Insights, 82% of customers conduct online research before purchasing. With so many customers engaging with multichannel marketers, it seems wise to take a closer look at multichannel selling.

What is Multichannel Selling?

Multichannel selling has become a common term in eCommerce, though its definition hasn’t solidified yet.

Industry experts, eCommerce platforms, and developers often debate exactly what comprises multichannel selling and marketing. They also debate the difference between the terms “multichannel” and “omnichannel.” For our purposes, we’ll stick with the most commonly agreed upon definition.

Essentially, multichannel selling involves selling across multiple channels (no surprises there). That means you have your products listed on at least two of the following platforms:

  • Online Marketplaces: Your products are available on eBay, Amazon, Etsy, etc.
  • Social Media: Social media listings can take many forms. You might have a Facebook Store or you might be using buy buttons on Pinterest or Instagram posts.
  • Your Own Online Store: You maintain your own online store. If you’re still figuring out how to set up an online store and sync your inventory across channels, keep reading for some advice.
  • Your Brick-and-Mortar Store: You sell products in the real world, using a POS system to keep track of everything.

Merchants can engage in many different levels of multichannel selling. If you use two or more of the above methods, you’re a multichannel seller.

Why Sell Across Channels?

So, why should you sell across channels? Well, for a lot of reasons. Selling across channels increases your company’s exposure, increases revenue, and encourages customer loyalty. I’m breaking down the reasons to sell across channels below:

  • Current Shopping Trends Lean toward Multichannel: Modern customers are price-wary and tech savvy. Around 50% of online shoppers compare prices online before they make a purchase. When you list your products across multiple platforms, you make sure that customers see your options, whether they are in someone else’s brick-and-mortar store looking up a product they have in hand, or just scrolling through selections on Amazon.
  • Multichannel Shoppers are More Loyal: It pays to earn the type of customer I’ve just described. According to an article from Practical Ecommerce, customers that buy from one brand across at least two different channels are more loyal than other customers; they spend 32% more annually than customers who only shop in-store.
  • Better Traffic and Revenue: Data from Stitch Labs in 2015 reports that online stores which list their products on just one marketplace experience a 38% increase in revenue compared to when they sold exclusively on their site. Stores that are listed on two marketplaces experience a 120% increase in revenue. I’d say it’s worth looking into Amazon and eBay.
  • Build a Stronger Brand: Establishing a presence on an online store and marketplace in addition to your physical store will give credibility to your brand.

What are the Difficulties of Multichannel Selling?

Of course, additional avenues of selling come with their own complexities. When you choose to sell across multiple platforms, you’ll encounter new challenges to your business. Here are a few of the most common difficulties faced by new multichannel sellers:

  • Managing Inventory: Inventory is the biggest challenge for multichannel sellers. With so many selling avenues, it can be difficult to ensure that you always have the correct stock on hand. If you aren’t careful, you may end up selling the same product twice!
  • Rules, Rules, Rules: When you begin selling on a new marketplace, you will have to figure out all the rules and fees associated with that platform. Amazon, eBay, and Etsy all have their own strict guidelines about which products you can and cannot sell, timeframes in which you must fulfill your orders, and customer satisfaction rules. Inability to comply with these regulations can result in expulsion from the marketplace. In addition, you’ll need to pay accurate fees to each marketplace, which vary depending on product type and whether or not you’re using FBA for fulfillment.
  • Consistent Branding: If you’re working seriously to establish your brand, you may run into a couple snags as you expand across platforms. It can be difficult to create a unified brand experience when you’re extending your efforts across your online store, your brick-and-mortar location, Facebook, and Amazon. In fact, most marketplaces don’t let you include any brand information on your listings.
  • Figuring Taxes: Taxes are difficult for every online seller, and multichannel selling further complicates things. When you sell across channels, it’s harder to compile all your sales information to calculate and file state sales tax. And, if you choose to store your products in warehouses (like those used by FBA sellers), your sales tax responsibilities expand significantly. By housing your products in multiple states, you establish nexus in those states. That means you’ll have to pay sales tax to every state in which you have a physical presence (be that a warehouse, an office, a store. etc.). You can read more about nexus on TaxJar’s blog here.

How Do I Go About Resolving These Issues?

While some of these challenges will persist no matter what you do (there’s really no escaping marketplace fees!), you can resolve many issues with the right toolkit.

One of the best ways to ensure that multichannel selling works without a hitch is to employ a multichannel-compatible shopping cart. Shopify, BigCommerce, Ecwid, and Magento all easily integrate with popular marketplaces and POS solutions to facilitate multichannel selling. Some platforms even offer integrations with Facebook so you can set up a store on your Facebook profile.

Integrating and syncing your various platforms will reduce potential loss from inventory errors and keep sales information organized in one place. When your different platforms talk to each other, everything stays accurate, manageable, and up to date.

In addition, you should consider integrating a few third-party services that can help you tackle the challenges of multichannel selling. For example, you might look into a few of the following services:

Tax Calculation Software

  • TaxJar: TaxJar can help relieve the agony of tax preparation. This software automatically calculates origin-based and destination-based taxes for each state in which you have nexus. That’ll make collecting and filing state sales taxes much easier. TaxJar boasts a one-click integration with Amazon, eBay, Etsy, WooCommerce, Magento, Shopify, BigCommerce, and Ecwid. They also integrate with PayPal and Stripe if you want to connect them to your payment service provider. You can find more information about TaxJar here.
  • Avalara’s AvaTax: Avatax can help you calculate tax for international sales in addition to domestic sales. The software integrates seamlessly with numerous shopping carts and POS, CRM, and CMS software. With such a robust software calculating your taxes automatically, you’ll have a lot more time to worry about other aspects of your business. Compare Avatax to TaxJar to see which best fits your company’s needs.

Accounting Software

  • Quickbooks: Quickbooks is one of the most popular accounting solutions on the market, and here at Merchant Maverick we’re pretty big fans. We’ve given Quickbooks Online a perfect five-star rating for their feature-rich software. Quickbooks Online gives you the tools you need to handle inventory management, payroll, and sales tax. Many businesses (especially those with multiple employees) are already using Quickbooks for their accounting, and fortunately, most popular shopping carts integrate easily with the software.
  • Xero: Xero is Quickbook’s strongest competitor, also scoring five stars in our review. Xero provides features for contact management, payroll management, sales tax reporting, and inventory management. Take a look at our reviews of each software to find out which one would better serve your business.

Should You Consider Omnichannel?

If you’re already following the above tips and you’re still having trouble managing your sales, it might be time for you to upgrade to something a little more robust.

Omnichannel solutions provide native integrations with POS, tax, and accounting solutions, and include pre-built integrations with the most common marketplaces. Using an omnichannel solution, you can also keep your OMS, CRM, and CMS software under one umbrella. It all works together seamlessly, which makes expanding your business a whole lot easier. Unfortunately, omnichannel solutions also come at a price. You can expect to pay several hundred dollars a month for each module you choose to include in your package. That can amount to a few thousand dollars monthly.

That said, if you’re seeing such a high volume of sales that your current patched-together solution can’t handle the weight, you just might be able to afford an omnichannel solution. To learn more about omnichannel solutions, read my blog post on the subject here.

What Are You Waiting For?

Does multichannel selling sound right for your company? If so, get integrating! You’ll soon be reaching customers who were previously out of your reach.

If you’re already selling across channels, leave a comment below to let us know which integrations, marketplaces, and shopping cart you’re using! We’d love to hear more about how you’re making multichannel work.

Liz Hull

Liz Hull

Liz is a recent college graduate living in Washington state. As of late, she can often be found haunting eCommerce forums and waiting on hold with customer service representatives. When she's free, Liz loves to rock climb, watch Spanish dramas, and read poorly-written young adult novels.
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