The Long-Term Effect of Multichannel Usage on Sales

Abstract

The paper investigates the long-run consequences of multichannel shopping on customers’ spending. Using data from a major US catalog company which introduced an online channel, our results validate previous findings that multichannel customers spend more than mono-channel customers in the short run. However, the difference in spending dissipates over time with multichannel customers reverting to their regular consumption pattern in 3 years. As our results are based on observational data, we use different panel data econometric models and combine them with propensity score matching methods to control for potential self-selection biases. Our key results are consistent across the analysis methods.