Multichannel Retailing Research Articles

Unveiling consumer preferences: A two-stage deep learning approach to enhance accuracy in multi-channel retail sales forecasting

In the dynamic and turbulent business environment, sales forecasting for multi-channel retailers has become increasingly intricate, particularly with the shift from traditional brick-and-mortar channels to a diverse range of distribution channels. This transition not only complicates forecasting challenges but also highlights the crucial role of utilizing online traceable consumer purchase data to discern consumer preferences for stores and products and enhance sales forecasting accuracy. This paper proposes a two-stage deep learning approach based on the Online Channel Consumer Preference Heterogram and Multi-Head Attention mechanism (OCCPH-MHA). In the first stage, the model identifies potential consumer group preferences based on individual purchasing behavior. In the second stage, it seamlessly integrates this identified feature with time-series demand data using a global–local attention mechanism, thereby facilitating multi-step forecasting. This study’s robust validation involves testing the model on the dataset from a multi-channel retail restaurant company, showcasing its prowess in significantly improving the precision of sales forecasting. This not only substantiates the model’s effectiveness but also underscores the importance of consumer group preferences, as it contributes to a comprehensive framework. This framework, focused on tracking the preferences of potential consumer groups, emerges as a valuable tool that collectively refines and optimizes the sales forecasting process for both industry practitioners and researchers.

Identifying the drivers of ‘loyal showrooming’: a systematic literature review

ABSTRACT Retail showrooming behaviour is described as the phenomenon in which customers browse the products in-store before making the purchase online at a lower price. This is due to the fact that different shopping channels have emerged and have gained the attention of customers. However, customers do prefer visiting the showroom to check on the prices and best buying options within the store. The retail environment is progressing towards the environment where store-based offline shopping does exist with online shopping mediums, and retailers need to understand the factors that maximize customers’ purchase within the store during showrooming. This paper is aimed at establishing the significance of loyal showrooming and determining its drivers based on an extensive literature review of 168 research articles published in indexed journals during the last 12 years. It is suggested that retailers should adopt strategies based on the present multichannel retailing environment and the driving factors identified to convert the showroomers into loyal showroomers.

An Analysis of Consumer Behaviour in Multichannel Retailing and Omnichannel Retailing

This paper investigates consumer behavior in multichannel and omnichannel retailing environments. With the evolution of technology and the increasing importance of the internet, consumer expectations and shopping behaviors have significantly transformed. Multichannel retailing, which involves using multiple channels for selling products, and omnichannel retailing, which ensures a seamless consumer experience across all channels, have emerged as critical strategies for businesses. This study aims to explore the differences in consumer behavior in these two retailing models, examining factors such as customer satisfaction, purchase frequency, and loyalty.

Navigating the digital marketplace: perception, risks and webrooming intention

PurposeThe purpose of this study was to validate the factors influencing perception of digital buyers (PDB), risk factors of digital buying (RFDB) and webrooming intention (WI) and also to examine the mediating role of WI between PDB and RFDB.Design/methodology/approachThe antecedents of variables were validated using exploratory data analysis. The association between PDB and RFDB was established using structural equation modelling. Furthermore, the mediating role of WI is examined using the Sobel test.FindingsThe antecedents of PDB (digitization practice, credence preference, brand awareness and consciousness, product features, utilitarian behaviour, price and discount factors), RFDB (performance risk, socio-psychological risk, financial risk, aesthetic risk, time and return risk and perceived quality risk) and WI (perceived ease of online search, usefulness of online search, need for touch, socialization and webrooming attitude) were identified. PDB significantly and positively influences RFDB. There is a direct relationship between PDB and WI. WI and RFDB are positively correlated. WI partially mediates between PDB and RFDB.Practical implicationsThe research outcome helps the multi-channel retailers to identify the digital platforms to find greater opportunity for customer engagement.Originality/valueThe study augments the body of literature on WI by exploring the interplay of PDB, RFDB and WI, which will help retail personnel to strategize operational practices.

Bi-GRU-APSO: Bi-Directional Gated Recurrent Unit with Adaptive Particle Swarm Optimization Algorithm for Sales Forecasting in Multi-Channel Retail

In the present scenario, retail sales forecasting has a great significance in E-commerce companies. The precise retail sales forecasting enhances the business decision making, storage management, and product sales. Inaccurate retail sales forecasting can decrease customer satisfaction, inventory shortages, product backlog, and unsatisfied customer demands. In order to obtain a better retail sales forecasting, deep learning models are preferred. In this manuscript, an effective Bi-GRU is proposed for accurate sales forecasting related to E-commerce companies. Initially, retail sales data are acquired from two benchmark online datasets: Rossmann dataset and Walmart dataset. From the acquired datasets, the unreliable samples are eliminated by interpolating missing data, outlier’s removal, normalization, and de-normalization. Then, feature engineering is carried out by implementing the Adaptive Particle Swarm Optimization (APSO) algorithm, Recursive Feature Elimination (RFE) technique, and Minimum Redundancy Maximum Relevance (MRMR) technique. Followed by that, the optimized active features from feature engineering are given to the Bi-Directional Gated Recurrent Unit (Bi-GRU) model for precise retail sales forecasting. From the result analysis, it is seen that the proposed Bi-GRU model achieves higher results in terms of an R2 value of 0.98 and 0.99, a Mean Absolute Error (MAE) of 0.05 and 0.07, and a Mean Square Error (MSE) of 0.04 and 0.03 on the Rossmann and Walmart datasets. The proposed method supports the retail sales forecasting by achieving superior results over the conventional models.

Price discounts and cheapflation during the post-pandemic inflation surge

We study how within-store price variation changes with inflation, and whether households exploit it to attenuate the inflation burden. We use micro price data for food products sold by 91 large multi-channel retailers in ten countries between 2018 and 2024. Measuring unit prices within narrowly defined product categories, we analyze two key sources of variation in prices within a store: temporary price discounts and differences across similar products. Price changes associated with discounts grew at a much lower average rate than regular prices, helping to mitigate the inflation burden. By contrast, cheapflation – a faster rise in prices of cheaper goods relative to prices of more expensive varieties of the same good – exacerbated it. Using Canadian Homescan Panel Data, we estimate that spending on discounts reduced the change in the average unit price by 4.1 percentage points, but expenditure switching to cheaper brands raised it by 2.8 percentage points.

The role of service recovery in omnichannel integration services success model

PurposeThis study basically develops an omnichannel integration services (OIS) success model and further uses perceived value and stickiness to measure the actual net benefits. Furthermore, this study explores the role of service recovery in OIS success model.Design/methodology/approachA quantitative online survey study was mainly being conducted to statistically test these relationships among the customer experience, satisfaction, perceived value, stickiness and service recovery. The statistical data collected from 371 respondents were taken for analysis through partial least squares.FindingsThe findings revealed that the online and offline customer experiences have a significant influence on their level of online and offline satisfaction, respectively. Both online and offline satisfaction are major factors which are enhancing the perceived value and stickiness. Service recovery also has a significant effect on online and offline satisfaction.Research limitations/implicationsThe results of the hypotheses presented in the OIS success model may usually vary from one cultural context to another. Hence, additional studies should access the current research model, especially those that are culturally different from Taiwan.Practical implicationsThe service failures are always inevitable and the recovery of such encounters represent to have a significant challenge for OIS. Thus, practitioners should allocate more such resources to enhance on customer experience of OIS, which in turn promotes to enhance customer satisfaction. Moreover, OIS practitioners seem to be more concerned with a thought on how to avoid service failures and provide satisfied customer experience than developing service recovery strategies.Originality/valueAlthough the past studies on multichannel retail have yielded insights into the factors affecting consumers' channel preferences, there is a dearth of research that sheds bright light on the intense factors affect the success of OIS; hence, a conceptual framework of OIS success model, referenced to the model of updated information systems success (ISS), thus is used to act as the basis of this study. Furthermore, this study explores the role of service recovery in OIS success model.

Localised multiple channel distribution strategies of luxury fashion retailers – evidence from China

PurposeThis empirical study aims to examine luxury fashion retailers' localised multiple channel distribution strategies in China.Design/methodology/approachThrough case studies of 15 participating retailers, qualitative data were collected from 33 semi-structured interviews.FindingsStrong impacts of internationalisation strategies, distribution strategies and channel length towards multiple channel retailing are revealed. Multi-channel retailing is widely employed by firms who have entered China and further developed their businesses through local partnerships and adopted a selective distribution strategy via relatively longer channels. Omni-channel retailing is only suitable for the few retailers using an exclusive distribution strategy through direct marketing and wholly owned customer relationship management. As a dynamic transformation from multi- to omni-channel retailing, cross-channel retailing is adopted by those who are withdrawing from local partnerships and shifting to wholly owned expansions and operations in host markets.Research limitations/implicationsThe results are potentially challenged by relatively small sample size.Practical implicationsPractitioners are suggested to adapt multiple channel retailing to their international expansion strategies, distribution strategies and channel length in the host markets.Originality/valueThis paper contributes to the literature in both multiple channel retailing and international retailing by offering insights into the motives, development patterns and suitability of multiple channel retailing in the international retail marketing context.

Linking Clicks to Bricks: Understanding the Effects of Email Advertising on Multichannel Sales

Businesses have widely used email ads to directly send promotional information to consumers. Whereas email ads serve as a convenient tool that allows firms to target consumers online, there is little evidence of their multichannel impact on consumer spending in both online and brick-and-mortar stores. In this paper, we utilize a unique high-dimensional data set from one of the world’s largest office supplies retailers to link each consumer’s online behaviors to item-level purchase records in physical stores. We employ a doubly robust estimator that incorporates nonparametric machine learning methods for causal estimation of observational data. Our results show that email ads significantly increase the retailer’s sales across different channels. We also investigate the effects of email ads on diverse consumer behaviors along the purchase funnel and find that increased sales result from increased purchase probability and a wider variety of products purchased by consumers. Further, we examine several moderating factors, such as product types and consumer segments, that influence the multichannel effects of email advertising. Our study provides empirical evidence for the economic impact of email ads on consumer behavior across different channels and the underlying mechanisms thereof, offering direct implications for multichannel retailers seeking to improve their digital marketing strategies.

Temporary VAT rate cuts and food prices in e-commerce

Since the onset of the COVID-19 pandemic in 2020, temporary VAT cuts have gained popularity as an unconventional fiscal policy tool. The effectiveness of these stimuli in reaching the intended recipients depends on a VAT cut pass-through to consumer prices; however, the empirical evidence, particularly in digital markets, is scarce. The aim of our paper is to measure the price shift in e-commerce following the VAT rate reduction and test whether this effect was consistent across different types of retailers, exploiting detailed daily price data from the six largest German online full-assortment grocery retailers. Our findings indicate that multichannel retailers passed on the VAT cut almost completely, whereas online-only retailers made fewer price changes. This discrepancy has significant implications for the effectiveness of temporary VAT cuts, as the reluctance of large online-only sellers to pass on VAT cuts to consumers could hinder the efficacy of this unconventional fiscal stimulus. Keywords: temporary tax reduction, value-added tax, digital markets, food markets, COVID-19.

Personalized pricing versus showrooming: competition between online and offline retailers

AbstractThis study examines how personalized pricing affects customers’ showrooming behavior in the duopoly competition with horizontal product differentiation between traditional and online retailers. For the available personalized pricing strategies, we obtained the optimal decisions for both retailers in the scenarios with and without showrooming. Our results indicate that adopting personalized pricing under particular conditions enables each retailer to be more profitable, even in the presence of showrooming purchases. This finding explains why an increasing number of online and offline retailers have implemented personalized pricing based on technical means and consumer purchase records. It is also demonstrated that personalized pricing can counter showrooming behavior of consumers amidst the competition between both retailers, which provides a novel theoretical basis for dealing with cross‐channel shopping in multichannel retail competition. We further clarify how retailers can avoid being trapped in a prisoner's dilemma when both sides have access to personalized pricing. Also, the adoption of personalized pricing can improve consumer surplus and social welfare.

The consumer web-rooming on different sales models and retailing channel expansion

In the context of multichannel retailing, the phenomenon of web-rooming, where consumers research online and purchase offline, has become widespread. Therefore, we consider supply chain consisting of a manufacturer, an e-commerce platform, and an offline retailer, we study the impact of consumer web-rooming effect on the three sales modes of online channels, which are directly operated by the manufacturer, resold by the e-commerce platform, or co-exist with direct operation and resale, and comparatively analyze the pricing, demand, and profit of each channel under the three modes. The conditions for optimal pricing decisions are further explored through numerical simulation. It is found that profit always increases whether the online channel is opened by the manufacturer or the e-commerce company. The coexistence of direct sales and resale does not always increase profit for offline retailers, which must be discussed in the context of the sales model before channel expansion. The existence of web-rooming not only affects the decision-making of manufacturers and e-commerce platforms, but also always harms the interests of e-commerce platforms, and as the intensity of web-rooming deepens, the revenue of e-commerce platforms becomes smaller. Offline retailers benefit from web-rooming and experience a slowdown in profit growth as the intensity of the phenomenon increases. For manufacturers, the impact of changes in the intensity of the web-rooming is analyzed in relation to platform commission rates and online retail prices.

Role of Omni Channel Attributes and Perceived Behavioral Control in Omni Channel Selection

The retailing industry worldwide is transitioning from multi-channel retailing to omni channel retailing. In contrast to multi-channel retailing which provides offerings through different and separate channels, all channels are essentially well integrated in omni channel retailing. In the middle eastern region, the transition from multi-channel to omni channel retailing is rapidly taking place in Saudi Arabia. However, managing channels synergistically for providing seamless customer experience is proving out to be challenging task for omni channel retailers. What omni channel attributes are valued necessary by consumers in making them seamlessly choose omni channels for shopping are not explicit in the literature especially in Saudi Arabian context. In order to better integrate and coordinate channels it is very important for omni channel retailers to first understand the behavior of omni channel shoppers. The omni channel retailers need to know what omni channel attributes influence consumer’s perception of ease and ability in selecting omni channels for shopping. This study examines how omni channel attributes namely omni channel transparency, omni channel convenience and omni channel uniformity help in influencing consumer’s perception in selecting omni channels. The study employed snowball sampling method for collecting the sample of omni shoppers from different regions of Saudi Arabia. The study sample comprised of 551 respondents who actively shopped through various omni channel retailers of Saudi Arabia. All hypothesized relationships of the study were tested simultaneously using structural equation modelling technique. The study reported that omni channel transparency, omni channel convenience and omni channel uniformity positively influence consumer’s perception in selecting omni channels in Saudi Arabia. This study tries to combine consumer and omni channel retailer perspectives for the better understanding of shopping behaviors across omni channels. With the better understanding of consumer shopping behaviors, omni channel retailers would be thus able to better integrate their channels and coordinate their supply chains to the best satisfaction of their consumers.

Predicting the Use of Chatbots for Consumer Channel Selection in Multichannel Environments: An Exploratory Study

Online consumers are increasingly looking for more convenient ways to purchase products and services, and chatbots are becoming increasingly popular in multichannel environments due to their ability to provide an efficient service. In this context, managing digital complexity with the help of artificial intelligence and supporting decisions in a multichannel context is an appealing perspective for the retailer, who must find the right strategy to win and keep customers online. The present empirical study aims to better understand consumer behaviour in the multichannel environment in the context of four categories of products and services (retail banking, mobile communications, fashion, and consumer electronics) from the perspective of identifying determinants of channel selection when the consumer uses chatbots. Data were collected from 936 respondents with multichannel retail experience to conduct an empirical investigation on social media platforms, including Twitter, Facebook, and Instagram; these data were then analysed using structural equation modelling (SEM). We found that the online consumer’s multichannel behaviour was not only a reality in the field of broad purchasing decisions but already a norm, and consumers had good reasons to use more channels in the context of chatbots. Research results suggest that chatbots can represent a decision-making aid for managers in retail companies who want to develop an efficient and optimal logistics service strategy in multichannel environments.

Spirit & Free: adapting assortment strategies across rapidly growing channels in fashion retail

Social implications This paper aims to describe the cross-channel challenges experienced by a leading US fashion retailer and illustrates the adaptation to consumer needs as led by a female divisional head and female executive. Learning outcomes The teaching objectives include to understand the assortment planning complexities experienced by merchandise managers; address critical issues surrounding channel strategies; identify the data needs for assortment improvement and cross-channel management; investigate responsive solutions for customer-focused assortment diversification; and explore the challenges associated with continual retail channel adaptation. Case overview/synopsis The fashion retailer Spirit & Free (S&F) (pseudonym) is a Fortune 500 retailer. As a multi-channel retailer, S&F is proud of the consistency of the brand’s identity across channels. However, recently, S&F has noticed a difference between their mobile (m-commerce, social commerce) and in-store/e-commerce customers. Through this case study, students will follow the Women’s Apparel Divisional Merchandise Manager and explore how the business will maintain a consistent brand identity and capture both sets of customers through assortment planning. Resources will be provided for assortment planning analysis, and students will be asked to consider assortment opportunities regarding category mix and pricing strategy. Complexity academic level The case would be relevant to upper-level undergraduate courses or introductory master's level course in retail, management, fashion merchandising and omni-channel retail. Supplementary materials Teaching notes are available for educators only. Subject code CCS 8: Marketing

Coordination in Multibrand, Multimedia Advertising: Is It Always a Good Thing?

The growing online retail market has led to the prevalence of multichannel retailing. Meanwhile, retailers are increasingly combining multichannel retailing with a multibranding strategy. Although this can further increase the retailer’s sales, it brings new advertising challenges. Multibrand, multichannel retailers usually launch advertising campaigns for different brands on multiple media. Thus, their advertising efforts fall into a set of brand-media units. Each unit’s advertising can affect the sales of all brands on all channels. To maximize the advertising returns, a retailer needs to coordinate the advertising expenditures on different units. We develop a stochastic differential equation model that helps the retailer estimate the impact of multimedia advertising on the sales of different brands on different channels. Afterward, we formulate the advertising optimization problems under four coordination strategies: noncoordination, brand coordination, media coordination, and global coordination. By solving the problem for each strategy, the retailers can obtain the optimal expenditure for each unit under that strategy. Finally, we compare the retailer’s profits under four strategies. Interestingly, we find that brand or media coordination may result in a profit lower than noncoordination. Our findings provide insights regarding the selection of coordination strategies for multibrand, multichannel retailers with multimedia advertising campaigns.

Can Brick-and-Click Stores Yield Returning Online Customers? Assessing In-house Logistics Service Quality (LSQ) of Multi-channel Retailers

This study aims to examine the influence of retail logistics service quality on online customer loyalty in Malaysia. In total, 372 self-administered questionnaires were collected from customers who have ordered products online from ‘brick-and-click’ supermarkets and department stores. The results show that product condition, product availability and delivery durations are significant predictors of customer loyalty. The novelty of this research lies in its strong emphasis on last-mile parcel delivery, which is a crucial aspect of order fulfilment operations, and the first-party home delivery service, which is among the earliest conducted in the region.

Direct mail to prospects and email to current customers? Modeling and field-testing multichannel marketing

Multichannel retailers need to understand how to allocate marketing budgets to customer segments and online and offline sales channels. We propose an integrated methodological approach to assess how email and direct mail effectiveness vary by channel and customer value segment. We apply this approach to an international beauty retailer in six countries and to an apparel retailer in the United States. We estimate multi-equation hierarchical linear models and find that sales responsiveness to email and direct mail varies by customer value segment. Specifically, direct mail drives customer acquisition in the offline channel, while email drives sales for both online and offline channels for current customer segments. A randomized field experiment with the beauty retailer provides causal support for the findings. The proposed reallocation of marketing resources would yield a revenue lift of 13.5% for the beauty retailer and 9.3% for the apparel retailer, compared with the 6.5% actual increase in the field experiment.

Multirooming: generating e-satisfaction throughout omnichannel consumer journey design and online customer experience

PurposeThe objective of this research is to analyze how omnichannel consumer journey design (OCJD) influences the online customer experience (OCE) and e-satisfaction in consumers' multirooming behavior (searching for information in online and offline channels and purchasing the product online).Design/methodology/approachThe problem-solving theory and experiential marketing perspective are the theoretical background that enables the establishment of five hypotheses. A survey is conducted on multiroomers who had purchased a product online, following an online and offline research journey.FindingsThe results showed that OCJD directly and indirectly (through online consumer experience) influences e-satisfaction. Females and younger individuals exhibited higher levels of e-satisfaction.Originality/valueFirst, this research analyzes consumers' multichannel search strategies. Second, the consumer journey is incorporated into the study of multichannel retailing. Third, an emergent typology of cross-channel free-riding behavior is analyzed: multirooming.

When showrooming is not a threat: Uncovering opportunities for showroomer retention

Showrooming is an increasingly common behavior that challenges the profitability of store-based retailers when the purchase is done at a competing online retailer. However, showrooming can also be a loyal behavior, although few studies differentiate between loyal and competitive showrooming. This study aims to provide multichannel retailers with knowledge about how to retain consumers who enter their stores with the intention to showroom. To this end, the influence of situational variables and loyalty towards the retailer are considered. With information from 466 showroomers and applying the fsQCA methodology, the results allow us to conclude that online price advantage and salesperson quality play a role in favoring loyal showrooming and preventing competitive showrooming respectively. Additionally, product category and the purchase device influence the transition from competitive showrooming intention to behavior. From these results, several managerial implications are proposed for store-based retailers.