Luring longtime and new customers to try online shopping, and retaining them in a competitive and crowded marketplace, is the challenge of the day for established offline retailers. A study of the multichannel UK grocery shopping environment recently yielded insights that will be useful for retailers with an online channel or considering adding one to their customers' options.
A team of researchers from Belgium's KU Leuven (University of Leuven), led by doctoral candidate Kristina Melis, investigated purchasing behavior and the adoption of an online grocery shopping channel by customers of four leading UK supermarket chains. They found that customers of a particular chain tended to gravitate to that chain's digital channel when making their first online purchases, but that once the shoppers became accustomed to online shopping, they began to drift to other chains' websites. Once shoppers began comparing different chains, they valued assortment more than price, according to Melis and her faculty co-authors, Katia Campo, Els Breugelmans, and Lien Lamey, in "The Impact of the Multi-channel Retail Mix on Online Store Choice: Does Online Experience Matter?," to be published in the June issue of the Journal of Retailing.
Initially, the authors explain, customers' offline preference for a particular chain -- say, Tesco or Waitrose -- drove them to try that chain's website, and their comfort level increased when they found a level of choice comparable to the offline store. But as they gained more experience with online shopping, they started "to feel more confident in the online shopping environment, better able to evaluate different online alternatives, and less dependent on their offline shopping experience as an information cue" -- a clear risk for the store owners.
The authors conclude that retailers must be aware that their offline customers, however loyal in the past, have ample opportunity and easy access to make comparisons when they're shopping online. To satisfy customers and keep them returning, the assortment of products offered online has to be virtually equal to that of the offline store -- not just for the trial stages of the online buying process, but for customer retention. "It adds to the complexity of the multichannel retail strategy," the authors write, "but at the same time opens up opportunities to better retain loyal customers and attract new ones."
Materials provided by Journal of Retailing at New York University. Note: Content may be edited for style and length.
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