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Comment: British retailing's multi-channel future is clicks and bricks

It's been quite a month. First we saw British internet advertising spending overtake television advertising for the first time. Then we had the landmark of the first England football international broadcast over the internet and not on television. Both developments would have been unthinkable just a few years ago. By Cameron McLean


Comment: British retailing's multi-channel future is clicks and bricks

At PayPal, we naturally follow such online developments with great interest. But we fully understand that the recipe for success for most retailers involves clicks and bricks: a multi-channel approach, rather than a pure online offer. 

This was one of the key findings of the PayPal UK Online Retail Report, conducted by Experian earlier this year. The report showed that consumers see multi-channel as a natural way of life, even if they’ve never heard of the phrase. They no longer distinguish between their online and high street experience when judging a retailer.

And almost two thirds of online shoppers would like their favourite brands to do more to combine their online and offline services. For example, they’re frustrated when high street retailers offer just a small selection of stock online – after all, isn’t it easier to offer a wider range online, without the constraints of limited floorspace?

The consumers we spoke to also like the idea of instore collection for goods they’ve ordered online. And it’s striking that 72 per cent of female online shoppers say that being able to combine online and instore services will always be important.

The PayPal report also found that over 20 per cent of British online shoppers had been put off making a future purchase in a retailer’s high street store after having a bad experience with its online store. That figure rises to a striking 37 percent amongst 18 to 24 year olds. And it’s a similar story in reverse: a third of 18 to 44 year olds and ABC1 consumers have decided not to buy online from a retailer after being disappointed by an instore experience. In other words, the overall customer experience is crucially important for retailers.

The other reason a multi-channel approach is important is that consumers have very clear views of the advantages of both online and offline shopping. Online shoppers still overwhelmingly prefer to review products ‘in the flesh’ – a massive 59 per cent said instore was best for this. They also think physical stores offer the best service. But a big majority of online shoppers still firmly believe the internet offers the best value, including the keenest discounts and other promotions.

A retailer that has a winning multi-channel strategy is well placed to benefit from these strongly held consumer views about where to buy. After all, the last thing they want is for shoppers to spend time in their stores researching products, only to go to a rival’s website to seal the deal. (As a well known retailer’s current advertising campaign urges consumers to do!)

At PayPal, we’re just completing another major piece of research into consumer attitudes towards shopping online. It is part of our campaign to better understand what drives consumer behaviour and how we can better help retailers win at the online checkout. We have no doubt that we’ll all see continued progress as retailers make the shopping experience more enjoyable and convenient than ever, both online and instore.

By Cameron McLean, general manager, merchant services, PayPal UK

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