Omnichannel vs multichannel: what are they in marketing?

By Indeed Editorial Team

Published 11 July 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Omnichannel is a form of retail that involves having an integrated network of mediums of sales that seamlessly interweave into one another while multichannel is a form of retail whereby the different modes of sales are separate and distinct from each other, having no connectivity. For clarity, multichannel advertise their products through several channels that work independently, whereas in omnichannel, the channels connect. Knowing their differences could aid you in many aspects of sales. In this article, we discuss the differences and uniqueness of the two styles.

Omnichannel vs multichannel

Regarding omnichannel vs multichannel, it's worth noting that both of them are about advertising products over multiple digital and physical mediums. In a multichannel system, a retailer could have a digital website to sell some shirts and a physical shop where they sell shirts. These two are distinct, and buying from one has no bearing on the other. They both have separate stores from which sales happen, so if the digital website runs out of stock, the physical one can still have stock. Additionally, if you buy from the physical store, you can't return it online for refunds.

The omnichannel version might have a joint store from which the organisation sells items, so when it shows out of stock on the website, that means in the physical store, the items are also out of stock. You could also see adverts to the website link in the store and the physical store's address on the website. This is unlike in multichannel, where the offline and online experiences are completely or near-completely different with little to no connection, probably like two different businesses. Some organisations hardly practise the multichannel approach when compared to their omnichannel counterpart.

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Why omnichannel and multichannel are great in the retail market

Multichannel and omnichannel are similar in the sense that they both use multiple channels to sell their goods or services. Since one of them is in the segment and the other gives a more streamlined, cohesive experience for different organisations, one might be beneficial over the other. For omnichannel, the experience customers have on a channel can lead to another, offering a unique and expansive experience. With multichannel, you get to service clients where they prefer to buy stuff from and this builds a good customer experience.

Customers who like a holistic interaction usually prefer a unique experience that's more expansive than the style of multichannel retail when it comes to interconnectivity. But regarding clients that want to stick to a single preferred medium of purchase without any distraction or ads, multichannel is suitable. There are several mediums through which you can access these two channels, and some of the things customers want when interacting with a retail brand are:

  • Website services: This means buyers want to be able to access the retail website online on a designated website domain where they can purchase goods or services that they want. Websites are a good way to have a base online where people can learn more about your company regarding the full range of what you sell and other pertinent information regarding the business.

  • Social media: Social media sites or applications are one of the best places to advertise a company's products, and where many people frequently buy and sell goods and services. The type of audience you wish to have can determine the kind of social media platform you advertise on.

  • Mobile: Having an official application for your business is another good way to showcase your commodities and services to the world because it can serve as an alternative to the other means of advertising. This is usually for people who are already customers or those who aren't comfortable with the use of social media and see the application as easier to use than the website.

  • Retail stores: This is the only offline channel from which buyers can get goods or services, and it's one that's used by almost every sales company. Retail stores are the traditional model of selling and they can connect to the other channels using flyers or pamphlets found at the store, via word-of-mouth advertisement or other varied means.

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Why omnichannel isn't mainstream

Despite many retail companies and retailers claiming to be omnichannel, many of them merely adopt aspects of omnichannel into their businesses without taking in the full scope and applying it in totality into their business models. There are retailers who possess a solution, allowing buyers to buy things online but collect them in person if what they wish to buy isn't in the physical store. Some brands use the click and collect system, but finding completely omnichannel retailers can still be difficult.

As a retailer, using a half-way omnichannel style might not be very efficient for your business as omnichannel is usually at its best when you fully embrace and utilise it in all mediums where customers make purchases. That way, you garner more customers and an easier user experience for them as well.

How organisation that use both systems do it right

There are still some brands using the two systems to achieve success. They use the system to further sales and enhance customer experience. Some mix ideas from people and in-person purchases where the user experience becomes very positive, and this leads to growth in their digital revenue. Some companies start by giving out content and then use that to foster a loyal and hardcore community fanbase before selling products and services to them through wholesale partnerships. These companies use a fantastic omnichannel scheme to formulate multiple interconnected mediums that lead to their behemoth.

For multichannel, companies mostly start with a customer coming through a medium and sticking to that medium due to its specialisation. The benefit of having a group of employees that incredibly focus on the medium increases the functionality of the medium, with in-person staff not bothering about what goes on in the mobile staff section. When companies segment the mediums, such as online and physical, and keep each side independent from the other, it leads to an increase in focus and performance in each of the individual mediums.

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Disadvantages of the two systems in retail markets

You can easily observe the problems with both sides because the advantages of one expose the disadvantages of the other. One of the main issues, when you wish to implement an omnichannel style, is the cost and uneasiness in doing so. A retailer using omnichannel spends a lot of money due to the high investment in technology and the integration of that technology through the different aspects and mediums of the retail business, even taking over from some legacy systems. Doing this successfully demands an incredible level of expertise and determination from the retailer or company.

Omnichannel also can vary with regard to the company's branding since it's on different platforms. This makes advertisements or the general optics of the retail seem incoherent with one another at times. Multichannel systems have the main issue of not being able to seamlessly transition from one medium to another. It causes breakage and disconnection between the mediums, which might not be conducive as one medium could attract buyers to another medium.

How the business culture plays a part in the problem

Since enterprises try aligning to the wills of the market, it's pertinent to know how you can do that when considering the business culture of a company. To have a transformation of the entire system of mediums, you ingrain it in the business from top to bottom. The biggest resistance a retailer of bricks and mortar encounters as he or she tries to enact omnichannel is from his store employees. Multichannel might be uneasy to accomplish if the team doesn't have the necessary interpersonal experience linking to another medium, but with training, this probably doesn't become an issue.

In-store employees tend to view a digital expansion as competition because they get no commission from purchases made online. An in-store employee might get a customer to buy something that's in the store as opposed to what he or she wants, which hampers customer satisfaction. You can eliminate this by making sure either of the systems lets you follow the in-store or online transactions with buyers that keep buying either physically or online. If you monitor and collate the data, you can formulate a way to encourage staff to wish to sell regardless of the medium.

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