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: Dancing with the Devil"> Dancing with the Devil

As part of the assault on demon customers, retailers are getting better at tracking them throughout the research process, with the goal of getting them to stick around and make their purchases. There are simple ways to achieve this, such as providing online shoppers with a Web coupon that they can print out and redeem in stores, or allowing online customers to pick up or return items in the store. Despite the relative simplicity of these solutions however, just over half of the top 100 retailers offer in-store returns for online purchases, and just 13 percent offer in-store pickup, according to a recent survey by Stores magazine.

But many Web sites today go further. Apple.com automatically logs in customers when they open the Web page, and the log-in information can then be tied to credit card purchases made in the offline stores, which helps to give Apple a better understanding of the multichannel shopper. When customers save something in their shopping carts, they're likely to get a phone call from an Apple sales assistant asking whether they have any questions about the product. The idea is to ensure that the site doesn't lose customers while they're crossing over from the online to the offline world—assuming, of course, that they don't react badly to the unsolicited sales call.

At Gap Inc., based in San Francisco, if a regular-priced item is not available in the right size or color at a store, the company will ship it to the customer's home from another store, at no extra cost. Customers can also place online orders from within the stores themselves. And at Plano, Texas-based J.C. Penney Co. stores, sales clerks are also using Web-enabled point-of-sale systems to give retail customers access to items the store doesn't have in stock, according to Tim Lyons, spokesperson for J.C. Penney.

Profile of a Multichannel Shopper
 Has never multichannel shoppedLess than 5 years5 or more years
AGE (Mean)484442
Household income (U.S.$)56,47658,81873,699
Has college degree 26%28%48%
Has broadband at home 21%30%43%
Made online purchase in the past 3 months40%61%76%
Source: Forrester Research Inc.

But the poster child for the personalized multichannel shopping experience may be Recreational Equipment Inc., largely because the membership-based sports-equipment cooperative, based in Kent, Wash., made the investment necessary to integrate its on- and offline customer databases and inventory systems. Compared with most retailers, it was cost efficient for REI to merge its bricks and clicks operations because it already had extensive customer information, such as a history of past purchases, in its membership databases. So when its online customers asked if they could forgo the shipping charges—often significant for large items, such as canoes—and pick up the items at their local store, the company made it happen. The tactic was cheap to deploy because such orders are loaded along with the rest of the stock, which leaves Washington state each week to replenish REI's 76 stores around the country.

REI's efforts met with tremendous success: In the first 12 months, in-store pick-ups from online sales accounted for $40 million in revenue, and they now account for a third of annual online sales. The strategy has other advantages as well: Like most retailers, REI believes that once a customer is in the store, he or she is likely to buy something. "We found that one out of three people who came to the store to pick up an item they bought online also spent, on average, an extra $90 [on accessories and other merchandise]," says Joan Broughton, REI's vice president of the multichannel program.

And, like flared trousers, some technologies that had fallen out of favor are making a comeback: In-store kiosks are now reappearing. REI offers retail-store customers access to product information via kiosks. Sales clerks can also look up a customer's previous purchases and get easy access to information about products in the store, or products that are offered online, but which are not currently in stock. REI is considering equipping their sales staff with smart handheld devices that will let them see both on- and offline inventory, and assist customers with information about products in the store.

This article was originally published on 12-01-2004
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