Omnichannel vs multichannel eCommerce – which is the right retail strategy for your business? Knowing the difference between the two is crucial for businesses aiming to step into the digital landscape to optimize customer engagement and drive sales.

While both approaches involve selling products through multiple channels, they differ significantly in execution and customer experience.

Multichannel retail involves operating across various platforms, such as online stores, marketplaces, and physical outlets, without necessarily integrating the customer experience across these channels. Each channel functions independently, offering customers multiple yet separate avenues to interact with a brand.

In contrast, omnichannel retail focuses on creating a seamless and unified customer journey across all platforms. This strategy ensures that whether a customer is shopping online via a mobile app, browsing an online store, or interacting through social media, their experience is consistent and interconnected.

Read along to understand more about the distinctions between omnichannel and multichannel retail, with insights and examples to help you determine which approach best aligns with your needs.

What is omnichannel eCommerce? 

Omnichannel in E-commerce retail is a strategy of providing a unified shopping experience by integrating all customer touchpoints, such as online stores, mobile apps, social media, email, and physical retail locations.

One good example of omnichannel in E-commerce is Walmart. You know how you can place a pickup order on the app, and it’s ready for seamless pickup right outside? They use technologies like geo-fencing, connecting your device (app) to the store’s system. So they know when customers arrive for pickups and are ready with your purchased items.

What is multichannel in E-commerce?

Multichannel in E-commerce retail is a strategy for selling products or services across multiple, independent platforms, such as a website, online marketplaces like Amazon or eBay, social media channels, and physical retail stores.

Take Nike, for example. You can buy its products through its official website and physical stores, but you may also get them at third-party retailers like Foot Locker and department stores like Costco – and prices vary, too.

What is the difference between omnichannel and multichannel retail distribution?

By now, you know what omnichannel and multichannel in E-commerce retail are. While both strategies aim to increase customer touchpoints, the differences lie in how these channels operate and interact with each other.

Multichannel retail focuses on expanding reach by selling across various platforms like websites, marketplaces, social media, and physical stores. However, each channel works independently, and there’s no automated data exchange. Businesses must tailor sale strategies for specific platforms (that’s why the price difference) and often require separate management for inventory, messaging, and analytics.

Omnichannel retail, in contrast, focuses on consistent experiences at all touchpoints. There’s a continuous flow of data between channels to enable synchronization for more unified customer interactions. By synchronizing data across different platforms, retailers can tailor experiences to meet customers’ preferences and behaviors everywhere.

TL;DR – Check the table to understand the core differences between the two.

Approach	Omnichannel	Multichannel
Integration	All channels integrated	All channels function independently
Customer experience	Personalization and seamless experience	No personalization and could lack consistency in brand messaging
Data Synchronization & Analytics	Data synchronized through all platforms, enabling a holistic view of the customer journey	Little to no data synchronization; therefore independent data collection of the customer journey on each channel

Multichannel vs omnichannel example

Understanding how businesses implement multichannel and omnichannel strategies in E-commerce retail can help you understand its uses better.

Take Walgreens for example. It’s a leading U.S. omnichannel pharmaceutical retailer, which exemplifies the implementation of an omnichannel strategy in the healthcare sector. By integrating digital tools with physical store experiences, Walgreens has created a seamless and personalized customer journey.

The Walgreens mobile app serves as a central hub for customers, offering features such as:

• Prescription management, including barcode scanning for quick refills and order tracking.
• Access to Find Care Now, connecting users to local healthcare providers for services like telehealth consultations and lab testing.
• In-app shopping with options for same-day pickup or delivery.
• Personalized deals and rewards through the myWalgreens loyalty program.

This integration ensures that customers can manage their health needs conveniently, whether online or in-store. Walgreens’ commitment to an omnichannel pharmaceutical experience can be seen through initiatives like automated micro-fulfillment centers enhancing efficiency and customer satisfaction.

Another great omnichannel retail example is Sephora. The brand is known as a one-stop solution for buying personal care beauty products. However, while you can buy Sephora’s products in-store, they are still not widely available in all localities. Sephora tackles this distribution issue through its E-commerce storefront on web and mobile apps. It also has a Beauty Insider Rewards program to foster deeper connections between the company and its customers.

Sephora’s omnichannel E-commerce retail not only lets you browse its products online and order them at your doorstep or in-store but also:

• locate nearby stores
• claim reward points on any channel
• scan products at physical stores and find alternatives online
• and much more

In North America, this highly effective omnichannel marketing approach has fostered a membership base of over 17 million people who are responsible for 80% of the company’s sales and who also serve as a reliable source of free, positive advertising.

Let’s end this section with an Under Armour example. It’s a renowned athletic apparel brand that employs a multichannel retail strategy to reach its audience, not just to sell its products but also to proliferate its brand name.

For example, A-list celebrities like Dwayne “The Rock” Johnson and athletes like Michael Phelps and Tom Brady hail the company’s name by fashioning its goodies on social media. The company also bought the fitness tracking app, MyFitnessPal, allowing Under Armour to boost its digital footprint.

Now, it has the Under Armour app, which allows consumers to purchase online. However, you can purchase its products through third-party online retailers, physical brand stores, and authorized resellers.

Each channel operates separately, with distinct inventory systems and customer engagement practices. However, its multichannel strategy for retail marketing greatly maximizes its market reach and influence.

Omnichannel advantages and disadvantages

The major benefit of omnichannel in E-commerce retail is the data exchange across all the channels. It offers countless advantages to boost your operational efficiency in retail stores, such as:

• Enabling you to offer a seamless and consistent experience across all channels to improve customer satisfaction, which leads to higher retention rates.
• Understanding of customer behaviors and preferences at each touchpoint.
• Streamlining and syncing processes across channels, allows merchants to optimize operations and save time, money, and other resources.
• Offering a cohesive shopping experience can differentiate a brand in a crowded marketplace.

If omnichannel E-commerce has such great benefits, then why don’t all retailers use it more? Well, there are some obvious challenges that come with it. Here’s a list:

• Integrating various channels with end-to-end data sharing is complex and requires significant planning, resources, and technological investment.
• Maintaining consistency across all platforms can be costly, especially for smaller businesses.
• Coordinating different channels is a task better left to the experts because if it isn’t done right, inconsistent messages or services across different channels can be delivered.

Multichannel advantages and disadvantages

While Omnichannel also offers expanded reach, which is the main benefit of multichannel E-commerce, it’s comparatively easier to set up. It’s probably the reason why most retailers start with a multichannel approach and transition to omnichannel. Here are some obvious benefits they’re looking to take advantage of:

• Connecting with a broader audience, meeting customers where they prefer to shop, be it online marketplaces, social media, and physical stores.
• Increasing the brand’s exposure and visibility on various channels boosts the probability of potential customers encountering and recognizing the brand.
• Selling through multiple channels reduces dependency on a single source of income, providing financial resilience against market fluctuations.
• Operating on multiple platforms provides diverse data points, helping businesses understand customer behaviors and preferences across different environments.

Yet, the lack of data sharing results in some obvious difficulties in multichannel strategy for E-commerce retail. This explains why omnichannel might be an investment worth making for scaling businesses. Here are the most common issues entrepreneurs face as they grow:

• Analyzing data from various data points is overwhelming as there’s no single source of truth. Maintaining consistency across various channels can be challenging, requiring significant coordination and resources.
• Maintaining consistent branding is also challenging. Different platforms may necessitate varied messaging styles, increasing the risk of brand inconsistency and customer confusion.
• Managing stock levels and order fulfillment across multiple channels can lead to serious logistical complexities and potential errors for a large-scale business.

Omnichannel vs multichannel distribution – Learn how to use them

Choosing between omnichannel and multichannel distribution strategies depends on your business model, its scale and size, customer expectations, and operational capabilities. A multichannel strategy might be more appropriate for businesses selling niche products with a specific target audience.

Maintaining distinct channels like a dedicated website, social media platforms, and third-party marketplaces gives you flexibility. You can approach each channel with a custom growth strategy without needing full integration across all channels by:

• Tailoring content and customizing messaging and promotions to suit the unique audience of each channel.
• Allocating marketing efforts based on the performance and reach of individual channels.
• Testing market responses to see which platforms yield the best engagement and adjust strategies accordingly.

However, relying on just a multichannel approach might be limiting if you operate a high-traffic E-commerce website like BestBuy. Given the scale, the above actions become hard to maintain. You’ll need to invest in an omnichannel strategy that can enable data exchange, making all your sales and marketing channels work in unison towards a single goal — enhancing customer engagement and boosting conversion rates.

By integrating various channels, you can keep your customers engaged on all touchpoints by:

• Offering real-time updates about order statuses or special promotions through their preferred communication channels.
• Providing seamless discounts on different platforms, ensuring a consistent shopping experience.
• Recovering abandoned carts with personalized reminders via email or WhatsApp to customers who have left items in their carts.

This unified approach ensures that customers receive a cohesive and personalized experience, regardless of the channel they choose to engage with.

Whether you’re looking to develop a scalable website from scratch or integrate complex systems for a seamless omnichannel experience, Anglara is here to help. Our expertise in custom web and mobile app development ensures your business can adapt and thrive in today’s dynamic E-commerce landscape. Contact us for a free consultation on how we can support your digital transformation journey.