Direct marketing in a multi-channel context: challenges for research in multi-channel marketing

Citation

Broderick, A. (2008), "Direct marketing in a multi-channel context: challenges for research in multi-channel marketing", Direct Marketing: An International Journal, Vol. 2 No. 2. https://doi.org/10.1108/dmij.2008.32502baa.001

Direct marketing in a multi-channel context: challenges for research in multi-channel marketing

Article Type: Editorial From: Direct Marketing: An International Journal, Volume 2, Issue 2.

It is now common for customers to use different channels at different stages of their decision-making process, for example, collecting information online before making an offline purchase. Research suggests that multi-channel shopping is associated with higher customer profitability (Venkatesan et al., 2007) and a recent study by Jupiter Communications confirms that multi-channel shoppers spend 30 per cent more than their single-channel counterparts. Rangaswamy and van Bruggen (2005) define customers who use more than one channel to interact with firms as multi-channel customers, and marketing strategies to reach such customers as multi-channel marketing. The increase in multi-channel distribution strategies, seeking to target individual consumers via both physical and electronic channels as multiple routes to purchase, can be explained through two key developments which have evolved the media mix concept into what we now think of as multi-channel marketing:

1. 1.

   A transition by marketing and advertising professionals in the 1990s toward integrated communications reflecting a shift in focus from transactions to customer relationships.

2. 2.

   An increase in the number of channels available to marketers with both new electronic media such as web sites and e-mail together with less distinction between pure communication channels and sales channels.

With many retailers offering multiple avenues and formats for shopping, the challenges and complexity of making marketing investment decisions increases significantly. Four major challenges for research in multi-channel marketing include: the drivers of multi-channel shopping (Venkatesan et al., 2007); the impact of multi-channel shopping on customer profitability (Neslin et al., 2006); the behavioural rationale for consumer channel selection decisions (Nicholson et al., 2002); and, the types of information companies need to collect to facilitate one-to-one marketing investments (Hansotia and Rukstales, 2002).

The importance of multi-channel marketing as an academic research area has been articulated in this Editorial. A review of academic research reveals that this field has experienced significant research growth, but the growth has not been distributed evenly across the four major challenges identified. The articles collected in the current issue address several of the issues that have been highlighted.

Kabadayi's paper on “Adding direct or independent channels to multiple channel mix” reflects the focus of this issue's Editorial. The paper clarifies the conditions under which firms can add direct or independent channels to their single-channel system and switch to multiple-channel systems, providing guidelines to managers regarding the composition of their multiple-channel systems. Findings indicate that under high-specific asset investments, high-environmental uncertainty and high-internal uncertainty conditions firms add direct channels and adopt independent-direct multiple-channel systems. However, under low levels of those variables firms expand their channel system into multiple channels by adopting an independent-independent multiple channel.

Pedrood, Ahmadi and Charafeddine, in their paper “Systematic profitability analysis of binary network marketing organizations”, design a systematic algorithm for simulating a binary network topology. This algorithm predicts growth for network marketing organisations, the empirical application improving customer profitability efficient by 6 per cent.

Norazah, in his paper “Internet shopping acceptance: examining the influence of intrinsic versus extrinsic motivations”, examines the relationship between perceived ease of use, cognitive absorption, perceived usefulness, fashion involvement and buying intentions online in a Malaysian context.

Clifford Hurst of Career Impact Inc. brings us the industry perspective on “Sustainable telemarketing”. Presenting consumer goodwill as a limited, but potentially renewable resource, Hurst proposes that like a renewable natural resource, consumer goodwill can be over-exploited. Using the US telemarketing industry as a case study, Hurst argues that direct marketing practices should be managed in accordance with principles of sustainability. He proposes a framework of sustainability, warning that a sudden and near-permanent decline in consumer responsiveness will be the outcome if sustainable practices are not implemented.

Amanda Broderick