"That's the Internet group, they sell stuff online."

That's how Matt Corey, VP Internet Operations, sums up Bombay Company's initial attitude when he started in early 2002. Now 18-months later, the multi-channel concept is firmly ingrained in the company's philosophy.

Corey says, "The Internet for Bombay is a fantastic marketing tool that happens to generate online sales. And until somebody's [online] conversion rate is over 50%, then I will challenge those that say differently."

His integrated approach to ecommerce builds on two underlying beliefs:

#1. The only thing that matters is total sales and not which channel each sale comes through.

#2. Each consumer is a moving target. It's a given that different customers have different preferences when it comes to how they like to be communicated with and where they buy. But these preferences shift as customers discover or migrate to alternative ways of communicating and shopping.

"Yes, you're going to be able at some level to say that this customer really likes to get our catalogs and shop at our stores, but let's just keep in mind that that customer's attitude and behavior may change. I don't see how people can segment groups like that absolutely and keep them there."

The logical conclusion? Give customers as much choice as possible and let them choose the channels and vehicles that best fit their current needs.

Here are the five key steps Corey and his team took:

-> Step #1. Eliminate cross-channel jealousy

Corey's team regularly meets with district managers and shows them how online activities are driving sales to stores through, for example, email notifications of in-store events and sales.

"It's constant support and constant reiteration from senior management on down that this is a communication vehicle to drive sales in our stores and we happen to drive some online sales too."

As a result, store managers understand how the online channel is complementary, rather than competitive.

"They get that if you get a 2, 3, 4% conversion online, the other 96-97% are going to be viewing your website and email marketing and then they're going to go elsewhere."


-> Step #2. Put all products online

Corey abandoned the policy of only displaying products online that would sell online.

Customers use the Bombay website as a research tool as much as a purchasing venue. So not featuring all products available in stores would lead to a disconnect for those planning a store visit.

"Bombay's strategy is to make sure that the customer view of our channel, be it our stores, our catalogs or our website is all-inclusive."


-> Step #3. Ensure cross-channel consistency

Bombay also synchronizes promotions and merchandising across all channels to ensure consistency in the customer experience.

So, for example, the product display on the cover of a Bombay catalog is the same one you'll find in the store window, and identical imagery features on the homepage. The same applies to internal catalog pages.

"Let's say we're featuring a four-poster bed on pages 3 and 4 of a catalog. Well guess what, that four-poster bed is going to be featured in the furniture section at our website."


-> Step #4. Make sure the back-end organization supports the multi-channel approach

This kind of cross-channel consistency is only possible with the right back-end organization, especially for planning and allocation.

Bombay ensures, for example, that products selected for special promotions are always viable items for online sales and that sufficient product is reserved for the website channel.

Corey notes, "It's a philosophical change for the company -the direct channel is getting bigger so we've got to start treating it like it's a really, really big store. We've got to buy for it, plan for it, allocate for it and fulfill for it."


-> Step #5. Use the Internet to expand the reach of offline marketing

Corey's team sees the Internet - and email in particular - as a way of overcoming the physical limitations of offline promotions, particularly catalog and FSI (newspaper insert)distribution.

Bombay reproduces its catalogs and FSIs in full on the website - mirroring the printed versions in every way. In contrast to the traditional SKU-by-SKU approach common to e-commerce, this lets Corey's team lifestyle products on the website, within a larger image.

Passing the mouse over a product featured within that image brings up product-specific information plus the opportunity to click through to the product page itself.

"It's like search or browse or buyer's guide or decorating tips - it's arming customers with features, tools and information to help them make a buying decision."

Corey notes that online catalogs also help with customer
acquisition, since visitors seeing a catalog for the first time online often sign-up to get the printed versions. These online catalogs still get between 8% and 9% of total site traffic.

Corey's team also use email to promote this website feature, sending an appropriate link, copy and printable coupons (redeemable on- or offline) to the 360,000 permissioned email addresses on the house list.

"A Sunday newspaper insert that's only sent to 10 US markets has now been emailed out to an incremental 360,000 people that may or may not be seeing it in their local paper...we find when we email these things out people are opening them and printing them like crazy."

"It's that whole multi-channel aspect. It's not just promoting what we're selling on our website, it's talking to customers in ways that they want to be communicated to."


-> Next step: Aiming for true online/offline integration

Corey's next challenge is taking the integrated "only total sales matter" approach further, implementing an "order online, pick it up at the store" facility, plus internet kiosks so sales associates can help people order the products they can't stock in the store.

He notes, "As you empower stores and implement new technologies, give the store the credit for that sale, who cares? If you get the corporate red tape out of the way, you're going to do the right thing for your customer and the right thing for your offline operation."

The Bombay Company http://www.bombaycompany.com

Note: The Bombay Company is a member of Shop.org, a forum for retailing online executives to share information, lessons-learned, new perspectives, insights and intelligence. http://www.shop.org