Most people know them: online stores like About You, Bonprix or MyToys. What perhaps not everyone knows is that these online stores - just like numerous other online stores, each specializing in certain industries or market segments - all belong to the Otto Group. The Otto Group is thus pursuing a multi-shop strategy, offering different online stores for different target groups and their individual shopping needs.
But what is behind this strategy and is it worthwhile for companies from the manufacturing sector to consider having several online stores for different target groups?
Have you already seen our first 4 blogs to this series? If not you can start from the beginning right here.
What is a multi-store strategy?
Companies that pursue a multi-shop concept offer several online stores for different target groups. Ideally, these online stores are managed centrally via one system in order to keep the administrative and technical effort and thus the costs as low as possible. This strategy is particularly suitable for companies that want to address completely different target groups (e.g., from the B2B and B2C sectors or from completely different price segments) separately.
What are the advantages of a multi-shop strategy?
- Addressing target groups individually
If separate online stores are operated for different target groups, their needs can be addressed in their respective tonality and language and with a suitable design. For example, if you want to address both high-priced and price-sensitive target groups with different (brand) products, it may be worthwhile to address these customers separately.
- Conveying a high level of product range expertise
Companies that are represented in different product areas or sectors can convey a high level of expertise by concentrating on individual product ranges and position themselves as specialist providers for precisely this product range. Compared to generalist online stores, this can increase credibility and thus trust in the online store.
- Addressing new customers and new markets
By addressing specific target groups, you can effectively address new customers and new markets and increase your sales.
- Risk distribution across different online stores
If several online stores are operated in parallel, the risk is distributed among these web stores - unless one store generates the majority of sales, and the other stores are only by-products.
- SEO advantages
Another advantage can be the search engine optimized operation of the individual stores in different languages. This is particularly suitable if SEO-relevant parameters (e.g., URL) are to be language-specific and if this brings added value.
What are the risks of a multi-store approach?
The simultaneous operation of several, target-group-specific online stores usually means a higher financial and administrative outlay than the operation of a single online store. The complexity of running multiple web shops in parallel should not be underestimated. This is where a multi-shop-capable store system comes in handy, making it possible to centrally manage multiple online stores.
The individual web shops can be completely different in terms of type and design. If the same products are offered in the different stores, duplicate content must be avoided. This means that the description of the products must be adapted to the respective target group of the specific store so that the individual web shops do not compete for Google rankings.
For whom is the multishop strategy worthwhile?
Is a multi-store strategy suitable for companies in the industrial sector or for manufacturers of machinery, plant, and equipment? In general, it can be said that the more individual and specific the target groups of a company's individual market segments are and the more the individual products differ from one another, the more worthwhile it can be to operate multiple online stores.
It is also important in mechanical engineering, plant, and equipment construction or for manufacturing companies to build up and continuously expand their own brand and unique selling points.
Correcting the strategy is allowed
The fact that some companies are rowing back from the multi-shop strategy in parts is shown by the latest example of the Otto Group: as announced in September 2021, the group of companies has decided to close the sub-shops “Neckermann”, “Schlafwelt”, “Naturloft”, “Otto-Baumarkt” and “YourHome”. The products originally sold through these specialty stores will now be offered via the Otto platform.
This is in line with Otto's strategy of further strengthening the Otto ecommerce platform and expanding it into an online marketplace. To find out whether it can be worthwhile to use a B2B marketplace alongside your own online store, read our blog post "B2B Marketplaces as a Supplement to Your Own Online Store?”.
One ecommerce strategy is not like another
In the field of ecommerce, there is not THE one strategy that fits all companies in an industry. On the contrary, the topic is highly individual and comprehensive. It is not something that one specialist department can handle alone, but has an impact on processes in service, after sales, logistics, IT, product management, marketing and sales.
Think big - but start small
Ecommerce is an area that can have many stages of expansion: Starting with an integrated online store, launching a B2B customer portal, expanding to an ecommerce platform, to using online marketplaces or building multiple online stores. It makes sense to keep all these aspects in mind.
However, you should not aim to implement everything at once. Think big but start small. Gather experience and optimize your processes bit by bit.
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