Mark

Pricing – Many retailers struggle with profitability if they are forced to offer the same price for an item, class, or even category both on line and in the store. Usually this arrises from differing cost structures in the store and web supply chains, siloed purchasing/vendor management resulting from the legacy store only channel, or even the differing level of returns for on line versus in store purchases.

Marketing & Promotions – Some retailers have separate planning cycles, and separate promotional calendars/processes for on line versus stores. This goes back to pricing in the end. There can also be technical web site limitations for things like BOGOs which can be more easily implemented in the stores.

Merchandising – The customer experience and be really inconsistent on the web if the on line and in-store assortments are not very similar. The “not available in stores” can be frustrating – but the retailer can have very valid reasons for not offering items in stores. Think of high margin, but low profit/ft2 items.

Branding and Visual Merchandising – sometimes retailers have siloed operations for basic processes like photo shoots… for apparel especially, if the models used, lighting, or branding approach are not similar, it can be hard for consumers to find items on the web based on paper promotions (more common than you think)

These are just a few of the more interesting challenges I’ve seen in the last few years.

This gap in functionality can very well be the impetus for them to try another brand, perhaps for the first time, and the potential for defection rises dramatically once they have taken that first step.