And then what happened? A longitudinal study of the long-term effects of adding an online channel to an offline hypermarket
(A2020-63881)

AUTHORS

Emelie Fröberg, Stockholm School of Economics; Sara Rosengren, Stockholm School of Economics

KEYWORDS

Multichannel; retailing; propensity score matching

ABSTRACT

This study investigates the long-term effects of adding an online sales channel to an existing offline grocery retail offer. Based on previous literature, it is hypothesized that the addition of an online channel could have long-term positive effects thanks to tilted shopping behaviors, negative effects due to more planned shopping, or no effect because of cannibalization. Findings show that the offline channel still attracts the largest customer base, but the online channel is growing—to a large extent at the expense of existing offline customers. Using propensity score matching, we also test short- and long-term effects of becoming a multichannel household. Our results show that multichannel customers spend more (per visit and in weekly average), purchase larger volumes, and create higher margins both in the short- and long-term.

REFERENCES

This work was supported by Hakon Swenson Stiftelsen.