Strange eBay Holiday Promotion Forced Shoppers To Engage In Unnatural Merged Channel Gymnastics

A very bizarre eBay holiday promotion—which appears to have been in response to an almost-as-bizarre holiday promotion from Amazon—seemed to reverse conventional thinking about merged channel retailing. Instead of offering an incentive to shop online or in-store, the eBay incentive inexplicably required consumers to shop in both channels.

What started this holiday dogfight was an Amazon promotion, where it was offering a tiny discount (5 percent, with a ceiling of $5) for people who scanned barcodes and then purchased the item on Amazon. eBay's response was what it billed as a $10 in-store coupon, with three retailers: Toys "R" Us, Dick's Sporting Goods and Aéropostale.

As is usually the case, the fine print paints a very different holiday shopping picture. To get the $10 coupon for in-store use, shoppers had to spend at least $100 online and pay for it with PayPal. To get the benefit of that $10 coupon, the consumer then had to drive to a store and continue shopping. And it wasn't a $10 gift certificate for anything. Some of the stores required consumers to purchase more in-store before they could use the $10, and what that coupon could be used for was limited. (At Toys "R" Us and Dick's Sporting Goods, the shopper had to buy $10 worth of in-store products before they could use the $10 coupon. At Aéropostale, the shopper had to spend $20 before the coupon could be used.) Oh, and it was only good for three days.

Setting aside the logical "why bother?" question (knowing that the answer lies in the small number of consumers who read terms and conditions language), this eBay campaign raises a much more troubling interpretation of merged channel promotions.

eBay's statement got it right when it said: "eBay’s partnership with these national retailers promotes how today’s consumers shop—online and offline, via mobile and at the mall—to find what they want, when and how they want it." But the promotion didn't do that. Instead of enabling consumers to make those PayPal purchases entirely online or entirely in-store, to get the much-touted $10, consumers were forced to go to both channels.

Let's say a Dick's Sporting Goods customer wants to use this promotion. He goes to DSG's site and buys $100 worth of stuff. If there's more than $100 worth of products that he wants, why not let him buy it right now online? Why force him to then drive to the store and have to buy more stuff just to get the benefit of the $10?

This is the opposite of customer service. It's pushing the customer to go to multiple versions of the same chain. That's not what the customer wants, not what the retailer should want and it's certainly not what PayPal and eBay should want.

Merged channel—the next logical step after multi-channel and cross-channel—is about making the customer not focus on the channel but to focus instead on the service, the product and the chain. Aéropostale's IT management shouldn't care whether someone goes to an Aéropostale store or aeropostale.com. As long as those customers are not going to a rival store, they're happy.

What will the next promotion be? Perhaps the customer will have to be put on hold and talk with a customer service rep at the call center to buy some stuff and to then use his/her mobile device for other things. Maybe they'll have to find the paper catalogue, too, before they buy three things on the Web site and four more at the brick-and-mortar? Maybe it's like Simon Says, waiting to see how many hoops a shopper will jump through. Or it could be like a scavenger hunt. Only this time, the objective is to see who can drive customers into the arms of Amazon as fast as possible.

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