Omnichannel shoppers change the economic equation for retailers by shifting where revenue is earned, where costs are incurred, and how customer lifetime value is created and measured. Research by Erik Brynjolfsson at the Massachusetts Institute of Technology and Sunil Gupta at Harvard Business School indicates that customers who use multiple channels are often more valuable overall, yet they also create cost and margin pressures that span physical stores, e-commerce, and third-party platforms. That simultaneity—buying online, picking up in store, returning by mail—breaks traditional per-channel accounting and demands integrated cost allocation.
Channel interactions
cross-channel cannibalization and added handling costs. The cause is behavioral: consumers choose the cheapest or most convenient fulfillment option, which can move margin from higher-cost channels to lower-margin ones. In dense urban markets, quick click-and-collect options may favor stores; in dispersed rural areas, shipping and returns dominate costs, altering the profitability calculus by territory.
Management responses and consequences
The consequence for retailers is that apparent profit by channel can be misleading unless firms adopt unified accounting and advanced attribution. Gupta Harvard Business School emphasizes investment in shared inventory pools, real-time data, and activity-based costing so that fulfillment, returns, and customer acquisition are traced to the right customer journeys. Culturally, retailers must realign sales incentives and store labor practices to support omnichannel tasks without overburdening staff. Environmentally, higher return rates and fragmented deliveries raise carbon intensity, creating reputational and regulatory risks in regions with strong sustainability expectations.
Executional nuance—local logistics, customer service culture, and territorial cost structures—ultimately determines whether omnichannel behavior is a profit lever or a drain.