Linking Clicks to Bricks: Understanding the Effects of Email Advertising on Multichannel Sales

Businesses have widely used email ads to directly send promotional information to consumers. Whereas email ads serve as a convenient tool to allow firms to target consumers online, there is little evidence of their multichannel impact on consumer spending in both online and brick-and-mortar stores. In this paper, we utilize a unique high-dimensional data set from one of the world’s largest office supplies retailers to link each consumer’s online behaviors to item-level purchase records in physical stores. We employ a doubly robust estimator that incorporates nonparametric machine learning methods for causal estimation on observational data. Our results show that email ads significantly increase the retailer’s sales across different channels. We also investigate the effects of email ads on diverse consumer behaviors along the purchase funnel and find that increased sales result from increased purchase probability and a wider variety of products purchased by consumers. Further, we examine several moderating factors, such as product types and consumer segments, that influence the multichannel effects of email advertising. Overall, our study provides empirical evidence for the economic impact of email ads on consumer behavior across different channels and the underlying mechanisms thereof. Our findings offer direct implications for multichannel retailers seeking to improve their digital marketing strategies, as well as for policymakers interested in evaluating the economic impact of prevalent email advertising.

History: Eric Zheng, Senior Editor; Khim Yong Goh, Associate Editor.

Funding: This work was supported by the Marketing Science Institute [Grant 4000086].

Supplemental Material: The online appendix is available at https://doi.org/10.1287/isre.2020.0557.