5 axes of dealer improvement

Opening a market, creating outlets on the side of a pure player, downloading e-commerce websites from the side, mobile commerce… Here are the levers of growth that are being set up in e-commerce, according to Xerfi.

What strategies do e-merchants adopt to grow their business? Whether it’s pure gamers or retailers, online retailers are expanding their network in five directions, according to a “Consumer E-Commerce” study published in October 2017 by our partner Xerfi, including JDN, revealing selected excerpts.

1. Opening a market to enrich the offer

Market opening is a lever of growth for e-merchants. In France, the latter generated sales of 4.3 billion euros and accounted for just under 10% of e-commerce in 2016, according to Xerfi estimates. Rapid growth: most were launched between 2007 and today, with the exception of pioneers Amazon, eBay and PriceMinister.

Setting up these markets is part of two different strategies. In any case, the retailer decides to diversify and expand its offer through third-party retailers, such as large retailers. Or, he specializes in developing deep offerings in one segment, even in a niche market, to try to become essentially like ManoMan in DIY. Among the market benefits listed by Xerfi: multiply sourcing sources and the number of references offered, get rid of storage costs that most often remain the responsibility of third-party vendors, and diversify your clientele.

2. Application of omnichannel strategy

Convergence between e-commerce and retail is accelerating. On the website, pure players leave virtually to gain a foothold in the physical world. Their goal: to enrich the customer experience by trying and touching the store, increase brand influence, or gain approval that is relevant to certain products, such as selective perfumery. In particular, online retailers are developing three point-of-sale strategies, Xerfi says.

As far as traditional distributors are concerned, initiatives also abound towards the internet. Objective: to create traffic in stores thanks to the audience on the Internet. According to Xerfi, these click & mortars set at least one of the next three levers.

• Create a mobile application that allows geolocation, scanning items on shelves or comparing prices.
• Use of social networks with presentation sheets, promotions or advertising campaigns.
• Implementation of payment in the store (click and collect), with the possibility of completing the web order by purchasing in the store.

3. Diversification of delivery methods and investments in logistics

Withdrawal from the pick-up point, in the store or from the locker, home delivery … What do online consumers prefer in terms of delivery? Below is a chart of online shoppers ’choices.

To cope with these new demands, retailers are building warehouses, Xerfi points out. Among several notable examples listed between June 2016 and the end of 2017: 170,000 m² in Boves (80) and soon 200,000 m² in Bretigny-sur-Orge (91) for Amazon, 40,000 m² in Saint-Mard (77) for Cdiscount 84,000 m² in Valence (26) for Allopneus and 8,000 m² in Tourcoing (59) for the Vestiaire collective.

Distributors also invest in services. For example, the location of ads between individuals to withdraw a purchase, Leboncoin or PriceMinister mode. Cdiscount has been geolocating suppliers for its customers since the end of 2017. Amazon is experimenting with one-hour delivery with Amazon Prime now in Paris.

4. Build e-commerce skills through downloads

When traditional distributors do not develop the skill themselves, they buy it. Whether it’s the audience, customer databases, a strong brand or even SEO, these others are hungry for e-commerce sites to accelerate their own development. In the United States, Walmart is a striking example. Recently, Carrefour invested 17% in Showroomprivé. Monoprix also bought Sarenza. This is an incomplete list of the latest significant financial transactions made by Xerfi.

5. Integration of mobile commerce

One in four purchases was made via mobile phone in 2016. That’s why 83% of France’s 30 largest retailers have already developed the app by the end of 2016, according to Xerfi. These applications enable online ordering, but also improve the experience in stores. Necessary investment: 70% of customers today use their mobile phone when shopping in the store. In 2017, m-commerce had a turnover of 15 billion euros, or 18.5% of total online sales in France.

Source

Consumer e-commerce study est. published by Xerfi, an independent publisher of sectoral economic studies.