How brands invest in E-commerce?
KPMG and Fevad present a reflection on brands in the era of e-commerce. This study on innovation in e-commerce is based on the testimony of the main players in the French ecosystem.
In recent times, the Fevad has noted the arrival among its new members of many brands, said Marc Lolivier, general delegate. Long suspicious of e-commerce, a channel deemed "uncontrollable", brands have decided to regain control or to get started. We are at the dawn of a new revolution. The purpose of this study, conducted with KPMG, is, therefore, to better understand the impacts, challenges, and opportunities that e-commerce represents for brands and the e-merchants' perspective on this development. "
E-commerce is pushing brands to reinvent themselves
Brands have for a long time lagged behind e-commerce in France. Driven by e-merchants and new modes of consumption, they have been led to integrating this new channel into their distribution strategy. From a logic of strategies undergone, brands are moving to active strategies as they understand the many opportunities that e-commerce can offer them. They have regained control of their online sales strategy.
Nevertheless, not all brands evolve at the same speed. There are big differences in maturity in supply chain management, content strategy, price, product, and supply. Today, there are three main maturity profiles:
- "First movers": brands that have invested since the advent of e-commerce and on several tables
- "Fast followers": brands that have invested cautiously but surely in the digital world by choosing their battles
- "Late movers": brands that have little or no investment in digital: they have not yet understood the opportunity that this represented, or fear to take the plunge
These differences in maturity can be explained in particular by the financial and human investment capacity required for this transformation, the acquisition of new talents that are rare and difficult to retain, or the resistance of certain parts of the company to this transformation. (supply chain, technologies ...).
"E-commerce is no longer seen as a risk by brands, but rather as a key channel, to be integrated into broader strategies to provide a consistent omni-channel experience," said Emmanuel Hembert, Partner KPMG , Leader of the Consumer Practice and Retail Advisory.
The temptation of direct to consumer (DtoC)?
Most brands are exploring DtoC. Indeed, 46% of brands surveyed indicated that the launch or acceleration of their DtoC strategy is one of their priority projects. In addition, 82% of them say that launching their own online sales site is the best way for a brand to succeed in its e-commerce strategy.
But the DtoC generates a new operational and economic model. Brands do not see the need to invest in specific brands for e-commerce. Also rare are the brands that make DtoC the center of their strategy.
Towards a brand new future?
In order for their relationships to be effective, brands and e-tailers must establish operational cooperation, in order to streamline interactions and focus on activities with higher added value but also cooperation on customer data.
KPMG and Fevad have identified the six main challenges they face: strategy; human capital; technologies ; organization and operation; customer knowledge and the supply chain.
Taken from E-commerce mag Written by Dalila Bouaziz