10 hot things you didn’t know about e commerce
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10 HOT things you didn’t know about e-‐commerce!
La Poste e-‐commerce track @LeWeb 4th December 2012
Catherine Barba Delphine Remy-‐Boutang
1st e-‐commerce track @LeWeb 4th December 2012
#laposteleweb
www.laposteleweb12.fr
Media sponsors:
❶! Behind an enviable growth, an industry making liMle money
❶!
A myriad of new merchants but few with a sustainable and profitable
business.
Behind an enviable growth, an industry making liMle money
❶!• Unless integraOng verOcally
the whole value chain, gross profit is small.
• Gross profit unable to cover: -‐ fulfilment cost -‐ sales & markeOng costs
Behind an enviable growth, an industry making liMle money
❶!
+!Digital producOon, cataloguing, quality control
Fulfilment costs are incurred for:
LogisOcs
Customer services
+!
Behind an enviable growth, an industry making liMle money
❶!• MarkeOng costs:
Rising CoCA Poor conversion rate Without repeat purchase , no profitability Repeat business structurally low
Cost of Customer AcquisiOon
Life Time Value
vs!
Behind an enviable growth, an industry making liMle money
❶!To be profitable:
1. Good prices on sourcing 2. Gross profit high enough to allow mkg sales 3. Control customer acquisiOon cost 4. LTV > CoCA 5. Very effecOve analyOcs 6. Frugal mindset
Behind an enviable growth, an industry making liMle money
Customers are mutants, changing much quicker than merchants do. ❷!
La Poste e-commerce track @LeWeb12!
❷!
« There is an urgent need to support tradi@onal merchants in
understanding how much their customers have changed»
La Poste e-commerce track @LeWeb12!
Customers are mutants, changing much quicker than merchants do.
• We are:
1. Over-‐informed
❷!
La Poste e-commerce track @LeWeb12!
Customers are mutants, changing much quicker than merchants do.
• We are:
1. Over-‐informed 2. Seamless
❷!
La Poste e-commerce track @LeWeb12!
Customers are mutants, changing much quicker than merchants do.
• We are:
1. Over-‐informed 2. Seamless 3. Over-‐mobile
❷!
La Poste e-commerce track @LeWeb12!
Customers are mutants, changing much quicker than merchants do.
• We are:
1. Over-‐informed 2. Seamless 3. Over-‐mobile 4. Over-‐social
❷!
La Poste e-commerce track @LeWeb12!
Customers are mutants, changing much quicker than merchants do.
• We are:
1. Over -‐informed 2. Seamless 3. Over-‐mobile 4. Over-‐social 5. Seeking for aMenOon
❷!
La Poste e-commerce track @LeWeb12!
Customers are mutants, changing much quicker than merchants do.
• Impact on business:
1. Be available 24h a day everywhere, especially on the mobile
2. A drasOc coherence btw what you say and what you do 3. Enhance the need for «exOmity» and social influence
4. Upgrade your level of customer service. Value for money
❷!
La Poste e-commerce track @LeWeb12!
Customers are mutants, changing much quicker than merchants do.
❷!
La Poste e-commerce track @LeWeb12!
Customers are mutants, changing much quicker than merchants do.
Who can outperform Amazon? ❸!
La Poste e-commerce track @LeWeb12!
Who can outperform Amazon? ❸!
« Amazon has an unfair compe@@ve advantage that only another giant
could surpass. Who?»
La Poste e-commerce track @LeWeb12!
Who can outperform Amazon? ❸!A turnover of $ 48 billion + than Google
+ 41% of turnover from 2010 to 2011 3 x the e-‐commerce growth
$111 billion in market capitalizaOon 2 x ebay
More than 100 million visitors a month N°8 top Alexa almost as much as
40 000 employees 5 x less than
1st distribuOon brand Ahead of Walmart
Favorite brand in France Ahead of
La Poste e-commerce track @LeWeb12!
• Before being a supermarket with an infinite choice (26 categories), an ultra simplicity, most of the Ome the cheapest, Amazon is a logisOcs company with :
empathy analyOcs
frugality
Who can outperform Amazon? ❸!
La Poste e-commerce track @LeWeb12!
2 unfair compeOOve advantages
• Shipping acOvites in deficit: $2,5 billion: + $1,5 billion (sending cost), -‐ $ 4 billion (shipping cost)
• Luxembourg VAT rate on products and services 3% = very low prices on MP3 files, downloadable movies and e-‐books (2015). Many digital products boosted by Kindle.
Who can outperform Amazon? ❸!
La Poste e-commerce track @LeWeb12!
customer-‐friendly retailer-‐friendly cheap and convenient discovery shopping
supermarket social commerce
Who can outperform Amazon? ❸!
Will pure players survive ? ❹!
La Poste e-commerce track @LeWeb12!
❹!
« Pure players will hardly survive, e-‐commerce is no more a specific
industry »
La Poste e-commerce track @LeWeb12!
Will pure players survive ?
❹!In the US, TOP 100 e-‐commerce :
-‐ Only 17 pure players -‐ 34% of total incomes -‐ Except Amazon, Ne`lix et VistaPrint , 4% of total incomes!
Pure players will be fewer and fewer.
La Poste e-commerce track @LeWeb12!
Will pure players survive ?
❹!The e-‐commerce is a distribuOon channel represenOng +/-‐ 10% of the retail turnover. To be a leader on e-‐commerce does not weigh much.
To exist, a pure player should realise at leat 10% of the global turnover global in his field. If tomorrow the e-‐commerce represents 20% to 25% of a field, a pure player should get 40% of market shares on Internet : it is just impossible based on an organic growth!
La Poste e-commerce track @LeWeb12!
Will pure players survive ?
❹!3 opOons for a pure player :
1. Partner with another pure player 2. Being purchased by a retailer 3. Buy out/open retail stores
La Poste e-commerce track @LeWeb12!
Will pure players survive ?
❹!To survive, they will need:
1. A strong brand 2. A disOncOve value proposiOon 3. Passion for customers 4. Good prices on sourcing 5. Gross profit high enough to allow mkg sales 6. Control customer acquisiOon cost 7. LTV > CoCA 8. Very effecOve analyOcs 9. Frugal mindset 10. Adaptbility … La Poste e-commerce track @LeWeb12!
Will pure players survive ?
Restera-‐t-‐il des pure players ? ❹!
La Poste e-commerce track @LeWeb12!
What is at stake for retailers ❺!
❺!
« Everywhere, the success of omnicanal and connected stores lie on the mobiliza@on of managers »
What is at stake for retailers
What is at stake for retailers ❺!TradiOonal retailers main compeOOve advantages : -‐ branding, reputaOon
-‐ sourcing -‐ customer knowledge -‐ in-‐stores
Culture Not enough digital culture : empathy, analysis, involvement of leaders. New role of vendors.
OrganisaOon An organisaOon running behind consumers. Vision and measure of crosschannel customer service.
What is at stake for retailers ❺!
❺! What is at stake for retailers
❺!Mobile
Magasin connecté
Social
Customer relat omni
canal
Site
How to digitalise the in-store experience ?!
How to do real cross-canal ?!
What is at stake for retailers
The challenge of local commerce ❻!
The challenge of local commerce ❻!
« Innova@on only kills those who do not innovate.»
❻!…to not follow the trends!
…to lose customers!
…to waste time!
… showrooming!
…some rules!
Overcome our fears
The challenge of local commerce
❻! The challenge of local commerce
❻!Mobile
Connected store
Social
Omni canal customer
relaOonship
Site
How to use the mobile to drive in-store traffic?!
e-commerce as a component of commerce!
The challenge of local commerce
Mobile, mobile, mobile! ❼!
Mobile, mobile, mobile! ❼!
« Time spent engaging with apps has surpassed @me on the mobile
web. And mobile IS the web2store! »
Mobile, mobile, mobile! ❼!
• Who hasn’t got a phone aMached to its hand ?!
• Mobile commerce is gejng stronger and stronger and more connected to the rest of commerce
Mobile, mobile, mobile! ❼!
1/3 Visit commerce sites via mobile Geolocalise a local store Compare in store Buy from their mobiles Check where their purchases are at
• … and pay?
Mobile, mobile, mobile! ❼!Prepare!
Follow-up!
Is there a social crise ? ❽!
Talk is cheap – Silence is fatal"Social commerce = $ 30 billions by 2015"
Social commerce : the only thing constant in business is change ❽!
Companies are averaging an overwhelming number of corporate owned accounts
❽!Platform Average #
accounts
Twitter 39.2 Blog 31.9 Facebook 29.9 LinkedIn 28.8 Forum/Message Board/Communities 23.4 YouTube 9.4 Foursquare 6.3 All others 5.3 Flickr 3.8 Gowalla 0.3 Sum 178
Source: Altimeter !
Trend: Social Retailing ❽!The digital as an experience accelerator
A way to increase sales and to maintain relaOonships with fans and customers
Share shopping experience with friends on social networks
Using social media in store to ask advice from friends
To Be Heard In Social, You Will Pay
La Poste e-commerce track @LeWeb12!
❽!The future of adverOsing is dependent upon social. Soon, you won’t be able to tell the difference between conversaOons and ads.
Paid Owned Earned will Converge
Source: Altimeter !
What is innovaOve in terms of user experience? ❾!
« The experience of online purchase is geOng more and more
personnalised and emo@onal »
❾! What is innovaOve in terms of user experience?
Check-‐out
What is innovaOve in terms of user experience?
welcome!
❾!representation!selection
assistance!
Omnichannel analyOcs ❿!
Omnichannel analyOcs ❿!
« Companies relying on data analysis see their produc@vity grow
by 5 to 6%»
(Strength in Numbers : How Does Data-Driven Decisionmaking Affect Firm Performance ?, Social Science Research Network 2011)!
• How to define a unique product ID? • How to define a unique customer ID, for an omnichannel CRM programme? • What tools to beMer anOcipate sales? • What dashboards can provide a confortable and personnalised reading of the KPI?
❿! Omnichannel analyOcs
It is Ome to drop the « e » off of e-‐commerce…
La Poste e-commerce track @LeWeb12!
• Accelerate interconnected retail! Customers don’t care about the shopping channel anymore.
• How well do you facilitate crosschannel shopping behaviours? A maMer of culture & organisaOon
• Mobile is a key piece in the omnichannel mix. It is reshaping the tradiOonal role of a store. Search and price comparison happen in the store. In-‐store self check-‐out too.
• In-‐store digital tools need to offer more than what a shopper can do at home on his own. Simply adding digital is not the answer.
Drop the « e » off of e-‐commerce…(1/2)
La Poste e-commerce track @LeWeb12!
• A brand’s ability to innovate is not about technology. It is about combining tech with a richer human experience.
• How will you make relaOonship with customer sOckier? Vendor has a new key role to play, providing experOse, emoOon and relaOon.
• Champions of tomorrow: Kings of analyOcs, CocA <LTV
• Above all passionnate about customer service, ensuring that brand messaging and customer engagement is consistant, relevant and unique across all channels and customer touchpoints.
• Sell projects, not products!
Drop the « e » off of e-‐commerce…(2/2)
La Poste e-commerce track @LeWeb12!
THANK YOU! MERCI ! @delphineRB
@cathbarba
Many thanks to Philippe Méda for his illustrations. !