This vendor-written piece has been edited by Executive Networks Media to eliminate product promotion, but readers should note it will likely favour the submitter's approach.
There has been a tremendous growth in e-commerce over the last few years with the 'Business to Consumer' (B2C) sales worldwide expected to touch US$1.9 trillion in 2016, according to eMarketer. The emerging markets are seeing a big surge in online purchases, given the explosive growth of internet penetration and the proliferation of smart phones and tablets.This is posing a real threat to physical retail stores.
Recently, there has been more news around retail outlets closing shop as customers are going online for shopping. Dubai based Al-Futtaim group, which manages several big-name retailers, recently announced that its John Little stores at Marina Square and Tiong Bahru Plaza, as well as the Marks & Spencer outlet at The Centre Point would close this year in Singapore.
Service organisations and logistics providers are seeing a big market with e-commerce. For example, SingPost which has traditionally been in postal services is making forays into e-commerce and provides an end-to-end managed e-commerce solution. Some of the big Consumer Packaged Goods (CPG) organisations are venturing into B2C for their niche brands with support from third party logistics providers. It is important for manufacturers, retailers and other players to have a coherent strategy to deal with this fast emerging channel. I have listed four foundational elements which need to be considered for success in e-commerce through the lens of a manufacturer in the CPG industry.
The consumer of today may initiate a transaction on his or her mobile phone, during the commute back from work, and is likely to finish the transaction on the desktop or tablet reaching home. Viewing a product advertisement on YouTube channel, checking product reviews on Facebook and discussing a recipe in a blog could influence the consumer to place the online order. It is important to keep the consumer at the centre of the e-commerce strategy and give a unified experience across the different channels (called multi-channel or omni-channel strategy) be it mobile commerce, social commerce, e-commerce or traditional commerce. This demands a far more collaborative approach between sales and marketing which may handle different elements of the omni-channel.
Manufacturers will have to make the right investment to ensure that that there is data synchronisation and exchange of content with retailers and their own websites. Having the same product description, pack size details, regulatory indicators etc, across all sites is easier said than done. As consumers are becoming more conscious of the product they use, there is demand beyond basic operational information of the product. The extended product information for example, could be for nutritional data, sustainability indicators and allergy information. In order to make this happen, manufacturers need to have a robust capability in internal master data management process and synchronisation. It is worth investing in this space to provide consistency in information across the value chain.
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