So, whether going direct, creating a marketplace, a new brand or a subs model, companies in ecommerce will be looking to do all they can to capitalise on growth online in 2022.
Growth in ecommerce, though, is about more than retailers selling in an increasing number of channels. Spryker, a cloud commerce solution, recently produced a useful summary of 12 ecommerce growth strategies, and along with tech such as cloud, headless, and various types of automation, it featured:
This sentiment sums up the shift occurring, perhaps most obviously, in consumer packaged goods but also in retail generally and in B2B industries such as manufacturing.
There are obvious overlaps here with digital transformation and culture, and when looking at current success stories in retail, you can see the impact of investment in innovation and self-disruption. Next’s Q4 results in 2021 showed that online sales from third-party brands (Next Label) were up 85%, helping online sales overall rise 45%, in an environment where retail (UK and Ireland) was down 5.4%.
- marketplaces (and the ability to create your own)
- new revenue streams (such as subscriptions or retail media)
- selling D2C
- selling cross-border
- expanding your brand
- exploring B2B (or vice versa)
Despite fears that the massive ecommerce gains since March 2020 might fall off, growth is still good, particularly considering the challenging environment for retail as a whole. Many of the US estimates for 2022 show similar online growth to that seen in 2021, whereas brick-and-mortar is close to flat.
“We know we need to win in every shelf everywhere…” said Bernard Meunier, Nestlé Head of Strategic Business Units and Marketing and Sales, at an investor’s day conference last year (as reported by DigitalCommerce360).
One aspect of this continued ecommerce growth is omnichannel retail, driven by integrated tech and unified data strategies. Retailers consistently say that multichannel shoppers prove to be the most valuable, and Emarketer reported in May of last year that ecommerce sales from multichannel retailers were picking up speed over non-store retailers, and would hit 45.6% of total retail ecommerce sales in 2023.
B2B Digital Transformation
Nike’s digital business is still soaring, now accounting for 21% of total revenue, up two points on 2020, and the brand aims to reach a target of a “40% owned digital business by fiscal 2025.” Of the shift to ecommerce, CEO John Donahoe said on an earnings call last year, “That plays to Nike’s advantage. Our ‘Consumer Direct Acceleration’ strategy is capitalising on this marketplace transformation. We know that when we get to the other side of this, we’ll be in even stronger shape. We’ll be more agile, more direct and more digital.”
To go back to FMCG, where ecommerce is still around the 10% mark, there are big changes afoot in marketing and digital at companies like Nestlé as they seek to effectively double ecommerce sales in the next few years. It will be fascinating to see how this progresses, given the challenges posed by supply chains, profit margins, and new mandates in areas like digital advertising.
The last of the 12 points is to “disrupt yourself”. While disruption might sound too strong a word for some, the Spryker report warns that “if you’re not willing to disrupt yourself, your competitors will” and that “fear of change can cripple a business in a rapidly evolving industry.”