You don’t often see experts and astute commentators openly sharing their opinions on how they see digital marketing in e-retail and talking about the challenges ahead. But here are four experts who are doing just that: Jean-David Chamboredon (ISAI), Ghadi Hobeika (Unibail Rodamco), Clémence Bussière (Voyages-sncf.com) and Raffi Kamber (Alven Capital).
Artificial intelligence, mobile, web-to-store… while these buzzwords have been around for a while, they are really taking hold this year. Read on for code-breaking tips in this extensive article, illustrated with examples from our fantastic four.
The end of barriers between retailers and pure players: welcome e-retailers!
The start of 2017 signals the convergence of traditional retailers and pure players. Although web giants are monopolizing the online market, retailers are starting to catch up. Jean-David Chamboredon, CEO of ISAI (French tech entrepreneurs’ fund for companies including BlaBlaCar, Evaneos, Hopwork, Quitoque, etc.), takes this view: “Retailers have risen to the online challenges, particularly Amazon who is making inroads into the physical world. Brands also have an ever-increasing online presence”.
So retailers have understood it: they have to harmonize offline and online points of sale. As Raffi Kamber, a partner at Alven Capital (a venture capital firm specializing in the digital economy), has previously pointed out: “The more forward-thinking retailers have started to offer slightly more sophisticated web services, such as online availability checks for a product in store”.
Although most retailers’ infrastructures aren’t yet up to the task and this type of service is more about innovation, Kamber is optimistic: “In four or five years, it will be possible to manage in-store and online stock at the same time using a consolidated approach”. And that’s an idea that works for both retail and service.
More data = more CRM = higher turnover
“All e-retailers have recognized how important Customer Relationship Management is. Customer recommendations, a personalized customer approach and, above all, targeting – by the end of 2017, everyone will be using all of this”.
For Ghadi Hobeika, Unibail Rodamco Group Director of Marketing and former FNAC Digital & CRM Marketing Director, marketers must harness artificial intelligence in their CRM. What comes next? “Companies who’ll stay one step ahead will be those who use data not just for marketing, but also for merchandising, logistics and elsewhere. They’ll also be offering more and more customization of the customer journey”.
The main challenge retailers now face is how to collect data using the Amazon model. Kamber sheds light on this issue: “Points of sale are going digital: this is where information is retrieved and where loyalty schemes come to life. Retailers begin to gain access to everything Amazon is already achieving by using their large amount of data”.
That explains the trend for using a new generation of products, and employing retargeting, cross-selling or targeting solutions, such as Tinyclues: “These solutions are now available to regular retailers – they enrich the customer experience and boost sales figures”.
Clémence Bussière, France and Europe Relationship Marketing Director for Voyages-sncf.com, concurs: “Although CRM is still a key driver of revenue, the traditional activities associated with it, like one-size-fits-all newsletters, won’t cut it anymore. We have to rethink how we approach our business. With a solution like Tinyclues, we can identify the customers most likely to be interested in each of our targeted campaigns”.
The challenge is all the more important since customers are less and less faithful. “Protecting your customers, who are getting better informed and more unpredictable, in a very competitive environment – now, that’s a tricky business! To succeed, you need to capitalize on a strong brand, a fluid omnichannel journey and a dynamic loyalty scheme”, Hobeika revealed.
Going local means more service
In 2017, Paris is a battle scene for e-retailers fighting over service quality and express deliveries. Distributors are pumping money into building up their local logistics networks. Hobeika delves deeper into this trend: “The goal is to challenge Amazon and their Prime Now service (free delivery within two hours for premium accounts). Hence Cdiscount has opened a warehouse in Roissy so they can make faster deliveries and pip the competition to the post.”
Web-to-store is another 2017 digital marketing trend. Attracting web users to physical points of sale means that distributors can:
- track the impact of the digital communication campaigns on in-store sales;
- measure store visits against each digital medium.
“Retailers need technological solutions to harness different sources of customer information online, via mobile or at physical points of sale”, explains Hobeika.
Mobile 1 – Email 0
Mobile-first and mobile-only approaches are growing in power. Without any physical presence or classic web-based point of sale, new mobile entrants are making themselves known thanks to very low infrastructure costs and the virality of their offer. Hobeika highlights Wish and Ali-Express, two companies from China that offer rock-bottom prices on accessories, fashion, design products, IT and more: “Their apps were amongst the most downloaded in France in 2016. This incredibly disruptive approach marks an unexpected market entry mode”.
Up against new ways of communicating with customers, email is running out of steam. And that also applies to relationship marketing. As Bussière explains, “Newsletters are becoming less effective and generate more fatigue, particularly among young people”. So you have to find new ways to address this target group: “We’re testing conversational approaches via our Messenger chatbot and wish to prospect new channels of this kind”.
The move from email to mobile conjures up new challenges for marketers. For Bussière, “Mobile doesn’t have the same qualities as email: it’s a more intrusive channel. Mobile campaigns work differently and should have a specific plan of action”. Real-time notifications, customized services and a sharp focus on the relationship aspect – there are the ripe opportunities to seize in 2017.
When digital transformation goes hand in hand with agility
For traditional retailers, the move to digital is making them take a long, hard look at their setups. According to Chamboredon, the pace of change will speed up in 2017: “Digital transformation poses problems for retailers’ matrix organizational structures. The Internet invades and disrupts them internally”. Companies have to take a fresh look at their digital value chain, using startups’ technological agility as a model.
Voyages-sncf.com is striving to get this organizational agility up and running. As Bussière explains, “We are building multi-disciplinary teams to break silos: feature teams working more independently and building a strategy collectively. Making teams responsible, involving all members of staff and mixing up tasks: that’s what allows us to speed up the time to market”.
Artificial intelligence, are you there?
Our four experts agree: 2017 is the year when artificial intelligence is going to have a significant impact on the economy. After many years of development, AI technologies are entering the phase where they now have to live up to their promise.
According to Kamber, “We’re now seeing real acceleration. Technologies are mature and data is ready to be used. When the end product is easy to use and doesn’t cost too much, AI can have a significant impact. New ideas and diverse applications are going to revolutionize retail and e-commerce”. Chamboredon shares this enthusiasm and points out that “You have to tackle the subject tactically and strategically.” For Tinyclues, this comes down to combining ROI from the first month of use with a more long-term view of where CRM is going.
This year looks bright for e-retailers. There’s an abundance of projects. A common theme is the necessity to harness data and – more importantly – to use it to improve the customer experience and the company strategy. So don’t wait for 2018, let’s get down to work now!