© CLAVIS INSIGHT

WINNING IN THE UK E-COMMERCE ENVIRONMENT

EMEA FORUM 2015JEREMY RADCLIFFE

© 2

WINNING IN THE UK E-COMMERCE ENVIRONMENT

• State of the Nation

• The Story so Far……

• Preparing Today, To Win Tomorrow

• Summary

© 3

A BRIEF HISTORY OF TIME….

Grandmother Jane Snowball, 72, from an armchair in her Gateshead home in May 1984.

Used a television remote control to order the groceries from her local supermarket.

It was an order for margarine, cornflakes and eggs.

© 4

STATE OF THE (ECOMMERCE) NATION- GROWTH

0

5

10

15

20

25

30 2015 2020

0

20

40

60

80

100

120

140

160

180

200

China

$ billions

$ billionsHigh incidence today,

more growth projected.

Growth of online grocery buying is ahead of bigger markets, smaller geographical size aids ‘last mile’ and click and collect developments.

© 5

CHANNEL SHIFT, SAME HABITS?

© 6

STILL ABOUT CONVENIENCE, YES….BUT….

Time-poor shoppers equipped with technology are increasing demand for online shopping.

New delivery services such as Shutl, Instacart and Uber are supporting these habits where retailers are not moving quickly enough to satisfy demand.

© 7

LIFE-STAGE DISRUPTION: AN OPPORTUNITY

“There are, however, some brief periods in a person’s life when old routines fall apart and buying habits are suddenly in flux. One of those moments — the moment, really — is right around the birth of a child.”

Charles Duhigg, Author of “The Power of Habit”

© 8

GENERATION EXHAUSTED!

©

9

WHO’S LEADING THE CHARGE IN ONLINE SHOPPING

20%No Children

Top Reasons for Shopping for Groceries Online

“It is convenient to have groceries delivered to my front door”

“I can shop online at any time”

“I don’t have to carry heavy items home”

“Shopping online saves me from making a trip to the

store”

“Shopping online helps me stick to a budget “

“Shopping online saves time“

47%

Parents with Children Under 3

32%

Parents with Children 3-17

15%Empty Nesters

Source: Kantar Media Compete 2012, UK Panel

© 10

THE CONSUMER AT THE HEART OF ECOMMERCE

Being convenient isn’t just about ecommerce, technology and design…..

When it’s done well it’s integrated into every touch point.

Nescafe: Making a virtue of convenience….

© 11

NOT SUITED TO ONLINE, OR UNDER-DEVELOPED?

Source: TGI UK 2012

© 12

CLOSER TO IMPULSE?... (FORTUNATELY;-)

Cinnabon offering same day delivery in the London area.

Distribution and fulfilment are increasing in speed and scope.

Perishables are now following where other verticals have already trodden.

© 13

TOPPING UP THE SHOP, FAST FULFILMENT

Where consumer needs are un-met, new businesses are being created to serve demand.

Single vertical retailers and taking advantage of ‘top up’ shopping.

© 14

THE STORY SO FAR….KEY THEMES

Global growth continues unabated, UK still has room for growth.

Convenience of the channel is helping facilitate growth through design and tech advances.

Parents leading the charge with online grocery shopping.

No category is immune to going online!

© 15

PREPARING TODAY, TO WIN TOMORROW…

MULTI-CHANNELCONTENT MULTI-LOCATION

BRILLIANT BASICS

© 16

ECOMMERCE: IT’S A BIT LIKE GARDENING.....

If you leave it un-attended for too long, it becomes overgrown…

© 17

BEAUTIFUL BASICS……

‘Always On, Always Right’

‘We endeavour to be ‘Always On, Always Right’ – Sean

Ferguson, Digital Activation, Molson Coors UK

© 18

INTERNAL ALIGNMENT + METRICS AID SUCCESS

Organisational Engagement & Alignment

Source: CapGemini, CEB 2013

Digital Transformation Trends Briefing Page 7

All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage

and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2014

3. Culture “Culture eats strategy for breakfast,” management guru Peter Drucker famously said. This quote

sums up the need for a cultural shift to allow for the business change required in digital

transformation.

Attendees to Econsultancy’s Digital Transformation Roundtable event consistently spoke of the

challenges of extending a digital mindset throughout the organisation. Those in large

organisations or those in heavily regulated industries felt this most acutely – and expressed deep

frustration at the inability to effect broad change in their organisations.

Capgemini’s matrix of digital maturity highlights the risk of complacency. In the analysis of

186 companies, those that were digitally mature “digirati” (have effected cultural change

alongside adopting digital) saw higher profitability and revenue. By contrast, “fashionistas” (those

that adopt digital but fail to make the corresponding cultural and management changes) suffered

declines in profitability.

Source: Capgemini Consulting

Roundtable attendees spoke of the difficulty of shifting a company culture. Many spoke of the

challenge of combining the culture of digital teams with the main office. One participant lamented

that he needs to keep a suit at the office to don for meetings at head office.

FASHIONISTAS DIGIRATI

BEGINNERS CONSERVATIVES

Category ManagersCustomer Teams

Shopper MarketingDigital Managers

eComm ManagersBrand Teams

Brand ActivationPrice & PromotionsR&D / Supply Chain

Optimize Range & Distribution

Category & Brand Growth

Effectively Market Brands Online

Maximize Brand Equity,

Communication and Performance

Availability

Range & Assortment

Search

Content Integrity

Price/Media Evaluation

Ratings & Reviews

Role Objective Metrics

© 19

MANY LEVERS AVAILABLE TO CATEGORY MANAGERS

© 20

IT’S VERY TEMPTING TO PULL….

you may not have visibility of sufficient data (and all lever-types) for each retailer to help influence your digital investments.

…but

© 21

USE DATA TO FOCUS INVESTMENT & EFFORT

What do manufacturers have most control over in the long term and short term?

Taxonomy / Changes

Media & Content Investment

ROI?

© 22

TAKE ADVANTAGE OF RICH CONTENT OPPS

Richer content gives brands and opportunity to gain more data about their consumers.

Give / Get – The more compelling to better.

Define compelling content by testing amongst a small representative group.

© 23

LEVERAGE ADJACENCY OPPORTUNITIES

Parents with children under 3 are:-

Significantly more likely to buy groceries and home furniture online

Significantly more likely to buy baby and children's products online

Spend twice as much time on Automotive websites

X 5

Segm

ent

X 2

X 4

X 2

Source: Kantar Media Compete UK 2012

© 24

DIRECT TO CONSUMER: A DATA OPPORTUNITY

Manufacturers have an opportunity, with the right ‘services’ vehicle to build direct sales with consumers.

Learning more about your consumers preferences.

DTC channels also help build brand values on the path to purchase.

‘Buy Now’ expedites lead generation and purchase.

© 25

MARKET PLACES PROVIDE ADDITIONAL REACH

Marketplaces are the malls of ecommerce.

Great opportunities for trusted brands.

Risks for manufacturers, Less control over how a brand is presented.

© 26

BRANDED APPS INCREASE SHOPPER ENGAGEMENT

Some brands have tied everything together using mobile.

Useful to the ‘sufferer’.Capture’s data with permission.Location ‘Aware’.Purchase Ready.Links to both On AND Offline Stores.

© 27

ECOMMERCE EVERYWHERE – NOT JUST TRADITIONAL

Click & Collect is Growing

Amazon & eBay using London Underground and Argos as pick up points

Retail pick up is not limited to traditional retail outlets

Measuring delivery from a single point only is only part of the picture.

Building ‘Click & Collect’ around the shopper rather than vice versa

© 28

PUTTING THE CONSUMER AT THE HEART OF ECOM

Building ‘Click & Collect’ around the shopper rather than vice versa

Pre-Order Baby Milk to be collected afterairport security clearance

Brands need to protect their reputation and image in multiple places

© 29

Convenience Yes…but understand who it’s convenient for.

Don’t under-estimate the potential for categories to move online.

Getting the Basics right…it’s like gardening, needs constant attention.

The ‘Digerati’ Organisation, Linked to Increase Revenues.

Content can be both engaging AND an opportunity to learn about your consumers via data.

Location, location, location: ‘me-commerce’ can activate the consumer ‘anywhere’.

WHAT DOES ALL THIS MEAN TO BRANDS TODAY

© 30

THANK YOU!