Rapid changes in eCommerce highlight digital skills imperative - image by Mokoland on Free VectorEconsultancy partner Ben Davis highlights developments in eCommerce, including an increase in marketplaces, D2C efforts and automation, and asks if businesses have the digital skills to respond.

While reading Next PLCs 2021 results, I was struck by a paragraph titled ‘Evolution not Strategy’. This notes, “the way in which [Next has] changed has been tactical – lots of individual initiatives taken in response to the opportunities and threats of a rapidly changing market.”

The rapid change in many industries has been in part due to digital disruption. As Spryker’s Alex Graf told me last year, “Even though it might look complicated today, it only gets way more complicated tomorrow. In digital, where nothing can be planned over the time frame of two or three years, that’s not a good position to be in. So, for most sectors, it’s a very good time to do it now.

Graf was referring to building an online marketplace, the strategy that has been very successful for Next. Sales from its third-party brand business, Label, growing by 69% over the last two years to £865m.

But, to take advantage of opportunities in eCommerce, there are inevitably skills and ways of working that companies must develop as they pursue these new initiatives.

The growth in third-party marketplaces

Many more multichannel retail brands are moving into marketplaces now. Kingfisher (B&Q) and Superdrug have recently launched third-party marketplaces on their eCommerce platforms (both partnering with Mirakl). Kroger, Carrefour and Bed Bath & Beyond are further examples.

The benefits include greater volume, more customer choice, greater pulling power in search, and tapping into new demographics. And in fashion, Next highlights the lower risk of the marketplace strategy, being “able to spread the risk of fashion volatility across many different brands and product categories”.

B&Q talks up the advantage of having this scale as part of an omnichannel presence, with its store network offering “a level of choice, speed and convenience that pure-play retailers cannot match”.

This increase in third-party marketplace strategies shows the dramatic shift in retail to online. And though marketplaces are integrated with existing eCommerce platforms and lean on expertise in a retail business, there’s no doubt they emphasise the need for certain skills. Areas such as performance marketing, content management, fulfilment, customer service and all the sell-side considerations, such as shopper media –only grow in importance.

D2C and its data challenges

Perhaps the most obvious development in eCommerce where new skills are needed in-house is that of big consumer packaged goods. Companies and other wholesale businesses are selling more and more directly to the consumer.

The in-house digital expertise needed beyond brand and into shorter-term sales activations includes data specialists. Agency partners have historically taken care of most data needed to run online advertising targeting customers who convert in physical stores or on retailer websites. As conversion on brand.com increases, businesses need more data and analytics skills in-house. And these are at a premium across marketing. Nearly 37% of large businesses responding to Marketing Week’s 2022 Salary Survey admitted they have identified a skills gap here.

There’s also a change in ways of working needed. With Mars Petcare’s Chris Rodi, European Marketing Director of Natural and Health Brands told the Festival of Marketing that in D2C efforts, brand and performance marketing teams need to be given equal importance. “You need people searching for your brand in the first place at the top of the funnel, and you need people to help convert.”

Consequently, Mars Petcare got both teams working from a single brief and rethinking how customer insights relevant to the entire customer journey are shared across the organisation.

CRM is still the hero

The importance of first-party data should not need emphasising to eCommerce businesses. But the events of the past two years have done just that with the advent of stricter privacy standards and a pandemic-renewed focus on loyal customers.

Email has always been a faithful driver of sales for marketing. However, innovative CRM teams have really proved their worth in recent years through rigorous testing and engaging content.

Now is the time for marketing teams to work with partners and their data colleagues to get the most from advanced segmentation and recommendations in email without sacrificing imaginative and helpful messaging.

Automation vs attention

Self-service vs human service is a familiar dichotomy for those businesses selling high cost or complex products online. Econsultancy founder, Ashley Friedlein, wrote last year about the idea of ‘experiencing fast, experiencing slow.’  The idea that customers want either quick, efficient and seamless, or slow, immersive and considered.

This is a relevant discussion for the online-offline debate in retail and many other industries. Understanding what customers want from various sales channels, and how customer service forms a part of the online customer journey.

Customer insight skills (including analytics) are again at a premium here if eCommerce brands are to understand what customers want at each point in the funnel and, crucially, how these expectations can be met or exceeded.

Doing the marketing basics right

Ultimately, marketers working in this time of rapid change and within eCommerce businesses should be firmly in charge of the basics alongside more specialised digital skills.

Last month, Mark Ritson reminded marketers at the Festival of Marketing that tactics should follow strategy. Anyone talking about NFTs, for example, should be confident they fit the strategy.

Though cutting-edge new tech affecting eCommerce, such as virtual goods, may well follow the strategy for some brands (perhaps in luxury or those already active in gaming), it is surely a distraction for the vast majority.

Now is the moment to shore up the marketing, data and digital competencies within your business if you are to compete in a massively competitive eCommerce landscape.

econsultancyEconsultancy’s leading-edge digital marketing and ecommerce learning is highly targeted and multi-touch. It reveals and addresses skill and knowledge gaps, models best practice, and lets your people learn effectively, when, where and how they want to.

By deepening understanding, honing skills and changing mindsets, it supercharges your digital marketing and transforms your ecommerce, building your profile and accelerating your growth.


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