Agility and Omnichannelity are a must for brands in 2023
In the context of hybridization of commerce, omnichannelity is no longer an option. The race to innovation is in full swing to offer renewed shopping experiences to consumers who have become versatile and demanding. On the web, access to marketplaces is becoming increasingly dense, with severe competition over services. An overview with Vincent Druguet, CEO of Wunderman Thompson France and Jérémy Hoy, Managing Director GroupM Commerce at GroupM France.
What are the main findings of the Wunderman Thompson x WPP 2022 Future Shopper Barometer?
Vincent Druguet: We were surprised by some of the figures in this fourth French edition. In 2021, we had already observed the multiplication of channels, but this year new contact points have appeared particularly second-hand sites. Indeed, 12% of the interviewees say they use Back Market or Vinted in the inspiration phase to shop around before turning to a retailer's site, a brand site, or social networks.
Another striking phenomenon is that marketplaces, and in particular Amazon, are the undisputed leaders in e-commerce across the entire shopper journey, combining inspiration and research. This is especially true since nearly 70% of customers want to move from inspiration to purchase as quickly as possible. In France, no less than 35% of online spending is done on platforms, 25% of which is on Amazon. We can see that the customer is extremely fickle and brands must have the ability to provide the right offer at the right time.
One last surprise: between the choice of fast service and the ecological choice, consumers favor fast service, to the detriment of reducing the carbon footprint associated with deliveries. These reflexes are conditioned by Amazon since the phenomenon is global. In spite of this, Green IT is a data item studied by our clients.
Jérémy Hoy: The French are very vigilant about protecting their data, but they are willing to share it in order to benefit from offers and promotions. Here again, deciphering their intentions is not easy.
How should brands manage "the weight of ideals and constraints in consumer behaviour", a phenomenon described in Philippe Moati's latest book?
VD: The main challenge for brands is to know their customers in order to follow them as they navigate through a constantly evolving digital ecosystem. To deliver the right message to the right target, you need to be technologically equipped and internally organised with data scientists. It is essential to anticipate and innovate in this context. The example of Fnac-Darty with the use of live shopping, social networks and the launch of second-hand products to meet consumer expectations is interesting.
JH: Knowing the customer also means integrating their versatility. Analyzing and constantly adjusting data, communication, pricing policy, catalog offer, etc. This is very restrictive for brands and merchants. Projections are now made for three months rather than one year.
What innovations are you expecting in the French e-commerce sector?
VD: We see the role of artificial intelligence in e-commerce development for the purpose of personalizing merchant sites. Live commerce and social commerce are going to become more important, as well as the ability to predict stocks to make products and services available on all channels. Finally, consumers want to have a direct link between inspiration and conversion, which is driving sites to a race for innovation. Whether it's on retailer sites, banners, or social networks, you have to be able to ensure conversion in the shopping cart.
Elon Musk buying Twitter, what does that mean to you?
VD: More than Twitter itself, it's the subject of monetising influence that is on the table. Everyone is looking for a business model for Twitter. It's not clear that people are paying a fee every month to be certified.
JH: Only 6% of French people are on Twitter, so it's only a certain population. Most won't go.
What do you think are the major challenges in terms of logistics?
VD: Logistics is at the heart of the customer experience, against the backdrop of the players' CSR commitment. Indeed, even if 47% of consumers prefer environmentally friendly brands, the choice between sustainability and comfort remains a dilemma: 37% of Internet users would like faster deliveries and 21% would prefer them to be more environmentally friendly. In the short term, consumers focus on price, fast delivery, and the choice offered in the different types of delivery.
JH: For the e-merchant, the challenge is to preserve margins in a difficult economic context. To achieve this, the automation of the supply chain enables better management of its capacity to sell and deliver in order to rationalize the operating costs of a multi-channel strategy.
In France, no less than 35% of online spending is done on platforms, 25% of which is on Amazon.
How should brands embrace social commerce? What strategy should they use?
VD: Firstly, they have to consider it. Secondly, their priority is to invest in being able to distribute their catalogs and content on social networks. And don't hesitate to put the link on their merchant site because people click on it during the purchase phase. Tomorrow, the funnel will be integrated into the social network.
JH: I think we need to have an approach to portfolios that is specific to social platforms: push new products, instant or exclusive ranges, etc.
What role do marketplaces play in the purchasing process of Internet users? Do you see any major changes in this diversification of e-commerce?
VD: Our study shows that 55% of respondents in France are motivated by the prospect of being able to buy everything on a single platform (versus 64% globally) and 56% consider Amazon to be "good value for money". It is therefore obvious that DtoC sites will invest in marketplaces, being where the customers are. Consumers are window-shopping there, but it is also the first search engine before any purchase, as the catalogues are so rich.
Marketplaces are present at all stages of the buying process, including in the shop itself, where consumers search for the price of an item online. We can see that the DNVBs, which had their moment of glory during the lockdown, are in trouble today.
JH: On the sellers' side, marketplaces bring together in one place large manufacturers, but also small brands that are present in large audience hubs and sell merchandise at a lower cost.
It was announced that the physical point of sale would make a comeback post-Covid, has this phenomenon taken place?
VD: Firstly, consumers are asking brands to be omnichannel. Nearly half of those surveyed want brands to communicate in the same way across all channels and 54% of 16-24 year olds prefer to shop at a brand with physical outlets. Finally, 51% would like brands and retailers to innovate in the use of new technologies to improve the shopping experience.
So, yes, the shop has a role to play, but it needs to be more connected to the global ecosystem. The union between digital and retail is taking place through the connectivity of physical outlets.
The service era has driven retail in recent years, what are the next challenges?
VD: The subscription era, no doubt. We are seeing new business models in retail such as the €34.99 monthly subscription launched by Pizza del Arte to eat in restaurants once a day. Another strong comeback is loyalty programs and brand strategies to keep their customers. The brands we work for are capitalizing on their CRM and adding value to their customer base.
Retailers are reinvesting in loyalty programs such as Amazon's Prime, IKEA Family, Monoprix, Lidl, Action, Darty Max to extend the life of products. Loyalty models are very innovative.
What do you think are the most successful examples of brands appropriating the metaverse?
VD: For the moment, it's a question of image and modernity for the brands. The business aspect will come later, even if there is an obvious appetite for gamers when it comes to "direct to avatar". Some industries, such as luxury, are already seeing returns on their investments.
One year after numerous market structuring announcements, what is your assessment of retail media in France? What are the trends for 2023?
JH: E-retail media has become the third pillar of digital advertising behind social and search. However, it will continue to grow with forecasts of a 20 to 25% share of digital investment over the next three years (compared to 10% today). Driven by the retail sector, other sectors (cosmetics, DIY, fashion, etc.) have understood the value of this medium in terms of marketing knowledge and additional revenue for merchants. In 2023, the retail media ecosystem will grow with the use of data in marketing plans integrating segmented TV, DOOH, video, etc.
Jérémy Hoy has been leading GroupM Commerce since 2019 (WPP). He works on issues related to digital commerce and the transformation of physical retail outlets. Formerly director of digital strategies at OMD, he is passionate about digital transformation issues.
Vincent Druguet joined Wunderman Paris (WPP) in 2015 as CEO. He has accompanied global brands in their marketing transformation (Lipton, Michelin, Nissan, IKEA, Dassault Systèmes) within three major agencies. He is co-author, with Jean-Baptiste Vallet, of "Le commerce connecté: comment le digital révolutionne le point de vente".