Struggling to stand out: Retailers fight to get noticed in e-commerce market

While it’s old news that e-commerce accelerated at an unprecedented rate in 2020, not everyone has been able to keep pace with the industry’s breakneck development. Retailers now find themselves at a crossroads: Sell their product via third-party platforms such as a virtual marketplace or develop their own e-commerce operations. Both options have pros and cons, according to executives at DHL and Dachser. [caption id="attachment_69098" align="alignright" width="450"] DHL Express facility at Chicago O'Hare Airport (ORD).[/caption] As e-commerce has evolved during the Covid-19 pandemic, so too have customer expectations, according to Leendert van Delft, vice president of global sales programs and global e-commerce at DHL Express. The pandemic increased customers’ requirements for clear information on how and when shipments will be delivered, he said. And this doesn’t merely apply to business-to-consumer (B2C) buyers, van Delft said. Business-to-business (B2B) buyers are also people who have become accustomed to rapid deliveries, expecting their B2B shipments to arrive just as quickly as in their personal B2C transactions. Ultra-fast shipping capabilities aren’t an option for many B2B shippers, van Delft said, leaving those retailers lagging behind other e-commerce businesses. Struggles of entering the e-commerce arena While there are many hurdles retailers have to clear upon entering e-commerce operations — including handling the incredible amount of paperwork to import and export products — van Delft said the tallest hurdle is becoming discovered within the vast e-commerce space. “One of the challenges all new companies face is establishing a clientele and reaching new clients,” said Florian Langenmayr, head of business development for the U.S. at logistics provider Dachser. “As with any distribution channel, you have to find and attract a customer base. In the e-commerce world in particular, there are so many accessible options that it is sometimes hard for new businesses to attract new clients.” It’s no longer enough to simply be attractive to customers in a single country, said DHL’s van Delft. “Companies need to make sure their websites attract consumers beyond their borders,” he said. “When it comes to cross-border consumers, they may have more criteria, or sometimes different criteria.” Pros and cons of third-party marketplaces The challenges associated with establishing an independent e-commerce footprint have led some retailers to sell via third-party platforms, such as online marketplaces. These marketplaces have pros and cons, van Delft said. Pros include saving money by not having to invest as heavily in marketing or a website with sales capabilities — both services provided by most online marketplaces. On the other hand, dependency on a third-party platform forces shippers to sacrifice a degree of control over their brand, and makes building customer relationships difficult, van Delft said. Marketplaces have a major advantage that plays into how customer expectations have developed throughout the pandemic: shipping. “One thing that these marketplaces have done fairly well over time is crack the code of the importance of shipping and delivery,” van Delft said. “Many of these marketplaces make shipping and delivery front and center in their proposition to customers.” Next-day shipping has become a key differentiator, but marketplaces aren’t the only ones with this capability. Retailers can also manage it with a combination of skillful positioning and a variety of delivery options, van Delft noted. “Third-party platforms do not provide their services for free,” said Langenmayr. “In the past, e-commerce was just one of many distribution channels. Nowadays, it has become for many companies the most important one. Therefore, it is only logical that larger retailers try to establish their own e-commerce platforms.” Moving away from third-party platforms Some B2B shippers are choosing to move away from reliance on third-party platforms, instead forging their own way in the world of e-commerce. Whereas B2C e-commerce was growing steadily pre-pandemic, B2B e-commerce has been slower to change, relying on more “traditional” sales methods, like sending salespeople to conferences or flying sales reps overseas to meet in person with potential customers. The pandemic eliminated both options, forcing B2B shippers to re-examine the e-commerce model. Recent research from DHL suggests only 20% of B2B buyers would like to see a return to pre-pandemic sales models, van Delft added. Moving away from third-party platforms doesn’t happen at the snap of a finger. Shippers will need to build a network and establish clientele, said Langenmayr. The inconvenience and timelines of building out these operations has been a major factor behind why some have stuck with their current shipping provider, he said. Integrators and forwarders now offer solutions for those who want to establish their own e-commerce options. Geodis, for example, late last year launched a direct-to-customer delivery service for European and U.S. businesses. The B2C service MyParcel offers guaranteed four- to six-day shipping from the U.S. to 27 European countries, and is designed to engage customers who abandon their carts at checkout after seeing high shipping costs. The program will gradually expand globally, according to a release. Likewise, DHL offers a “Website Health Check,” a 10-point checklist used to diagnose potential weak points in a customer’s website, including their positioning and delivery options. Once diagnosed, DHL offers consultancy services designed to find solutions. Opportunities to build strong customer relationships, collect more data — which can be used to nurture customers and create new sales opportunities — and control their brands are pushing some retailers to leave their current platform, van Delft said. No matter where shippers choose to market their products, e-commerce isn’t going away, van Delft noted. From an e-commerce perspective, the pandemic vaulted 2020 into 2030. That acceleration will continue, even as physical retailers reopen, he said.

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