28 Jul E-commerce trends on the French market
According to the Fevad (French Federation for e-commerce), French e-commerce’s overall revenues have increased 16% on the first trimester of 2016 to reach €17.9 Billion. If this rise is mainly due to a strong increase in the number of transactions (21% and 237 millions in total) it compensates a decrease of the average order value (-4,4% to reach 76€).
Online sales made through smartphones and tablets continue to progress (+39%) and represent around 10% of e-commerce in France.
We have identified what we consider to currently be the major pillars, opportunities and trends of the French e-commerce market.
Pillars
Data and Programmatic
Hold of qualified data, the ability to analyse it, cross it with others sources, exploit it, create value with and around it, and protect it. Mastering customer’s data throughout the buying journey allows re-linearization of physical/online fragmentation.
In connection with the advanced machine learning technologies, marketing automation is progressing and investing in new fields such as connected TVs, screens out-of-home, mobile, market places…
Mobile
Combination of interaction technologies and proximity equipment in stores and important work to make the use of mobile completely fluid. Especially with the deep linking, a technology that enables the link between web and mobile by making the a transparent link between both.
Interaction Technologies (RFID, NFC, Beacons …)
The selling point is progressively equipping its processes with interaction technologies to increase its proximity with the customer. These technologies allow to operate “push”, to systematize contactless payment, to connect the store with its direct external environment (other merchants, local services) and more generally to work on the concept of “experience” as a lever acquisition and customer retention.
Marketplaces
Marketplaces provide retailers an opportunity to diversify with little risk involved: local shops and additional visibility window.
Physical Selling Points
The physical outlet still drains the majority of purchases and is often the “centre of gravity” of a customer journey, yet wanted more “frictionless”. Digital is estimated to represent around 9% of total sales. As technology continues to advance, so does in-store shopping.
Opportunities
Mobile Payments
After a difficult start – in comparison with the UK or the US particularly – some traction in the area of mobile payment applications is observed, often combined with other features (loyalty cards, etc.). The adoption of mobile solutions cashing store is rising as well. Apple Pay was launched in France in July 2016, beating its rivals to the crucial French market.
Delivery Optimisation
Logistics is one of the last sections affected by digital transformation. Driven by customs favoring immediate orders, delivery must meet with the strict requirements of speed and packaging until the customer receives the order.
Seasonality
The context around a purchase can guide and influence a customer journey. The search engines and recommendations, integrated as white-label to the retailer’s site or within an application of “best practices” must integrate multiple criteria to better qualify the purchase.
Internet of Things (IoT) and Wearable Objects
The connected objects in points of sale, mobility or at home such as smart watches, automatic control buttons and physical store automation applications, are playing an increasingly important role. Their aggregation within platforms allows to create unique scenarios.
These connected portable objects, mainly watches, create emulation among application developers. If the “killer app” of trade and distribution doesn’t exist yet, the battle is already underway by all the major industry players.
The rise of “Smart-Cities”
Smart logistics, business concierge and proximity, loyalty cards across a shopping street or neighbourhood, intelligent lighting to achieve seamless connectivity are some of the services that help to shape the city of tomorrow. In France, more than 120 cities are today working on specific sustainable and smart innovative projects for their cities. Montpellier, Nantes, Lyon or Grenoble tend to be leading the way.
Trends
An improvable Value Chain
From the brand to the client, but also between retailers and suppliers, and brands and retailers. The impact of the on-demand economy is felt on all sides, eg with import-export, the crowd-shopping trend or the power of the “mystery customer”.
Shopping Assistants
“Companions” more and more sophisticated, tailor-made (home fitting, pushed by the current changes in logistics) who know the precise location of products in the store, adding valuable and innovative advices to the traditional purchase. Macy’s recently launched an AI shopping assistant in partnership with IBM Watson, and could be an interesting example to follow
Proximity
Traders networks mesh: common loyalty cards, recommendation systems for non-competing products. We also observe the deployment of local relays with the emergence of Amazon Prime Now in 2016.
Purchasing Tools: Food & Retail Markets
Order intake is experiencing a real transformation: if click-and-collect is exploding, the e-reservation and options systems move from their initial application sector (transport) to reach the retail area.