Comment: eCommerce for brands - the affair

Picture this: your partner has a very public affair, comes home to tell you that the new squeeze is henceforth getting the spouse role, and then – here’s the extra rub – suggests you carry on seeing each other privately but without you sporting the number-one-partner badge any more. You’d be delighted, right? Yet this is exactly how many brands are responding to the rise-and-rise of eCommerce. Nike for example is investing heavily in and NikeID and as a result is seeing online sales grow four times faster than its overall growth rate. OK, great for, but not so great for its traditional channels.

A well-documented example of exploiting a switch to the direct-to-consumer (D2C) model which the internet is so powerful at enabling is Burberry. Five-fold growth in sales in less than 10 years is obviously a story that most brands would die for. Take a look, though, at how it’s been achieved (data sourced from their annual plc reports):

How happy would you be if you’re a wholesale customer of Burberry? OK, in this case, the D2C growth was powerfully fuelled by investment in a network of own-stores too, but eCommerce was certainly an accessory to the crime. Opening stores with reasonable national coverage is an expensive undertaking even in the UK. Doing so in tempting countries such as the USA or even China may be prohibitive, which is why brands are increasingly seeing eCommerce as the cost-effective route to international growth.

In turn this simply raises the same channel-conflict issues. In those same tempting countries brands tend to already have existing distributors, often long-standing relationships. Possibly they could try to harness them to the new eCommerce-centric strategy, involving them in local activities such as order-fulfilment or customer-service, but this is often a big step-change in competency that whole distributors are ill-equipped to handle.

Reaching customers other channels cannot reach – even if actually they’ve been reaching them fine for years – is one story. But there’s an even more compelling reason for brands to find D2C eCommerce attractive: the opportunity to control the entire relationship with the consumer. Obviously a powerful digital marketing strategy is mandatory for every brand today and has been so for many years, but the own-brand website has often been a neglected element. With good reason – I can remember not so long ago doing a consulting engagement with a brand, and having the group marketing director opine that “only management consultants and MBA students look at our brand site.” And the analytics said she was right.

What has changed is the perception of the sale. Traditionally a sale to a consumer was just a transaction. In fact quite often when using more traditional distribution channels, it’s a transaction you can only observe through rather blurred glass: obtaining out-sell reporting, as distinct from in-sell data, is often something of a challenge.  Selling on your own-brand D2C website could be regarded as just another – albeit easier to record – transaction.

Increasingly sophisticated personalisation, attribution, analytics, CRM and general big data solutions mean the sale is no longer just a sale. It’s now the consummation of the relationship with the consumer. As a brand, you can become an active participant, through every stage from initial flirtation to long-term partner. And since this is business and not just romance, you can measure, analyse and control all those stages. You’re no longer guessing what your consumers think about you – you know first-hand, and can do something about their perceptions.

What’s more, can you do something about making the relationship – and even more importantly your brand-positioning – sustainable for the long-run. eCommerce is here to stay, and even most offline-buying consumers research online before purchasing. A big reason they do so, of course, is price. Online pure-plays, most notoriously Amazon, are often poor respecters of details like RRPs. It’s very easy for a sales director to become a hero by generating spectacular growth selling to pure-plays who systematically destroy your long-term brand-value through persistent heavy discounting. You can probably never stop this completely, but at least having your own D2C sales channel allows you to fight back, reclaim some eCommerce sales of your products and also set a strong example to your other better-behaved retailers.

Whither then brands for which D2C sales is not appropriate, practical or preferred? In this situation you have a different duty in respect of eCommerce: making sure the affair between the consumer and your retailers happens in nice places. This is seemingly a neglected area. Such brands will often go to great lengths to ensure their products are well-presented in brick-and-mortar stores, while simultaneously accepting some truly egregious behaviour on eCommerce sites. Even at its most simplistic and tactical, the list of offences includes lousy photography, inaccurate product descriptions, weak search-indexing, low category ranking, unmoderated reviews and cross-selling to competitors. This is then undermined further by not requiring any of the detailed click-by-click, consumer-by-consumer, action-by-action reporting that eCommerce makes possible and which they would die for in a store environment.

Summarising the key takeaway for brands is to regard the sale not as a mere transaction, but as the consummation of a lengthy affair with the consumer. Then to recognise what digital enables is their involvement in every possible step in that affair, with complete traceability and measurability though the power of the resulting data and insight. And therefore to take active steps to gather that data, both directly from D2C channels and/or indirectly from partners, and use the insight to drive long-term, sustainable, brand growth.

But that still leaves the open question of who finally gets to marry the consumer…

Chris Jones is a freelance specialist in multichannel and eCommerce, with extensive senior-level experience as both consultant and hands-on interim. He has worked extensively in both B2B and B2C sectors, and has client engagement experience in 15 countries. He is the author of ‘The Multichannel Retail Handbook’. You can find him at

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