E-commerce: a ‘must’, or a gimmick?

We are well aware that e-commerce is having more and more of an effect on our consumption habits.  But is this distribution channel really suited to very small companies?  Can it - should it - really form part of your distribution strategy?  Can you "plug" an e-commerce site into an existing distribution network?  Or is this perhaps a rather costly and ineffective novelty?

What are the major trends in e-commerce in Belgium?

To date, e-banking and social networking are the main activities practised by Belgians online, but the growth of e-commerce is unsurprisingly a major trend, a fact that you cannot/can no longer ignore.

·        Most indicators continue to develop with a significant increase in high-speed mobile Internet.

·        E-commerce is growing in popularity. Many retailers (also) sell their products online. It should be noted that Belgians often use the Internet to compare different products before making a choice, but they often go to a physical shop to make the purchase.

·        Other countries, particularly neighbouring countries, have higher scores in the e-commerce and mobile Internet sectors.  Progress can and must be made... Remember that the Internet has no borders. For some products or services, this involves the arrival of new competitors.

·        Internet security concerns mean Belgian web users are more cautious, and this applies to both individuals and companies.  The solutions offered must be reliable and communication reassuring.

Pure players or multi-channel?

In the jargon, “pure players" are companies that ONLY sell online, and "multi-channel" refers to a strategy with several distribution channels.

In many cases the issue doesn't really arise.  You already have a point of sale, a "physical" establishment, and you are asking if it is really relevant to add an e-commerce site.  This will be multi-channel. 

However, for starters, it is sometimes a real existential question... It may seem tempting to "start online" based on the principle that it is less expensive than opening a point of sale. But this is not the case; experience also shows that it is often difficult to be seen on the web, to appear at the top of the results when your potential customers perform a search.  In addition, for many products it is often crucial that the consumer can "touch" the product if they want to.  This is the case in the textile sector, for example...

In any case, it is a good idea to ask yourself about the customer's requirements, the way a product that is perhaps still unknown is positioned in the virtual world, to reference it correctly, not to underestimate the logistical aspects which may be more complex and time-consuming than initially imagined.

And if, after further consideration, the decision is made not to venture into e-commerce, even temporarily, it is no less essential to be correctly referenced, which is to say "findable" to your customer, particularly where and when they need.   It is a good idea to mention here Google referencing or even Facebook, as well as Google Maps, Foursquare, or sector or local portals. Increasingly, searches are performed on mobiles and relate to local demand.   What a shame then if you don't appear in the search results of those needing your products or services!

Are companies working in e-commerce always "sustainable"?

In financial terms, it is clear that the rise in this new distribution channel affects the sustainability of the company, and not just positively like in other sectors. The arrival of powerful competitors on the web is likely to claw back precious market share.

Above all, e-commerce benefits those who are able to make the most of it and reposition themselves correctly.  Whatever it may be, whether we consider it in a reactive or conquering way, the question is inescapable.

Another argument often mentioned is the environmental aspect.  The drastic reduction in printing and sending huge paper catalogues, the effectiveness of the logistics, optimising storage and transport, getting closer to the removal point in the consumer's home or place or work, the removal of energy-consuming points of sale, the dematerialisation of certain products (e-books, digital music, VOD, etc.). All this can contribute to a more sustainable commercial activity from an environmental point of view. 

From a social point of view, a study by McKinsey shows that for each job "destroyed" in the traditional economy, 2.6 jobs are created in the digital economy.   E-commerce also favours the re-use of used items, often sold at low prices, and now more accessible to the lowest incomes.   It allows people with reduced mobility to procure various products without the need to travel.

An integrated strategy or nothing

Whatever the motivation, regardless of the sector, the fact is that an e-commerce strategy is only really effective if it is perfectly integrated into your company's commercial strategy.   There is no point in developing a non-ergonomic and poorly referenced website requiring lots of administration for very little return.  It would be just as unwise to underestimate the logistics work involved in this new channel, at the risk of seriously damaging your profitability. All aspects of the operation must be examined carefully before launching so as to make this the key to your success, rather than an additional difficulty.

Legal framework, the end of the Wild West

Let's be clear, unless you are leaving for an exotic country less scrupulous than we are in Europe, selling online requires the respect of a certain number of legal constraints, mostly for consumer protection.   And insofar as each of us is also a consumer, it would be ridiculous for us to complain...

If you launch today, do it right.  And if you are already selling online, make sure that your website still meets the legal requirements, as these changed on 1 June 2014!  The new regulations include, among others, an extension of the information obligation (notably precontractual), an extension of the withdrawal period; other provisions concern the delivery time, or even the transfer of risk during the shipping of goods, etc.

An IT provider worthy of the name will be able to produce a website meeting the legal requirements.  To find out more, we remind you that we have already dedicated an article to this subject.  And, as an entrepreneur, forewarned is forearmed, and in any case, you will survive longer; more detailed information can be found on the consumer protection pages of SPF Economie.

Do you need financial help to set the wheels in motion for your e-commerce solution?

Whether you opt for a general module, which is easily configurable, or a more ambitious and customised solution, it is good practice (even essential) to apply for any public grants available.

If there are no grants specifically for the introduction of an e-commerce platform in Brussels, other grants may be intelligently used.  By this we essentially mean export grants (obviously for those with a real international development strategy) and consultancy grants (which, as the name suggests, only relate to consultancy services, to the exclusion of mere development). 

This subject has already been discussed in a previous article (FR).

So, should I do it or not?

There is no easy response to this question.  The answer is rarely simple, but the question is asked.  So make sure you dedicate the time required for this!

We are well aware that e-commerce is having more and more of an effect on our consumption habits.  But is this distribution channel really suited to very small companies?  Can it - should it - really form part of your distribution strategy?  Can you "plug" an e-commerce site into an existing distribution network?  Or is this perhaps a rather costly and ineffective novelty?

 

Updated 28/07/2017

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