With the proliferation of e-Commerce platforms making it easier that ever to sell products online, it is increasingly difficult for brands to stand out.
In this week's webinar, Ogilvy Consulting's Pierre Kremer will take us through the retailing landscape and how brands can matter in e-Commerce.
4. Do you
want this
deck?
It will be available for download
shortly after the webinar on:
slideshare.net/socialogilvy
And the recording up on
facebook.com/OgilvyConsulting
5. A Bit Of Context
eCommerce Landscape
eCommerce Imperatives For Winning In eCommerce
7. % eCommerce sales
Source: Nielsen Total Store Report
Frozen Foods
Alcohol
Bakery
Dairy
Meat
Produce
Packaged Grocery
Household Care
Personal Care
Health Care
Pet Care
Beauty Care
49.3%
0.8%
57.0%
67.4%
46.0%
18.4%
41.4%
17.8%
28.7%
27.3%
73.3%
26.9%
YOY Growth
0% 5% 10% 15% 20% 25% 30% 35%
Value Creation Opportunity: eCommerce has yet to pass the
“tipping point” in many categories
8. 2007 2017
1000
2000
3000
4000
2xin 10 years
Total Number of Consumer Products
Introduced in the U.S. Market
By category, 2007- 2017
Source: Mintel + Wall Street Journal
Battling Clutter: more new products being introduced that ever
9. Global Vs. Local Brand Share of Spend
Source: The Nielsen Company, 2018
36.2%
63.8%
35.8% 35.4%
64.2% 64.6%
2015 2016 2017
Global Brands Local Brands
Dairy Food Beverages
Home
Care
Beauty &
Personal Care
20% 26.6% 38.3% 47% 58.4%
Localization: consumer preferences is shifting to local niche brands
10. Percent of All Autopilot Consumers Who Have Used Autopilot
Consumption for each category over the last 12 months.
Source: GlobalData Consumer Research, March 2018
Grocery home delivery
and automated ordering is
enabling eCommerce
growth
Household
Cleaning
Toilet
Paper
Kitchen
Paper
Dishwasher
Products
Pet
Care
Health
Products
Snacks Diapers Baby
Wipes
Baby
Formula
Laundry
Products
60.7%
57.3%
55.1%
48.6% 48.2%
40.2%
38.1%
29.8%
24.6%
23.9%
20.1%
Innovation: driving consumer buying behaviour change
11. Small and Medium CPG Businesses Taking Share
with eCommerce and Omnichannel InnovationPercent of Global CPG Market
2014 2016
$18Bshift from big to small
in just 2 years
54.2% 52.4%
Large
Medium
Small
Extra Small
Note: Extra small: less than $100M sales, Small: $100M-$1B, Medium $1B-$5B, Large $5B+Source: IRI Data for MULOC
Necessary Cannibalization: without eCommerce pay & value
capture, brand share will decline
12. How do I compete
with Amazon?
How can my brand
stand out amongst all
this competition?
Do I need to sell in
marketplaces and if
so, how do I do it?
Do I have the assets
to win?
What should my
portfolio strategy be?
What should my
content strategy be?
How do I connect
with consumers?
How can I prevent my
brand value from
eroding?
The opportunity?
13. Mindset Shift
From
manufacturer
to retailer
1
Strategic Shift
From
one-size-fits-all to
tailored strategies
2
Accelerate Growth
From
single channel
to omnichannel
3
Three imperatives for brands to capitalise on consumer behaviour
and technology enablement to accelerate growth
14. 1
• B2B model
• Passive role in retail distribution
From Manufacturing…
• Consumer obsession
• X-channel optimization
• Technology savvy
To Retail
From acting like a manufacturer to acting like a retailer
15. • Same brands and products across
eCommerce channels: DTC brand.com,
E-Retailers, and Marketplaces
From One-Size-Fits-All… To Tailored Digital Commerce
• Brands and products tailored for each channel
for optimal channel performance
• Creation of Digital Brand Archetypes
for each opportunity
2 From one-size-fits-all to tailored strategies for digital commerce
16. Percentage of Total Brand Revenue from Digital
Mono
Brand DTC
Portfolio
Brand DTC
3rd Party
eCommerce
*25%–35% *30–80%
*Indicative figures. Derived from Forrester’s, “Assessing The Digital Commerce Opportunity For Branded Manufacturers”, report published
inNovember 2018
• 3rd Party
eCommerce
Selling through
online wholesalers
• Mono-Brand DTC
Pure play direct to
consumer brand-
owned website
• Portfolio-Brand
DTC
Multi-brand direct
to consumer website
3 Retail is detail: follow the money to accelerate growth
17. 3rd Party
eCommerce
Mono Brand
DTC
Portfolio Brand
DTC
Brand/Product
Archetype A
Brand/Product
Archetype B
Brand/Product
Archetype C
Key digital brand “archetypes”
emerge and define how and
why consumers engage with
the eCommerce ecosystem.
Building an eCommerce
Strategy with this framework
allows for tailored strategies to
maximize growth.
Introducing the CPG eCommerce matrix
19. What Consumers
Are Seeking
eCommerce
Purchase Occasion
Where Consumers
Find The Brand
Illustrative Examples
of Each Archetype
Need
Brands/Products
“Solve My Problem” Reactive Amazon
Choice
Brands/Products
“Validate My Choice” Routine / Restock Google / Amazon
Passion
Brands/Products
“Enrich My Life” Impulse Vs Trial Google, DTC.com & Links In
Digital Brand Archetypes Illustration: the consumer
20. Brand Imperative Business Imperative
Breadth & Role of
SKU Assortment
Role of
Content
Need
Brands/Products
Solve Problem
• Be Top-of-Mind
• Focused proof
• Be easy to buy
Narrow Demonstrate
Choice
Brands/Products
Reinforce Choice
• Maintain relevance
• Expand brand role
• Demonstrate leadership
Broad & Deep Engage
Passion
Brands/Products
Build Relationship
• Scale usage to larger
segments
• Drive repeat purchase
• Acquire efficiently
Narrow & Deep Entice
Digital Brand Archetypes Illustration: the brand and business
21. What Consumers
Are Seeking
eCommerce
Purchase Occasion
Where Consumers
Find The Brand
Illustrative Examples
of Each Archetype
Need
Brands/Products
Choice
Brands/Products
Passion
Brands/Products
Mapping Brands: brands can cross-over archetypes
22. 3rd Party
eCommerce
Mono Brand
DTC
Portfolio Brand
DTC
Brand/Product
Archetype A
Brand/Product
Archetype B
Brand/Product
Archetype C
Today’s Discussion
The Making Brands Matter eCommerce Matrix
24. May 7, 2019
1. 2. 3.
4. 5. 6.
Allows manufacturers to
distribute products via
wholesalers online
3rd party sellers can
sell manufacturer
goods without their
consent
Platforms (e.g. Amazon)
launch their own
products to compete
with CPGs
Main consumer
destination for online
purchases globally
First touch in shopping
lifecycle (Amazon
search beats Google)
Algorithms drive
customer experience
which damages
brands
Mono
Brand DTC
Portfolio
Brand DTC
3rd Party
eCommerce3rd party eCommerce and why it is important
25. May 7, 2019
Mono
Brand DTC
Portfolio
Brand DTC
3rd Party
eCommerce
North America Europe Asia Pacific Latin America
3rd party eCommerce and why it is important
26. May 7, 2019
Mono
Brand DTC
Portfolio
Brand DTC
3rd Party
eCommerce
The Top Four Countries Where Consumers “Shop Less Often” at Retail Stores Due to Amazon.com
Retailers are competing with Amazon for market share
Source: PwC, Total Retail 2017
Japan United States Brazil
39% 37% 35% 34% 28%
Germany Global
3rd party platforms drive consumer to shop
less at physical retail
27. May 7, 2019
Mono
Brand DTC
Portfolio
Brand DTC
3rd Party
eCommerce
0
18
35
53
70
China USA France UK Germany Japan LATAM
Column1
MercadoLibre & Amazon
Source: Econsultancy
Alibaba (Taobao, Tmall)
Amazon
61%
54% 56% 56% 56% 54%
48%
3rd party eCommerce platformed first touch in
product searches globally
28. May 7, 2019
Mono
Brand DTC
Portfolio
Brand DTC
3rd Party
eCommerce
Source: Econsultancy
4.3%
9%4%
Low Cost
Trackable
14%
17%
7%
Multiple options
49%Free
Fast
Same Day
Amazon introduced Prime in 2005,
introducing free delivery as a viable
option when purchasing goods
online. Because of this customer
expectations have changed.
3rd party eCommerce platforms have set expectations
29. May 7, 2019
Mono
Brand DTC
Portfolio
Brand DTC
3rd Party
eCommerce
Discover
Explore
BuyUse
Ask
EngageDiscover
Explore
BuyUse
Ask
Engage
From To
Shopping and buying journeys merged, now 3rd
parties play a role in every stage of the lifecycle
30. May 7, 2019
Mono
Brand DTC
Portfolio
Brand DTC
3rd Party
eCommerce
Consumer
Facing
Price
Product Title
Product Description
Visual Assets
Ratings & Reviews
Purchase Options
Logistics
Stock Availability
Fulfillment Options
& Performance
Purchase Options
Search Results
Performance+ =
Algorithms drive 3rd party search, not brands
31. Need Choice Passion
1 2 3
Digital Brand Archetypes in 3rd Party eCommerce
Case examples
32. Case
Examples
How a “Need”
Brand Behaves
in 3rd Party
eCommerce
• Where do consumers engage with the brand?
• Primarily through product-type searches on
eCommerce platforms
• Consumer Cycle Touchpoints
• Buy, Use, Ask, Engage
• Business Imperative
• Control the channel
• Adapt product portfolio to combat
low-frequency usage
• Demonstrate product superior performance
and drive product consideration
• Role of Content
• Focus on performance, providing the
most useful content on how to use the
product and solve the problem
• Expertise, endorsement and consumer
generated content to validate product
performance
“Need"
Archetype
33. Case
Examples
How a “Choice”
Brand Behaves
in 3rd Party
eCommerce
“Choice”
Archetype
Where do consumers engage with the brand?
• Primarily through category-type searches on
eCommerce platforms
Consumer cycle Touchpoints
• Discover, Explore, Buy, Use, Ask, Engage
Business Imperative
• Demonstrate category leadership by driving
awareness of product portfolio
• Address unmet consumer need by developing new consumer-
centric product portfolio and increase reach within category
• Drive routine behavior to reinforce buying frequency
Role of Content
• Address category-type search queries by being as
relevant as possible to consumer touchpoints needs
• Immersive and engaging content to drive emotional
connection with the brand and routine behavior
34. Case
Examples
How a
“Passion”
Brand Behaves
in 3rd Party
eCommerce
“Passion”
Archetype
Where do consumers engage with the brand
• Primarily through brand name searches on
eCommerce platforms
Consumer cycle Touchpoints
• Discover, Explore, Buy, Use, Engage
Business Imperative
• Maintain engagement with consumers and continue
driving loyalty and evangelism
• Develop and/or adapt consumer-centric product portfolio to
maintain brand leadership in category and increase reach
• Reinforce routine purchase behavior
Role of Content
• Immersive and engaging brand purpose content to create and
maintain emotional connection with the brand and its values
• Highlight what makes the product special
• Consumer generated content to drive sense of community,
belonging and positivity
35. May 7, 2019
1. 2. 3.
5. 6. 7.
Serves very specific
consumer demand space
with continuous innovation
Defines every part of
business to deliver the
best customer experience
Smart product
development with varied
distribution models
Personalization at scale:
product, package,
communications
Purpose and community
to drive continuous
engagement/growth
Brand is a bespoke
and authentic
destination
4.
Accommodates single
purchase and subscription
autopilot models
Mono
Brand DTC
Portfolio
Brand DTC
3rd Party
eCommerceMono DTC and why it is important
37. Case
Examples
“Need"
Archetype
How a “Need”
Brand Behaves
in Mono-Brand
DTC
• Business Imperative
• Strong brand awareness to be the first choice
when wanting to resolve a problem
• Very easy to buy, very easy to find
• Business Imperative
• Primarily though unbranded search in Google
• Role of Content
• Focus on performance, providing the most
useful content to solve the problem
• How to and daily hack content to
solve problems quickly
• Expertise and influencer content to
validate product performance
38. Case
Examples
“Choice”
Archetype
How a “Choice”
Brand Behaves
in Mono-
Brand DTC
• Business Imperative
• To be the best performance-wise
• Very easy to buy, very easy to find
• Business Imperative
• Primarily though unbranded search in Google
• Role of Content
• Focus on performance, providing the
most useful content to solve the problem
• How to and daily hack content to
solve problems quickly
• Expertise and influencer content to
validate product performance
39. Case
Examples
“Passion”
Archetype
How a
“Passion”
Brand Behaves
in Mono-Brand
DTC
Business Imperative
• Amplify brand purpose and drive usage
to a larger customer base
Business Imperative
• DTC.com and links in from social
Role of Content
• Pull commerce to attract new users to the brand
• Content needs to amplify purpose and
develop sense of community
• Importance of authenticity and
innovation narrative
• Bespoke in the way the brand behaves and
interacts with audiences, developing a sense
of community that drives purchase
• Personalization of content key to delivering
brand experience
40. May 7, 2019
Mono
Brand DTC
Portfolio
Brand DTC
3rd Party
eCommerce
1. 2. 3.
Portfolio Brand DTC is a
multi-brand digital marketplace
Portfolio Brand DTC enables the
development of category, brand,
product, and lifestyle content
Allows for entire portfolio to be sold
and provides opportunity for new
SKUs to be introduced
Leverages innovative technology to
simplify consumers’ lives and create
new value propositions
Enables collect ion of consumer
data for development of meaningful
personal relationships
4. 5.
Defining portfolio DTC
41. Need Choice Passion
1 2 3
Portfolio Brand DTC Encompasses All 3 Digital Brand Archetypes
All 3 digital brand archetypes exist in portfolio brand DTC experiences
42. CRM
Drive consumer
engagement, brand affinity
and brand loyalty
Content
Creating authentic bespoke
content and UGC.
Innovation
Create new products and
brand.
Commerce
Provide consumers with
purchasing choices that
simplify their lives
Concept
The main reason ‘why’
people will interact
with & buy from a
multi-brand digital
marketplace
Portfolio brand DTC success depends on a powerful concept
47. Mindset Shift
Strategic Shift
Accelerate Growth
3rd Party
eCommerce
3rd party
eCommerce is a
must for “Need” and
“Choice” brands
1
Mono-Brand
DTC
"Choice” & “Passion"
brands are a selective
fit for Mono-Brand
DTC
2
Portfolio Brand
DTC
Portfolio brand DTC
allows you to behave
like a retailer with
omnichannel strategies
3
Three implications for CPGS
48. 3rd Party
eCommerce
Mono Brand
DTC
Portfolio Brand
DTC
Brand/Product
Archetype A
Market to the algorithm
No
Yes
Concept-driven multi-brand,
multi-purpose DTC
Brand/Product
Archetype B
Market beyond the algorithm
to demand drivers
Selective
New news + innovation to drive relevance
+ Seasonality
Brand/Product
Archetype C
Market beyond the algorithm
to people’s passion points
Selective
Personalization + innovation
Authentic + bespoke + Seasonality
The End Result