What is the potential of the ecommerce business

Study: Manufacturer online shops have a lot of potential in e-commerce

In recent years, more and more manufacturers have pushed their own way into the internet. With their own online shops they tried - sometimes more, sometimes less successfully - to bind customers to themselves and to build up their own image. In the study “Manufacturer Online: Potential 2020 - Rising Stars of Online Retail?” By ECC Cologne and 004 GmbH, it is now clear that there is still a lot of catching up to do in some industries.

© Manufacturer Online: Potential 2020 - Rising Stars of Online Trade - ECC Cologne / 004 GmbH

In the short study "Manufacturer Online: Potential 2020 - Rising Stars of Online Retail?", ECC Cologne, in cooperation with 004 GmbH, examines the potential of direct manufacturer sales and comes to the conclusion that there is still room for improvement in some industries.

For the study, a so-called degree of maturity was determined for the various retail sectors. In the sectors in which a low grade was determined, the authors of the study selected ten sub-sectors that appear attractive for manufacturers to sell directly online. The following segments were examined: automotive accessories, construction, office equipment / furnishings, catering supplies, household goods (GPK), food, medical and health supplies, furniture, safety technology and tools.

Manufacturer online shops are spurring e-commerce

On the supplier side, the market is primarily occupied by big players such as Zalando, Amazon and Co. Shops directly from the brand, on the other hand, only have a small market share. However, these have recorded above-average growth of around 28 percent in recent years. The turnover for 2014 is estimated at 4.3 billion euros.

And the authors also forecast decent growth in the future. The reason for this is the loss of importance of the classic three-stage value chain. With the increase in cross and multichannels, brands can use a wide variety of sales channels. The fashion industry in particular is a pioneer in verticalization.

Customers are impressed by the manufacturers' online shops. Almost 27 percent of the consumers surveyed stated that they usually shop in the manufacturer's online shop. For users with a high brand affinity, the figure was 42.3 percent. The reasons for shopping in the manufacturer's shop include the “detailed information on the product”, “the large selection” and “the special service quality”.

© Manufacturer Online: Potential 2020 - Rising Stars of Online Trade - ECC Cologne / 004 GmbH

The manufacturers themselves see advantages for themselves as well as for their sales partners in the reasons mentioned. Because contrary to the common assumption that manufacturers and retailers are in extraordinary competition with one another, they understand partnership as an essential maxim.

For example, Andreas Unger, Head of E-Commerce at Stabilo International GmbH, explains: "The primary goal of our online shop is not to achieve a certain share of sales, but to make the Stabilo brand tangible digitally." The named manufacturer of home accessories refers to the common practice: “We want to reach customers with our online shop that we cannot reach through our trading partners. The sales are therefore not lost to the trading partners. "

The industries develop differently

Depending on the industry, direct sales by manufacturers with their own online shop are very different. The authors of the study see reasons for these differences both in the degree of development of online affinity and in the different degree of verticalization.

While the areas of Fashion & Accessories, CE / Electronics and Leisure & Hobby each have a very high online share of the respective overall market with over 20 percent, the manufacturer shares are comparatively low. This is particularly noticeable in the hobby and leisure area - the manufacturer's share is just 0.4 percent.

© Manufacturer Online: Potential 2020 - Rising Stars of Online Trade - ECC Cologne / 004 GmbH

The authors of the study determined the “degree of maturity” of the product range in accordance with the manufacturers' shares in the online market and the online sales potential. Manufacturers see a particular need to catch up in the areas of home improvement & gardening, fast moving consumer goods (FMCG), leisure & hobbies, health & wellness, and living & furnishing.

In the study “Manufacturer Online: Potential 2020 - Rising Stars of Online Retail?” The authors go into the particularities of the respective product ranges. However, they make it clear that not every product group is suitable for vertical forward integration.

If you would like to know which product range has what potential, you can download the short study "Manufacturer Online: Potential 2020 - Rising Stars of Online Retail?" Here free of charge.