European brands think relying on marketplaces is not sustainable

October 12, 2020 by
Sanne Leenders
European brands

According to Accenture and GEODIS, 54% of European brands think their e-commerce potential is crippled by their logistical capabilities. That is why many retailers and brands turn to online marketplaces. However, they think that relying on marketplaces is not sustainable. Therefore, they want to shift the balance more to their own e-commerce channels.

Two key findings emerged from Accenture and GEODIS' research. The first is that the COVID-19 outbreak brought major changes in where brands make their sales. During the lockdowns, online sales doubled, while direct online sales quadrupled. 56% of European brands expect their direct online sales to exceed 20% in three years from now.

The second finding is that 54% of European brands think their logistics is not scaled to support their online business acceleration. “So many brands use marketplaces as a one-stop-shop for selling their products. This allows them to reach a broad audience and compensate for a lack of resources and logistics infrastructure, while at the same time meeting the expected customer experience”, says Sohel Aziz, Managing Director of Accenture.

Depending on marketplaces

Currently, 59% of European companies depend on online marketplaces for their online sales. This percentage is higher than that of companies from the United States (46%). In the period before COVID-19 spread across the globe, online marketplaces had a 28% share, while during the pandemic it increased to 38%.

However, many brands believe that over-reliance on marketplaces is not sustainable. They want to shift the balance more towards their own online sales channels. Almost two-thirds (64%) say reducing the dependence on marketplaces is their first or second priority in the next six months.

Selling directly to the consumer

Within three years, 56% of European companies want to sell directly to consumers through their own online store, with the goal of generating 20% of their total sales through this channel.

“Currently, only 5% to 8% of online sales are direct sales from brands’ own websites. The brands want to increase this share to 20% or 30% over the next three to five years”, Sohel Aziz explains. “The survey shows that brands are aware that improving their omnichannel logistics capabilities is essential. To achieve their goals, adjustments are urgently needed.”

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