At Cross-Border Magazine, we like to have inspiring discussions about cross-border e-commerce. In this article, we are focusing on Deliveroo Singapore in partnership with eTail Asia. Deliveroo offers consumers food choices for every occasion.

We spoke with Minjoo Lee, Head of Marketing at Deliveroo Singapore, to discuss their cross-border and e-commerce journey.

Can you tell us a bit about yourself and Deliveroo Singapore?

As Head of Marketing at Deliveroo Singapore, I oversee all activities related to Brand, Marketing, and Partnership and spearhead strategies and implementation. Over the past two years in the Deliveroo Singapore team, I have been honored to be part of the core management - giving me opportunities to build a high-performing team.

In fact, our latest consumer survey results found that consumers are now used to the convenience food delivery services bring, so much so that it is part of their daily lives. This has encouraged us to continue engaging and building loyalty among consumers. As a food delivery platform committed to offering consumers the food choices they seek for every occasion, we have been. We will be actively adding an even more comprehensive array of options. These include healthy options like SaladStop! and VIOS by Blu Kouzina. Also, not forgetting their craving for local food, we onboarded the likes of CRAVE in order to better meet their food preferences along with our local hawker stalls island-wide.

At the heart of it all, as a global F&B delivery platform, technology is still the baseline of our operations and offerings to cater to our stakeholders effectively and meaningfully - be it keeping our customers fed, creating accretive revenue streams for our restaurant and grocery partners, or providing riders with access to earning opportunities with flexible work which fits around their schedules.

Can you tell us about Deliveroo’s global expansion throughout the years? 

Deliveroo was first started out of London in 2013 by our founder and CEO, Will Shu. He discovered a city full of great restaurants, but he was amazed that so few of them delivered food. As such, he made it his personal mission to bring the best local restaurants directly to people’s doors. Since then, we have grown rapidly and now operate in 10 markets worldwide, working with 179,000 restaurants and grocers, 150,000 riders, serving millions of consumers.

In 2015, we entered Singapore to further build on our goal of making food accessible to all, especially given the strong food culture here. Since then, we have expanded to our current 80 people-strong teams, working with over 10,000 restaurant and grocery partners and 8,000 delivery riders - all of whom played very pivotal roles when we entered the pandemic.  

Moving into the post-pandemic phase, restaurants still recognize the importance of food delivery and that it is complementary to their dine-in services, bringing in additional revenue. To best support restaurants in fully embracing the increasing demand for deliveries, we work closely with our restaurant partners to provide insights and help identify opportunities in order to best engage their delivery customer base. 

Beyond restaurants, we also launched our grocery delivery offering in Singapore in 2021, after noticing consumers’ growing reliance on delivery, especially how it increased exponentially during the pandemic.   

Just last October, we further grew our global footprint by entering the Qatar market to connect consumers with a range of local and international restaurant choices, coupled with quick and reliable deliveries. This is our third market in the Middle East after the UAE and Kuwait, where we have been seeing strong business performance and consumer demands.  

As we continue offering a plethora of food delivery choices and convenience for our customers, we also remain committed to giving back to those in need in the communities we serve in. 

• In doing so, we recently rallied for greater donation support from our customers by expanding our partnership with local Singaporean charity, Food From The Heart (FFTH), to contribute an additional 43,000 meals to beneficiaries through this current campaign.  
• Aside from our campaigns with FFTH, we have also been actively organizing Ramadan initiatives that seek to create positive impacts over the past years. On this, we have recently collaborated with Darul Makmur Mosque in Singapore this past month to reach over 250 mosque-goers each week across four weeks by distributing meals for the breaking of the fast onsite at the mosque.  
• On top of our core business as a food delivery platform, we are regularly looking for new ways to be a force for good and give back to the communities in which we work, and we are grateful for the opportunities that have allowed us to do so thus far.   

And what about Deliveroo’s e-commerce journey? 

Deliveroo has observed a growing appetite among Singaporeans for food and grocery delivery services. On the e-commerce front, food delivery has definitely become an indispensable part of Singaporeans’ daily lives, and this trend has not dissipated post-pandemic, with us seeing more customers and restaurant and grocery partners on the platform.  

Post-pandemic, Singaporeans’ lives, and food delivery services have become even more intertwined. As highlighted in our latest consumer survey results, 60% of Singaporeans say they use food delivery services now more regularly compared to pre-pandemic times. A large majority (70%) anticipate they will use food delivery services at least once a week. 

Currently, grocery delivery services are also on the rise as more consumers turn to digital/online means of commerce. Almost 60% prefer getting groceries delivered over going to the supermarket. In a 2020 survey commissioned by Deliveroo, only over a fifth said they were most likely to order from grocery stores when using food delivery services. 

With the pandemic shifting consumer preferences and wanting to adopt healthier lifestyles, we’ve also pivoted our offerings to better cater to these demands. As part of our ever-evolving journey, Deliveroo has remained committed to meeting consumer demand for more healthy food options through convenient access to a wide range of restaurants and grocery offerings on our platform. In the last two years, Deliveroo has seen a significant increase in orders for our ‘Healthy’ and ‘Healthy Options’ categories. 

Food and grocery delivery services are definitely here to stay in Singapore. For many F&B businesses, food delivery is even an indispensable part of their business. As demand for food and grocery platforms continues to grow, Deliveroo is committed to serving the diverse taste buds of all our customers. 

What are some offline and online strategies adopted by Deliveroo Singapore? 

As dine-in resumes its pre-pandemic levels, it’s important that we adapt yet still retain the core value proposition of Deliveroo, be it to consumers or restaurant partners. As found in our report, while food delivery remains a key part of our everyday lives, we have empowered consumers to have the option of ordering online and heading to our partners’ restaurants/stores for self-collection via the Pickup option. This encourages footfall from our app into the stores/restaurants of the operators (in line with the return of dine-ins), enabling another direct touchpoint between operators and consumers.  

Online 

We are constantly ensuring we stay relevant and connected with consumers by being the platform that delivers happiness through food. Whether they are ordering their favorite food or trying something new, Deliveroo strives to be the delivery service they turn to help spark that moment of joy when consumers get their food delivered to their doorsteps. Concurrently, we continuously support our partners and merchants to unlock incremental revenue generation through our understanding of consumer preferences and demands. This not only helps customers discover new and amazing food options but ensures that our restaurant partners get connected to these consumers.  

Offline

While being largely driven by online engagement due to us being an online delivery platform, we turn to offline activations mainly for key milestones. One such example was our 7th birthday celebration pop-up event in Singapore last November, which saw us bringing treats for fellow November birthday babies in the CBD. Attendees got to partake in lucky draws to win gifts, merchandise, and Deliveroo vouchers up to S$1000. Furthermore, the first 20 November birthday celebrants who showed up got to redeem additional $50 Deliveroo vouchers. We further complemented this milestone with various online deals and promotions for our customers.  

What are some of the challenges Deliveroo faced with global expansion and online selling? 

While we continue to stay true to our mission to be the definitive online delivery platform of choice and provide consumers with access to the food they love, there is also the challenge of balancing great deals for customers in a highly competitive industry while also ensuring that we don’t end up just forging a transactional/deal-driven relationship with them. As such, our engagement strategies are constantly refreshed to ensure that we remain the platform that brings joy to the daily lives of our customers through them receiving the food they love rather than them turning to us purely for deals.  

And what has Deliveroo learned from these challenges? 

The amazing thing about Deliveroo is the ability to impact so many people’s lives, whether it’s keeping our customers fed, creating accretive revenue streams for our restaurant and grocery partners, or providing riders with access to earning opportunities and flexible work which fits around their schedules. Despite concerns about inflation and the challenging economic landscape, we see that customers are still turning to us as we bring value not just through deals but the range of food offerings, reliability of delivery, and much more.  

Interestingly, through our service standards and our emphasis on giving back to the community, we observed more consumers leveraging their food orders as opportunities to show their kindness - be it for rider tips or rounding up their orders to donate to our beneficiaries from Food From The Heart. These notions further spur our team to do even better, as it showcases the importance of coming together in such challenging and constantly changing times. We strive to continue delivering on these promises across all three sides of our marketplace and stay committed to continuously tackling any challenge that might come our way. 

What would be a piece of advice you would give other people in the same industry? 

Focus on building close relationships with consumers - only then will you be able to truly find out what they are seeking for (whether it’s value, food options, preferences, etc.) and hence be readily able to embrace changes accordingly to cater to the ever-evolving consumer and market trends.  

And why must people not miss the eTail event? 

As the marquee retail business conference, eTail Asia brings with it insights from a plethora of industry experts, including Deliveroo. With the retail and commerce industry constantly needing to adapt according to consumers' ever-evolving preferences, businesses need to stay abreast, and there is no better way to do so than to be exposed to fellow industry partners, be it exchanging ideas or key learnings.  

Find out more here!

The post Deliveroo Singapore: “Food delivery has become an indispensable part of Singaporeans’ daily lives” appeared first on Cross-Border Magazine.

This article previously was published in Cross-Border Magazine

Proudly founded in Singapore, HipVan is creating affordable furniture and home decoration for its customers. Inspired by the problem that in Singapore, there were limited furnishing options, high retail mark-ups and (a lot of) low quality products, HipVan seeks to help their customers build a stylish home they will love every day. Currently, HipVan is accessible in Singapore, Malaysia and the United States, focusing mainly on serving the first two markets. Shobhit Datta, co-founder of HipVan, tells us about the challenges they faced.

What are the key drivers in the success of HipVan?

We focus on providing affordable designer furniture for our customers. Previously, designer furniture was often only accessible for the fortunate people. Every day, our hard-working team is doing their very best to make designer furniture more accessible for everybody. One of the ways we decided to do that is by choosing a pure, cost-effective online business. We only work with one Experience Store in Singapore.

What does HipVan do to improve its business?

To improve our business, we focus on multiple things. First is to consistently improve on our designs and to source better products. Our second key factor is the focus on our service levels; when we provide a good service to our customers, they will remain happy. An important aspect of this is optimising our channels and on-site performance to improve conversion rates.

HipVan is expanding internationally, and currently has an online store in Malaysia, Singapore and the United States. What were the cross-border challenges in this expansion?

As furniture is often bulky, and normally requires assembly, our industry faces more logistical challenges than others. With over three thousand designs, it was necessary to establish a presence on the ground and have the resources to assemble furniture in the locations where we sell our products, for example in our current markets.

What are the big differences in selling in these different countries?

In South East Asia, the online consumer is not yet used to buying furniture online. It requires a bond of trust, which we need to establish first, through our customer service. They are the main contact point, alongside the web shop, for our customers and can persuade them to buy online on our shop. They create the bond between web shop and consumer.

Another big difference is how we can set-up our logistics and fulfilment department. Singapore is compact, which makes it easy to serve the whole country. For other countries, expansion will be more deliberate. We will have to take a city-by-city approach to establish our brand and services.

The furniture market hasn’t got the easiest products to ship in general. How does HipVan cope with selling furniture in the logistics department?

In Singapore we have an in-house team that has been especially trained to assemble all kinds of furniture. In other countries we use third-party partners.

How is HipVan expanding into the future?

We will keep on introducing new products, new designer furniture at great value. This way, we are trying to become of even more interest to our customers. Another aspect we are focusing on is more technical; we would like to develop tech features like image search, and also look into AR to make it possible for all our customers to create a beautiful home.

The post HipVan: Designer Furniture in South-East Asia appeared first on Cross-Border Magazine.

Berlin – a blooming and friendly city – building the future that does not forget about its past. It is the city of Zalando’s headquarters as well. We are meeting up to talk to Vice President Customer Satisfaction Lisa Miczaika and Vice President Logistics Products Jan Bartels, who will tell us about Zalando’s way of handling their customer care and the brand new Zalando Fulfillment Solutions.

Customer Satisfaction: a team effort

In 2017, Zalando is a well-established fashion platform in Europe, dealing with thousands of customer queries every day. It all started when one of Zalando’s founders, David Schneider, put his phone number on the website in 2008, and since then, Zalando’s customer care has grown into a key factor of the organisation. Lisa Miczaika: “Customer satisfaction is one of the main cornerstones of our organisation and customer care an important aspect of it. Satisfaction is not produced from customer care alone, but rather an effort from everyone.” She continues: “A customer care team is very close to the customer, since they are always in contact with them through various channels.”

As Zalando started in Germany, this is where their customer care team started as well. Expanding across borders, into new markets, let to the demand of more service teams. Each team located in Berlin focused on their own market: the German team on the German market, Austria on the Austrian market, the Dutch team on the Dutch market and so on. “Every team had its own thing going on, and although we had processes, they were not clear for. At some times, it was chaotic in the beginning. We had some basics: a customer called with a problem and it had to be resolved. However, in the last four years, as Zalando grew, we became more professional in terms of having this backbone that you need to do customer care. What our team of specialists concentrates on is ‘what the customer wants’, and improving the NPS (Net Promoter Score).”

Measuring Satisfaction

Having the means to measure customer satisfaction lead to decent and effective changes in the workflow. For a large fashion platform, such as Zalando, it is essential to have satisfying workflows. The brand asks customers to fill out a survey, and when customers agree, they receive a survey that measures all important NPS scores. All touchpoints, from landing on the webshop up until the potential reimbursement of a returned order, are questioned. “We try to collect data on all aspects that influence the satisfaction of a purchase and look at them monthly. People are more than welcome to write a negative review, but naturally, that is not what we wish for. It is not just about preventing bad reviews to be written, it is more. Naturally it is not what we wish for, but people are more than welcome to write a negative review. Our goal is that in the end, the experience of the purchase was a good and positive one. Our goal is that customers come back to us the next time,” says Lisa. Analysis of gathered data from the survey, as well as from social media channels, review channels and more leads to very specific, localised changes in certain processes. “For example, when we notice that French customers may were not happy with certain promoted items during the previous summer, we try to find out why. Or, for instance the tendency that our customers are very used to their local delivery company. This is for example why we decided to work with PostNL for our regular deliveries and with DHL Express for fast delivery in the Netherlands.” Lisa explains.

Zalando has not rolled out a ‘one size fits all’ approach. Each market has its own tailored customer care approach. A common example is differences in payment preferences. The Dutch very much like to pay with the local payment method iDeal, while Italians like to pay with cash on delivery, since they are relatively new to shopping online and have not build up the necessary trust to use payment systems like credit cards.

Customer care and its development takes place in Berlin, as Zalando has their customer care for the largest part done from the capital of Germany. While it sometimes might be difficult to find the right employees to work on the local markets from Berlin, Zalando works with native speaking customer care employees, an approach the team views as highly effective. “We do not outsource 100% because we want to stay close to our customers to know what is on their minds. This means that outsourcing in general is not what we aim for. However, in some markets like the Finnish, and in certain periods the Dutch, we struggle to find the right native speakers to work in Berlin. That is why we outsource some of our work to sustain the stability in our service levels, and to have the people we need inhouse. Our partners in the local markets are a part of the Zalando family and know how we work. We handle all training ourselves to make sure our brand values are communicated, and to know that our personnel are able to provide service in line with the Zalando Identity. It is important that our customers experience these values when they visit the website or when they actually pick up the phone and contact us,” says Lisa.

The concept of the Zalando Identity only started about a year ago, but the results already show an increased customer satisfaction. “Customers feel that they are talking to a person instead of a robot. That is what we want customers to feel, that we really want to help them resolve any issues. Just as important for us was the change among our own employees. Being able to talk more freely to our customers is way more satisfying. For our diverse audience this works well, since our teams now have the autonomy to interpret how to talk to them. You do not talk in a stiff manner to an 18-year-old, and that is why we allowed more freedom to tailor the conversation.” comments Lisa.

Growing on a steady fundament

As Zalando is growing rapidly, all aspects of the company need to grow with it. Among these aspects are the customer care teams. Is it not very difficult to keep the customer satisfaction on the same level while expanding in so many ways at the same time? “The most important thing when growing is to have a reliable, steady fundament. If your fundament is steady, you have the opportunity to expand. If it isn’t strong enough, you will run into issues. We realised that in customer care, we would need outsourcing partners to keep our service levels up for some local markets.” says Lisa. “To me, there are different components to a steady foundation. Firstly, having the right number of people to deliver local service on the level we want. We do not want Swedish customer care in English, for example. The management part is very important too. Only employees who feel comfortable, and are happy with the offered working conditions will be able to deliver good customer care. Second is the process part. This means that we need to provide everyone with information so they know what they need to do, and on the other hand give them enough freedom so they feel comfortable doing it. The last is the technological part. You need a good CRM-system, have the right channels like Chat, WhatsApp and Facebook etc. When these three pillars are covered, you can grow.”

What about local differences in service?

Lisa says, “Zalando works with Experience Managers, one for each local market. They make suggestions to provide the best local services. Our Belgian Customer Experience Manager, for example, pushed us very strongly to provide customer service for native Flemish and Walloon speakers. Typical Dutch or French speakers do not go down too well for Belgian consumers. We also gained unique insights from our Finnish Experience Manager. The Finnish do not like to call and prefer to chat, as they think it is a more convenient and quicker solution to a problem. We increased the offering of chat in this market. Our Experience Managers really help us to localise and tailor the experience to a market.”

To make these changes, Zalando wants to confirm that something works. Therefore, new features are tested extensively upfront. “A lot of it is technological, AB-testing, where we divide customers into two groups and see how they react to different messages that are supposed to say the same. We did this for our Surprise & Delight programme, where we act when something goes wrong and send flowers or chocolate to apologise for the inconvenience. A handwritten card, drawing or anything else – even without a discount voucher – was received as more satisfying than a formal email message with a 20% off voucher.”

It is OK to make mistakes

Very interesting for Zalando, and something Lisa Miczaika clearly supports, is the open mind for new things. While being a very structured organisation with a lot of tailored processes and workflows, there is room to improve and to learn. It is okay to make – small – mistakes. Lisa explains: “Without making mistakes, we cannot learn as much as we do when we do make them. To find things out and see how they work, you must do tests. If something does not work, we stop. An example is a customer care chatbot utility we tried – it was not great and we decided to quit the experiment. It was important that we clearly told our customers we were testing this as a feature, so they hopefully would not blame us if things were not going perfectly. I still believe it could be a nice addition for our company, once the technology has developed itself. It could be a great addition to our dynamic FAQ.”

Zalando Fulfillment Solutions

As learning and development are so important to Zalando, it is only logical that new services are being introduced. One of the major new services are the Zalando Fulfillment Solutions. Here Jan Bartels comes in. With natural enthusiasm, he tells us about this new feature Zalando introduced for its partners. “One of our newest babies, Zalando Fulfillment Solutions, helps us expand the Zalando platform. In the past, we basically sold products launched on our platform. As we have built up strong logistic capabilities, we have now opened them to our partners.”

The fulfillment solution look a lot like Fulfilment by Amazon, which has the big advantage of being very close to the end-consumer. Jan Bartels says: “It is only logical for other companies to think about these kind of services, as they are very economical. Our partner programme is our approach to a marketplace. It is even more, as we have our own opinion about how to do things. Partners are offering their merchandise on our platform – they remain the owners of the goods and make all economical decisions, like pricing and offered quantity. In the past, we used to work with a dropship model, where our partner had to meet certain requirements to send his product(s). With the Zalando Fulfillment Solutions, this has changed. We did this to secure convenience levels of our end-customers. As we know what customers in local markets prefer and we have the technical connections to do so, we can easily provide them to our partners. For them, it would be very time-consuming and expensive to integrate all of this. We have been through this journey already, so why not make it easier for our partners? Besides that, by the end of this year, we have multiple warehouses in which our partners can store their inventory. Most big brands only have one, or maybe two in Europe. This way, we can help our partners to be more local to their customers as well.” says Jan.

“There is an economic benefit as well,” he continues. “Look at a typical Zalando order in our partner programme and it becomes clear – our customers, generally, do not buy one item on our shop. Usually, there are items from different brands and from Zalando as well. What happens in a classic dropship model is that every partner would send out a parcel with their part of the order. In the worst-case scenario, a customer would have to be at home for multiple deliveries on multiple days, which is not consumer friendly. Similarly, returning an order would happen in multiple packages. The Zalando Fulfillment Solutions makes sure that the customer only receives one package with all items. For our partner and us, it means a cut in logistic costs, which makes it possible for our partners to extend their offered range of products,” tells Jan.

This service is about enablement. By providing the service,  partners can extend their assortment, which helps brands to expand their European footprint. Naturally, Zalando started testing this solution service to make sure everything works. Just as in customer care, hiccups in service could be eliminated before a full launch took place. The programme is still developing itself. Jan Bartels: “As we were piloting the first Zalando Fulfillment Solutions, we were already testing a new service, Fast Replenishment. This is a service where our partners have weekly replenishments, resulting in a low capacity consumption on our side. For our partners, the benefit is to keep their stocked inventory more in control. We can predict what will be selling in the next one or two weeks and can recommend our partners what to send to us. When we provide our stated service levels, our consumers, partners and we can benefit from this solution. We have fully launched it since then.”

Bartels is very clear about one thing: the Zalando Fulfillment Solutions will be an exclusive feature for their partners. “We do not want to become a sole logistic service provider. Zalando will remain a fashion platform. We would not offer our fulfillment service to a brand that is not a part of our partner program – that is not the idea behind the Zalando Fulfillment Solutions.”

The post Zalando: Care for Customers and Partners appeared first on Cross-Border Magazine.

What was the motivation to move towards a more digital business model?
“On the one hand, we wanted to sell online because the customers are increasingly getting used to doing everything online. In their private life, they are accustomed to services as offered by Amazon or Zalando, and therefore begin to wonder why in the B2B environment they should still do everything in an old-fashioned way. In addition to that, we wanted to improve our service. We had a strategic analysis performed by a company called Fenego, who made an overview of how to better translate our goals into a digital strategy. We want to sell the farmers what they need, but also offer technological support to help them improve. One example is to help livestock farmers monitor the growth of their animals online. Technological applications like this not only serve the farmer, but also help us to offer the farmer new options to optimise his business, such as advanced nutrition fitting his situation. The classic cross-selling has got a new component: the salesman used to speak to the farmer out on his land to talk about his needs, but it is now also driven by data gathered online. Online data has given us an alternative, additional source of information.”

So, the e-commerce system is also used within the organisation?
“The digitalisation of Schippers’ processes supports both the continuous improvement of the system, and the optimisation of support the company can offer to its customers. Customers can see their invoice history independent of the sales channel of their previous orders. They can easily place repeat orders or make a list of favourite products. They can also start a return procedure wherever they are. Also, the inbound personnel of Schippers can always access this in real time.
The 10 localised websites not only serve the customers buying online, but also support the inbound sales agents when assisting buyers over the phone or to make orders. As the inbound agents make such heavy use of the e-commerce systems, their feedback is of great value when improving the processes.”

Do you offer localised content?
“Yes, we have all our foreign websites in the appropriate languages, and I can tell you that translation is an undervalued challenge. We use translation agencies, and then have all content double checked by our local people. We are lucky to maintain good relationships with the team and clients in all countries, so we get enough feedback to find problems in the texts and to improve. Besides translations, the content is localised as well as the payment methods.”

How did you manage the transition to a functional, international e-commerce system?
“We have a PIM system (Product Information Management), where we manage our collections, which we share with the webshops. In the Netherlands, Germany and Belgium we have the same collection, which can be compared with a category structure. Products may differ, but the structure remains the same. In Canada, for instance, we have a smaller assortment, so we had to adapt the category structure. Our PIM shares product data and collections with touchpoints through websites, apps and catalogues. From the PIM, we have a special application to share information with the website and we also use it to make our catalogues.”

Catalogues? Do they still exist?
“Sure! They are an important marketing and information feature because people can easily start exploring with catalogues. In addition, with a web shop, you can’t make it clear that your company has a wide range of choices, whereas the thick catalogue always creates that idea. Another positive is that clients start looking online when they are already in an order process, whereas the catalogue is looked at during lunch or coffee, just to have a little browse. This has an inspirational value.”

With which platform do you realise international online sales?
“We use Intershop. It is an internationally powerful B2B platform that makes it easy to manage different situations in different countries, e.g. when it comes to pricing, VAT or shipping costs. We thought the risk of taking an open source platform was too big for us. Intershop makes each international step faster and easier, and we can open in new countries without any problems. We integrate our catalogue, Syncforce and all client data and prices (SAP) with the Intershop platform.”

How do you manage international differences?
“In each country, there is a marketing expert who also advises on the local assortment. The assortment differs per country, and the registration for products might also be different. On top of that, we see that the acceptance of internet as a B2B purchase channel varies from country to country. In Germany, internet usage is sometimes very low, so we suggest to our farmers to try ordering online, but we never push them to change their habits. For us, there is no difference in which channel they use.”

In which way do you use online marketing as a tool?
“We carefully weigh with which kind of customer we are interacting with. Smaller clients are often sensitive to promotions, special offers, that we can put online. They constantly weigh us against the competition. Larger companies have a different relationship with us: we talk about solving problems and we build a different kind of trust and long-term collaboration. The website becomes an ordering tool. We know that the farmers need time for their work, so we don’t want to steal it. We make appointments for real discussions about optimising operations, and shopping can easily be done via our online services, even after working hours if the client wishes. One of the most important questions was how can we better facilitate our customers by offering a 24/7 self-service portal. In order to accomplish the goal of showing the customer as much of the information possible relevant for the customer individually, we needed to make information from the SAP ERP system available in a ‘My Account’ section on the webshop. This was realised through a synaptic integration between Intershop and the SAP-system used by Schippers. We also make increasing use of social media; Facebook is regularly used by farmers and we have already accumulated 10 000 likes in about 10 months. We also get questions there from all over the world, which has already clearly increased.

Is it difficult to make customers trust online markets after years of ordering from a catalogue?
“The most important factor here is reassurance. If you send a good order confirmation, you already win a lot of trust.”

How do you deal with marketplaces like Amazon or Alibaba, which may compete with you on certain levels?
“They are active in certain overlapping sectors, yes. We don’t use marketplaces like Amazon and Alibaba for our sales. For the future, I could imagine it would be interesting to grant other, third-party suppliers access to our marketplace and client base. But we would then keep everything under our name and brand identity. However, we would not like to engage in drop-shipping models, because it distracts our clients from their work if they have to leave the stable for multiple deliveries. In our checkout process, you can always bundle your products to a single delivery. But if we can arrange it in a way that suits us, developing towards a marketplace model is surely an option.”

And other continents, such as China for instance?
“There are cultures where our products simply meet a much lesser demand. In China, livestock farming is not at a level that structural hygiene and an anti-antibiotics policy as advocated by us, are something people are looking out for. But who knows what the future brings. Martien Schippers always said the Netherlands is- as far as the farming industry is concerned- a good indicator of what will happen elsewhere in the future.”

The post “I could imagine opening up for third-party sellers” appeared first on Cross-Border Magazine.

Who?
Harrie Temmink is currently the Acting Head of the Public Interest Services unit, DG Internal Market, Industry, Entrepreneurship and SMEs and the European Commission. The unit is responsible for postal and parcel affairs, gambling services; and other services of general economic interest such as energy, water, health and education. Harrie has a Dutch Law degree as well as a Spanish Language and Literature degree from the University of Utrecht (the Netherlands).

What about coffee?
Like many of his fellow Dutchmen, Harrie is an enthusiastic coffee drinker. Before lunchtime he has usually already had a cup, if not more!  At work, he prefers Nespresso Lungos. At the weekends, he tries to limit himself to one cup a day (but not a Nespresso!), at breakfast. When he goes out for lunch or dinner, he likes to have an espresso after his meal.

Why is delivery such a crucial element of successful cross-border e-commerce and therefore also of the digital single market?
Delivery is a key factor in the overall development of e-commerce, in particular of its cross-border development. There are many challenges for postal operators and e-retailers which can have major effects on the customers. Studies show that delivery-related problems heavily influence whether e-shoppers finalise their purchases. Consumers too often don’t know what delivery options may be available to them, when their order will arrive, and how they can return it if they so wish.

Many retailers, SMEs and larger ones, still seem to struggle with cross-border logistics. What do you think the reasons are?
The delivery market is a diverse and complex one, with different operators offering many different services and prices depending on many features such as weight, size and format, as well as destination and number of items. This makes it difficult for e-retailers and e-shoppers to access comparable information about delivery, resulting in sub-optimal choices. In addition, one in five e-retailers say they are only aware of one delivery operator, but the average number of alternatives is, in fact, three to four operators.

The European parcel market can generally be characterised as a tight oligopoly – although more competition can be identified in specific markets. One of the consequences of this is that the list prices for cross-border delivery from the traditional postal operators are on average three to five times higher for parcels than their domestic equivalents. These differences cannot be explained by labour costs or other costs in the destination country. This is particularly an issue for low volume senders of cross-border parcels such as SMEs and individuals who have less bargaining power to negotiate tariffs directly with the parcel delivery operators. There also regulatory and administrative requirements such as customs regulation and complicated VAT procedures.  The lack of inter-operability between delivery companies in two different countries is another major factor that complicates cross-border logistics.

Wouldn’t you say the forces of a growing market will regulate these problems over time, wouldn’t that be better than policy makers interfering?
In principle, I agree. In 2012 the European Commission organised a broad consultation of e-retailers, postal operators, users, national authorities etc. Indeed, the responses showed us that the interested parties expressed, in essence, a preference for industry-driven measures. Therefore, the European Commission's roadmap for completing the Single Market for Parcel Delivery of December 2013 largely contained actions of a self-regulatory nature. We stimulated the creation of pan-European trustmarks for the e-commerce sector, which were later established by companies such as EMOTA and ECommerce Europe, containing criteria for the quality of parcel delivery services.  

However, there is an additional role for policy makers when market forces alone cannot repair the imperfections in the market. This is why we have come forward with a proposal for a regulation on cross-border parcel delivery services to improve price transparency for cross-border EU deliveries and to enhance competition. In a broader context, legislation may be necessary in order to guarantee decent employment conditions and basic consumer rights.

How will the new platform "Deliver in Europe" help to solve their problems?
The objective of the "Deliver in Europe" platform is to improve the transparency of information on existing parcel delivery solutions, particularly for cross-border delivery. The platform is set up as a "one-stop" information point for e-retailers on existing eLogistics solutions, presenting and comparing all the different solutions available. The information platform should give SMEs effective tools to improve their bargaining power. The EU is co-funding this (private) project which will hopefully become operational by the end of 2016.

Do you think there is enough interaction between EU policy makers and the industry and consumers? What actions are taken to improve the information flow and interaction between these three?
The door is always open at the European Commission! We try to reach out as much as possible to e-retailers, parcel operators, consumer representatives… During the last few years, for instance, we hosted several major workshops to bring interested parties together. The Postal User Forum was intended to sound out the customers of the parcel delivery services. We are also active in the European Social Dialogue Committee and we have frequent meetings with the national regulators, in particular in the context of the European Regulators Group for Postal Services (ERGP). Finally, no new initiatives are considered without a proper public consultation which feeds the so-called "impact assessments".

The post A cup of coffee with the Cross-Border European Commissioner Harrie Temmink appeared first on Cross-Border Magazine.

Stephan Spijkers, Operations Director at Westwing

Who? He has worked for Westwing for 4 ½ years, practically from the beginning of the company in the Netherlands. He is responsible for the entire supply chain process, from ordering from the supplier to delivering to the client and everything in between, including transport, warehouses and last mile carriers. He also manages certain IT developments such as new features on the website, the app and the mobile site.

This article previously appeared in Cross-Border Magazine Nr.2, which you can download here.

Furniture and home decoration is one of the fastest growing categories in e-commerce, with around 30% of total sales in Europe, and one quarter of sales in the United States already happening online. Selling furniture online is a logistical challenge on its own, but combining it with a flash sales concept for sure ranks among the more complicated business models when it comes to operations. Nevertheless, furniture and lifestyle pure-player Westwing is pulling it off, having grown from a start-up in a German garage in 2011 to an international player active in 14 countries with over 26 million members. We met with Stephan Spijkers, the operations director for Westwing in the Netherlands, in Amsterdam, to discuss the operational challenges of the fast-growing, international home and living retailer.

A complex business model
The business model of Westwing is complex, describing itself as a ’shoppable magazine’. Westwing runs 1000 new products per day in a flash sale method with 30-70% reductions and without having any inventory. The continuity and amount of new daily products are a clear advantage of this idea. The ‘shoppable magazine’ is a hybrid of an inspiration source and a daily deal site, active in Europe and with a smaller focus on Russia and Brazil. The trade-off of the business model are the long delivery times and the dependence on the supplying manufacturers to keep their promises.

Just as many similarly operating websites, Westwing places an order with a contracted supplier once the flash sale is over. “One of our main challenges is how to get products to the client faster. As our business model has zero inventory, 24-hour delivery will not work for us, but if you look at where we have come from, we have already achieved a lot. One year ago, we communicated a 3-5 week delivery period and now 30% of our products can be delivered within 1-2 weeks. Improving delivery times without breaking any promises you make to the customer, is one of our major challenges,” explains Stephan Spijkers.

Start in-house, scale up with partners, refine in-house
Westwing started small, from a little office in Munich where all employees helped packing deliveries. When growth accelerated, a partner was docked with experience in the ecommerce sector. Through the facilities and services of the outsourcing partner, Westwing quickly scaled and ventured into many markets. “After a while, we refined our services by managing the processes with the suppliers ourselves, including purchase orders, invoicing, and communication. In Berlin, we have now gone back to doing a lot of things ourselves, such as the inbound operations, which form an important part of the business.”

Sourcing and selling
The local offices work on two fronts: they source products from local brands, and they serve the local customer buying from the website. At the moment, Westwing is most active in the countries where there is also an office, but they sell to most neighbouring countries as well. The local presence is important, because the differences in customer preference in this sector are very outspoken, even between culturally similar countries such as Germany and the Netherlands. However, some countries share offices and warehouses: the Benelux is managed from Amsterdam, and the Berlin warehouse not only serves these countries, but also the entire DACH region. “In each country that Westwing is active in, there is a staff of 110-120 people sourcing and buying products, presenting them on the website, telling stories, taking photographs and holding interviews for the magazine. There are also extra styling tips along with most sales”. The products sourced in one country can be offered on all 14 Westwing websites, depending on how many countries are interested. Spijkers: “Sharing these campaigns means that a very small manufacturer from the Netherlands gets the chance to launch his creations in France and Italy.”

Cross-border platform
Brands can thus use Westwing to sell into new markets and to test demand in these markets, which makes it, alongside Amazon and other market-places, an interesting cross-border platform. The operations director explains: “Westwing understands online marketing. This is particularly interesting for manufacturers from the home and living sector that have little online experience. We offer a marketing platform, millions of relevant newsletters and a good logistics system, while creating an individual, beautiful brand representation on our site. Even if that means we must change product descriptions or send our photographer there to shoot the right images. Our suppliers don’t have to do too much; we can facilitate everything from presentation to logistics.” Selling furniture online is often perceived as a challenge to traditional players, Westwing did it from scratch: “The most special thing about our work is that we ship large furniture all across Europe on a daily basis, without the customers even noticing. When they order something, they often don’t even know that these products come from all over Europe. Maybe we should communicate that more. For us, these are normal daily operations,” says Spijkers.

The delivery must match the brand experience
One of the goals is to find ways to make the delivery experience match the overall inspirational tone of voice the company which is presented on its site and throughout the shopping journey. All parcels are therefore re-packaged in branded, turquoise Westwing boxes with a special filling. Products are divided into two categories, packages and ‘2-man handling’ goods, which includes furniture like sofas or beds. Both categories are handled by separate, specialised last mile carriers. The quality of the delivery is an essential part of the branding and customer retention process: “You don’t want your €1500 sofa to be delivered by a shady operator in an old minivan,” illustrates Stephan Spijkers. Returns are free at Westwing, even if it’s a box-spring bed or a couch. Items are stored at the warehouse. “Either we run a new campaign with this same brand, or we sell it off to third parties.”

Logistic challenges
“Making delivery faster” maybe sounds like an easy job to accomplish, but if you look at the way a parcel has travelled before arriving to the customer, the scope of the challenge becomes evident. Spijkers: “Suppliers from the Netherlands deliver products to the Berlin warehouse and from there they either go to Dutch or German customers or to other warehouses in Europe. On a micro level, it seems more logical to send one pallet directly from the supplier to an Italian warehouse and another one to France. On a macro level, it works best for us to gather everything in Berlin, where we can make bulk deliveries, sending a full truck to the Italian warehouse.”

However, Dutch and Belgian clients ordering from Dutch brands also receive their parcels from Berlin. In order to improve the turnover time, Westwing has now outsourced part of its fulfilment of smaller packages. “We want to serve our Dutch clients quicker and also improve the export options for our Dutch suppliers, which is why we selected a local partner,” says Spijkers, adding: “It was vital for us improve delivery times, especially for smaller products, because that’s what the clients desire. Working with a local partner is faster for Dutch clients, but also useful for foreign deliveries.”

Drop-shipping- a holy grail of the future?
Drop-shipping seems like a quick-win solution when it comes to improving delivery times, but it makes it complicated to safeguard quality. Westwing has started pilots with certain suppliers, helping them with the packaging, IT solutions and offering them the same contracts with the parcel carrier that Westwing has negotiated. A complete transition seems far away, though Spijkers acknowledges the rise of this trend: “if you look at the US furniture industry, they are already ahead of us. There, 70-80% of furniture and home décor is drop-shipped directly to the consumer. We lower the barrier by offering suppliers a drop-ship starter pack, providing the boxes and we help with an IT integration. But there are limits to where this approach takes us. In the US, you see that drop-shipping starts as soon as the products are sourced from the factory. They come in dropshipment-ready packaging, directly from China or Indonesia. That is the future, but it still seems far ahead.”

No special offers for Christmas
Although home and living items seem like perfect gifts, Westwing does not massively scale up its offerings for the festive season. “We believe in presenting our selection beautifully, not by filling up the website. Why add more just because we can?” says Spijkers. Logistically, however, there is a lot of coordination required during the holiday season: clients order more and a whole group of new clients come in. This peak must be anticipated and communicated not only with the brands supplying the products, but also with the logistics partners. “We have to coordinate how much extra capacity we expect for this season, and how we can improve delivery times further for the Christmas time.”

The future
In Germany, Westwing is experimenting with pop-up stores and has launched an “on stock” online shop called ‘Westwing Now’. “Faster delivery is going to be an important component of such a shop’s success. However, Westwing has proven that brand experience and the product itself can be more important than the delivery time. Otherwise, we wouldn’t have become this successful.” 

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