Winning The Race For Digital Commerce

Despite the growing importance of digital commerce, many established FMCG companies still don’t have a sound plan in place to seize the opportunity. Here are four key steps that will enable brands to get ahead in the digital commerce race.

- Richard Webster, Mike Booker And Suzanne Tager

More and more consumers are opting for the convenience of purchasing on their smartphones or laptops than shopping in stores. Yet the reality is that despite the growing importance of digital commerce, many established fast-moving consumer goods (FMCG) companies still don’t have a well-funded plan in place to seize the opportunity. They’re struggling to win online.

There are some standouts. Procter & Gamble understood the potential of digital commerce early in the game, and made it a core element of its growth strategy. Similarly, Unilever, which is watching its online sales grow at twice the rate of the global e-commerce market, has quickly adapted to the unique needs of the digital marketplace by investing in the right capabilities. These companies are not only holding their own, they’re actually pulling away from the pack. They’re capturing growth in booming digital commerce channels amid tough competition from young, nimble and digitally savvy insurgents such as Harry’s and Birchbox, which are leapfrogging many traditional players in digital capabilities.

There’s a great deal at stake. No doubt about it, the majority of future growth for many brands will come from digital commerce. Online grocery sales alone are projected to top $90 billion by 2020. To appreciate the dimensions — and potential — of digital commerce, look no further than Singles’ Day, China’s annual, promotions-heavy, 24-hour online-sales event, which generated $17.8 billion for Alibaba sites in 2016 alone — more than Whole Foods’ total annual revenue. Sales of FMCG represented a sizeable portion of Alibaba’s revenue.