It’s prime time for consumer electronics retailers. The holiday shopping season is in full swing, and according to the latest research from the Consumer Electronics Association, (CEA), 160 million U.S. shoppers will purchase electronics gifts this holiday season. The CEA further projects that 2015 holiday sales will be “the biggest on record.”
Online sales will continue to rise this holiday season, too, with a growth rate of 13.9 percent over 2014 levels, according to eMarketer. This should add up to a happy holiday season for CE brands, with larger online sales than ever and a growing online influence on offline sales.
But while online sales represent significant opportunities for growth this holiday season, the online world can bring significant threats as well, and brands must take the right steps to protect their brand equity and minimize channel conflict, while also increasing their online market share. What can brands do to ensure online success this holiday season and throughout the year?
Online success starts with complete visibility of who is selling their brands online, where and for how much, especially in the age of marketplaces. Once brands understand this, they can then take steps to identify and address unauthorized sellers, better support their authorized channels, and ultimately take appropriate measures to grow their share of the digital shelf relative to competitive brands. There are three primary steps to doing this:
Step 1: Understand who is selling your brands online. Do you really understand who is selling your brands online? Online marketplaces mean anyone can become a seller, and it’s estimated that over a third of U.S. e-commerce purchases now go through marketplace resellers. However, many traditional monitoring tools provide no or very limited visibility into this fast-growing channel.
The first step is to gain visibility of everyone that is selling your brand online — retailers and marketplaces — and for how much. The graphic below shows a sample representation of price ranges and depth of product coverage for digital cameras at both stores and online marketplaces:
Step 2: Increase the performance and compliance of your authorized sellers. The next step is for brands to strengthen their authorized sellers. Brands may know who their authorized sellers are and which products they carry, but typically they lack visibility into how they are representing and supporting their brands online. Brands need a channel intelligence solution that highlights product coverage, availability and pricing by retail partners on demand and over time. This also gives the insight to ensure authorized sellers are compliant with negotiated terms including pricing (MAP or otherwise), products and promotions.
Step 3: Increase your share of the digital shelf. The third step to online prosperity for brands is to understand, optimize and de-risk the composition of their digital shelf over time, taking great care to avoid too much consolidation among a handful of retailers. As well, brands will need to gain insight into the online market penetration of competitive brands, so they can respond appropriately.
By following these three steps, brands will protect their brand equity, drive margins and increase their online market share this holiday season and beyond.
Jenn Markey is marketingVP of 360pi, a market research firm that helps retailers and brands including Best Buy Canada, Overstock.com, TrueValue and Ace Hardware successfully navigate the multi-channel landscape with real-time insight into who is selling what, where, and for how much.