Sep 21, 2018 03:14

The Swedish e-com market and the importance of strategy

By Ulrika Stroth Karlsson

In an excellent article about Swedish e-commerce, where the Beaconomist (in Swedish) talks with some of the major players in the field, about consumer demands, competition, trends and Amazon, it becomes apparent to the reader that the market for e-commerce solutions and products is thriving. The total market for e-commerce in Sweden was worth 109,5 billion SEK in 2017, according to the industry report Svensk e-handel. But isn't the market saturated yet?


Old tech is ageing quickly

The short answer is no, not as long as there is old tech around. The rapid evolution of e-commerce technology  as a result of customer maturity and ever-changing consumer demands , prevents the market from being saturated. Performance is crucial for customers today, digital natives have low tolerance for complex processes and long load times, which is why more retailers decide to invest in new tech or rebuild their solutions from scratch.

One of the biggest challenges for e-merchants today is to catch people's attention and inspire them to stay on the site. As a result, there is a constant need for new integrations and improvements to existing solutions. User experience, personalisation, loyalty programs and omni-channel support features are becoming hygiene factors and retailers need these components to just stay in the game.

What use is a car if you don't know how to drive it?  

The complexity of tech and customer expectations have also increased the demand for truly strategic coaching and advice. Before, during and after a tech project. Buying the latest tech is the easy part. Creating a business model and an organization supported by digital tools is much harder. It requires new skills, new ways of working, new processes and new priorities. 

- We can see that our customers to a greater extent are asking for a combination of strategic advise and technical execution, says Niklas Johnson, CEO at Avensia, and this is exactly the Avensia way of working. Two of our customers, Lyko and NA-KD, were awarded prices for best e-commerce during the spring, and the key for both projects has been to have a clear strategy and spearheaded technology. This combination has enabled superior user experiences and as a result, higher sales figures.    

 

What is the strategic approach to competition from Amazon?

An article about e-commerce  in Sweden would not be comprehensive without mentioning the elephant in the room. And not only the elephant known as Amazon, other big players, Wish, JD.com and Alibaba should not be neglected either. Tobias Bergström, commerce advisor at Avensia comments on the development:

 - It’s interesting to see how many companies with retail outlets, be it brick & mortar or digital, see online marketplaces such as Amazon or eBay as a threat to their existence, rather than new sales channel opportunities. Especially considering that most have a substantial proportion of their sales in private label products to which there is no direct competition. And it’s about time we start seeing commerce platforms as the hub of all digital business, independent of channel.”

Tobias and his colleagues in the  advisory team have a lot more to say about this issue, and about other trends and coming challenges for retailers.  Read more about the advisory team and our strategy service offerings!

 

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