Q&A: MARC LOLIVIER
DIRECTOR GENERAL FEVAD
The head of the Fédération e-commerce et vente à distance (Fevad) offers his expert perspective on the French ecommerce sector as part of Retail X France 2020 Ecommerce Report publication. This comprehensive report on e-commerce in France is available on Retail X website.
What’s new in the French market since 2019?
Well, 2019 was the year of records for France. We hit three records. Together, they show two or three important trends. Firstly, in terms of level of consumption, we hit €103bn in ecommerce sales in France – €55bn in services and travel,€45bn in goods. Historic data! The second record we hit was in the number of French people online, 40 million. And the third was use of mobile and m-commerce: all websites had an acceleration on traffic via mobile. For 100% of the top 15, their mobile traffic is higher than desktop traffic. For a long time we saw mobile going up, but desktop was almost stable. In November 2019, for the first time in our surveys, we saw desktop was going down and mobile was accelerating. Most people are buying on their smartphones at home – it’s more convenient than opening a computer. Also, retailers are now realising how important it is to have an app for m-commerce as consumers can store their payment details, address, etc. This creates more convenience for consumers.
What were the main drivers of the ecommerce market in 2019 and what do you foresee as the main drivers in 2020?
What we saw in 2019 will continue in 2020. People were spending a lot of time during the gilets jaunes strikes on transportation and could order online on mobile. M-commerce is growing four times faster than ecommerce. So it’s definitely a driver and will keep on for this year, particularly because of apps. All the main webshops now have apps. The second thing we see – and this is a trend that started about a year ago – is brands selling direct to consumers. In Fevad, we see brands joining the federation – Adidas, Chanel, etc. We see a lot of brands that now have a digital strategy, not just in terms of marketing but in sales. Seeing how people are reacting without having to go through stores helps them to create their products. Social media are getting more and more important, particularly to brands. Brands are very strong on Instagram, so they are using these tools and bringing them to ecommerce. Smaller webshops also love social media because they’re cheaper than using Google marketing tools. What are the best enablers in the market? The advent of 5G will really boost mobile. The one thing we need to be extremely careful about is security. Hackers are always a threat. In our last survey, sustainability and security were highlighted as really important. “Is my credit card safe? Is my data safe?” Those are big questions for French consumers. We have to be proactive about this because if you don’t have security, you don’t have confidence. We do research in this area and we have a security working group
What are your priorities as an ecommerce association?
Sustainability and security. During this time of crisis, we are also focusing on integrating newcomers to Fevad. It’s very important we look not only at big players, but also to smaller newcomers, shops and brands that are considering going online. Additionally, Fevad is a great believer in the EU. We want to work on ensuring companies have what they need to complete both internationally and domestically in the ecommerce market. What impact do platforms and marketplaces have? They help small companies and entrepreneurs to get online and with relatively low risk because, if they don’t sell, they don’t pay. It’s positive for companies doing digital transitions. We are lucky because we have good competition. We have Amazon, eBay, Rakuten, but also some strong national players such as LeBonCoin, Cdiscount and ManoMano. I think it’s very important to keep this competition. In France it is generally agreed on by experts that only about 20% of total ecommerce (online sales of goods/services) is through Amazon, which is less than most European countries including the UK and Germany. Having robust competition for the marketplaces/ platforms makes France a very interesting ecommerce market for both international and domestic retailers and brands.
Is sustainability becoming a major issue?
This is a very important topic. We saw over the last two years, particularly in 2019, that this topic really came up. It’s something consumers are demanding. We ran a consumer survey on this and it shows people are demanding more sustainability from webshops as well as physical shops. It’s a global trend, and in this global trend ecommerce is a major shopping tool. Of course we have to meet this demand. It’s something we tell our websites, we need to do more because people are waiting for more from our side on this. There’s a lot of expectation around packaging, the sourcing of products and waste policy. Waste policy is an area where you can come up with a win-win approach – good for nature and good for business. In the past, people thought sustainability would bring more costs/burdens, but I see a change in mindset of companies. Despite Covid-19, sustainability will remain a main topic for 2020.
How is Covid-19 affecting France?
As we speak, the country has been in lockdown since 17 March. In terms of ecommerce, we saw two main phenomena. Some sectors did very well. People went to buy food on the internet, although historically this has been a small market. The second sector that did very well is computer and home electronics because people are now working from home and needed to prepare, to get equipped. A third sector was cultural products and educative stuff to get kids occupied and busy.
On the other side, sectors such as clothing and home furniture were hit with a 40-60% decrease. It’s something that did not surprise us because people were stressed. For about 10 days after 17 March, everything stopped except in the sectors I have mentioned. Basically, 20% of webshops reported growth, whereas 75% reported a decrease of sales, an average drop of around 50%. One thing that was really new with this crisis was logistics. Even those sectors that were booming were missing people in the warehouses. Home delivery services were overwhelmed. Slowly, the traffic on clothing websites and in home decoration/furniture is starting again. We have not recovered the same levels, but there is traffic. We see that the conversion rate is much slower than it used to be, either because people do not want to buy because they are stressed about the future and also because delivery dates are much longer than people are used to. In summary, this has been a big shock for the ecommerce sector and we have had to adapt very quickly. On the other hand, we are less affected than stores that had to be closed down. We are in contact with all our members and decided to help all the webshops, whether they are members or not. We provide information, organise webinars and we work with the government to help the sector.