How have companies shaped the future of commerce with economic conditions?

In order to decipher the influence of macroeconomic circumstances on changes in usage and commercial issues, Maddyness wanted to give the floor to Bastien Borget, e-commerce manager from Eden ParkJudicaël Baudot, Digital Director by ElevenParis and Emilie Benoit-Vernay, Southern Europe Director for Shopify🇧🇷

Adopting adaptation as a way of life in times of crisis, a business reality

Macroeconomic events, when they generate consequences considered negative, can be classified into two categories: events that cause the total or partial stoppage of the activity and those that increase the cost or difficulty. In any case, company adaptation, in the Darwinian sense of the term, is necessary for the entrepreneur.

Covid, in this sense, is a perfect example of macroeconomic circumstances bringing business to a screeching halt. The impossibility of going to the store meant the impossibility of companies selling their products and services. It was therefore necessary to modify its activity for the professionals affected.

Meanwhile, current macroeconomic issues such as the war in Ukraine, inflation and rising international freight costs are hampering business without closing business. The increase in these costs is a serious issue to be studied: should the price increase be passed on to the customer? Should you take responsibility and reduce your margin?

Taking an interest in the difference between the turnover and the company’s real profit then assumes all its importance and requires a detailed analysis of the company’s economic health. “It’s a reality: the cost of transport has exploded. This gives the opportunity to reflect on the approximation between production tools and delivery services. The habits of consumers, who now want free express delivery, are also at odds with the desire not to raise prices too much. However, the additional cost is high and forces us to readjust our price, even if we had borne this additional cost since the beginning of the pandemic” specifies Bastien Borget, Eden Park eCommerce Manager.

This problem invites entrepreneurs to carry out a diagnosis of the company’s economic situation. This is the first step towards rationalizing costs and making trade-offs to direct available cash to the essentials. “With these crises, we were able to resume and analyze all our investments. Today, it is necessary to be accurate in financial reading, and thus know from a budgetary point of view, where to cut expenses and where to increase them. Immediate profitability becomes important. Thus, the Shopify tool allowed us to focus only on our customers’ problems, without wasting time on technological issues » affirms Judicaël Baudot, Digital Director at ElevenParis.

It is true that external financing has become rarer, or more expensive, because of these macroeconomic circumstances: It is therefore necessary to do better with less money, to make liquidity efficient. Work habits, planned investments and daily expenses of the company must be studied in order to carry out consistent arbitrations.

These reflections, necessary in times of crisis, can lead to a repositioning of the brand, as was the case with ElevenParis. “Before, our target audience was 18-35 years old” recalls Judicaël Baudot, Chief Digital Officer at ElevenParis🇧🇷 “Today, we are in an audience of 13 to 18 years old, mostly female. It was Covid and the awareness of our brand’s digital power that allowed us to take this turnaround. […] Our audience is young, and has a different way of spending their money than their parents. This perhaps explains why we are not strictly impacted, for the time being, by inflation”.

Crises, opportunity to reinvent yourself and create new opportunities

After covid, the forced digital transition forced companies to adapt. For Bastien Borget, e-commerce manager at Eden Park, this period accelerated the brand’s commitment to e-commerce: “In 15 months, we have seen a leap of several years in the digitization of sales and the increase in turnover in the sector. It was a real paradigm shift. Our Shopify e-commerce brick allowed us to easily absorb these new flows.”

However, the development of e-commerce has not replaced physical sales. E-commerce has become an additional means of attracting customers, in addition to the brands’ physical stores. “In 2021, local shopkeepers wanted to keep both channels, and over time they managed to demystify the difficulty of opening an online business”, says Emilie Benoit-Vernay, Head of Southern Europe at Shopify.

A multimodal logic thus developed more quickly thanks to these macroeconomic circumstances: capturing the attention of customers in a channel (website, social networks, physical stores, etc.) issue in the relationship with the customer. Thus, if a good is not available in the store’s stock, the possibility of accessing it online from that same store is a real strength.

The company reinvented itself and counted

This reinvention of the company thus presupposes a reflection both in the relationship with the customer and in the relationship with the company’s employees. 🇧🇷 More and more people want to be entrepreneurs or self-employed. Today, it has to be a legal company to be successful in recruitment: offering telework, working with sports and well-being at work,…”, says Bastien Borget. The individual awareness that has emerged in recent months is influencing the company, which must adapt in the eyes of the new generations of workers.

As far as customers are concerned, they now have access to more information, allowing for greater insight into their consumption. Entrepreneurs had to adapt to this transparency. The crisis revealed the need for proximity between the customer and its brand, and the desire for product authenticity.

This proximity is linked to the customer acquisition cost: this has become increasingly high and forces a shift from a transactional commerce logic to a relational commerce logic. Customers no longer buy a product, they buy a story, an experience. Communication must therefore adapt even more in times of declining purchasing power, when consumers carefully select what they buy.

“We are moving away from transactional commerce to relational commerce, and that requires a better connection with consumers” affirms Bastien Borget🇧🇷 “You need simple access, be able to communicate quickly with them, and have a great CRM to give him relevant information according to what he wants. New networks like Tiktok are exploding. It is an axis to talk to them, in a different way. We must be careful not to lie about who we are, about our company. The company’s DNA must be visible in the various communication channels”🇧🇷

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