Increased willingness of consumers to shop direct poses ongoing
profitability challenge to manufacturers
BRACKNELL, England--(BUSINESS WIRE)--More than two-fifths (42%) of European adults have bought products
directly from a manufacturer in the last 12 months, according to the JDA
Manufacturing Pulse Report, which surveyed 6,146 adults online
People are also reading…
across the UK, Germany, France and Sweden (tweet
this). However, 43% of respondents said that a lack of delivery or
collection options that suited their needs would stop them from shopping
directly with a manufacturer, while a further 43% stated they were
frustrated when manufacturers did not have their desired items in stock (tweet
this). Despite these concerns, of those European adults who had
bought directly from a manufacturer in the last 12 months, 40% said the
experience was better than that encountered when shopping with a
non-manufacturer (tweet
this).
When asked about their shopping habits, nearly a third (30%) stated they
had bought more products directly from a manufacturer now, compared to
five years ago (tweet
this). The research also highlighted that European adults are
shopping directly via a number of channels; of those adults online who
had bought products directly from a manufacturer in the last 12 months,
68% had shopped in-store and 53% had done so online (tweet
this). While many manufacturers have an online presence, this
illustrates that many still don’t offer consumers the ability to buy
directly from their websites.
“The huge boom in omni-channel commerce is now also really starting to
impact the manufacturing sector. Consumer goods manufacturers are at a
crossroads when it comes to selling directly to consumers. To date, many
have dipped their toes into direct selling and in the main have found it
an unprofitable exercise. The question now facing the majority of
manufacturers, is how do I make my online channel profitable?” said
Hans-Georg Kaltenbrunner, VP Manufacturing Industry Strategy EMEA, at JDA.
“We have already seen the retail industry grapple with the same
challenges. Today’s manufacturing supply chains must be reshaped to
handle more fulfilment locations and increased singles picking for
customer orders, while at the same time offering choice and convenience.
With the potential costs of fulfilling orders high, manufacturers must
protect themselves now against any impact on their bottom line.”
Getting closer to the customer
The online research found that there is still considerable room for
improvement when it comes to how manufacturers are using customer data.
Indeed, only 38% of European adults who had shopped online with a
manufacturer in the last 12 months thought that manufacturers had made
good use of their customer data. When it came to social media and online
reviews, 32% of respondents said that reviews shared online and via
social media had influenced their purchasing decisions over the last 12
months (tweet
this).
After price, choice and availability seen as reasons to go direct
Perhaps unsurprisingly, price (62%) was cited as the biggest reason for
why respondents would ever shop directly with a manufacturer; followed
by product availability (39%), product warranty (32%), product choice
(31%) and product knowledge/experience (24%) (tweet
this). Certain sectors lead the way when it came to the type of
products that respondents had purchased directly from manufacturers in
the last 12 months. Of these people, just under half (46%) had purchased
furniture for the home, followed by clothing or footwear (35%) and
electrical equipment (33%) (tweet
this). Further broken down by gender, the figures reveal that across
all countries surveyed, more men online (38%) purchased electrical
equipment directly from a manufacturer in the last 12 months than women
(28%), and more women (51%) purchased home furniture than men (40%);
more women (36%) also purchased clothing or footwear than men online
(34%).
Getting personal
Personalisation has the potential to become a significant differentiator
for manufacturers in the future, yet its impact on supply chains could
be considerable. Currently, 9% of European adults online said they had
items personalised by manufacturers in the last 12 months. However, over
a quarter (28%) of respondents said that personalisation would make them
more likely to buy products from a manufacturer (tweet
this).
“In order to meet the demands of today’s digital consumer, manufacturers
need a digital supply chain. Digital capabilities in planning,
manufacturing and fulfillment will allow physical supply chains to be
configured in a way that can support both manufacturers’ traditional and
direct channels. If manufacturers ignore or take only a piecemeal
approach to their direct channel, it will prove unprofitable and may
damage brand reputation. Those that invest in it, supported with the
necessary supply chain planning and execution capabilities, have the
opportunity to improve profitability and create positive customer
experiences,” added Hans-Georg Kaltenbrunner.
All figures, unless otherwise stated, are from YouGov Plc. Total sample
size was 6,146 adults (UK, 2,083; Germany, 2,025; France, 1,029; Sweden,
1,009). Fieldwork was undertaken between 8th-15th October 2015. The
survey was carried out online. The figures have been weighted and are
representative of all adults (aged 18+) in the UK, Germany, France and
Sweden.
Access the JDA Manufacturing Pulse Report 2015 here.
Tweet This: #JDASurvey
Finds European Adults Are Shopping Direct w Manufacturers But Can They
Keep Up w Customers’ Expectations? http://bit.ly/1l24tkX
About JDA Software Group, Inc.
At JDA, we’re fearless leaders. We’re the leading provider of
end-to-end, integrated retail, omni-channel and supply chain planning
and execution solutions for more than 4,000 customers worldwide. Our
unique solutions empower our clients to reduce costs, increase
profitability and improve collaboration so they can deliver on their
customer promises every time. Using JDA, you can plan to deliver. www.jda.com
RSS Feeds:
JDA press releases: www.jda.com/rss.asp?a=press
JDA
LinkedIn:
YouTube:
SlideShare:
“JDA” is a trademark or registered trademark of JDA Software Group, Inc.
Any trade, product or service name referenced in this document using the
name “JDA” is a trademark and/or property of JDA Software Group, Inc.
Contacts
JDA Software Group, Inc.
Mette Krogh, +45 20 827 825
Senior
Marketing Director, EMEA
or
JDA
Public Relations Contact:
Jolene Peixoto, +1 978-475-0524
Director,
Corporate Communications