#FromAislesToApps: Journey beyond the shelf

With the ongoing tech heaviness across industries, including FMCG, and significant tech-oriented investments being made, it’s an exciting juncture to discuss how brands are navigating through their journey beyond the retail shelves.

Over the past few years, especially since the pandemic, the role of e-commerce for FMCG brands has changed a lot, observed Internet Commerce Summit (ICS) MENA 2024 session moderator Nader Amiri, Partner, Homegrown.

So, what’s the role and business model that e-commerce plays for your business, he asked his fellow panellists.

“Our brand has been built on the D2C model and I personally like to call it Direct to Community as opposed to Customer,” stated Justine Dampt, Co-founder & Chief Executive Officer, Shake Your Plants. “We are in the business of acquiring and retaining customers online. Almost 70% of our sales in the UK and in the UAE come from the website – of which 37% come from Meta and the rest is organic. So, building and engaging with our community online is of essence, while expanding our presence offline by participating in events.”

“I think without e-commerce for D2C brands, it becomes hard to penetrate the retail market,” Amiri stated. “Often, the challenge is not to be on a shelf but to move products from the shelves. For that, a strong brand recall among the community is crucial,” Dampt added.

As a bootstrapped startup Bambuyu.com also launched as a D2C brand initially. “It allowed us to launch with a single product – for the first nine months we only sold toilet paper – and that’s difficult to do in an offline retail environment,” shared Founder Sahar Karoubi. “The D2C model allowed us to learn, engage with our customers, understand what the new SKUs could be to launch and how we can build it up, and we really grew organically from there. After the first six months of operating through our D2C platform we started developing our presence on marketplaces such as Amazon and Kibsons.”

While building a community is crucial for startups where D2C plays a big role, what’s the role of e-commerce for large players, Amiri asked.

“It’s a growth driver for us too,” responded Baris Akdevelioglu, E-commerce Manager ME, Pepsico. “Although we’re not a startup, e-commerce generates awareness and double-digit revenue for us. It’s a channel that drives repeat purchases and at the same time helps us to run trials and innovate.”

The role of e-commerce has evolved significantly in the past few years at Fine Hygienic Holding too, shared Bashar Al Mousa, Global Director of E-commerce. “It’s no longer a channel for online sales only. It’s one of the channels that helps us to enable a holistic, omnichannel experience to reach a wider audience and indirectly improves offline sales. Moreover, the e-commerce channel, I feel, has more capabilities when it comes to understanding the customer journey and influence decision making for the overall strategy of the company, especially when we’re launching new products. E-commerce was a small channel for us that now accounts for double-digit percentage of our total sales.”

At this point Amiri asked the best way to build an e-commerce presence.

“Whatever acquisition cost you’ve planned, triple it, and don’t give up on offline activation which has the potential to drive organic growth online,” Dampt recommended.

“The brand story is important,” Karoubi added. “Customers are not just buying a product; they’re also buying into our mission to improve the environment with our tissues made from bamboo. And bamboo is a grass versus traditional tissues that are made from trees and contribute to deforestation. Our customers are keen to make an impact with their choices.”

PepsiCo has very strong muscles in terms of go-to-market offline. How challenging is that to translate online, Amiri asked.

“It’s quite challenging,” Akdevelioglu admitted. “Offline, we’ve a huge aisle which we share mainly with another company. Online, we don’t own an entire aisle, we are competing to be on the top.”

Summarising how e-commerce has evolved, Al Mousa said, “There was no playbook for us when we started our e-commerce business. Everything was a learning curve, and since then we’ve been on a ‘fix the fundamentals’ journey. Importantly, teams play a big role in determining success of any business, irrespective of channels.”