Derisking E-Commerce: 3 Pillars Pet Brands Must Master
After reading the headlines, you might assume that every pet food and product manufacturer is swimming in profit due to the e-commerce and omnichannel surge over the last few years.
It’s just not that simple.
In fact, the exponential increase in e-commerce business adds complexity and uncertainty.
- More competition offering more choices to consumers
- More demands from more retailers to drive consumer traffic and purchases
- More pressure to have the right products in the right places at the right time
- Less control and oversight of pricing, promotions, and discoverability of your products
- Less awareness of market realities, competitive benchmarks, pricing perception, and profit drivers
- Less confidence in your digital performance, decision making and ability to tell your internal and external stories
While these factors are relevant to all CPG brands, the acceleration and penetration of omni-channel shopping and higher shopper loyalty in the pet category elevate the need to address them quickly.
The 3 Pillars of E-commerce Mastery
Working with pet brands and retailers, we see the most successful organizations focusing on three areas:
Collectively, these components provide the core controls, causal and drivers of growth.
Similarly, deficiency in any of the key areas can directly impact the other areas in a way that compromises the reliability and effectiveness of your entire e-commerce approach.
For example, if you cannot enforce MAP compliance, your visibility into pricing perception is skewed.
Add to this the fact that MAP violations may be driving availability issues jeopardizing your ability to be seen by your customers.
As a result, your marketing investments and revenue strategy are compromised by an inability to accurately construct a pricing architecture that protects profitability.
How to Manage the 3 Pillars for Growth
To solidify your e-commerce presence and competitive strategy, use the 3 pillars as foundational building blocks, but also understand the factors that strengthen each of these key areas.
For many pet companies, e-commerce has become more about putting out the latest fire than acting strategically. When we look at the driving factors of price, promotion, assortment, and availability across your competitive set and retail ecosystem, we can identify which of the pillars is weakening and which can offer the biggest gains.
For example, we often hear from pet brands, “We know we are out of stock. There is nothing we can do about it right now.”
Out of stocks lead to lost revenue and compromise digital shelf positioning. Let’s focus on areas that can balance this loss…
- MAP compliance to protect profitability of your in stock products
- Promotional compliance to make sure that you are not paying for promotions when there is no stock
- Digital shelf visibility to understand how the out of stock is impacting your discoverability and ranking so you can plan for the future
- Market strengths and weaknesses to build a strategy to get back in the cart when you are available
Pick and Choose Your Battles
E-commerce is a necessity to compete as a pet brand today. However, doing so shouldn’t feel like a leap of faith. Instead, brands should be intentional and informed about priorities and investments.
The 3 pillars and influencing factors are guides to help you reduce risk in your e-commerce business decisions. However, it’s not possible to address every factor at once. Choose which battles are worth fighting today.
It is so important that common understanding, prioritization and investment are tethered by accurate, relevant and timely data.
When you have data that informs each of the pillars, you eliminate blindspots in your e-commerce and competitive approach without worrying about crashing.
Bungee Tech offers all manufacturers the opportunity to measure their e-commerce data with a complimentary benchmarking sample aligned with the 3 pillars – compliance, visibility, and strategy.
At Bungee Tech, we believe that e-commerce should not be a blind leap, but an adventure for brands and retailers that are securely cemented to solid ground with Bungee Tech’s competitive data and market analytics.