Introduction
In today's post we present an interview with Pawel Fornalski, e-commerce expert and founder of the iDoSell platform. The interview, conducted by Konrad Szatkowski, provides valuable insights into the current state of the e-commerce market, the impact of pandemics and strategies for the future. Here are the most important lessons that can help e-commerce sellers succeed.
E-commerce growth during pandemic
During the pandemic, e-commerce recorded rapid growth, driven by the need to move shopping online. Customers, forced to order online, over time became convinced of this shopping model, resulting in a natural increase in sales performance. According to Pawel Fornalski, "in covida, e-commerce grew naturally, which was due to the fact that it was difficult to simply buy products in the traditional way, primarily in shopping malls, and more people started ordering online." However, after the pandemic ended, there was a correction in the market, and the results were no longer as promising. Fornalski points out that consumers began to spend less on durables and luxury goods and more on travel and other experiences, which affected the decline in e-commerce sales.
Rising costs and price list increases
In the post-pandemic period, many SaaS companies raised their prices as a result of increased labor costs for IT professionals and other economic factors. Fornalski points out that "e-commerce systems were severely underpriced." The increase in the cost of e-commerce systems was a necessity for companies to be able to cover the growing expenses of developing and maintaining services. The labor of IT professionals has become more expensive, and the market for IT services has become more globalized, which has further affected costs. Fornalski also notes that when comparing the cost of developing a system on one's own to using SaaS solutions, the latter still comes out cheaper, despite the increases.
The importance of speed of delivery
One of the key factors for success in e-commerce is speed of delivery. Customers expect ordered products to reach them quickly and efficiently. Fornalski stresses that "we very often talk about flying to Mars, and the package arrives after a week." Companies that can organize fast and efficient deliveries gain a competitive advantage. Fornalski notes that in many companies the packing and shipping process takes too long, which affects customer satisfaction. It is worth investing in streamlining logistics processes to meet customer expectations.
Customer relations and personalization
Building lasting relationships with customers and personalizing offers are key to e-commerce success. Customers appreciate personalized attention and personalized offers. Fornalski stresses the importance of relationship marketing, which keeps the customer coming back to the store. Investing in personalization tools can bring significant benefits, as customers who feel appreciated and noticed are more loyal. Fornalski says that "the most important thing is relational marketing, the kind of marketing that makes the customer come back to the store, will try to perpetuate the brand and the product and the store in some way, and will want to come back."
The Future for Small Vendors
Small retailers can succeed by focusing on niche products and providing quality customer service. Although the e-commerce market is increasingly dominated by large players, small retailers offering unique products and quality service have a chance to build a loyal customer base. Fornalski notes that "if you're talking about online stores, I've consistently said the same thing for a decade. The future belongs to those who build relationships well with the customer and build good logistics." This shows that even small stores can compete if they focus on delivering quality products quickly and building relationships with customers.
Changes to the Business Model
The future of e-commerce is the direct to consumer (D2C) model, where manufacturers sell their products directly to consumers, eliminating middlemen. Fornalski stresses that "the future of e-commerce belongs to manufacturers, the so-called direct to consumer." This model allows for greater control over margins and customer relationships. Manufacturers can offer more attractive prices because they eliminate middlemen's margins. This also allows for better brand management and customer service quality.
Competition from China
Products imported from China are a significant part of the e-commerce market. Companies that can effectively manage logistics and deliveries from China can compete on price with local vendors. Fornalski points out that "a lot of brands can simply be made in-house based on when ordering in volume from a Chinese." However, it is important to keep in mind product quality and regulatory issues. Products must meet safety and quality standards to earn the trust of customers.
Strategies for the Future
E-commerce companies must be flexible and ready to adapt quickly to changing market conditions. Fornalski stresses the importance of constantly improving offerings and logistics processes. It is also crucial to invest in new technologies and tools that can streamline operations and improve the customer experience. Fornalski says that "instead of importing 100,000 products into a store, it's better to choose a few, a dozen or so unique products and build marketing around them." This approach allows for better assortment management and more efficient use of resources.
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Summary
An interview with Paul Fornalski provides valuable tips for e-commerce sellers. The rise of e-commerce during the pandemic, the need for price increases as a result of rising costs, the importance of speed of delivery, building relationships with customers, the future for small sellers, changes in the business model, competition from China, and strategies for the future are all key areas worth paying attention to. Implementing these lessons can help e-commerce sellers succeed and build a sustainable position in the market.
