Archive for January, 2010

Announcing the Alice.com eCommerce Platform for CPG

Tuesday, January 12th, 2010

Today Alice is excited to announce that we have launched a new eCommerce platform that allows Consumer Packaged Goods (CPG) manufacturers to create branded storefronts at their own web properties.  You can read our full press release announcing our new platform here.

Why are storefronts important to CPG manufacturers?

Supporting an online store with the Alice.com platform provides a host of benefits for manufacturers, including:

Engaging with Mainstream Consumers

CPG consumers are busy, and they aren’t likely to engage in a meaningful way with a CPG branded site that lacks the ability to actually buy the product.  Offering an online store is an effective way to attract and enter into an ongoing relationship with that mainstream consumer.  

Gaining a “Learning Lab” of Consumer Insights

CPG manufacturers need to get closer to their consumer.  With a direct commercial relationship, CPG manufacturers can transform their websites into “learning labs” that deliver a rich set of consumer insights that help inform marketing/positioning, product development efforts, and brand building.  And most importantly, these insights can be shared with the manufacturer’s retail partners to drive more impactful promotions and increase sales through the retail channel. 

Delivering Direct Response Capabilities to Online Advertising

Manufacturers can now use the direct response capabilities at their own storefronts as a centerpiece of their digital marketing campaigns.  This helps to ensure that their digital marketing is accountable, measurable, and optimized to deliver the most value over time. 

Meeting Underserved Demand

Between the rise of store brands and retailer sku rationalization, the retail shelf is getting smaller every day.  Supporting an online store allows manufacturers to find a home for their “misfit toys” that aren’t able to secure retail shelf space, but still have demand from consumers.

Gain Incremental Revenue

Multi-channel revenue is increasingly important in today’s economy, and an online storefront can provide another important incremental revenue stream

Why the Alice platform?

Manufacturers in non-CPG industries are increasingly using the online channel to sell direct to consumer (for example, Internet Retailer recently announced that manufacturers selling direct to consumer is the fastest growing online retail category in their Top 500 Guide).

To date, however, CPG manufacturers have had a difficult time joining in that trend and putting up a storefront of their own.  At Alice, we asked ourselves why.  There are a host of eCommerce platforms in the market today that can be used to power an online store.  Why aren’t CPG manufacturers using them and launching their own stores?  The reason, we believe, is because the existing platforms that create stand-alone storefronts aren’t optimized for the peculiar needs of the CPG shopper.  Let me explain.

When we shop for CPG products, we typically fill our shopping cart with dozens of products from multiple manufacturers in a single trip.  Are you really going to replace that shopping trip with an online experience that makes you visit 10 different manufacturer store fronts (from toothpaste, to trash bags, to toilet paper), to order 10 different products and pay shipping fees for each box to reach your door?  And are you going to replicate that process each and every time you run out of a product?  That’s a lot of extra hassle, a lot of cardboard, and a lot of extra shipping fees.

CPG manufacturers are realizing that in order to meet the needs of the mainstream CPG shopper, they need to serve up three things within their storefront experience: 1) free shipping ; 2) a broad assortment of brands that can be purchased in a single basket; and 3) an easy way to plan purchases to avoid running out of items and making emergency store trips.

The Alice.com eCommerce platform allows manufacturers to meet these needs by directly tying into, and sharing, the Alice.com customer experience, including a unified checkout and fulfillment process.  This shared experience enables manufacturers to sell direct in a completely new way—one that allows consumers to easily purchase (and repurchase) from multiple CPG manufacturers in a single shopping trip and receive one box of bundled goods direct to their door with free shipping, overcoming the barriers to mainstream CPG sales online.

A Growing Trend

We are working hard to make this new innovative platform a tipping point for the CPG industry to finally unlock the value of the online channel and transform their websites into learning labs that drive sales across all their channels.  In fact, we believe that by the close of 2010, every major CPG company will either have a storefront up and running at their branded property, or will have a plan to launch one.

Agree or disagree, we look forward to your comments and we are extremely excited to work hard this year to help move the industry forward online.

Posted in Announcements, Press Releases, eCommerce | 5 Comments »

From the DigitalCPG Blog-What Does it Mean to be a “Retailer” Today?

Friday, January 8th, 2010

(This post was originally published on our Digital CPG Blog. Go check it out for more news and notes on the CPG industry)

For all you CPG veterans out there, did you ever think you’d see the day when major retailers would open up their stores up to competitors?  A day, for example, where a small retailer could waltz into WalMart and put an identical product up on the shelf?

It’s happening online.  Today Sears joined WalMart and Amazon as the third big boy to launch a “marketplace” that opens up its online store to third party sellers (see news here, here and here).  eCommerce is certainly changing what it means to be a retailer.

Sears Marketplace

For these big retailers, I can see how the marketplace concept makes sense, namely, by allowing them to leverage the power of their brand to expand their product selection for customers and gain incremental revenue without disrupting their own customer fulfillment costs (Sears, for example, charges each seller a listing fee and the seller drop ships products directly to buyers).  In many ways, it seems like a win for everyone involved.

Can this work for CPG manufacturers that are interested in selling direct to consumer?

In my humble opinion the answer is no for a very simple reason:  Shipping fees.

The mainstream CPG shopper expects to fills her basket with dozens of items from multiple manufacturers and take one bundled basket of goods home in a single trip.  That same shopper is not going to be excited about shopping online for these goods in a marketplace in which she has to pay shipping fees for 10 different manufacturers to drop ship a standalone box to her door.  10 boxes with 10 shipping fees doesn’t seem to work.

Is there a way to drop the shipping fees?  One method Amazon uses with their Subscribe and Save program is bulk CPG buying.  So instead of buying a four pack of bathroom tissue, I have to buy 48 rolls in order to get free shipping.  But is this really mainstream?  And even without the bulk, do I want a stand alone box on my door for bathroom tissue, toothpaste, trash bags, pain reliever and the dozens of other products I stock in my home on a regular basis?  That’s a lot of cardboard.

We’re taking a different approach at Alice.com, which like the marketplaces mentioned above, is open for manufacturers to sell direct to consumer.  But instead of consumers getting multiple boxes, they receive one Alice box of bundled goods from multiple manufacturers shipped free to their door.  By sharing the box and shipping costs (rather than drop shipping), the manufacturers can offer consumers the convenience and free shipping they demand.

Bottom line for CPG manufacturers?  The lines of what it means to be a manufacturer and a retailer are blurring online, and opportunities abound to innovate in how you get your goods into the hands of the consumer.

Posted in eCommerce | No Comments »