Fevad conducted a survey on the morale of French e-commerce merchants in 2022. The latter seems confident about the future despite the doubts.
The health crisis is not completely over, but the high vaccination rate (77.8 percent) reduces the risk of exacerbations of cases and also affects the relaunch of retail activities. Although e-commerce has done well during the two years that the pandemic has lasted, players in this sector have developed some skepticism and have mixed opinions about the evolution of the market in 2022.
For the eleventh year in a row, the Federation of E-Commerce and Distance Selling (Fevad) publishes the results and trends of its survey on the morale of French e-merchants. While 65 percent said they were more or similarly optimistic as last year, 35 percent of respondents said they were less optimistic, marking a clear break with 2021, when they were just eight percent.
Two-thirds of e-merchants are still confident in the future and this is reflected in the economic prospects of their business: 67 percent believe their sales volume will grow and 45 percent expect an increase in net profit. However, 15 percent of them expect a decline in their sales for 2022, a number that rises to 21 percent for net margin.
Other trends expected in 2022 by leaders surveyed include: the increasing sophistication of second-hand products (for 90 percent of them), the signing of strategic agreements between e-merchants/retailers (71 percent) and continued focus movements (64 percent).
E-commerce, a sector that will continue to hire
Although optimism is lower than in previous years, 54 percent of executives plan to increase their workforce and 37 percent believe they should keep the number of employees unchanged. In total, only 9 percent of e-merchants see their workforce at risk of declining, which remains very close to the level recorded in 2021, at 7 percent. Projections are that e-commerce should remain, again this year, a job provider for the French economy.
More than 50 per cent of respondents believe that the Covid crisis has accelerated investment. They are half of what they think the epidemic has slowed them down.
E-Commerce Priorities in 2022
This year, IT issues (IT, and security) ranked first in the priorities of e-retailer investments, ahead of CSR, logistics and marketing/advertising. Thus, 66 percent believe their investment in computer systems will increase and 29 percent believe it will remain stable. As for CSR, 57 percent of e-traders expect investment to increase, an increase of 2 percent from 2021 while 31 percent think it will remain stable. In terms of logistics, it’s very similar to 56 percent, with an emphasis on environmentally responsible delivery and packaging, and finally 55 percent for marketing and advertising.
With social networking being one of the priority investment channels for e-commerce merchants, continuity is essential. 65 percent of respondents expect spending in this area to increase.
In the medium term, innovation projects should focus on predictive marketing (64 percent have an ongoing or future project), and site accessibility (61 percent); stock consolidation (59 percent, up nine points); Return mailbox (42 percent) and online parcels (40 percent). Conversely, interest in voice assistants and virtual reality continues to wane.
The decline in the risk of serious pollution has reawakened an old ambition of e-commerce, and in-house, which is back on the agenda and companies seem poised to once again set out to conquer new markets. Among the executives surveyed, 85 percent believe their revenue will grow internationally over the next two years, up from 73 percent last year. So they only have five percent to judge that this percentage will go down. It is clear that the desire for international expansion is a priority for e-merchants and testifies to the dynamism of the national players. Among the three preferred destinations, we find Belgium, followed by Spain and Italy.
Concerns about political and economic developments
Political and economic news is the main source of concern for e-commerce leaders. Seventy percent say they are very concerned about the pressures affecting supply chains, which are actually driving up prices. Rising delivery costs, which stem in part from these tensions, is the second biggest concern cited by 60 percent of e-retailers. In third place, the decline in household consumption associated with lower purchasing power is an issue mentioned by 57 percent of managers.
To offset these concerns, there are also positive items that respondents brought up. First, 70 percent of respondents have very positive feedback about the continued growth in the number of online shoppers, which gives them hope for new opportunities. The second reason for optimism is the explosive growth of the mobile Internet, which was highlighted by 59 percent of managers. In third place, 51% rate the increased digitization of players very positively.
Two weeks before the presidential election, two-thirds of executives think it will have some impact on e-commerce, but 72 percent say the campaign does not live up to the industry’s challenges yet. Among the leaders’ expectations towards the future President of the Republic with regard to digital and electronic commerce, the number at the top of the list is to support companies in terms of investment and innovation (93 percent). This is followed by regulatory stability (91 percent), tax exemption (88 percent) and cybersecurity (87 percent). They also mention an increased expectation of more consultation with professionals. At the time of evaluating the overall work of the five-year period in relation to e-commerce, government efforts were emphasized compared to the previous five-year period, particularly with regard to the support and development of start-ups (impact was considered positive by 54 percent of CEOs, up 28 points), or Transforming digital business (42 percent; up 25 points), or in global digital support (37 percent, up 28 points).
Overall, 88 percent of CEOs said they are optimistic about their company’s future, a level similar to 2020, the year that saw the onset of the COVID-19 pandemic.
The study, conducted by OpinionWay for Fevad and LSA, is based on a survey of hundreds of managers of major French e-commerce sites. The survey was conducted from February 14 to March 4, 2022 with a panel of 104 e-commerce site managers. Vivad also specified that two-thirds of the responses were received after February 24, the start date of the invasion of Ukraine.