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Developing successful online strategies

"Collaboration with SMP helped us to create new growth opportunities. With its combination of professional expertise in e-business and deep industry know-how, SMP is an extremely valuable partner for us."
Director, mail order company

"The potential for online commerce is immense. Anyone who wants to be competitive must develop growth rates higher than the market. Based on our business experience we are able to work with our customers to ensure that the company is fully geared to the online market and also to achieving sustainable growth."
Fritze von Berswordt, Partner at SMP AG 

Project reference: Mail Order

Online commerce is on the rise worldwide. Many dealers who traditionally come from shop-based or the classic mail order business are losing market share owing to online business; this is because they fail to achieve commonly achieved growth rates of 5 to 20% by a significant margin every year.

Task

Together with leading dealers, SMP develops methods for exceeding market growth in the online environment on a sustainable basis by up to 30 percentage points per year.

The heart of the project is consistent alignment of the entire company to an Internet sales channel. To design the transition successfully, SMP amongst other things ensures together with the client's management team that all relevant employees internalize the strategy and support its implementation. Procurement as another essential part of the value chain is also included in the transformation and then contributes to growth through online optimization of assortment, price, content and availability.

These are some of the methods SMP used at one of the top five mail-order companies in Germany. In a comprehensive qualification scheme, all employees from purchasing, sales and cross-departmental functions were involved in the transformation of the company. After that, the company managed to continue the project sustainably on its own.

Results

By virtue of consistent transformation, online revenue grew by more than 40 percent - some 30 percentage points above the market. Part of this success was the strengthening of effective online marketing channels, a repositioning of the product range and more efficient customer management. This enabled the cost of online marketing to be lowered and the conversion rate to be increased. As a result, profitability was also increased by over three percentage points.