In spite of the lacklustre economic situation in France, one sector stands out from the crowd – e-commerce, which is growing very fast, running well ahead of traditional retail business.

Smaller French E-commerce Firms Set to Be Major Job Creators in 2014

E-commerce, a booming sector in many countries, is also making great headway in France. In fact in 2013, e-commerce grew eight times as fast as business at traditional retail outlets, accompanied by an increase in the number of e-tailers. These are the findings of a recently-published report commissioned by French e-commerce solutions provider Oxatis and drawn up by consulting and auditing firm KPMG, which looked into who exactly these new e-tailers were and how they work. The findings show that most of the new players in this market fall into the categories of very small, small and medium-sized companies. Today these firms appear to be breathing new life into a rather static job market and also seem to be more adept at matching their setup to consumers’ new habits and preferences.

A job-creating business

The e-commerce market grew by 13.5% in France in 2013, and is looking very promising for 2014 as well. As a result, the number of jobs in the sector is increasing.  Some 13,000 e-commerce websites were created in 2013, creating close to 2,000 jobs. The report predicts that the138,000 sites listed by French E-commerce and Remote Selling Federation FEVAD could create close to 20,000 new jobs this year, more than 15% of which would be generated by small and medium-sized enterprises alone. Recruitment in e-commerce could thus account for close to a third of all job creation in France. Local authorities and other governmental bodies therefore need to come up with ways and means of supporting growth in this sector, argue the KPMG-Oxatis authors, given that it is increasingly driven by small businesses and that the areas of net growth are – in line with society’s current trends – culture, beauty services and products, household products and services, and sports-related products and services.  However, although e-commerce is growing much faster than its offline counterpart, it does not appear to be killing off traditional retail. In fact 75% of e-commerce sites which also offer a bricks-and-mortar outlet have seen an increase in in-store purchasing.

Stores transitioning to digital

The benefits of the ‘web-to-store’ approach, which uses online sites and offline retail outlets as complementary sales channels, are really making themselves felt. Some 63% of merchants who are both e-tailers and offline retailers state that they have seen positive impacts from the virtual channel on the physical outlet. In addition to a substantial increase in the number of people actually going into stores, web-to-store enables a company to convey more and better-targeted information to its customers, which results in higher turnover for bricks-and-mortar store sales. In order to enhance the customer experience and adapt to consumers’ new needs and expectations, merchants are going ahead with their transition to digital, adopting a multi-channel approach which includes mobile. In 2012 some 75% of all the merchants surveyed for the report had integrated the ubiquitous smartphone into their sales strategy. This proved to be a wise choice since 82% of them have achieved extra sales via mobile. Another phenomenon, Social/Local/Mobile, aka SoLoMo, which basically means a more mobile-centric version of the addition of local entries to search engine results – has also helped to boost e-commerce sales, the KPMG-Oxatis report reveals.