Put yourself in your customer’s current situation: German fashion retailers like Hallhuber, which had to close all stores and their online shop after filing for bankruptcy in May 2023, or Oceansapart, which declared bankruptcy in July 2024 and ceased their online presence, are going out of business one after another.
It’s just as grim in other industries: electronics retailer Gravis filed for bankruptcy in June 2024 and had to shut down both their physical stores and online shops. Meanwhile, international players – especially newcomers from China like Shein – are taking over the market.
If online retailers in Germany want to survive in e-commerce today, they must position themselves clearly and focus. This message was at the heart of my talks at the CommerceTECH Conference and JTL-Connect 2024.
What worked yesterday is outdated today
Offering a wide online assortment for everyone and anyone, hoping that buyers will come, is no longer a viable strategy. Today, product selection, quality, and service must be precisely tailored to the customer groups that best match your customer’s business. These customers, who are the least price-sensitive, are the most likely to buy when they recognise the value. Your customers must ask themselves: “What do my customers truly value? And why am I the one who can deliver it best?”
Simply highlighting competitive advantages and strengths is no longer enough. When these are presented purely rationally, they rarely drive purchase intent. Over-the-top marketing and aggressive price wars often come across as desperate and rarely offer a sustainable solution – your customers understand this; otherwise, they wouldn’t be your customers.
Selling emotionally – the key to success
Your customers don’t need buyers – they need fans. Fans who not only purchase but enthusiastically recommend them to others. This happens when they connect with their customers emotionally. What’s crucial here is understanding their customers’ needs and expectations and stepping into their shoes. Testimonials or stories about the product can help achieve this. One example is Patagonia’s “Worn Wear” program, which combines sustainability with a brand message that resonates emotionally with many customers.
Three steps to optimising your customer’s offering
- Eliminate unprofitable products: Focus on products and channels that generate profit, following the Pareto principle – identify which 20% of products account for 80% of revenue, and delist the unprofitable 80%. There are plenty of examples: Conrad has abandoned physical retail for end customers, demonstrating a radical focus on profitable channels like B2B sourcing.
- Excellence in a niche: Less is more! Your customer should focus on a narrow target group and a specialised offering. Companies like Armedangels succeed because they know exactly what their target audience wants: sustainable, fairly produced fashion for environmentally conscious consumers. Revenue grows, and the target audience remains loyal.
- Clear positioning: Honestly analyse the market and give the company a sharp, emotionally charged profile. Deichmann demonstrates this with its young brand Snipes, clearly targeting urban lifestyle in the youth market – with a strong focus on in-house brands.
Is your customer ready for bold positioning?
Will they focus on what truly defines their business? This realignment is the cornerstone of long-term success. Because let’s be honest: what’s more valuable than loyal customers who buy and become genuine fans?
How can you support your customers in this?
Are you ready to pave the way with your software and payment solutions, guiding them on their journey to becoming a strong, profitable brand?
