Featured Report
Leveraging E-commerce for Future Growth
by Julian Dehn, Research Analyst
Thanks to mobile devices and broader, faster networks, consumers now
Traditional retailers are finding ways to take
have the power to access information instantaneously, giving them the
advantage of the growth in e-commerce to remain
ability to make a purchase decision from their home, on the go or even
competitive in the expanding marketplace as well.
at a competitor’s store. E-commerce retail purchases grew at a rate five
Walmart is leveraging its footprint of over 10,000 stores in combination
times faster than offline retail in 2013.1 The revolution of e-commerce
with its digital infrastructure to provide a multi-channel environment.
has entirely changed the shopping experience for both the consumer
Walmart’s well-established supply chain and large store footprint provide
and the retailer. As a result of this shift, new business models are being
a strong base to deliver a consistent shopping experience whether online
formed while traditional retailers have the opportunity to reassess
or in-store by supporting fulfillment, returns and same-day delivery.
their market position and adapt in order to grow their business.
In the past, Walmart had limited amounts of information on their
Riverbridge seeks to invest in companies that are competitively
shoppers. But now, with the help of internal analytics, Walmart is able
positioned and taking advantage of opportunities in the growing
to collect insightful data on customers’ behavior and shopping patterns.
e-commerce industry. This strategy will inure these portfolio
Walmart then uses this information to connect with customers via
companies higher returns on invested capital and business growth over
mobile apps, provide targeted coupons and send predictive shopping lists
the long-term.
to improve its customers’ shopping experience. This in-turn encourages
Amazon took advantage of this shift towards
e-commerce at an early stage and has built the
customers to shift more of their spend to Walmart, increases customer
loyalty and drives conversion rates higher.
largest e-commerce platform to date. In order
The proliferation of e-commerce can serve either as a tremendous
to maintain its position, Amazon continues to invest into its business.
opportunity or a severe threat to business models. Amazon,
Today, Amazon is positioned to fulfill orders quickly and accurately
ChannelAdvisor and Walmart are just three examples of companies that
once they have been placed. With the use of data analytics, Amazon is
are leveraging e-commerce to effectively interact with their customers
working to develop a system that anticipates what consumers will be
and expand sales growth each year in order to maintain a competitive
ordering next, in order to deliver the product to the hub closest to the
advantage in their respective industries. E-commerce allows these
customer before it is even ordered, enabling same-day deliveries (with
companies to reach out to current and new customers in different ways,
or without drones).
adding value to the overall consumer experience. As the e-commerce
E-commerce has also enabled small merchants to compete and
grow their businesses. With the existence of marketplaces such as
Amazon, merchants can expand their visibility and reach additional
sets of customers. However, this growth adds a layer of complexity to
managing the business as well.
industry continues to evolve, Riverbridge will remain committed
to seeking out and investing in well-managed, high quality growth
companies that are able to navigate the changing business environment
by effectively using their resources in order to create disruptive and
strengthened leadership positions.
This added layer of complexity provides
as
Julian Dehn joined Riverbridge Partners in
ChannelAdvisor, which delivers services that
2012 as a research analyst on the Investment
enable retailers and manufacturers to manage and optimize their
Team. In his role, Julian is responsible for
e-commerce business across multiple online channels. By customizing
conducting company and industry research across
inventory information, ChannelAdvisor helps with real-time inventory
all industry sectors. Julian graduated with a
allocation and availability across its clients’ multiple sales channels.
Bachelor of Science in Business degree in Finance
Outsourcing this service to ChannelAdvisor enables merchants to focus
from the University of Minnesota Carlson School
their time and efforts on their core competencies.
of Management. Julian grew up in Germany and
opportunities
for
companies
such
enjoys playing tennis and golf.
1
U.S. Census Bureau
Information in this newsletter is not intended to be used as investment advice. Mention of companies/stocks herein is for illustrative purposes only and
should not be interpreted as investment advice or recommended securities. The securities identified do not represent all of the securities purchased, sold
or recommended and the reader should not assume that any listed security was or will be profitable. Past performance is not indicative of future results.
Contact us: Phone 877-904-6200 • www.riverbridge.com