DECEMBER 2021retailtechinsights.com8In my opinion7 BUILDING BLOCKS THAT MAKE A SUCCESSFUL ONLINE RETAILERBy Staffan Morndal, Partner, VerdaneEven before the global pandemic, the world was moving from bricks to clicks. As part of a structural offline-to-online shift, online retailers have emerged as one of the driving forces in the economy in the decades following the dotcom bubble. The arrival of COVID-19 accelerated that structural shift further, with digital consumer companies emerging as one of the winners in the new normal economy. 2021 figures from Nordea, the largest financial group in the Nordics, show that online retailers now constitute 70 percent of the total global market capitalisation in retail stocks. But far from everyone that sets out to build an online retailer makes it to the top. Staffan Mörndal is a Partner at Verdane, a Northern European specialist growth investor with a track record of helping digital consumer companies scale their operations that stretches back to 2005. Originally an entrepreneur, Staffan joined Verdane in 2006 where he has helped build companies like Boozt, MatHem and momox into some of Northern Europe's most successful growth companies, with revenues reaching into the hundreds of millions of euros. In this article, he shares seven building blocks to help aspiring digital consumer entrepreneurs and growth companies succeed. 1. Define your recipe for success. How are you going to beat the competition? One of the fastest ways to answer that is to first decide on who your target customer is, then charge a market price and deliver a superior service compared to the competition. Of course, you will need logistics to work, secure enough stock of your customer's favourite products and make sure customer service is both available and top notch. Follow up on your progress through Trustpilot scores, Net Promoter Score (NPS) measurements and Customer Lifetime Value (CLV) to make sure your business is headed the right way. 2. Execution eats strategy for breakfast. Without the right team in place, you can't win. Remember that it is about who you have onboard (and how motivated your team is), rather than about how many people there are on your team. A large organisation is no guarantee of success; team quality is built and nurtured through a strong culture anchored in your company values. There is no overnight fix to building a strong culture, but as a leader it is something you always need to keep front of mind.3. Be frugal. In our experience, very few online retailers manage to be successful without being very mindful about costs and margins. This theme runs through both fixed and
< Page 7 | Page 9 >