E-commerce in upheaval

Industry expert warns: “TikTok will be the new Amazon”

E-commerce is increasingly being replaced by "social commerce".

(Bild: stock.adobe.com)

Swiss online retail is also struggling against strong competition from abroad. Chinese low-cost providers such as Temu and Shein in particular are now "stealing" a lot of business from local stores. But experts are also increasingly concerned about TikTok.

According to estimates by Bernhard Egger, Managing Director of the Swiss Retail Association, foreign retailers have snapped up around one billion Swiss francs (1.1 billion euros) in sales per year.

"If you then take into account that the equivalent value would often be higher, we are up to three billion francs that Swiss retailers are missing out on," he explained on Thursday at the Retail Forum at Zurich Airport. He sees low-cost competition, especially from China, as a real threat to Swiss retailers.

However, this is mainly for those who are themselves active in the trade of cheap and very cheap clothing. "For companies that have a higher-priced segment with better quality, these suppliers are becoming less of a competitor."

Egger predicts "smart" growth for Swiss online retail in the coming year and points to the increase in online retail of around 10 percent in the last four years. However, retailers will have to adapt to changes in their sales channels.

 "TikTok will be the new Amazon"
According to Egger, social commerce, i.e. sales via social media, is becoming increasingly important. "TikTok is becoming the new Amazon," said the industry representative. The social media provider, which is also Chinese, now offers the entire process for online retailers, from ordering and payment to logistics.

According to Egger, social commerce currently accounts for around 10 to 15 percent of online trade in Switzerland. "However, we assume that this will increase to around a quarter. This topic will therefore continue to keep us very busy," says Egger.

The topic of hybrid shopping also remains important. The common assumption that hybrid shopping - i.e. a mixture of online and analog shopping - leads to people looking at goods in the store and then buying them online at the best price is incorrect.

"We even often see customers who first find out about a product online and then come into the store to look at it in real life and buy it," says Egger. It is therefore particularly important for retailers to be able to present themselves as a provider of this product while their potential customers are researching online.