Irish company Luzern Solutions is an e-commerce platform and managed services provider that specialises in bespoke direct-to-consumer (D2C) programs.
In 2019, the total value of global retail e-commerce sales is estimated to have reached €3.45 trillion – almost 20% more than the previous year. The trend is likely to continue. By 2040, it’s predicted that 95% of all purchases will take place online.
Brands know that if they are to grab a slice of this pie, they must be clear on how to get it. That involves e-commerce web stores that are user friendly and super-fast. Or, crucially, having an online marketplace presence that allows them to take advantage of the vast amount of traffic on these sites – notably Amazon, which accounts for almost 50% of the US e-commerce market.
For brands, the Amazon Marketplace represents both an opportunity and challenge, as selling on the world’s biggest one-stop shop can present issues around pricing, profit margins, and more.
Luzern maximises brands’ online presence
Help is at hand. As many of the world’s top brands have discovered, there is an Irish e-commerce platform that specialises in helping companies to maximise their online retail presence globally.
Luzern Solutions works with a who’s-who of global brand names including Philips, Fossil, Gatorade, Carter’s, JDE Coffee, BiC, Victorinox, PetSafe, Nestlé, Hamelin, Ricoh and many more. The company’s incredibly diverse client portfolio is united by one ambition: finding a better way to sell online.
“We’re an e-commerce platform and related services provider,” says Ken Doyle, Luzern’s CEO. “We help brands around the globe, from leading coffee companies to pet care to fashion houses to some of the biggest consumer electronic companies in the world.
“We find that brands across industries face broadly the same challenges when selling their goods online direct to consumer,” he continues. “They may not necessarily want to be selling more but they do want to be selling smarter. They need to be able to grow and sustain profitability, and that’s where we come in.”
Established in 2003, Luzern is the Irish tech success story you might not have heard of. The Dublin-based firm is now a globally sought-after authority on D2C sales capabilities and services, which it delivers in two ways.
D2C strategy and expertise
“Our main speciality is helping brands with their online marketplace programs, mainly Amazon Marketplace but also eBay, Zalando, and others,” says Doyle. “The other main part of our business is building D2C web stores.”
In both cases, he adds, Luzern’s proprietary technology has been proven to “dramatically” increase online revenues for the brands it works with. While the business of building bespoke web stores varies from client to client, the challenges of selling on Amazon are likely to resonate with brands worldwide.
Navigating the Amazon jungle
“In many cases, brands feel they are losing control due to the complexities of Amazon across Europe and the US, along with the extensive costs associated with that. Loss of control over pricing can impact pricing on all channels and creates channel conflict,” he explains.
“Product lists can be suppressed if they are deemed to be unprofitable to Amazon, which puts a major squeeze on margins. It can be difficult to launch new products unless Amazon supports it, which they don’t always do as without previous sales history it’s seen as risky. Then there’s the whole product returns issue, which can be costly and difficult to manage. Amazon can also push competitors if there is more margin in it for them and we now see them launching more of their own branded products.”
“In our experience, there’s a kind of love-hate relationship between the brands that sell on Amazon and Amazon itself, and that is the same for long established and very big brands because the challenges are universal,” he adds.
“You must be on Amazon”
“Up to 60% of product searches begin on Amazon, making it the largest search engine for e-commerce. The bottom line is that if you are a growing brand you must be on Amazon, and that is our sweet spot,” Doyle says, “We help companies to reimagine their Amazon strategy and find new ways to protect their brand whilst increasing their online revenue. That is our proposition and we do this successfully for brands across the globe, that is why ambitious brands come to us.”
Most of Luzern’s business is through referrals and word of mouth, with clients coming from multiple categories. The firm has a thriving – and growing – center of excellence in Dublin and an R&D center in Galway, which develops the technology and provides expertise and support to clients.
“The way we do business is underpinned by both our technology and our people,” says Doyle, “We have a sophisticated, proprietary algorithm and a team of e-commerce experts to help brands take back control of how they perform and sell online.
“The way I describe our technology is that we’re ‘not just another dashboard’,” he adds. “Brands can use our data insights to understand their digital footprint and what that means for their brand online. However, we also help companies to take immediate action on foot of those insights. Luzern’s automated functionality enables clients to proactively manage their sales margins, position against competitors, and drive conversions, all in real time.”
He points to the watch giant Fossil as an example of how Luzern forges long-term partnerships with some of the biggest brands in the world.
“Fossil Group, the global watch and accessories company, was finding it increasingly difficult to manage their presence correctly on Amazon; the long-term impact to overall business wasn’t as expected with certain ranges seeing a drop in sales volumes.”
Luzern introduced an new operational program to support Fossil’s selling strategy on Amazon. The program included a revamp of product listings with optimized content and imagery to entice shoppers and more importantly, that converted to sales.
Through a combination of expertise assessment and the Luzern algorithmic platform, it also helped the brand to gain back control of pricing and address dropping sales numbers. Luzern’s intelligent automated price checker and algorithmic pricer, along with its ability to benchmark performance against key competitors, ensured Fossil was selling at the right price to achieve the margin needed to drive profitability. It also helped with the brand’s go to market strategy for new product launches on Amazon.
“Ultimately, we were able to help Fossil sustain profitability across the watch ranges,” he says.
Luzern continues to invest in innovation, both on the technology side and associated support and services.
“We started out in the UK and Ireland and we’ve expanded rapidly across Europe and elsewhere,” Doyle says. “In 2020, we expect further growth in key European markets including Italy, Germany, France and Spain, as well increasing our footprint in North America.”
So What’s next?