Gun Media: Retailers SHEIN, TEMU, Ali Express Change the Game of Online Commerce

In the local ecommerce market, tension is increasing from year to year. 2024 brings challenges that only adaptable and innovative brands can overcome, say representatives of Gun Media agency, with 11 years of experience in digital marketing. As online competition grows and audience volume remains the same, if not decreasing, with users' attention divided among social media platforms, costs are rising. The budgets thrown into the market by major retailers from Asia do not make the battle any easier. Robert Trandafir, CEO of the performance marketing agency Gun Media, analyzed the ecommerce market and observed trends, exposing some challenges and solutions for entrepreneurs in the industry.

"At this moment, the ecommerce market is becoming more dynamic, which obliges entrepreneurs to adapt their businesses, marketing strategies, and be willing to innovate to keep up. Artificial intelligence is one of the factors driving these changes - it is used in every field, and online stores are therefore turning to SaaS solutions. Again, the challenge for entrepreneurs is to find the right solutions and people to coordinate their correct implementation, so that the investment yields the desired results," says Robert Trandafir.

• Robert Trandafir: "People Have Changed Their Purchasing Behavior"

Inflation in 2023 had repercussions on many industries and also affected consumer behavior. They are more cautious, think twice before purchasing a product, return items, and ask questions that perhaps they did not consider so often before. Robert Trandafir believes: "Certainly, these changes in user behavior force entrepreneurs to build strong brands that establish an emotional connection with customers, to foster loyalty, and better respond to their needs and desires. Interestingly, we are also witnessing dynamics in online stores - some from Romania aim to expand to other countries - a development that involves new challenges: adapting to the legislation and taxation of other territories, finding suitable partners for logistics and transportation, as well as increased marketing costs. As for the entry of international giants into the Romanian market, such as Shein, Temu, or Ali Express, the question arises: how to counteract local businesses, how to bid efficiently, in such a way as to gain more display space than these major international players who are boosting with very large budgets? Temu, at the moment, is a competitor in Pay per Click for any online store, regardless of niche. Trendyol, Turkey's largest online store, partially owned by Amazon, is preparing to enter Romania this year. Besides, there are many regional players from the Czech Republic and Poland who have entered Romania in recent years."

• Increase in the Number of Online Stores

The number of online stores in each niche has increased, and online competition has grown significantly, Robert Trandafir told us, adding that during the pandemic alone, the number of online stores doubled: "Temporarily, demand doubled as well, but when people returned to offline, the large number of newly created stores remained. What is the challenge for entrepreneurs in this context? To develop strong communities and to foster customer loyalty. More than ever, we are talking about commitment, listening, empathy. Indeed, it takes a lot of courage to make decisions and take risks in such moments, when the market is so dynamic."

Fashion Stores Decline in 2024; Home & Decor, Beauty, and Children's Articles Segments Grow

The fashion segment, for example, records a decrease in the number of transactions in 2024, but other niches are on the rise, such as home & decor, beauty, or children's articles, according to the cited source: "And again, I come back to courage - because it is necessary more than ever to have the audacity to test innovative solutions, to stand out, to conquer the audience, in order to cope with competition, to be a step ahead. The fear that the investment will not pay off, impatience until the effects become visible, the fear of losing money - all these can block action. But such a change is necessary, otherwise the market evolves, new competitors emerge, and businesses may suffer, losing market share and profit."

• Four Solutions for Local Businesses in 2024

Gun Media's CEO proposes four solutions for local businesses this year:

"1. Brand awareness - in the short term, it is the most expensive and does not return the investment. In the long term, brand awareness translates into better conversion rates on the site, increasing the number of direct transactions.

2. Investment in data analysis and the use of conversion rate improvement tools that use statistical models or AI for recommendations based on user behavior on the site.

Email marketing (email & SMS) - it is a channel with a lot of potential that should become a priority. There are too few online stores from our country that use this channel extensively, with automations based on a personalized strategy considering audience behavior and their affinity for certain products, at certain times.

The courage to sell outside the country, cross-border. From my knowledge, we are last in the EU in the number of parcels shipped outside the country. We have everything logistic we need to sell worldwide, and we believe that online stores from Romania can do this."