The Programmatic Globe: France

Our head of Global Advisory Services goes deep on the state of programmatic and e-commerce in France.

Here at Sociomantic, we’re lucky enough to get to work with marketers in over 60 countries, helping them from our 17 offices around the globe to take advantage of the many benefits of programmatic advertising technology powered by local market expertise. In working across these diverse regions, one thing has become crystal clear: when it comes to e-commerce and programmatic marketing, no two countries are alike! And no one has a better view on the differences and eccentricities of these different markets than our VP Global Advisory Services, Lothar Krause.
That’s why we’ve invited him, with support from each of our local teams, to share unique, market-specific insights about the ins-and-outs, the ups-and-downs, the triumphs and challenges of programmatic advertising in each of the countries or regions that we are stationed. Next up: France!

Paris was Sociomantic’s third office launched, in September 2011. From the beginning, the French team developed strong and attentive account management, taking into account the local peculiarities and constantly innovating to drive success for our French clients. Here are a few of the characteristics that have set this market apart from the European pack.

Mature, Competitive Market

France is one of the more advanced markets globally in terms of programmatic display tech adoption (after US, UK and Germany).  When we first arrived, French advertisers were a bit suspicious of “RTB,” the new acronym (short for “real-time bidding”) that promised a more efficient way of buying display media. At that time, RTB was considered by many in France to be synonymous with low-quality remnant inventory, rather than seen as a way to interact individually with highest-quality customers and prospects with personalized ads.

Today, the situation has changed dramatically: there is a huge amount of premium biddable inventory that makes France a great place for marketers to invest programmatically — and they do. Thanks in part to this maturity, France has become quite a competitive market for programmatic display players, with a healthy selection of local technology vendors including DSPs (demand-side platforms, like us), SSPs (supply-side platforms), DMPs (data management platforms) and more.

Classic Retail Giants, Young & Agile Agencies

France is home to many huge classic retailers with long legacies and large existing customer bases. This means that, though their size might at times prevent them from adopting new innovations quickly, they arrived to digital with existing audiences and a clear understanding of the need to drive loyalty with these customers. This is in contrast to the pure-digital players that sprung up in France and abroad throughout the last decade, which by necessity had to focus on new customer acquisition during the programmatic boom, sometimes at the expense of maintaining and growing loyalty.

One area where it has been difficult for such classic players to adapt is online marketing attribution. France is the market where we first encountered a “first-click” attribution model, in which the advertiser attributes credit for a given sale or action to the first click in the chain. While this could be useful for helping to generate new traffic, the value of the last-click in generating conversions must be taken into account, and indeed last-click is still the most popular model in France. In light of both of these options, we hope to see many advertisers moving towards a multi-touchpoint, customer-journey attribution model in the near future.

The existence of these classic retailers laid fertile ground for the emergence of many agile and highly experimental local agencies to support them with digital objectives. These specialized agencies help retailers and brands to take advantage of online opportunities and navigate the complex ecosystem of technologies to get more performance and drive more meaningful interactions with customers and prospects. As a result, today, those retailers are clearly back in the game and can leverage their physical store networks and solid customer bases to build intelligent multichannel commercial strategies.

Strong Seasonality

The French market, like many others, has a strong seasonal pattern in terms of commerce with a few critical business climaxes in the year. According to French e-commerce association FEVAD, the French summer clearance sales (June-July), winter clearance sales (January-February) and Christmas sales (November-December) accounted for up to 35 percent of the French e-commerce transactions in 2013.

But what is especially interesting about these French sales is how the revenues are concentrated during the first 2-3 days of the promotional period — something we don’t see so dramatically in other markets. Some French retailers generate more than ten times more sales on the first day of the promo period than in the days leading up to the sale. It seems that the whole population is looking forward to the beginning of the sales!

How the “Sales” Obsession Bred Innovation: Shopping Clubs

As a response to the deal-seeking tendency of its shoppers, France became the birthplace of many successful online shopping clubs that spread quickly throughout Europe. This is a great example of how this market takes classic offline shopping behaviors to create a successful online model. French shopping club, founded in 2001, was the pioneer of online “flash sales” or “event sales” — offering members exclusive items at highly discounted prices. These members-only e-commerce platforms, some with millions of members, now account for a significant part of all e-commerce in France, spanning a vast spectrum of verticals including fashion (the first example), furniture, travel and (of course!) wine and food.

The Growth of Mobile Shopping

The need to land a deal (especially on limited-time offers on the shopping clubs) also means that the most dedicated French shoppers are ready to press “purchase” on-the-go, with high mobile and tablet penetration and a growing number of shoppers completing their purchases on mobiles today. “Click and Collect” is another growing trend in France that allows users to take advantage of online deals while picking up items at their local shops.

From a Local

Our French Managing Director, Thomas Reiss, confirmed my observations, saying:

“Due to the market’s maturity and competitive atmosphere, only programmatic players with strong, customizable tech supported by top local expertise will have the chance to succeed in France. Given the current dynamics of the market, our main areas of focus for the coming months will be to support our clients in innovating their multi-channel strategies, adopting smarter attribution methods and driving performance across the full funnel, as well as strengthening our partnerships with the market’s leading media agencies.”

Want to meet our wonderful French team? You’ll find us next at the E-Commerce Paris trade show, September 23rd-25th. Reach out to Sociomantic Paris if you’d like to connect.

Check out previous posts in the Programmatic Globe Series:

1. United Kingdom