One Country, Two Markets
It’s relatively hard for a merchant operating in Belgium to conquer the hearts of all its inhabitants, as the country is deeply divided into two parts: Dutch-speaking Flanders and French-speaking Wallonia.
The need to tailor offerings according to local laws, culture, and in two languages (French and Dutch), combined with a small population, make Belgium a somewhat more difficult market for those entering the EU for the first time. Additional resources and careful planning are required to make a foray into Belgium a successful one.
Major Shopping Categories
The key category is fashion with the majority of growth through to 2020 expected here. The solid growth prospects across the other categories are also interesting, particularly with furniture & appliances expected to challenge electronics for size over the same period. Data compiled by Statista.com highlights that the clothing category is responsible for around 50% of total online sales in Belgium. The online top 20 retailers also show an interesting mix of international brands with very few domestic retailers present. This does highlight the international nature of online in Belgium, also a reflection of the offline spending habits of Belgians was going to a neighboring country is just as natural as purchasing domestically.
Major Retail Holidays
As a rule, shops are generally open Monday to Saturday, with many inner-city shops preferring a 10 am opening. They are exceptionally open on certain Sundays allowed by law, for example, the two Sundays before Christmas and New Year, although you will see several independent shops open most Sundays, as well as some supermarkets (typically in the morning only), bakeries, and restaurants. In Belgium, promotional discounts are only allowed in January and July, so shops need to shift unsold stock fast – which means knockout shopping discounts during these two months. Dates are strictly government-controlled.
Belgian internet users are avid consumers of digital media and this is reflected in the growth of digital advertising spend. IAB Belgium has reported that digital advertising in the market topped €400m in 2015, up 14.5% on the previous year. Favored digital advertising channels include a display, accounting for 36.2% of expenditure, search at 28.3%, video at 18.1%, social at 15.7%, and email at 1.8%. Email spend is probably low, not because of a lack of popularity but because of the way that the service is provided.
Gaining importance as a mechanism for increasing relevancy and cost-effectiveness of advertising, programmatic trading, where algorithms running on service provider’s servers and allocate advertising placement in real-time, is accounting for a bigger proportion of the digital budget. Up 30% on 2014 expenditure, €187m is now spent via the technology (30% of total display spend). Mobile-related display advertising increased by 51% in 2015, accounting for 35% of total display advertising spend, highlighting the increasing importance of mobile devices in the customer journey.
The same study also highlighted the role of content in the discovery phase, with around a quarter of consumers suggesting that it made a contribution to the discovery phase of the purchase cycle. With single figures suggesting that it influenced the buying decision, merchants would be advised to tailor their content strategy depending on where in the customer journey the information is being displayed; relevancy is key. Belgians are more likely to view comments in-store, really highlighting the role of mobile in multichannel retail. Website content is an important element of the transactional process and international merchants should assess how their existing formats will fit in with these requirements. Data also suggests that consumer reviews should be a major part of the cross-border offering, enabling local consumers to assess any international merchant, not by what they say, but what their existing customers have to add.
Search Advertising & Mobile Internet
As in most western markets, Google dominates the search landscape of both the Netherlands and Belgium, with only Bing and Yahoo! exchanging places. Vinden and StartPagina are worthy of note. Whilst not technically search engines, they are important local players in that they can drive relevant traffic through paid-for links.
Mobile technology is used widely, with mobile phone penetration is well over 90%. Smartphones are also gaining traction at 60% in Belgium. Tablet usage is increasing, meaning mobile strategy will be an important element for any merchant trading into the region. Around 12% of Belgian e-retail is carried out via a mobile device. However, desktop remains the most popular route to the internet in Belgium so this shouldn’t be ignored either. In Belgium, the desktop is also the main method of going online whilst smartphone usage is further behind than in the Netherlands. Tablets are available to just over a third of Belgian internet users so represent the potential for brand interactions.
Whilst Android Tablets have a lower share of the overall market, they do convert quite well, certainly compared to iPads. As with other territories, an overall strategy encompassing both desktop and mobile is worth pursuing in these markets. Additionally, when looking at mobile optimization and marketing focus, it is important to take both Android and Apple’s mobile operating systems into account. If a resource needs to be targeted, the iPad audience should probably get the early focus for development.
87% of marketers see social media as part of their overall strategy although there is also a recognition that the quality of the content is more important than the quantity. A core component of any brand’s marketing communications strategy, social media usage is gaining traction in the Belgian market, both from a consumer and brand point of view. Social media interaction is very strong in both markets, with around 79% of internet users in both countries having a Facebook account. Google+ has 28% of users internet users having an account in Belgium. YouTube has high levels of usage, really reinforcing the importance of video-based advertising spend that was reported by IAB Netherlands. Looking more closely at Facebook engagement, e-commerce, in general, has high levels of engagement with a combined 14.9 million followers. General retail also fares well with around 10 million fans, according to socialbakers.com
In terms of social engagement, it does appear to be very one-sided in Belgium. With an average of 300,000 followers per brand in the top 20, they each only post 42 times per month on Facebook. The ratio on Twitter however is much closer, with fans posting over 26,000 times and brands responding 126 times. It would appear that there is potential for brands trading into these markets to increase the levels of engagement. Although, Insites Consulting has reported that consumers don’t necessarily want a lot of engagement, particularly around commercial activities such as discounts; although this reluctance is easing as consumers get more comfortable with the social channel. Aside from the marketing opportunity, studies3 have shown that 70% of those social media users contacting customer services expect a response within 15 minutes. 66% of these expect responses through the same channel as well; highlighting the need for close monitoring of the social engagement, especially in Belgium where there is still a lot of suspicion about brands communicating on social media.
In common with other markets, the use of email as a marketing tool is far from dead. Mobile engagement is reinvigorating this trusted marketing channel. The Dutch and Belgian markets show healthy levels of email engagement with National Email Benchmark reporting Confirmed Open Rates (COR) of over 35%, Click-Through Rates (CTR) of 7%, and Click To Open (CTO) rates of 17.4%. Irrespective of workday or weekend, desktop still dominates actions driven through email e.g. ‘clicked on’. However, open rates are evenly split by device over the weekend, whilst desktop accounts for 60% of email opening; perhaps mobile is used on the way to work during the morning commute as a way of prioritizing follow-up activity. This would appear to be reflected in open rates via mobile, depending on the time of day. Breakfast, lunch, and early evening seem to be the time where engagement is highest.
The peaks are much less defined over the weekend, perhaps when time constraints are less rigid. These data points highlight the importance that mobile devices have in the customer journey, particularly during the discovery phase. They also reinforce the role that email has in the marketing mix in the Belgian market whilst suggesting that frequency, timing, and content should be tailored depending on the desired outcome. International merchants will notice that these trends are common to many other markets so existing platforms are likely to be able to cope with these local requirements.
The Belgian consumer market still has strong DM activity. Industry data compiled by Post NL and Spring Global Delivery Solutions suggests that 87% of physical DM is opened and read. With reading rates on the same day at 85%, DM can be an efficient mechanism for both acquisition and driving website traffic. Highlighting the impact that DM has on digital-enabled sales in these markets, 67% of online searches are trigged by the mail piece. Online advertising, in conjunction with physical DM, leads to a 25% increase in response rates. As a brand development vehicle, DM obviously has its place in its ability to present a ‘physical form’ to the consumer which has benefits when trying to develop a presence in-country. As an activity to drive sales, DM has the potential to reinforce online messaging or to introduce new ideas. This will have benefits in helping to upsell and cross-sell, drive brand loyalty and develop cost-efficient traffic to an online presence. Where possible, unique URLs and offer codes should be used so as to be able to track the benefit and take the customer directly to the products or offers mentioned in the DM. DM combined with digital marketing has a role in consumer communications for some brands.