January 17, 2012

Accenture Survey Finds Diverse Geographic Regulations, Laws and Practices Impacting European Retailers’ Cross-Border Sales Aspirations

LONDON; Jan. 17, 2012 – One quarter (25 percent) of European retailers believe that they could increase revenues by 25 percent if they could sell more effectively online and cross-border in Europe, according to a new study conducted by Accenture (NYSE: ACN) for the European Retail Round Table (ERRT). However, while two thirds (68 percent) of the retailers consider expanded European cross-border e-commerce to be a medium or high priority for growth, the survey reveals that many are struggling to navigate diverse local laws, regulations and practices.

The increasing willingness of European consumers to use digital channels as part of their shopping experience is driving retailers’ focus on delivering efficient online, cross-border operations in Europe, and their aspirations for revenue growth in this area. For example, a report by the European Commission in 2011 showed that 40 percent of shoppers in the European Union use the Internet to buy goods and services1. And, according to the Accenture survey, more than three quarters (76 percent) of the retailers surveyed report that multichannel customers spend more than their single-channel customer counterparts, and one third (32 percent) said that multichannel customers spend at least 26 percent more than single-channel customers.

Survey respondents cited the following as the key challenges they face in cross-border online sales success:

Thirty eight percent of the retailers also cited differences in packaging and labeling laws as posing a challenge to their cross-border e-commerce sales success. Retailers that have one common inventory for both their store and Internet operations are required to put the same label on all inventory and in multiple languages, regardless of the goods’ specific destination. One retailer interviewed by Accenture estimated that the additional cost of fabric required to print the labels cost “millions,” and said his company needed to either “increase our prices…or take a hit on profitability.” Additionally, while many European markets simply require retailers to report how much packaging they use annually, some may require detailed packaging information at the individual product level.

“The opportunity for growing cross-border online sales across Europe is irresistible but successfully seizing it will require retailers to focus on the creation of innovative, low-cost, operating models that combine the agility and flexibility of the online pure plays with the brand power and convenience of store based businesses,” said Janet Hoffman, managing director of Accenture’s Retail practice. “We are starting to see retailers shifting from a defensive position, focused on protecting their market share and capitalizing on their domestic market multi-channel opportunity, to a more offensive position aimed at tackling the cross-border challenge in Europe.”

“Europe’s consumers are becoming increasingly digital; they are empowered by smartphones and social networks, and access to unprecedented levels of information,” said Juan Manuel Rebollo, senior executive and lead for Accenture’s Retail practice in Europe, Africa and Latin America. “We are seeing high-performing retailers investing in technology to streamline and manage the cross-border differences in Europe. This investment will be critical in successfully negotiating the operational, regulatory and legal hurdles ahead of them.”

Further details on the opportunities and challenges associated with European cross-border e-commerce are outlined in a new report by Accenture; “European Cross-border E-commerce: The Challenge of Achieving Profitable Growth.”

1 European Commission Digital Agenda Scoreboard 31 May 2011

About the research

Accenture’s study into European cross-border E-commerce comprised a survey of 146 retailers with more than 100 million Euros in annual revenues across six retail sectors – grocery, home goods, consumer electronics, clothing, toiletries and leisure goods – and seven European Union countries; Denmark, France, Germany, Italy, Poland, Spain and the U.K. Interviews with relevant executives from among the 14-member European Retail Round table (ERRT), which also included participants from the Netherlands, Sweden and Belgium, supplemented and enhanced the survey results.

About Accenture

Accenture is a global management consulting, technology services and outsourcing company, with more than 244,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$25.5 billion for the fiscal year ended Aug. 31, 2011. Its home page is www.accenture.com.

About ERRT

The

European Retail Round Table (ERRT)

is an EU association representing CEOs from the 14 largest retailers in Europe including Asda-Walmart, C&A, Carrefour, Delhaize, El Corte Ingles, H&M, IKEA, Inditex, Marks & Spencer, Mercadona, Metro Group, Royal Ahold, Tesco. The ERRT businesses operate worldwide and represent a cross-section of the retail sector. Collectively, ERRT members have a turnover of more than €420 billion and employ 2.4 million people in over 44,000 stores. More information on the ERRT’s activities is available at www.errt.org.

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Contact:

Matt Samuel

Accenture

+44 207 844 2055

+44 7717 866 766

matt.samuel@accenture.com