Manufacturer/Retailer Relationships: A Marriage Made in Heaven

Ever since the first e-commerce website appeared, manufacturers have been smitten with the idea of transacting directly with consumers in the digital realm. However, some of their early attempts at online retailing offered poor customer experiences and didn't support their relationships with retailers. These days it's a different story.

Manufacturers are investing more heavily than ever in e-commerce sites in an effort to improve customers' shopping experiences and develop one-to-one relationships with them, while others are launching e-commerce websites for the first time. What's more, many of these companies, having learned from others' mistakes, are including retailer location tools, using the information they gather to support retailers' efforts and ensure that retailers aren't left out in the cold.

CPGs Online
One of the big e-commerce stories of 2010 was how consumer packaged goods (CPG) manufacturers discovered the opportunity of online retailing. It began with the launch of 
Alice.com in June 2009. The company's platform enables CPG brands to operate their own e-commerce stores and centralized fulfillment solutions. There are nearly 100 brands currently selling on Alice.com, including recent additions like BIC pens and Hefty garbage bags.

Procter & Gamble (P&G) stepped into the arena last spring with PGeStore.com, which sells the company's leading brands directly to consumers. Company executives have insisted, however, that the venture is an attempt to learn more about online retail so P&G can support, not undercut, its retail partners. In a sign of just how hot e-commerce websites for packaged goods are, Amazon.com announced in November that it would acquire Quidsi, owner of packaged goods e-commerce sites Diapers.com, Soap.com and BeautyBar.com, for a reported $545 million in cash.