“To fully embrace the specifications of online retail, you have to go all-in,” Newpharma CEO Gilles Jourquin believes. This reasoning is the basis of the Belgian online pharmacy’s international success.
Daring to let go of the old
As soon as Belgian law allowed medical products to be sold online in 2009, Newpharma started the trade and never looked back. A team of one pharmacist from Liège and two IT professionals: that was all it took to get the ball rolling. Today, the group – fully owned by Colruyt Group since June – operates in six countries and reaches 4.5 million customers.
“If you really want to use the assets of new technology, you have to dare to let go of the old way of doing things”, CEO Gilles Jourquin observes. He should know, as he was previously director of a chain with about 100 physical pharmacies. They too tried to digitise, but still stuck to the old familiar model. “The new generation of pharmacists is now open to it, but e-commerce is often seen as an extension of the existing model. That is why many have failed.”
The difference is that Newpharma was willing to let go of the old model, the whole notion of a physical pharmacy. “To fully embrace the specifications of online retail, you have to go all-in”, Jourquin explains. During the Trends in E-commerce programme at the RetailDetail Night, the CEO will share his insights and experiences in the increasingly hostile online market.
Online noise is deafening
It is becoming ever more difficult to gain exposure online, Jourquin observes. “Today, as a newcomer, it is actually no longer feasible. The ‘noise’ has increased so sharply after Covid that you just can not rise above it. Digital marketing has also become so much more expensive, causing the ROI to plummet.”
Newpharma nevertheless continues to invest in marketing. “We have a good mix between online and offline, especially now thanks to all the synergies with Colruyt Group. We can be present on all touch points, from social media over television to supermarkets.” Indeed, a selection of parapharmacy products will now also appear on the shelves at supermarket chain Colruyt. “We do not see it as a sprint, but through the ecosystem we are strengthening our presence month by month in a financially sound way.”
Covid newcomers do not stick around
However, when people came online ‘en masse’ because of the coronavirus pandemic, that spurt did occur. However, it turned out to be short-lived: “The downside of that growth spurt was that people did not shop online purely out of ‘desire’. So after the pandemic, some of those customers disappeared again. Until 2019, we grew linearly and reached a group of people who really wanted to buy online. A lot of e-commerce players assumed that all those new customers would stick around and started investing too quickly”, Jourquin says. He uses a lot of data himself, which allowed him to quickly notice that buying behaviour deviated from usual. “So we were careful.”
Cautious and sustainable growth is also inherent to the Colruyt Group. “Our assignment is to achieve sustainable and long-term growth. As a result, we have also deliberately not seized a number of opportunities. That turned out to be our good fortune, because many other players are running out of breath now that the crisis does not turn out to be short and acute.”
Waiting for the good wave
In the long term, Newpharma aims for market leadership in its core countries. France definitely is up there: the Belgian digital pharmacy is one of the first players there. In the southern European countries, there is still less online maturity and more fragmentation, but Newpharma awaits its opportunities. “We are at sea, waiting for the right waves. Another advantage is that we are not a parapharmacy webshop, but a digital pharmacy. Not just every transaction with a shopping basket interests us. We care.”
Whether Newpharma will ever open physical outlets, is not yet decided. “I am not saying no, but then we need to think about how to do it better first. If we go ‘fygital’, it will be different. I do not see the added value of just running two models side by side. Moreover, we will then have to redistribute all our now centralised costs and stock. We will not open shops just like that. But Colruyt Group does a lot of R&D, just think of the unmanned OKay shop, so anything is possible.”
How can one innovate in e-commerce today? Gilles Jourquin of Newpharma will elaborate on this during the pre-programme ‘Trends in e-commerce’, which will take place at noon on 24 November, in the run-up to the RetailDetail Night. Speakers from eFarmz, INNO and Casa, among others, will also take the stage. The evening programme will bring several international speakers, a panel discussion with five Belgian retail CEOs, the RetailDetail Awards and an exquisite networking dinner. An event not to be missed as a retailer!