Regional Deep Dive: Data-Driven Experience Transformation in European Retail
Unlocking Profitability and Customer Value in a Complex Market
The European retail landscape is undergoing a profound transformation. As digital commerce accelerates, retailers across the continent are challenged to not only grow their e-commerce channels but also to do so profitably—while navigating a patchwork of privacy regulations, diverse consumer behaviors, and the rapid rise of omnichannel expectations. At Publicis Sapient, we help European brands harness the power of data-driven experience transformation to thrive in this dynamic environment.
The European Retail Challenge: Growth, Profitability, and Regulation
Recent research with retail decision-makers across Europe reveals a clear consensus: the pandemic has permanently changed the nature of retail, with 96% expecting e-commerce to continue its upward trajectory. Yet, this growth brings new pressures. Nearly half of European retailers say their e-commerce business is less profitable than their in-store operations, and a quarter report that e-commerce is not profitable at all. The challenge is particularly acute for e-commerce-only retailers, who are twice as likely as their brick-and-mortar peers to struggle with profitability and investment.
What’s driving this gap? European retailers face a unique set of hurdles:
- Stricter privacy regulations: The General Data Protection Regulation (GDPR) and evolving national laws require retailers to rethink how they collect, manage, and activate customer data. Non-compliance carries significant financial and reputational risks.
- Diverse consumer behaviors: Preferences and shopping habits vary widely across countries and regions, demanding localized strategies and nuanced personalization.
- Omnichannel complexity: Shoppers expect seamless experiences across digital and physical touchpoints, from mobile apps and social selling to in-store fulfillment and agent-assisted shopping.
- Investment constraints: While 90% of retail leaders know what’s needed to improve e-commerce profitability, nearly half struggle to make the necessary investments—often due to legacy systems, organizational silos, and the complexity of aligning cross-functional teams.
Where European Retailers Are Investing for Impact
To address these challenges, European retailers are prioritizing investments in:
- Digital customer experience: Over half of decision-makers cite holistic, omnichannel digital experiences as the top area for driving profitability. This includes optimizing mobile apps, enabling social selling and live streaming, and delivering agent-assisted shopping.
- Omnichannel commerce: Replatforming, expanding through marketplaces, and dynamic pricing are key focus areas, with grocery retailers also emphasizing supply chain modernization and in-store digitization.
- Marketing technology and data monetization: Business intelligence, analytics, and personalization are critical for turning data into actionable insights and measurable results.
The Power of First-Party Data in a Privacy-First Europe
With third-party cookies disappearing and privacy expectations rising, first-party data has become the foundation for sustainable growth. European retailers are increasingly:
- Building unified customer profiles: By integrating data from e-commerce, in-store, loyalty, and digital touchpoints, brands can create a single view of the customer—enabling more relevant, timely, and compliant personalization.
- Activating data across channels: Advanced customer data platforms (CDPs) and clean room technologies allow retailers to orchestrate journeys, segment audiences, and measure performance while respecting consent and privacy.
- Driving measurable outcomes: Retailers leveraging first-party data see improvements in conversion, average order value, and customer lifetime value—while reducing wasted spend on ineffective targeting and redundant acquisition.
Omnichannel Experience: Meeting Shoppers Where They Are
European consumers are true omnichannel shoppers, seamlessly moving between online and offline experiences. Leading retailers are:
- Optimizing for mobile and social: Mobile apps, social selling, and live streaming are increasingly important, especially for younger demographics. Personalization and entertainment are merging, with brands curating experiences that are both convenient and shareable.
- Digitizing the store: Robotics, in-store apps, and agent-assisted shopping are enhancing the physical retail experience, particularly in grocery and specialty sectors.
- Modernizing fulfillment: Investments in micro-fulfillment centers, shipping optimization, and inventory visibility are helping retailers meet rising expectations for speed and convenience.
Overcoming Silos: The Role of Cross-Functional Teams
One of the biggest barriers to data-driven transformation is organizational silos. European retailers are breaking down these barriers by:
- Forming cross-functional pods: Bringing together stakeholders from brand, merchandising, technology, analytics, and customer support to own KPIs and drive continuous improvement.
- Aligning on shared goals: Focusing on a small set of overarching metrics—such as quality traffic, conversion, and average order value—enables teams to act quickly and scale successful solutions.
- Embracing a test-and-learn culture: Rapid experimentation, real-time measurement, and iterative optimization are essential for adapting to changing consumer behaviors and market conditions.
Publicis Sapient: Your Partner for Data-Driven Retail Transformation
At Publicis Sapient, we combine deep retail expertise with advanced data, technology, and experience design capabilities to help European brands:
- Navigate privacy and compliance: We help clients implement robust consent management, data governance, and responsible AI practices to stay ahead of regulatory change.
- Unlock the value of first-party data: Our teams design and deploy customer data platforms, clean rooms, and analytics solutions that unify data, enable personalization, and drive measurable business outcomes.
- Orchestrate omnichannel experiences: From mobile and social to in-store and fulfillment, we help retailers deliver seamless, personalized journeys that build loyalty and profitability.
- Drive organizational change: We work with clients to break down silos, build cross-functional teams, and foster a culture of innovation and continuous improvement.
The Path Forward: Profitability Through Data-Driven Experience
European retail is at a crossroads. The winners will be those who can turn data into insight, insight into action, and action into profitable growth—while respecting the privacy and preferences of every customer. By investing in the right capabilities, embracing cross-functional collaboration, and partnering with experts who understand the nuances of the European market, retailers can unlock the full potential of data-driven experience transformation.
Ready to accelerate your journey? Connect with Publicis Sapient to learn how we can help you build the data-driven, omnichannel retail experiences that European consumers demand—and that your business needs to thrive.