Jul 25, 2014 0
2014 marks the 25th anniversary of the invention of the World Wide Web. The web has disrupted the way we carry out many aspects of our lives, from socialising, to watching TV, banking and shopping and has led to the demise of some brands, the rise of others. The creative use of web technology has shaped commerce; online commerce sales are set to increase by 20% this year to reach $1.5 trillion globally.[i] As we stand at the start of a fourth wave of online commerce, the challenge for today’s brands is to ensure their customers have a seamless experience. Consider the journey so far:
- Commerce 1.0 saw the first generation of web shops that were based on the real world and extended the product range through virtual shelves. Brands took their traditional sales model and ported it to the web.
- Commerce 2.0 incorporated rich content – such as video and user generated content, social networking and web applications – into the selling process. Brands started to link physical assets like stores with their digital assets.
- Commerce 3.0 is all about the proliferation of non-PC devices and globalisation. Brands are integrating digital fully into their physical stores.
- Commerce 4.0 will be driven by the ‘internet of things’, advanced use of data and analytics and a battle for control of the shopping basket between retailers and branded manufacturers.
Empowered, demanding and digitally savvy consumers expect to research and buy goods anywhere, anytime using any device or touchpoint and to have a seamless experience. Brands need to be confident they can meet their customers’ expectations of convenience, recognition, service and immediacy.
Successful brands will be those that manage to tie all of this together seamlessly, connect with their customers at a physical place or in the virtual world and get the products quickly to wherever they want to receive them. And he range of devices is increasing fast. Brands will need to consider the impact of the ‘internet of things’ (the network of physical objects with embedded technology, like in-car sensors and wearable technology). Gartner predicts that there will be 26 billion such devices in 2020 compared with 7.3 billion smartphones, tablets and PCs in use at that time.[ii] We’re at the early stages of this but its easy to see what some of the commerce applications might be. Volvo, for example, is testing a smart car that can give delivery firms access to the trunk, via a single use digital key.
I have a Fitbit wristband that tracks the distance I walk each day, calories eaten and used, weight and sleep patterns. I’d be very happy if this could be seamlessly linked to my chosen supermarket to easily re-order food and to be reminded when I’m likely to run out of an item. Some days, I’d even like to be alerted if I try to order the double chocolate chip cookies when I’m shopping, instead of the fruit salad. Other days I might choose to switch off such alerts.
One of the keys to enabling a seamless experience is effective exploitation of data. However, with 2.5 billion gigabytes created each day[iii], the challenge for brands is using it to derive insight and most importantly, acting on that insight. With a burgeoning list of data sources (back-office systems, stores, call centers, value chain partners, email, mobile, rich media, user-generated content, social media) many businesses are overwhelmed by the scale of the challenge.
Effective use of data can give brands a competitive advantage. Analysis of data will, for example, show how customers are using which devices and at what stages in their shopping journey, and will highlight barriers to purchase. Building a single customer view and using that to develop customer segments and to tailor communications will help brands offer a seamless experience. And if done right, will shorten sales cycles, and increase consumer engagement, loyalty and revenue.
And just think what additional data will be available from my Fitbit wristband, other wearable technology and all the new devices with embedded sensors. As long as I receive useful and enjoyable communications and have the option to opt out at any time, then I’d be happy to link this to specific applications and receive personalised communications.
2014 is a turning point in the struggle between Amazon, retailers and FMCG/CPG manufacturers for control of the consumers’ shopping basket as Amazon continues to expand its offering, particularly in grocery. Outside footwear and apparel, FMCG/CPG manufacturers have been trialing ecommerce but have yet to make big inroads into the direct to consumer market. Amazon’s continued expansion of its grocery offering should be a massive wake-up call to any supermarket or FMCG/CPG manufacturer not selling online. It’s Decision Time.
Manufacturers can embrace direct to consumer commerce without alienating retail partners, by for example, offering exclusives, subscription services, niche or customised products, different pack sizes etc. While there are many ways to get to market quickly, it’s also important to think strategically so that new offerings link up to existing ones seamlessly, that data and intellectual property is retained within the company and that strong foundations are in place for future growth.
Technology has always been disruptive and transformative. 25 years on from the birth of the web, brands need to harness the power of technology to offer consumers the seamless experience we all crave.
To deliver a seamless commerce experience, brands need to think about:
End-to-end experience – it’s easy just to focus on the customer experience at the different touchpoints, however this overlooks the end-to-end experience, which can be different. Brands should nominate a member of staff to ‘own’ a particular end-to-end journey, aiming to reduce customer struggle and improve the whole experience.
Data and analytics – it’s increasingly important that brands bring data sources together to develop a single customer view. This can provide an in-depth understanding of shoppers; whether it be the reason for their last purchase, personal preferences or which devices they use for which stage of their shopping journey. And most importantly, it can be used to develop customer segments, tailor their experience, promotion or content and to improve future business processes.
Infrastructure – to deliver a consistent and personalized experience and track interaction in order to react in real-time, brands need to choose platforms and technology components that can be centrally configured and managed to support all channels and devices.
(Originally published in 2014 BrandZTM Top 100 Most Valuable Global Brands)