Probably the Smartest Thread You’ll Read on (Social) E-Commerce…

March 13, 2013

Found this little gem at Social Commerce Today. Some really interesting ideas taken from the comments of 117 thought leaders. Some are listed below:

And for the time-pressed, here’s the speed summary of key insights/takeaways.  Brilliant.

  • The future is e-commerce; offline commerce will serve only two purposes:immediacy (stuff you need right away), and experiences (showroom, fun venues).
  • But immediacy may no longer a promise for offline commerce companies as both Amazon and eBay have announced same day delivery.
  • The role of offline lies in the value of the “showroom” and “entertainment” aspects to places like Williams Sonoma. The future of commerce is a hybrid model with (entertaining) showrooms + online fullfillment
  • The future of e-commerce is combining online and offline experiences in disruptive ways. (Chloe + Isabel, Warby Parker, Everlane, and Stylemint)
  • There is no such a thing as e-commerce any more. There’s just commerce. You can innovate in commerce with technology, but the e-commerce silo is dead/dying (mobile payments are disrupting/removing the online/offline divide).
  • The future of e-commerce is vertical integration in markets where there is significant markup in both wholesale and retail (think Shoedazzle, Bonobos, J Hilburn, Warby Parker, IndoChino).
  • Few successful e-commerce companies were started in the early 2000s, although a slew of recent new entrants appear to be getting traction - flash sales, social commerce, subscription commerce and other new “content + commerce” models
  • The first wave of e-commerce was about commoditization this wave online and offline is about being a “merchant” (point of view, authority, experience etc).
  • The key equation driving e-commerce is: profit = lifetime customer value minus customer acquisition costs
  • “If it has a UPC code, Amazon will beat you.”
  • Before you enter the e-commerce game, visit an Amazon warehouse.
  • E-commerce is good for two things – price and exclusives. Amazon will beat you on price, so you have to beat it on exclusives.
  • The only way to escape commoditization and catalogue commerce dominated by Amazon is to a) sell used stuff, or b) make your own products (or provide a marketplace for those things), or c) (possibly) offer customisation
  • Be wary of e-commerce businesses based on customization – they’ve  existed for a decade (cafePress, Shutterly, Vistaprint) and yet none are thriving. Customers don’t want customization, they want great brands and great design, and they want to be told what they want.
  • The e-commerce opportunity is to contribute to the e-commerce ecosystem rather than sell directly yourself; four opportunities – 1) supply chain innovation, b) marketplaces, c) e-commerce solutions for small businesses, d) mobile payments
  •  There’s room for innovation in the space as long as the ecommerce company creates value for all participants – the retailer, the supplier and the customer
  • To make money in e-commerce, you need to sell in emerging markets where there are no huge incumbents
  • Compete in an industry with a grey market, where consumers are willing to pay higher prices for reducing risk, for authenticity, and warranties
  • The opportunity is to venture into segments where Amazon won’t go (adult, arms… !)
  • The opportunity for e-commerce success is a) sell to iPad owners (iPad owners are 10x more valuable than non iPad owners), b) mobile commerce (nobody owns this yet), and b) target your customers who use social features  (3 to 4 x more valuable)
  • You can’t sell to people who know exactly what they want – Amazon owns that; focus instead either a) ‘discovery‘ (“the best place to discover the stuff you don’t know you need”) or b) deep domain expertise
  • to succeed in e-commerce, you need to sell exclusives. You can’t sell stuff that Amazon sells, Amazon will crush you
  • Amazon is not a store, it’s the world’s best supply chain and logistics company. Amazon is transforming from a retailer to a marketplace+services provider over time.
  • Domain expertise, live assistance, and overall experience are the critical success factors for success in a market where price-competitiveness and scale rule
  • Necessary (but not sufficient conditions) for e-commerce success are a)remarkable,  unique and branded experience and remarkable, unique and branded service; do what Apple, Tiffany & Co., Coach, Lululemon do in bricks and mortar commerce, but online

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Posted by david ricketts

Spar to include Amazon Lockers in selected stores

January 24, 2013

Spar has announced it is to include Amazon Lockers in a number of stores, allowing customers to retrieve Amazon parcels at a local Spar store. The Lockers are currently located in nine Spar stores with further Lockers planned to be added in the future.

The initiative lets Amazon customers choose their Locker option and location when ordering online. They then receive a secure pick-up code via email which they use to open the Locker and retrieve their parcel.

The nine Blakemore Retail Spar stores offering Amazon Lockers are: Fosse Road, Bocking Lane, Upton, Birmingham University, Bannerbrook, Broomhill, Grantham, Burbage and St. Albans.

Spar UK retail development controller Barry Wallis said: “This is a highly innovative move from Spar UK, showing our commitment to launching the latest technologies that provide the best possible convenience to shoppers.

“Online sales are growing with more than half of the UK population now shopping online. In recent months, we have introduced mobile phone charging units, free WiFi and mobile marketing apps instore for our customers. This is the next step in making our stores even more service-friendly.”

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Shifts in Retail Demand New Analytics

October 15, 2012

Our benchmark research into retail analytics says that only 34 percent of retail companies are satisfied with the process they currently use to create analytics. That’s a 10 percent lower satisfaction score than we found for all industries combined. The dissatisfaction is being driven by underperforming technology that cannot keep up with the dramatic changes that are occurring in the retail industry. Retail analytics lag those in the broader business world, with 71 percent still using spreadsheets as their primary analysis tool. This is significantly higher than other industries and shows the immaturity in the field of retail analytics.

While in the past retailers did not need to be on the cutting edge of analytics, dramatic changes occurring in retail are driving a new analytics imperative:

Manufacturers are forming direct relationships with consumers through communities and e-commerce. These relationships can extend into the store and influence buyers at the point of purchase.  This “pull-through” strategy increases the power and brand equity of the supplier while decreasing the position strength of the retailer. This dynamic is evidenced by JC Penney, which positions itself as a storefront for an entire portfolio of supplier brands. Whereas before the retailer owned the relationship with the consumer, the relationship is now shared between the retailer and its suppliers.

What this means for retail analytics: Our benchmark research shows retail has lagged behind other businesses with respect to analytics. Given the new co-opitition environment with suppliers, retailers must use analytics to compete. Their decreasing brand equity means that they need analytics not just for brand strategy and planning, but also in tactical areas such as merchandising and promotional management. At the same time, retailers are working with ever-increasing amounts of data that is often shared throughout the supply chain to build business cases and to enrich customer experience, and that data is ripe for analysis in service to business goals.

E-commerce is driving a convergence of offline and online retail consumer behavior, forcing change to a historically inert retail analytics culture. As we’ve all heard by now, online retailers such as Amazon threaten the business models of showroom retailers. Some old-line companies are dealing with the change by taking an “if you can’t beat ’em, join ’em” approach. Traditional brick-and-mortar company Walgreens, for instance, acquired Drugstore.com and put kiosks in its stores to let customers order out-of-stock items immediately at the same price. However, online retailers, instead of looking to move into a brick-and-mortar environment, are driving their business model back into the data center and forward onto mobile devices. Amazon, for instance, offers Amazon Web Services and Kindle tablet.

What this means for retail analytics: There has historically been a wall between the .com area of a company and the rest of the organization. Companies did mystery shopping to do price checks in physical trade areas and bots to do the same thing over the Internet. Now companies such as Sears are investing heavily to gain full digital transparency into the supply chain so that they can change pricing on the fly – that is, it may choose to undercut a competitor on a specific SKU, then when its system finds a lack of inventory among competitors for the item, it can automatically increase its price and its margin. Eventually the entire industry, including midtier retailers, will have to focus on how analytics can improve their business.

Retailers are moving the focus of their strategy away from customer acquisition and toward customer retention. We see this change of focus both on the brick-and-mortar side, where loyalty card programs are becoming ubiquitous, and online via key technology enablers such as Google, whose I/O 2012 conference focused on the shift from online customer acquisition to online customer retention.

What this means for retail analytics: As data proliferates, businesses gain the ability to look more closely at how individuals contribute to a company’s revenue and profit. Traditional RFM and attribution approaches are becoming more precise as we move away from aggregate models and begin to look at particular consumer behavior. Analytics can help pinpoint changes in behavior that matter, and more importantly, indicate what organizations can do to retain desired customers or expand share-of-wallet. In addition, software to improve the customer experience within the context of a site visit is becoming more important. This sort of analytics, which might be called a type of online ethnography, is a powerful tool for improving the customer experience and increasing the stickiness of a retailer’s site.

In sum, our research on retail analytics shows that outdated technological and analytical approaches still dominate the retail industry. At the same time, changes in the industry are forcing companies to rethink their strategies, and many companies are addressing these challenges by leveraging analytics to attract and retain the most valued customers. For large firms, the stakes are extremely high, and the decisions around how to implement this strategy can determine not just profitability but potentially their future existence. Retail organizations need to consider investments into new approaches for getting access to analytics. For example, analytics provided via cloud computing and software as a service are becoming more pervasive help ensure they meet the capabilities and needs of business roles. Such approaches are a step function above the excel based environments that many retailers are living in today.

thanks to http://tonycosentino.ventanaresearch.com/2012/10/12/shifts-in-retail-demand-new-analytics/

 

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Mobile shoppers spur rise of ‘showrooming’

April 12, 2012

Posted by: in North America

One of the initial barriers to online shopping was consumers’ reluctance to buy something without seeing it. Shoppers tended to research products online, then go to a physical store to examine them and make purchases. But as people have become more comfortable with e-commerce, and with smartphones enabling research and shopping on the go, a reversal in behavior is under way: Shoppers are going into physical stores to examine products, then using their mobile device to price-compare, frequently completing the purchase online.

It’s called “showrooming,” and more than a few shoppers are doing it. A 2011 Codex Group survey found that almost a quarter of respondents who bought a book online first saw it in a physical store. The Pew Research Center estimates that 5 percent of mobile phone owners who bought online in the 2011 holiday period did so from a physical store after comparing prices. In the U.K., almost a fifth of in-store shoppers check competitors’ websites on their mobile, with 30 percent of that cohort saying they’ve purchased from a rival while inside a store, according to Intersperience. And a ClickIQ study found that nearly half of participants who shopped online in the past six months had first seen the product in a store; some of them patronized that retailer’s e-commerce site, but almost half ended up buying from Amazon.

Amazon is eager to encourage showrooming. Its Price Check mobile app lets shoppers scan in-store products to easily look up Amazon’s prices. A one-day holiday promotion, offering up to $5 off for shoppers who used the app in a physical store, had brick-and-mortar retailers crying foul last year. They’re starting to fight back. In January, Target asked its suppliers to create products exclusive to the retailer, thwarting shoppers ready to compare prices online. Nordstrom, already known for its customer service, now offers free shipping for in-store shoppers.

The rules of retailing have changed. Showrooming already appears to be partly responsible for Best Buy’s current woes. For the most cost-conscious consumers, physical retailers will need to add more incentives (e.g., bonus products with in-store purchase). But while online retailers have the advantage of low overhead, brick-and-mortar offers immediate gratification, hands-on customer service and, in some cases, memorable experiences. Retailing as a Third Space, one of our 10 Trends for 2011, emphasized the need for retailers to create unique experiences and environments that are only partly about shopping. Ultimately, these could make the difference between a loyal customer and one with a wandering Web browser.

Image credit: Amazon

Thanks to jwtintelligence.com

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Online retail traffic – Europe

February 14, 2012

A nice little data gem from Comscore, showing the unique visitor traffic and time on site for retail based ecommerce sites by Europeans over the last 12 months. The data shows from one christmas period to another, total people visiting online retail sites climbed by almost 30 million people, while time on site almost doubled.

The data also went on to point out the top 3 retail sites in terms of unique visitors, which were unsurprisingly:

  • Amazon (118M users in Dec 2011)
  • Apple (53M users), and
  • Otto Gruppe – a popular German retailer (33M users)

Thanks to http://deliriantistiromani.wordpress.com/

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Trend in Cloud Computing Adoption – 2012

February 1, 2012

What can we expect from cloud computing in 2012? Where will cloud computing be one year from now?

  1. Basic premise of (1) economy of scale, (2) pay what you use and (3) better utilization through sharing will remain intact – though some reports challenging the extent of cost saving will emerge.
  2. Amazon will extend its lead over others with the most comprehensive offering on IaaS – competitors will try to carve out their own niche.
  3. Google will not make much headway in the enterprise segment – perpetual beta does not gel with enterprise.
  4. Microsoft will do just enough on office suite to keep competition at bay – but not too much to cannibalize its core office business.
  5. Same will happen with major ERP vendors – they will make just enough noise but stop short on cannibalizing their core business.
  6. Every vendor will look for a pie in the private & hybrid cloud – but the actual adoption will be very low the talk will shift to governance being the key.
  7. Critical concerns (both real and perceived) like (1) security, (2) privacy, (3) SLA and (4) compliance also remain – like credit card usage on net objections will slowly go away – but tipping point will not be 2012.

Neither cost saving nor flexibility is the primary driver for cloud adoption

There is clear indication that mobility has become the prime reason for cloud adoption.

Here are the results of two surveys:

  1. IBM: 51% of respondents stated that adopting cloud technology is part of their mobile strategy.
  2. CSC: 33% adopted cloud primarily for accessing information from any device as against only 17% who adopted for cost saving.

The implication is that cloud computing is becoming an enabler for mobility and mobility is the big thing. Cloud computing becomes a means to an end.

What will the implication be?

  • Budget will get allocated for mobility and not for cloud computing though people will use cloud to achieve mobility.
  • Mobility solutions will include a cloud component rather than a cloud solution with mobility component.

Amazon, Google and Microsoft

Amazon continuous to lead in the IaaS with more offering and more availability zones – it is also trying to get into PaaS.

Microsoft still continues to do just enough on office suites to keep competition at bay – it is fighting a battle of survival in the mobile and tablet space.

Google has still not made much headway into the enterprise – in spite of changing direction in many ways.

  • It has a new CEO.
  • It has closed down Google Labs.
  • It has a reasonable successful launch of social media platform.
  • It discontinued Google App Engine for Business.
  • It has modified its search algorithm to incorporate social data.

On the whole, as far as cloud computing is concerned, there is hardly any change.

What about Big Data?

Most analysts have proclaimed that “Big Data” is the next big thing. Big data without cloud computing is difficult to imagine.

  • Is Big Data part of cloud or is it part of analytics?
  • Is it to be treated as a separate category?
  • Or, is it a solution in search of a problem?

It is obvious that application of big data is limited to few specific set of problems. The key point we need to remember is that big data will not be of any use unless you are ready to ask the right question – but that is a separate topic.

Finally…

For everything to go into cloud and for us to access it from any device from anywhere we need wireless bandwidth. Do we have enough of it?

Look at some of these stats (picked up from this article):

  • In 2011 October, number of wireless devices in the U.S. exceeded the number of people.
  • By 2014, voice traffic will comprise only 2 percent of the total wireless traffic in the United States.
  • Smartphones consume 24 times more data than old-school cell phones, and tablets consume 120 times more data than smartphones.
  • Mobile networks in North America were running at 80 percent of capacity.
  • With advancements in connected cars, smart grids, machine-to-machine (M2M) communication, and domestic installations such as at-home health monitoring systems, wireless demands will only increase

Thanks to Udayan Banerjee

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Posted by david ricketts

Creating a magical in-store experience that is different from your online store

January 24, 2012

In early December, Amazon announced a new promotion where it would incentivize consumers to competitively price-check in retailers’ stores by providing up to $15 in Amazon.com credit. Retailers were floored, leading to many organizations speaking out against the online retailer and providing resources for retailers to boycott Amazon and its app.

The fact of the matter is many retailers simply cannot compete against the low-prices and broad inventory of online retailers. To be successful, independent retail business owners must differentiate their offering beyond price and convenience. Instead, they must focus on offering a remarkable in-store experience, provide the inventory that really matters at appropriate price points, and arm the store with sales associates that are likable and can offer expert advice to inquiring customers.

To executive on recreating a magical in-store experience that is differentiated from online retailer, retailers must focus on three main strategies.

1. Offer more than products. Retailers have to move beyond the belief that a store just needs to stock the shelves low-priced products. Instead, the store should be a place where customers come to experience the products (and brand), interact with the items and others, learn how to better use the products, and be able to inquire about the products.

2. Rethink the store inventory. It is no longer necessary to pack as much inventory as possible within the store. Customers that want a large selection at the lowest price will turn to online retailer. Instead, retailers should focus on carrying only the right mix of products at various price points. Additionally, the appropriate use of signage and a clear store layout can help customers quickly come in and out of the store to find the products they need fast.

3. Hire likable experts. This one is one of the most difficult, because it’s maybe the most intangible. Instead of training a staff of commissions-focused sales associates, retailers should replace and encourage their staff to be likable product consultants and brand ambassadors. These associates should be more focused on problem-solving than making a sale.

There are a number of point-of-sale software features that can assist retailers hoping to differentiate their stores. Here are a few features to be on the lookout for when evaluating new systems:

As with all technology, retailers must be dedicated to ensuring that their store experience is remarkable. They must offer an environment where customers will be excited to enter for the first time, as well as return.

Michael Koploy is an ERP Analyst for Software Advice (retail website here). He reports on news and trends in point of sale and supply chain management software. He can be reached directly at michael@softwareadvice.com.

C24 would like to thank Michael for this blog.

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Amazon’s new Silk browser video

October 14, 2011

Great video about Amazon‘s new browser silk, blow is an advert for the new Kindle Fire as well. The question is could Amazon be looking to take Apple’s crown, we think they could be a major competitor as they have all the elements in place. 

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