Call it „Commerce“!

In our little eCommerce world, especially amongst various service partners, new specific vocabulary is often created and then communicated as if it was the most important issue. Following cross channel, omnichannel, noline commerce and many more, nowadays the new buzzword seems to be couch commerce. What are all these hypes about? What are they good for? Do other players in the market understand this insider talk? What about companies that actually want to start a business with eCommerce? Do they have to precisely differentiate between these new trends and exactly know what they are about? I guess not.

Many new arrivers in the eCommerce market are not buzzword-addicted at all. Their eStrategy remains at the very basic stage: “I want to start with eCommerce. So let’s build a shop.“ In even more cases the motivation to start with eCommerce derives from the key finding: “I must start with eCommerce!” But why?

Yes, of course – the eCommerce market becomes more and more relevant. Growth rates in eCommerce are by far higher than in retail business. According to the market grew by more than 7% in 2011 – this is the highest growth rate since beginning of the Internet era. It’s not any more the question if eCommerce itself works and if consumers want to buy online. You can tick off these questions. Acknowledging the importance of the eCommerce market is a good start. Now start thinking about the most suitable business model for your company within this segment. This strategic process should lead to individual results and business models per company, unless you are a pure copy cat.
Just opening an online shop or implementing a new shopping app doesn’t necessary lead to major success. It may even not be the best answer for the individual needs of your customers and the organization of your company. What about the retailers’ experiences? Would you open a retail store in a completely new environment without knowing the market? Without researching what impact this might have for the rest of your business?

Compared to retail, eCommerce is a rather young business. Within the last 15 years, we saw an extremely dynamic innovation circle with enormous learnings in the market – often based on pure „trial and error“. One of the most important current trends is mobile: Mobile being the (future) linking centerpiece for consumer behavior. According to a recent study from Capgemini, the Market Share of mobile and online commerce will sum up to almost 50% by 2016. This includes tablets and the mentioned Couch Commerce. Is it necessary to differentiate where the consumer buys? Online, mobile or offline? Strategically yes, but in the end, the total sales and resulting profits is the most relevant perspective.
Okay – so let’s do eCommerce and include a smart mobile strategy. How to get this done with the right approach and efficiently? Establish eCommerce as a new isolated sales channel? Focus on multichannel, cross channel or are the implications of Couch Commerce the guiding principle for your activities? Do you need an app or is a mobile optimized online shop just good enough? What about your CRM? Should you develop your new business within the restraints of the existing IT systems? What’s better: Developing your own eCommerce software or implementing the most adequate standard software whilst reviewing some of your existing Infrastructure? Are your customers really waiting for you to open an eShop? Will they then stop buying at the competitors’ online sites? How do you retain loyalty of your customers to your retail stores?

You might think there is no simple answer to all these questions, but there is: Call it Commerce! Don’t get distracted from finding the right business model for you. If you address the right questions and come up with a well reflected strategic approach, your organization will be able to implement this – and your customers might also like this. They might even recommend you to other consumers that you’d never reached by yourself. With the right strategic approach you can grow this business with the market or even faster – and then you can “trial&error” with trends and innovations. It won’t matter anymore whether your customers buy online, mobile or in store. How do you call this: crosscommerce, multichannel, omnichannel or no-line Commerce? Who cares.

Otto, Zalando and Amazon do experiment with own retail outlets and own brands. These strategies don’t target the vision to become a multichannel retailer. These companies want to add value to their business by enriching the opportunities for their customers; they try to enhance their business model. Similar thinking will probably apply to Opening a retail store in Munich suits and improves their business model because they receive direct customer feedback and can offer new services that are hardly to be as successful without having this real customer touchpoint.
Nobody questions that research and buying behavior is different once you are relaxed on your couch – compared to inbetween or timewise restricted activities on your business PC or elsewhere. Before following this new trend and investing in new projects and adapting infrastructure or content take some time to find out if this is the right path you are following. Is this really relevant for your specific business and your customers? Get the right questions on the agenda at the beginning of your initiatives – this will help you to come up with the right decision for your strategy. The guiding principle remains: Call it Commerce!

About Oliver Lucas
Oliver Lucas, Munich, Founder of ecom consulting. Oliver is in the eCommerce and Multichannel Business since 1998 and was managing partner at a Full Service eCommerce Provider (eShop, IT, Backend, Logistics, Customer Service) and headed the Market entry of JCL eCommerce. He also was Project Manager at Deutsche Lufthansa. Ecom consulting focusses on the attunement of strategy and processes within the eCommerce and Multichannel business. Oliver has experience of more than 50 ecommerce projects. He publishes on various platforms. Homepage: Twitter: ol_ecom

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