E-Commerce is Dead, Long Live A-Commerce

E-Commerce is Dead, Long Live A-Commerce

E-commerce isn't really dead, it's just 'table-stakes' now. We should be preparing for The Next Thing: A-Commerce

It boggles my mind that in 2021 there are still businesses that don’t have an e-commerce presence. TJX, the parent company of, among others, TJ Maxx, Marshall’s, and HomeGoods didn’t view e-commerce as strategic to its business model in June 2020, during the height of Covid lockdowns. Since then they’ve announced that HomeGoods will launch its e-commerce platform in 2H 2021.

The remainder of the economy has embraced e-commerce and are looking at what’s next. E-commerce is table stakes and companies are looking for competitive advantage. Let’s take a look at what we think will be The Next Thing in the industry…a-commerce. Read on and we’ll tell you about a-commerce.

I read recently that Shopify is seeing a 65% shopping cart abandonment rate during Covid lockdowns. That number, while huge, feels about right to me. If I put something in my Amazon cart I try to let it sit there for 48 hours. Delayed gratification gives me time to think about whether I really need it. And sometimes I get a better price too. This of course isn’t the only reason for shopping cart abandonment and marketers have been studying the causes (and how to overcome them) for years. It turns out that our “data”, and some creative thinking, can help here.

It’s been written by many that the main reason for shopping cart abandonment is a terrible checkout user experience. I agree with that. There are plenty of tools and software to help with this, but maybe the better solution is avoiding the checkout experience entirely.

There’s a local pizza shop that I love. Best. Pizza. Ever. Prior to Covid-19 they didn’t even do e-commerce, only phone orders. Thanks to Covid, now they ONLY do online take-out orders. Version 1.0 of their e-commerce platform was horrendous. I hated their checkout process so much that most times I just decided to order somewhere else. I didn’t want to enter my credit card number every time and try to figure out my wallet-worn CVV code. The alternative was to create an account on their site with a password I’ll never remember only to find out years from now my Visa number is available on the Dark Web because they stored my payment info in mysql and used the default root account with no password. And there is nowhere on their website to enter special instructions for my order. What a horrible user experience! Then one day, it all changed. Read on…

People don’t actually enjoy shopping as much as they think they do

This is just my theory and I think Covid lockdowns are proving that people might not actually enjoy shopping:

  • The choices are overwhelming to the point of frustration. I just wish I was shown the best product given my consumer segmentation so I could buy it without over-thinking it. Do I want the cheapest or the best rated? Can I trust the ratings aren’t being generated from bots and AI? It’s too much to think about
  • During “covid”, even the most avid shoppers aren’t travelling to local stores. The trend away from human interaction is increasing. Local businesses are turning to e-commerce platforms like Shopify in record numbers. But we still need to solve the shopping cart abandonment problem. E-commerce is becoming table stakes.

The Rise of A-Commerce

A-Commerce is a way we can solve a lot of this. It’s kinda new and there is disagreement on what exactly a-commerce is. There is a lot you can learn from a-commerce regardless of how you define it.

Let’s start with “automated-commerce”, which is the currently-accepted meaning within the industry. Amazon calls this “subscriptions”.

Quick story: I’m addicted to Monster Energy Drinks. When I need my Monster Fix, I need it now, and I can’t jump in the car and go to the local convenience store. Whenever I order a case on Amazon it takes 2 weeks to arrive (why is that?). So I need to expend a lot of mental energy determining when I need to reorder so I don’t run out. Or, I can use an Amazon Subscription and put it on auto-pilot. I can automatically have a case delivered on whatever schedule I want. I get a 5% discount on every order and 20% off the first order.

Net effect: After being a subscriber for a year I have about 3 cases of Monster in the cupboard. I guess I consume less than I thought I do. But I’m not going to alter the delivery frequencies because I know it’s going to take me an hour to figure out where that option is on the Amazon website. I’d rather pay for a product that I’m overstocked in, just to avoid dealing with what might be another bad user experience. And with Covid’s effect on supply chains, I may be glad I have some extra on hand. All of this works in the favor of the business.

That’s a-commerce. Automation

Back to my favorite pizza shop. One day during the pandemic I noticed my pizza shop released Version 2.0 of their website, which included an option to “subscribe” to my pizza. I can set a recurring schedule for pizza. So Wednesday has become Pizza Night and at 7:30 I know I’ll be having delicious pizza without any additional work to do. Do you know how many times I’ve forgotten about my “pizza automation”? Too many times. But that’s a good thing. It gives me a midnight snack without even thinking. Point is: the Digital Transformation is real, even for pizza shops. For decades Domino’s Pizza orders were telephone-based, now 70% originate from their e-commerce platform.

Automation is solving consumers’ desires for speed and reduced human contact.

  • A bunch of QSRs (Quick Serve Restaurants) and sports stadiums are piloting a new checkout-free payment system from Mastercard called Shop Anywhere. I can see one problem with Mastercard’s implementation…I will need to sign up separately with each retailer. If the process doesn’t feel like it is saving time for consumers, will they use it? Time will tell.
  • Amazon has about 20 Go-branded stores which use AI, cameras, and scanners to let shoppers “automatically” pay for their purchases without waiting in line to pay. And in March Amazon began offering other retailers access to their technology.

What else is A-Commerce?

A-Commerce is also:

  • Algorithm-Commerce : if I can inject some data science into a process and improve the user experience or save money, that’s a win. Examples:
    • price optimization: what factors allow me to adjust my price such that I sell the most product to generate the most revenue?
    • customer segmentation: how can I learn about my buyers and build custom, measurable marketing campaigns?
    • demand forecasting: how can I better forecast my product’s demand?
    • supply chain management: Covid taught us all about just how fragile the world’s supply chains really are.

These are all things that I can improve with an better algorithm and possibly some additional data.

  • Analytics-Commerce: Executives rely on analytics to help them understand how to respond to consumer behavior and shifting market dynamics. This is easily done with the right data. This can also answer the question: “what should we do next”
  • Alternative-Commerce: We can use “alternative data” to provide revenue lift. Non-traditional, external data sources are being leveraged by forward-thinking companies in creative ways every day. Obvious examples are weather data and social media. But have you ever thought about:
    • voter registration data. In many areas this can be obtained with a simple request. This data won’t tell you who I voted for, but it will tell you what party I’m registered with. What could you do with this data?
    • satellite imagery: I can tell a lot about you based on your home and property. Should I be up-selling or looking for cheaper alternatives?
    • Other paid 3rd party data sources: In the Digital Era, the consumer is the product. Companies are tracking and monetizing consumer habit data and you can purchase it. And not just social media either. Buying habits can be purchased from credit card companies and insurance companies. And that’s just the start.

Implementing A-Commerce

A-commerce is still nacent, but forward-thinking companies are carefully watching the trends. All of these a-commerce trends require more data and a different approach to analytics. Traditionally, data projects were risky, with blown deadlines and budgets. This risk has been mitigated in recent years using better technologies that can be deployed in an agile fashion without any up-front capital expense. We do a lot of these projects and I can assure you that simple processes like integrating your SCM data with your Salesforce data can be done in just a few days instead of a few months. The tools are that much better and easier to use. The ancillary benefit is your marketing team can actually do a-commerce initiatives instead of massaging data in Excel.

Become Data-Driven at the Microsoft Technology Center

Are you convinced that your company is ready for the a-commerce era?

Most marketing departments are taking steps to become more data-driven, but there’s a lot of work to do. Most data-savvy marketers are still doing analytics using carefully-curated Excel data. We can do better. We can automate these processes.

I am a Microsoft Technology Center (MTC) Architect focused on data solutions. The MTCs are a free service and we strive to be Trusted Advisors for our customers. Others have Know-How, we have Know-What. We want to understand your business problems before rushing to solutions. We also know that technology alone cannot solve these problems without smart people and modern processes. We offer services ranging from human-centered Design Thinking Workshops to hackathons.

Listen, we aren’t a-commerce experts but we are great enablers. Within a few days we can build a rapid prototype and show you the Art of the Possible. Just bring us a thorny problem that we can help you solve. We’ll show you what it takes to start an a-commerce initiative and we’ll help you solve data problems in days that would’ve taken months just a few years ago.

Does that sound compelling? Contact me on LinkedIn and we’ll get you started on your a-commerce journey.

Are you convinced your data or cloud project will be a success?

Most companies aren’t. I have lots of experience with these projects. I speak at conferences, host hackathon events, and am a prolific open source contributor. I love helping companies with Data problems. If that sounds like someone you can trust, contact me.

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