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People, processes, and technology to execute the providing of development content, analytics, promotion, pricing, customer acquisition and retention, and customer experience at all touchpoints during the customer buying cycle are all part of digital commerce.
In the most basic sense, digital commerce is the evolution of eCommerce (buying and selling online, usually on a website).
The practice of purchasing something online without the involvement of a human is known as digital commerce. The distinction is minor, but if eCommerce were totally automated, from marketing and sales through product delivery, it would be considered digital commerce. While complete automation may appear to be a long way off, several of the world’s top retail companies are already employing this method.
Conducting exploratory research seems tricky but an effective guide can help.
All aspects of purchasing decisions are taken into consideration by digital commerce. All of these pieces are important, and without them, the digital commerce experience would be miserably insufficient.
Typically, digital strategists focus on mapping the complete consumer journey, whether product or service, establishing how much significance to allocate to each purchase milestone, and building consumer journeys that offer the end-user with a smooth experience. Digital commerce features include, but are not limited to:
Automation is a key component of effective digital commerce, and it works best when it is backed up by data. Digital commerce is based on very complicated automation and the availability of massive amounts of data, as well as analytical capabilities.
Global supply chains are cost-effective and time-efficient, but they are also prone to failure due to weather catastrophes, pandemics, political turmoil, and other factors. In such circumstances, data serves as the foundation for predictive analytics, allowing digital commerce businesses to forecast undesirable outcomes based on frequency, seasonality, and other factors.
Digital commerce is omnichannel, meaning it can be found wherever the consumer is. This degree of granularity is only achievable if roadmaps for every potential situation are created and backed by automated solutions that regulate everything from inventory movement to customer satisfaction.
Customers often do not have to consider where their Amazon purchase is sent from or how it may be wrapped on a micro level. Instead, consumers are concerned with urgency (how quickly an order is fulfilled), quality (if the product has monetary worth), and relevance (how accurately the product delivered matches the product represented).
As a worldwide retailer, Amazon serves a few thousand orders per second; the only option for the firm to meet these constraints every time is to leverage automation at both the supply and warehouse levels, therefore establishing Amazon as a real representative of digital commerce.
Services are also supplied in the digital commerce paradigm, and SaaS (software-as-a-service) applications are only one example of how digital commerce is used in business.
In general, digital commerce in the business environment operates through four types of business models:
Businesses offer items to other businesses that require them under the business-to-business paradigm of digital commerce. These transactions are often greater in size yet occur less frequently. Some companies go around this constraint by offering monthly and yearly subscription alternatives that automatically renew.
Products and services purchased without human connection are the most prevalent instances of B2B digital commerce. Collaboration platforms like Slack and Trello, as well as automation technologies like HubSpot and Lightspeed, are examples.
Business to consumer digital commerce is quite similar to the previous use case, with the exception that the buyer is an individual consumer purchasing for personal use. B2C digital commerce is shown by the majority of smartphone applications that require payment.
The consumer-to-consumer internet commerce paradigm is more difficult to grasp, but Etsy provides an excellent illustration. Digital goods sales on marketplace systems such as Etsy are completely automated. The consumer makes a purchase, and the goods are delivered to their inbox by email.
This is a C2C transaction since the platform has no involvement in the actual transaction other than to facilitate it. Furthermore, a customer might be both a buyer and a supplier.
Review systems are the greatest example of the consumer-to-business digital commerce paradigm. On Amazon, the software generates review requests automatically, and customers are rewarded with badges and rewards points for providing helpful feedback. Because a full evaluation might create more income for the firm, the transactional value is collected from the consumer. C2B refers to the transfer of value from the customer to the company.
By creating value and money over a longer period of time, digital commerce extends the benefits of eCommerce. Why, therefore, should businesses embrace digital commerce?
Today’s purchasing process is channel-agnostic. Consumers, regardless of platform, desire frictionless transactions. For businesses, this means a plethora of ways to reach out to customers, including social media, market places, brand websites, apps, and more. As a result, there are several sales chances.
Both small and large companies may do well if they are perceived to be real and honest to their brand. According to certain studies, approximately 70% of internet buyers seek social proof. Through social networking, feedback, and relevant material, digital commerce assists businesses in gaining authenticity.
Digital commerce promotes greater revenues while increasing visibility with multichannel methods. Businesses that capitalize on online purchasing trends (and give unique, personalized purchase alternatives) notice a boost in revenues.
Everything in the internet world is always evolving, and digital commerce is no exception. While it may have been adequate to be visible on numerous channels in the past, the urge to go farther is ever-present. Here are a few examples of digital commerce trends:
Who would want to be a statistic? “No one,” is the answer. Although retail enterprises are hugely scalable, customers still like to be addressed as individuals.
Data-driven product recommendations, product bundling, gift hampers, and other personalized commerce options are available. Some companies go even farther by providing consumers with total agency of choice. They may now make their own shampoo and choose what goes into their weekly supermarket basket based on a meal plan, and even customize the proportion of fruits in their smoothies.
Augmented and virtual reality work well in retail, and companies are already on board. Furniture companies employ these technologies to illustrate how their items integrate into homes and workplaces, whilst beauty companies use filter effects to highlight their cosmetics and hair products.
Consumers may use this knowledge to order customized items, and firms can learn about customer preferences without stockpiling a single item of inventory.
Even with the introduction of digital commerce, inventory remains the most expensive component of retail. Businesses are addressing this issue using data, which is the foundation of digital commerce.
Today, fashion businesses may combat inventory dumping by utilizing “phygital” storefronts, which are empty physical store spaces that are digitally stocked based on each consumer’s specific choice. Customers may even try on things using augmented reality-powered mirrors and place a purchase online, eliminating the need for a checkout procedure.
Following receipt of the order, the product is made and delivered to the consumer while adhering to sustainability ideals.
What digital commerce and eCommerce achieve has a lot in common.
Platforms typically limit eCommerce, and online sales fall within this category. Digital commerce, on the other hand, is device agnostic and may take place on a range of platforms such as websites, applications, virtual reality (VR), and augmented reality (AR) (AR).
The goal of eCommerce is to sell. The total income earned while keeping inventory costs low is used to determine the success of an eCommerce enterprise. eCommerce is more transactional in this way.
Engagement in the purchasing process is attributed to value in digital commerce. Content and mobile devices are the primary drivers of digital commerce. Customer lifetime value (CLV), or the amount of money earned by the same customer over the course of their brand’s lifetime, is the main success statistic. This is useful in retail marketing since it generates more income from the same client, lowering marketing expenses while keeping the consumer interested throughout the purchasing process.
There are several advantages to using digital commerce, and they touch all parts of the organization, including strategy, income, costs, and much more. Here are some of the benefits that are driving most organizations to adopt a digital commerce model:
Almost every prospective customer path is pre-planned and backed by specialized content. In many respects, digital commerce is the pinnacle of marketing automation, since it can forecast a consumer’s next logical demand and meet that need to encourage consumers to purchase.
This technique dramatically decreases buying time, especially in the B2C arena, where the majority of transactions are deemed impulsive.
Because digital commerce is highly automated, it eliminates the need for expensive workforces. It also frees up time for the human labor to focus on abstract problems while data successfully handles repetitive operations.
The business model is significantly easier to grow because most digital commerce applications are automated. Hiring, performance management, managing various regions, and consolidating sales are typical scaling issues; data may alleviate these challenges through digital commerce.
Consumers want a personalized experience from internet shopping. Because every process is streamlined to provide a good consumer experience, customers return for more, resulting in higher income.
When a visitor registers on an eCommerce website, the information they provide may not be authentic, so you can’t tell if they’re actually interested in purchasing.
Cash-on-delivery transactions, for example, done using a forged phone number and address might result in enormous income losses.
As a result, it is critical to do online identity verification for each prospective consumer.
Cyberattacks can jeopardize the security of your eCommerce website by infecting it with viruses, and they can jeopardize the security of your registered customers’ data as well.
Hackers may obtain access to this sensitive data, including credit card information.
This scenario is one of the most difficult difficulties to solve in the eCommerce business, and it is undoubtedly one of every eCommerce owner’s worst fears.
Shopping cart abandonment is one of the most serious issues that eCommerce businesses of all sizes face.
According to statistics, online buyers abandon their shopping carts 68 percent of the time, with some businesses seeing abandonment rates as high as 80 percent.
Even with the best-designed eCommerce websites with a large selection of items and easy functions, customer loyalty is a fickle thing.
Any organization that lacks client loyalty will suffer since obtaining a new customer is five times more expensive than maintaining an existing one.
Increasing client retention rates by 5% can boost profitability by 25 percent to 95 percent.
Customer loyalty is a result of a seller’s brand integrity and mutual trust between the seller and the customer.
Because there is no face-to-face connection as there is in a retail shop, developing trust and loyalty in eCommerce requires more time and work.
Before making a purchase, more than 60% of internet customers check at a store’s return policy.
Shoppers would buy more if businesses offered fewer difficult returns, and an inconvenient returns policy drove away 80% of customers.
In addition, 89 percent of internet customers have returned at some point throughout their purchasing experience.
This raises a difficulty for online retailers: how can you provide your consumers peace of mind knowing they may return things they aren’t happy with without possibly harming the firm through shipping losses and reputation?
Manufacturers and merchants from whom internet businesses buy in bulk eventually start selling straight to clients.
As a result, the firm that was once a partner becomes a rival, which is exacerbated if they establish their own network of distributors.
Knowing that multi-channel buyers spend three times as much as single-channel shoppers is a powerful motivator to conquer this eCommerce hurdle.
In a world where there are desktop and mobile devices, official eCommerce storefronts, live chats, forums, Facebook, Instagram, and other social media pages, the contemporary shopper has a plethora of touch-points via which they may communicate.
This provides a requirement for merchants to have an omnichannel customer strategy. The alternative is to trail competitors and eventually be completely left behind.
When compared to traditional marketing, digital marketing has long been a more cheap method of promotion.
However, it looks that this is coming to an end as marketers grasp the value of digital marketing in the expanding online market.
The average cost of digital marketing has risen by 12% across all channels, implying that every dollar eCommerce managers pay now may have less impact than in the past.
Influencers are being forced to charge more by social media and Google algorithms in order to afford to have their postings reach more people — up to 25% more, in fact.
The aforementioned algorithms are making it more difficult for sponsored articles to achieve traction, resulting in a significant increase in the cost of these influencer services.
Voxco’s platform helps you gather omnichannel feedback, measure sentiment, uncover insights and act on them.
Voxco’s platform helps you gather omnichannel feedback, measure sentiment, uncover insights and act on them.