How to make sure your e-commerce strategy delivers

Introducing “e” into industry parlance has caused all manner of problems, not least for electronic commerce. Its use as a convenient prefix to anything vaguely related to the internet has played a central role in many a false start in the technology industry.

Instead of signifying the complexity of taking a physical activity and translating it to the online world, it seemed to have the opposite effect of luring many organisations into action without thinking things through properly.

However, lest we forget, e-commerce has been around for a long time ­ – though perhaps not as we know it today. From corporations trading via electronic data interchange (EDI) systems to high street shoppers buying their groceries online, e-commerce is gradually capturing more of the spend both between businesses and between consumers and retailers.

Despite a shaky start, e-commerce is doing OK. From the dot com boom-then-bust, some useful lessons have emerged. So how can businesses thinking about e-commerce avoid the mistakes of their predecessors?
We can consider this by referring to the life cycle that has evolved during hundreds of years of traditional retailing.

What are the key ingredients? The first thing to acknowledge is that we do not need to reinvent the wheel –­ the underlying success factors for e-commerce can be expressed in the same terms as normal commerce. This may be of no interest to an online retailer, but is of critical importance to a traditional retailer looking to extend its presence into the online world.

Marketing: Generating demand is all about advertising, word of mouth and events, involving marketing, sales, and product development teams internally, and the customer community externally. Online, the big difference is immediacy. A key guiding principle here is: don’t make bets you cannot afford to lose or promises you cannot keep. With this in mind, online marketing benefits from the ability to introduce and remove a campaign overnight, to take advantage of an event, a move by a competitor or even the weather.

Community: Individuals buy things, but communities influence individuals. The immediacy effect means that the audience is anyone with a web browser, including the competition. Hence, online communities need careful nurturing. They are less constrained than high street shoppers. For example, nobody walks down the high street discussing forthcoming purchases with complete strangers, do they? Today’s online communities are informed, opinionated and have made a conscious decision to opt in, while knowing they can opt out just as easily.

Point of sale: The most effective online checkouts today are more than a transaction engine, but not too much more. They offer a simple route from start to finish, and offer appropriate cross and up-sell opportunities. None of this is possible without additional insight from one or more of the other areas discussed.

Supply chain: Does traditional retail and online retail involve the same products, the same distribution and warehousing? Often the answer is yes, but not always. Does the supply chain work in both directions? Can returns be dealt with? Can the system cope with products being introduced and removed from different parts of the chain? This is perhaps one area where really, only the individual retailer knows the answers. But asking the right questions is paramount.

Customer relationship management (CRM): Somewhere in the equation, there needs to be a mechanism for pulling together all the threads. This means purchasing history and patterns, creditworthiness, individual preferences and so forth. This data can be used to drive product development and marketing activities, thereby closing the loop in the life cycle.

However, the sum is greater than the individual pieces, and this is especially true when it comes to e-commerce. So what else is there to consider to make it happen?

If we take a step back, one of the key enablers of a lifecycle approach is the flow of information. Fortunately, this notion is not just restricted to online retail; the entire industry is paying much closer attention to the need to extract and exploit information more effectively. Treating e-commerce as an extension of existing activities avoids repetition and duplication of effort.

Of course, there are some areas of e-commerce that need specific attention, such as online security and accessibility. Just as your physical store is obliged to offer access to able and non able-bodied customers, so is your web store. Just as you are obliged to protect your customers’ payment details in your physical tills, so too are you expected to take security and privacy seriously in the online world. Consumer confidence here above many other areas remains one of the key limiting factors preventing e-commerce truly becoming the norm.

All businesses need to decide the appropriate weightings for the areas we have touched on in relation to their own needs, and those of their customers. However, while marketing, community, point of sale, supply chain and CRM activities are driven by the nature of the business, the critical foundations – ­ information flow, security, privacy and accessibility –­ are not really up for discussion. They just have to work.

The tough economic climate means there is little margin for error, and lots to be gained from doing a proper job the first time around. In a few years’ time, those that like doing so may look back and state with confidence that the recession in 2009 was when businesses started to get e-commerce right, because the conditions of the time meant they had no choice.

UC – FMC usurper or saviour?

As enterprises move through their comms journey, should FMC still be on the cards, or has it been beaten to the budget post by other more compelling technologies?

Fixed Mobile Convergence (FMC) – essentially the process of bringing together fixed and wireless technologies to offer service through one handset has been around for a while. However, as yet it has failed to set the business world alight. Part of this failure may be attributed to lack of an optimum working environment in which FMC could truly thrive. Intuitively, FMC is best suited to a high mobility environment. While mobile workforces have existed for a number of years, in the form of sales and field staff out on the road, for example, it is only relatively recently that mobility has been brought more into the overall business processes, and the need for really true mobility has ramped up across many organisations, as workers become more mobile and dispersed. Additionally, implementing FMC within the business can be a daunting prospect, particularly when deciding exactly what FMC should look like, where it should reside, and what it should deliver. To expand on this point, FMC has a number of different flavours, including merging office and mobile numbers onto one handset (twinning), and dual mode – using WiFi enabled phones to take advantage of the corporate Wifi network to both improve coverage and reduce costs. This alone is not without its problems, as many company wireless networks are not able to handle the extra burden of voice calls, and would require extensive upgrades.

As a result of these factors, FMC has typically been seen as a nice to have rather than essential, and securing budget against this has been difficult. Moving forward, however, potential drivers for FMC services are the high and growing proportion of outgoing business calls that involve mobile, even when a fixed line is readily available, and the increasing degree of mobility required. Supporting this results in higher costs to the business and is putting added pressure on communications budgets. This will only get worse over time, as the need for mobility spreads within businesses, making it essential for companies to look at ways of dealing with spiralling costs.

But has the driver come too late for FMC? Already, we are seeing increasing take up and interest in complementary technologies such as Unified Communications, which provides integration of different types of communications, such as voice, email, instant messaging, audio and videoconferencing, within a common interface, in real-time, and which lay the foundation for a compelling migration path for businesses, as opposed to just providing enhanced flexibility to voice. Both FMC and UC serve a similar purpose in that they both deal with the issue of fragmented communications, and do not directly compete in terms of what they deliver. However, given the much broader reach of UC, in a world of tightly controlled costs, and ensuring implementations that are relevant to the business and deliver significant benefits, UC could just have the edge. Of course, UC has suffered in the past from being misunderstood, but companies are gradually beginning to get to grips with what it is all about along, with the benefits it brings.

Maybe, but maybe not, given the need for increased mobility, mobilising UC applications is where businesses will probably see the biggest impact, as UC allows everyone in the business to benefit from more streamlined, collaborative communications. In particular, UC will allow mobile users the benefits of integrated presence, messaging and conferencing facilities previously not easily available to them. Given this shift, and the cost issue associated with increased mobility requirements already mentioned, FMC clearly has a part to play in the UC stack, and provides a good opportunity for market players to revisit their offerings. Providers such as Avaya, with its oneX Mobile UC offering, along with its recent partnering with dual mode mobile UC player DiVitas networks, are already tuned into this fact. There are still issues to be resolved, however. With the DiVitas solution for example, the one key UC feature not yet available is that of presence, although this is on the cards for the near future. Similarly, there are issues with handsets – most notably a lack of support for Blackberry, which will doubtless irk many businesses. And of course, there is still the earlier mentioned issue of how the wireless LAN handles the increased voice traffic – something which has to be addressed by the business. Clearly from a user perspective, these are not necessarily paltry, but equally, they not insurmountable, and any decision will need to balance these ‘cons’ against the potential benefits.

Issues aside, FMC provides an enhancement to the UC stack that has the potential to increase the overall value of the investment – in particular by reducing pressure on call costs, businesses will be able to better embrace the UC applications that will in turn, drive productivity. While FMC might not be a primary consideration for businesses moving forward with UC, it does provide a natural fit, and it is worth seriously considering the extent to which it can be incorporated and the associated benefits it will bring.