What is e-commerce?
Amazon, eBay, and AliBaba. If you haven’t shopped from their websites already, then their names must at least ring a bell or sound familiar to you. These e-commerce giants have become the go-to websites for online shopping and have therefore redesigned how most businesses work on an operational level(1). But first, let’s have a look at a more in-depth definition of e-commerce.
According to the Corporate Finance Institute (1), e-commerce is defined by any commercial transaction of either goods or services carried out online, and are usually split into three different categories:
-Online markets, where they act as an intermediate between either B2C (Business-to-Customer) or C2C (Customer-to-Customer).
-Online Retail Sales directed straight to the customer (B2C).
-Online Sales between two businesses (B2B).
How does it affect our world today?
With the ever-evolving world of technology, our generation is currently not only witnessing but also playing a major part in the transformation of today’s businesses and their online presence.
Dr. Alexandro Pando, a multinational entrepreneur, consultant, and CEO of Xyrupt Technologies, lends his voice to the Forbes Technology Council by stating that “nothing beats walking into a retail store and interacting with the product or service — at least until now.”
In his article, Dr. Pando further explains how technology has come so far to the point that it is now able to deliver the customer experience originally underwent during actual visits to the store. How, you ask? Via virtual and augmented reality.
In fact, Shopify started including virtual reality (VR) options on their app, and eBay went as far as creating a full-featured VR store. (2)
However, it was not always so easy for these giants to land the top spot.
Maynard Webb, former COO of eBay, explains in this podcast how he managed to help this company get back up on its feet.
Yet whether it’s Shopify, eBay, Amazon or any other website, these trendsetters have proven that they are not afraid of using any new technology that comes their way to their benefit. And honestly? the figures speak for themselves.
What are the facts and figures?
As the numbers above demonstrate, Amazon takes the lead with the annual net revenues.
In fact, the founder of Verma Media, AJ Agrawal talks about the “Amazon Effect”, a term that explains the company’s major role in changing global retail practices as well as consumer expectations. Agrawal also writes that “by mid-2018, Amazon was already responsible for roughly 50 percent of the [ the USA’s] e-commerce sales and 5 percent of all combined offline and online sales.”
Jacky Chou, founder of Indexsy and guest writer for The Entrepreneur – Middle East predicts that “with their continued innovation and adaptability to changing technology trends, Amazon is quickly taking over the world and when it comes to speed of delivery — we’re talking about 48 hours — no other company compares.” Another baffling feature is AmazonAir, adds Chou, which allows your deliveries to arrive within 30 minutes via drones. (4)
A closer look at the Chinese market.
A third competitor to both of the websites mentioned above is the Chinese e-commerce corporation Alibaba group. Initially a B2B platform between Chinese manufacturers and international buyers, it expanded in 2003 to a C2C market and later on to a B2C market in 2008. (6)
It’s no surprise that this Chinese corporation is doing quite well, the graph below shows a prospective 16.37% rise in the gross merchandise volume of China’s e-commerce market in 2019 (having reached 4.2 trillion USD in 2018 and expected to reach 4.9 trillion USD in 2019).
Source: Statista (10)
However, China’s AliBaba group isn’t the only one making use of the rise of e-commerce platforms.
Gary Liu, CEO of the South China Morning Post and a known TEDx speaker, explains the country’s fundamental use of e-commerce not only in the economic sector but in the socio-cultural environment as well.
Future e-commerce trends.
A personalized customer experience.
Content marketing consultant and Affiliate Partnerships Manager for BigCommerce, Adam Enfroy, writes a few tips for those planning to get on the e-commerce wagon in 2019.
Enfroy mentions the importance of personalized customer experience, and an engaging one to be more specific: “using personal online data such as search queries, page visits, and purchase history, brands transform their online stores to best serve the customer’s needs and interests.” The writer also predicts that that will be available on all e-commerce platforms.
Take a look at Amazon for example. After having logged in, you will “find recommended products based on your past purchases, ads tailored to your search history, and marketing copy speaking directly to you.”(11)
Voice commanded purchasing.
Tiffany Delmore, Co-founder of SchoolSafe, writes that “according to predictions from ComScore, 50 percent of all search queries will be made via voice by 2020.”
With the rise of Amazon Echo and Google Home Hub, consumers will be able to search for items to buy online via voice command. Both systems are also integrating image search to help customers have a look at what they’re buying. (12)
Logistics, logistics, logistics.
A sector already under development with the introduction of AmazonAir, the key to leading the top spot on the e-commerce platform is fast delivery, argues Rahul Garg, CEO at Moglix. (13)
What happens is that “shopping carts connect through Web XML, API or other connection to a shipping management system to enable customers to receive the exact price quote for delivery of large items.” In return, this will result in better communication, a more favorable customer experience.
As new technologies appear, we are yet to finish witnessing the transformation of not only the e-commerce platforms but their businesses strategies as well. For example, in a move to cut their operating expenses, Tesla recently announced that they would be selling their Model 3 cars online. (14) As this enterprise moves to selling online, one wonders how many will follow in its footsteps. Furthermore, it would also be interesting to see what the Chinese enterprises have in store in order to help improve the lives of their people and country.
To conclude, a few wise words from Rahul Garg:
“Considering the immense potential, the sector holds, it is likely to see the entry of many more players in the coming years. The companies providing the most seamless services and unhindered user experience will be here to stay.”