Using Technology Can Improve Customer Experience and Build Loyalty

Using Technology Can Improve Customer Experience and Build Loyalty with Avalara

What turns a browser into a customer, and a customer into a repeat customer? It may be as simple as listening and helping shoppers find what they want. That can be done face-to-face in a brick-and-mortar store. For online sellers, it requires technology.

Though brick-and-mortar retail stores have reopened nationwide, the coronavirus (COVID-19) continues to drive record online sales. July’s ecommerce sales were lower than June’s, but still up 55% year over year. Adobe Analytics expects online sales for the year to surpass 2019 online sales by October 5, 2020. For many consumers, including some who didn’t shop online before the pandemic, ecommerce is still the best option.

To capture new customers and retain old ones, retailers must provide the essentials: easy browsing, a secure ecommerce store, seamless checkout, and trackable delivery. Yet today’s savvy consumers often want more. They like to see themselves wearing your products. They may want to connect with a sales associate — like they do when shopping in person.

It can all happen online with the right technology. Chatbots powered by artificial intelligence (AI), authentication tools, and curation services can help customers navigate product catalogs. When a shopper needs more detailed assistance, human experts jump in.

Business intelligence platform PSFK examines how technology helps shape customer experience in its Digital Commerce Playbook. Key findings on the importance of customer education and assistance are summarized below. All figures and statistics are from the report. 

Help them find what they want

Customers value clear information, well-timed input, and expert opinions. That’s hard to offer when consumers are anonymous, but increasingly, online shoppers are letting themselves be known. About 58% of millennials are willing to share personal information in order to get attuned product recommendations. And 36% of customers (not just millennials) expect a company to be able to provide “relevant recommendations for additional products and services after a single purchase.”

It would take an army of sales associates to offer that sort of personalized shopping experience for all browsers. Fortunately, AI-enabled support can assist with the early stages, narrowing down choices and gleaning preferences. If more personalized help is needed, it can gather information to share with human successors.

Be there for them

Consumers want to feel connected, perhaps now more than ever. Prior to the pandemic, 72% of consumers aged 18–64 said their overall customer experience would be better if they could text with a live agent in real time — too many of us have spent too many hours of our lives caught in endless cycles of automated help lines that provide no answers. Offering different, more human ways to connect can give you a competitive edge. 

Authenticate

Consumers want access to human help, but they also want assurance the products they’re buying are authentic. And unfortunately, the rise of marketplace sales was accompanied by an increase in counterfeit products. More than 70% of products purchased from marketplaces annually are counterfeit, and consumers spend almost $0.5 trillion annually on counterfeit goods.

Marketplaces are aware of the problem and working to stem the tide of counterfeit sales. Meanwhile, customers need assurance they can trust retailers. You can provide that via AI verification and blockchain tracking, among other tools.

In short, people like supporting businesses they can trust. They respond to ecommerce stores that curate selections to their taste and provide personalized assistance. It’s what they expect when they shop in person, and they’re coming to expect it online. Retailers that can fulfill those expectations are likely to outperform those that don’t.

Want more key insights about how technology can improve consumer engagement? Get the report from Avalara. 

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Welcome to BORN’s Partner series! Through this program we look to highlight thought leadership from our vast array of technology partners. Follow along using the hashtag #thisisBORN and #BORNpartner!

Today, we’re thrilled to call attention to our longtime partner, Avalara. Through this insightful piece, we hope you gain an understanding of what types of commerce technology can lift customer experience and bring loyalty to a brand.

BORN Group’s Guide to Mobile eCommerce

BORN Group’s Guide to Mobile eCommerce

Mobile eCommerce or m-commerce is the purchasing of goods and services via mobile devices. You might have thought of mobile phones as being the main device used, and you wouldn’t be wrong. However, there are two devices that fall under this category – smartphones as well as tablets. Tablets sales are still increasing year-on-year and are often not given as much consideration when it comes to builds, while smartphones have been a transformative component of the eCommerce industry and are a main consideration as we develop digital strategies for our clients1.

Key m-commerce statistics

  • M-commerce is growing rapidly and is being driven largely by mobile-first economies in emerging markets. In South Korea, for example, a country that adopted mobile early, 65% of online transaction volume now comes from mobile traffic3
  • 76% of customers use mobile devices to purchase because it saves time4.
  • 53% of visitors will abandon the mobile site if it takes more than three seconds to load5.
  • Salesforce reports that 75% of customers want consistent experiences across multiple channels (web, mobile, in-person, social) and 73% will likely switch brands if they don’t get it6
  • 70% of users abandon their carts on eCommerce websites while up to 85.65% of those on mobile websites do so. Extra costs and steps till checkout were some factors cited7.

Mobile versus desktop eCommerce

Even as research finds that consumers order more from desktops than from their mobiles, mobile phones still dominate as the source of web traffic. In some segments, such as fashion, more than 75% of traffic comes from mobile devices. However, conversion rates are lower on mobile (0.6%) when compared to desktop (1.3%)8.

Mobile optimization vs mobile apps

Since they store data locally on your smartphone, dedicated apps work up faster than mobile websites. However, there are many steps that customers need to take to search, download and use an app, and thus many more opportunities to abandon the process. App development also uses a lot of resources as the experience has to be rich and rewarding beyond the initial download. Besides websites optimized for mobile, developers these days are turning to progressive web apps which are websites that function like apps.

Design for M-commerce

Any unnecessary steps that take up time till checkout should be eliminated in m-commerce. Fewer steps equals higher conversion rates. 

It’s not enough to reformat your product catalog. Sephora, for instance, included researchers, product and marketing managers as well as developers not to mention customer feedback in its app redesign9.

A small screen compared to a desktop means less real estate, so here are a few more things to keep in mind:

Smart and visual search: The search function is probably the most important feature on a mobile-optimized website. The ability for high-intent visitors to find, categorize, view, and eventually buy the product is contingent on it. Visual trends are also key in the space – text is less important on mobile than high-quality images and video, and repurposing user-generated content is another way to up the visual quotient of your site10. An example is on Lush, whose mobile-optimized website is deeply visual with a rolling feed of social-media-worthy product images. It also has a prominent search bar offering not just the product as well as articles related to it. Visual search tools allow users to search for products using images.

Gestures and thumbs: Smartphone-specific gestures such as scroll, swipe and tap can be used to increase user-friendliness on your website or app. Keep in mind that the part of the screen that your thumbs sweep across is the most valuable space, so buttons critical to the customer journey shouldn’t be on top or too close together at the bottom.

Navigation, carts and pop-ups: It’s essential to think through your information architecture. Keep menus up top and easy to access, carts and number of products there in view at all times and pop-ups to a minimum.

One-click checkout: The feature popularized by Amazon is becoming commonplace on mobile sites and apps. It requires shoppers to enter their payment information once, so that they can use the one-click option to check out without having to re-enter it. 

Speed: Your customer experience correlates very closely with how fast your site or app is. Every second you can shave off is crucial. Google is famous for citing the ‘speed budget’, or a way to optimize site or app speed11.

M-commerce trends 

With the global smartphone numbers at three billion and growing every day, the proportion of eCommerce sales via mobile devices is only set to increase12.

Here are some exciting developments in m-commerce that will be keeping developers and brand managers busy in the foreseeable future. Some trends in eCommerce in general also apply to mobile. 

Omnichannel: With features such as location-based services, barcode scanning and push notifications, retailers can extend the user experience across all their customer touchpoints. 

Personalization: As with the general trend in eCommerce towards personalization, tailored and user-centric content and communications in m-commerce is not just becoming more popular but imperative.

Social commerce: One way to make the experience personal is to integrate key aspects of the social Web that customers are used to – interactions and recommendations from friends, groups, voting, comments and discussions – before and after the purchase. Integrations include pushing purchase information to social feeds or leaving reviews on forums. Moreover, social media sites such as Facebook, Twitter, Instagram and Pinterest have all introduced shoppable posts that let shoppers make purchases without having to leave the platform

There are other trends though that are specific to mobile because of the features that smartphones and tablets offer.

Voice shopping: Every smartphone sold these days is equipped with tools such as Alexa and Siri. Moreover, 28% of US households have a smart speaker and that number is expected to rise to 75% by 202513. Voice optimization of your website to make sure your products can be found and purchased in a simple flow using voice commands is becoming a standard feature.

AI, VR & AR: Artificial intelligence (AI), augmented reality (AR) and virtual reality (VR) make it easier for customers to imagine using your products and services. They help replicate the in-store experience in many ways. Amazon offers a ‘see how it looks’ feature. Mobile chatbots are another simple way for customers to ask a question and for a website to funnel customers to the product or answer they are searching for.

Mobile payments: The rise of various digital payment intermediaries such as PayPal, Google Pay and Apple Pay are changing the game in m-commerce. The use of cryptocurrencies is ramping up as PayPal and Venmo now accept all cryptocurrencies for payment14 – but ever more present is the use of mobile or digital wallets to pay for purchases that ensure the security of user details and save even more time. 

As a whole, the array of opportunities that m-commerce can provide for a commerce brand is infinite. For a tangible example of BORN’s work in mobile commerce, check out our case study for Nestlé Gerber here.

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Footnotes

1. Tablet shipments grew in 2020, Apple still dominant, gsmarena.com, https://www.gsmarena.com/tablet_shipments_grew_in_2020_apple_still_dominant_at_number_1-news-47634.php

2. Mobile E-commerce is up and Poised for Further Growth, Statista, https://www.statista.com/chart/13139/estimated-worldwide-mobile-e-commerce-sales/

3. E-commerce worldwide – Statistics & Facts, Statista, https://www.statista.com/topics/871/online-shopping/

4. The state of personalization in mobile commerce, XP2 by Dynamic Yield, https://www.dynamicyield.com/article/50-most-important-dynamicyield-personalization-stats/

5. Google Data, Global, n=3,700 aggregated, anonymized Google Analytics data from a sample of mWeb sites opted into sharing benchmark data, March 2016, GoogleData, https://www.thinkwithgoogle.com/consumer-insights/consumer-trends/mobile-site-load-time-statistics/

6. Customer Expectations Hit All-Time Highs, Salesforce, https://www.salesforce.com/research/customer-expectations/

7. Cart abandonment statistics, Sleeknote, https://sleeknote.com/blog/cart-abandonment-statistics#1

8. 2020 Global Digital Growth Benchmarks for Fashion Marketers, Insider, https://useinsider.com/report/2020-global-digital-growth-benchmarks-for-fashion-marketers/

9. How Sephora gave its app a customer-first makeover, ThinkwithGoogle.com, https://www.thinkwithgoogle.com/marketing-strategies/app-and-mobile/app-user-experience-redesign/

10. The State of Mobile E-Commerce Search and Category Navigation, Baymard Institute, https://baymard.com/blog/mobile-ecommerce-search-and-navigation

11. How speeding up your mobile site can improve your bottom line, ThinkwithGoogle.com, https://www.thinkwithgoogle.com/marketing-strategies/app-and-mobile/mobile-page-speed-data/

12. Number of smartphone users worldwide from 2016 to 2021, Statista, https://www.statista.com/statistics/330695/number-of-smartphone-users-worldwide/

13. Smart speaker household penetration rate in the United States from 2014 to 2025*, Statista, https://www.statista.com/statistics/1022847/united-states-smart-speaker-household-penetration/

14. PayPal and Venmo will offer and accept cryptocurrency for all online payments, theverge.com, https://www.theverge.com/2020/10/21/21527288/paypal-cryptocurrency-support-buy-sell-venmo-bitcoin

5 Tips for Success for B2B eCommerce Retailers

5 Tips for Success for B2B eCommerce Retailers

Last week’s blog post, centered around the rise of B2B eCommerce outlined the immense potential traditional business retailers have by adopting a digital-first strategy. In this article, we’ve gathered our top 5 insights B2B brands can leverage to further develop and grow their B2B offering, to take advantage of the recent surge in online transactions.

Attract customers using organic and paid marketing

An organic, as well as paid marketing media strategy that involves an SEO strategy, will help drive relevant users to your website. This could take the form of social media marketing, display and banners ads, emails, and press releases to drive traffic and generate leads using content offers.

Focus on stellar customer experience

Traditionally, a B2B purchase involves far less emotional appeal compared to a B2C one, and they also involve many more stakeholders in a relatively standardized purchase journey. However, rest assured that customer experience is still at the top of the list of important factors to lock in a B2B sale. 

  • A fast, responsive and easily navigable website that offers intuitive search results that can also be accessed from multiple devices is key. Optimization for mobile is a trend in B2B eCommerce that most organizations are adopting to reach the millennials involved in the purchase process. An omnichannel strategy can also help in gathering data around the customer’s preferences. W. W. Grainger, which scores in the top tier on distributor B2B surveys, recently introduced a visual search on its mobile app1
  • Order approval workflows should be able to accommodate multiple parties and roles in the buying committees.
  • Personalization and user journeys are equally important to take into consideration. Unique personal content such as personalized product catalogs will appeal to your customer’s needs. Further, adjust cross-selling and upselling suggestions based on the user’s purchase history. 
  • Sales teams have to be rearranged. With marketplaces taking a chunk out of traditional B2B sales, sales teams have to be reconfigured to offer personal connection, advice, broader expertise and build relationships2. According to a Forrester Research study, 68% of B2B buyers prefer doing business online versus with a salesperson, and when they engage with sales, they want that experience to be in a more problem-solving, consultative manner3.
  • Take customer feedback into account. Reliable customer support both during and after-sale is vital. Existing customers are a goldmine of feedback. 
  • AI and automation are increasingly being put to use to take the drudgery and paperwork out of the purchase process. Chatbots that are available 24/7 and also upsell and cross-sell products. At Genesys, the chatbot feature resulted in a whopping 50% less cart abandonment4
  • More information on product pages, different product views, and supporting information such as videos are even more important in B2B eCommerce, especially if you’re selling in bulk. More information will reduce communications, returns, and complaints5.

Pick the right B2B eCommerce technology platform

The architecture for your site is based on both customer need and maturity. Is it commerce-led, content-led, side-by-side or a pure headless model? Choosing the right platform that can handle all your needs can make or break your online offer. Developing an MVP (minimum viable product) can also shorten time to market and leave room to develop features based on feedback from customers. 

Flexible ordering, payment and pricing options

B2B customers need much more leeway with their ordering and custom pricing options as opposed to B2C customers. You have to be able to take purchase orders and credit applications into account and offer digital invoices, various payment methods, and a real-time snapshot of inventory. Incentivize new customers with free trials, reduced shipping costs, or a money-back guarantee. You can entice existing customers with easy order replenishment or loyalty rewards for repeat purchases such as discounts, tiered incentives, access to new features or a complimentary service.

Use social media marketing and user-generated content

Social media can not only be used to drive customers to your site but also for customer engagement. LinkedIn and Twitter are highly popular with B2B companies in regard to connecting with their audiences through text, podcasts, and video, gaining insights via feedback, providing thought leadership, and learning about their buyer persona. They can help funnel the customer from the education and awareness stage towards actual promotional content. Intel (@Intel) with its 4.8million followers is a great example of a B2B Twitter presence6. Publishing customer reviews are another way of establishing authenticity and credibility by driving user-generated content7.

As a leading systems integrator for platforms such as SAP Commerce Cloud, Salesforce Commerce Cloud, Adobe Commerce, BigCommerce, Shopify Plus, commercetools, VTEX, and Elastic Path, BORN Group is well-qualified to assess and advise you on the best platform to meet your unique needs.

For more information around BORN Group’s B2B offerings, please visit here.

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Footnotes

1. Grainger eyes a big future for its new mobile visual search tool, Nov 2019, Digitalcommerce360.

2. In 2021, B2B Marketing And Sales Become More Human, Thanks To Tech, Forrester Research, Nov 2020, https://go.forrester.com/what-it-means/ep193-b2b-marketing-sales-predictions-2021/

3. The Death Of A (B2B) Salesman, Forrester Research, May 2017, https://go.forrester.com/what-it-means/ep12-death-b2b-salesman/

4. The Total Economic Impact of the Genesys Omnichannel Engagement Centre Solution, Forrester, Feb 2016, https://genbin.genesys.com/old/resources/TEI_Case_Study_Genesys_-_2052016_FINAL.pdf

5. Rethink the B2B Buyer’s Journey, LinkedIn, https://business.linkedin.com/content/dam/business/marketing-solutions/global/en_US/campaigns/pdfs/rethink-b2b-buyers-journey-v03.09-eng-us.pdf

6. 5 Top B2B Brands Delivering Exemplary Twitter Engagement, Toprankblog.com, Sep 2019, https://www.toprankblog.com/2019/09/exemplary-twitter-engagement/

7. The Rise of B2B Product Reviews,  https://business.linkedin.com/content/dam/me/business/en-us/marketing-solutions/resources/pdfs/linkedin-crowd-b2b-product-review-book.pdf

The Rise of B2B eCommerce: Why Traditional Business Retailers Are Headed Online

The Rise of B2B eCommerce: Why Traditional Business Retailers Are Headed Online

Business-to-business (B2B) is a commercial transaction that is conducted between businesses, as opposed to B2C which is a transaction between a company and its customers. B2B transactions might take place between, say, a manufacturer and a wholesaler, or a wholesaler and a retailer. 

Multiple B2B transactions take place in a supply chain where a manufacturer might buy raw material or components that can be used in the manufacturing process. The end-result is the finished product. Much of the purchase process occurs through electronic data interchange (EDI) currently. EDI is well suited for large, recurring orders. B2B eCommerce can also include electronic products such as websites as well as software to increase business efficiencies. 

Learning from B2C

Spurred by the success of eCommerce in the B2C space, many organizations are gradually moving to the Internet and applying some principles and practices from that sphere to that of their supplier or wholesaler and retailer relationships. In 2019, global B2B eCommerce gross merchandise volume (GMV) amounted to 12.2 trillion U.S. dollars, up from approximately 5.83 trillion U.S. dollars in 20131.

Just as an eCommerce shop uses the power of the Internet to allow people to find out more about the company’s products or services and purchase them, online product or supply exchange sites allow other businesses to find out about the products and initiate procurement via an interface. B2B eCommerce sites also allow for more information, images and product descriptions that allow for cross-sell and upsell opportunities.

B2B vs B2C

While B2C involves more impulse buying, B2B solutions purchasing is more thoughtful and planned. B2B relationships are long-term and ongoing and purchases are usually recurring, and for this, the customers expect reliable deliveries along with attractive and dynamic prices and terms

It is no wonder then that B2B purchasing has become even more complex with more stakeholders involved and deliberating in the purchase process2. These developments have become imperative to make the process itself easier. A smooth customer experience is paramount, even in a seemingly standardized B2B purchase journey3.

B2B eCommerce Marketplaces

Leveraging an eCommerce platform, companies can set up marketplaces and online directories specializing in certain industries or products that facilitate B2B transactions. Besides Amazon Business which uses very similar principles to its B2C business, some of the most well-known B2B marketplaces include:

  • Horizontal marketplaces: An early pioneer of a horizontal B2B marketplace was Alibaba. Launched in Guangzhou by Jack Ma in 1998, Alibaba filled a need – to connect Chinese small and medium-sized businesses and wholesalers with clients overseas. Like Amazon, it charged a subscription to sellers who wanted to customize their shop. Unlike Amazon which leveraged its logistics network, Alibaba remains a platform player. Similar generalist marketplaces such as ThomasNet in the US and Tradenet India also exist. The other elephant in the room is Amazon Business. Like Alibaba, an Amazon Business account is a one-stop shop that enables a company which purchases corporate items and supplies to save costs and makes the process efficient. Amazon Business is set to top US$31 billion in revenue and US$52 billion in gross merchandise volume by 2023, including sales by third-party sellers on the marketplace, according to RBC Capital Markets4.
  • Vertical marketplaces: Vertical marketplaces have been around in industries such as automotive and healthcare for a couple of decades but new ones such as Makers Row for fashion, GoDirect Trade in aerospace, CheMondis in chemicals, FastMetals in iron and steel, and Farmers Business Network in agriculture are proliferating. Today, there are more than 70 B2B marketplaces in more than 13 diverse industries, according to research compiled by Digital Commerce 360 B2B5.
  • Service marketplaces: Service marketplaces such as Upwork (for freelancers) and Fiverr (micro-services), where the buying process is different from that of physical goods. One does not choose a supplier or offer but instead sends a request for quotation through the system, and receive offers from all the service providers. Buyers generally can’t browse seller profiles.

B2B eCommerce Trends 

  • Mobile: Mobile transactions for B2B eCommerce are becoming increasingly popular as more millennials drive the purchasing process. Given the 90% increase in B2B executives using mobile devices to research business purchases, mobile sites are now an essential business tool6. Mobile B2B eCommerce requires dynamic pricing and stock indications as well as real-time discount calculation.
  • Personalization, user personas and user journeys: According to Salesforce, almost 75% of business buyers expect vendors to personalize engagements to their needs and 8 in 10 say that the experience is as important as the products and services themselves7. These are high-level decision-makers with complex priorities and speaking to them about their pain-points, roles, goals, and objectives cuts through the noise.
  • AI-driven features: Tools powered by machine learning such as search enable the customer to find what they are looking for faster, with features like auto-suggestions, as well as fuzzy, partial and faceted searches, only added to the utility of the site.
  • Content marketing: The General Electric (GE) B2B experience is held as the gold standard of how to communicate with customers in a B2B environment. Using innovative videos, blogs, user-generated content and collaborations with influencers, GE uses content marketing to demystify its business products and build its brand8.

B2B at BORN

For a North American machine tool manufacturer, BORN implemented a sophisticated solution whereby when a part of a client’s machine goes down, an automated email is sent and the unit is reordered and replaced. This was a vast improvement from the previous system that consisted of multiple steps executed manually.

In another use case, BORN developed an innovative and efficient eCommerce and service experience for client Nestlé Starbucks and its Starbucks Branded Solutions by delivering a best-practice, extensible, global eCommerce framework leveraging an enterprise-grade platform and other key systems to amplify the growth of the online channel.

Over the years, BORN has worked with leading enterprise eCommerce platforms with a focus on B2B commerce, as well as associated applications such as order (OMS), content (CMS) and product management systems (PIM). Powering many of BORN’s solutions are B2B accelerators such as the first-ever SAP-certified accelerator for SAP Commerce Cloud, Eagle. Eagle is our eCommerce framework built exclusively by BORN for SAP Commerce Cloud (B2B, B2C & Custom C2C). In addition, Bulldog is BORN’s Adobe Commerce accelerator which includes pre-built extensions, B2B custom UX & UI features, and special B2B enhancements to essential functionalities.

For more information surrounding BORN’s B2B offerings and case studies, please visit here.

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1. Global B2B e-commerce gross merchandise volume (GMV) 2013-2019, Statista, https://www.statista.com/statistics/705606/global-b2b-e-commerce-gmv/

2. The New Sales Imperative, Harvard Business Review, March-April 2017, https://hbr.org/2017/03/the-new-sales-imperative

3.  New B2B Buying Journey & its Implication for Sales, Gartner, https://www.gartner.com/en/sales/insights/b2b-buying-journey

4.  There’s a unit inside Amazon that will be a $31 billion business in four years, RBC says, CNBC, https://www.cnbc.com/2019/12/06/amazon-business-a-b2b-unit-to-reach-31-billion-revenue-by-2023-rbc.html

5.  Why marketplaces occupy center stage in B2B ecommerce, DigitalCommerce360, https://www.digitalcommerce360.com/2020/03/05/why-marketplaces-occupy-center-stage-in-b2b-ecommerce/

6. The Changing Face of B2B Marketing, ThinkwithGoogle.com, https://www.thinkwithgoogle.com/consumer-insights/consumer-trends/the-changing-face-b2b-marketing/

7. Young Buyers Are Driving B2B Expectations of B2C-Like Experiences, Marketingcharts.com, https://www.marketingcharts.com/industries/business-to-business-83757

8.  GE Raises the Bar for B2B Content Marketing, enveritasgroup.com, https://enveritasgroup.com/campfire/ge-raises-the-bar-for-b2b-content-marketing/

eCommerce 101

eCommerce 101

It seems as though we’ve transacted online forever, but really it is only in the last three decades that eCommerce – that is, the buying and selling of goods via online services or the Internet – in its current form has been around.

The History of eCommerce

The germ of the concept dates back around forty years though, to well before the Internet became ubiquitous.

Encryption technology around telecommunications and the semiconductor industry advanced enough that in 1979, English inventor and entrepreneur Michael Aldrich demonstrated the first ‘online shopping system’[1] using a modified television set connected to a transaction processing computer via a telephone line in the UK. He enabled automated business-to-customer or business-to-business transactions in a closed, secure loop that could be shared by third parties, which would go on to become what we called eCommerce today.

In 1982, Boston Computer Exchange, an online market for people to sell used computers, became the first eCommerce company.

eCommerce stores and marketplaces

It took another 10 years till Book Stacks Unlimited debuted as an online bookseller, using an dial-up bulletin board. In 1994, it moved over to the Internet at books.com, today owned by Barnes & Noble.

In 1995, Amazon also launched as an online bookseller before converting into to a broad spectrum eCommerce store in 1998, and finally evolving into a marketplace that also accepted third-party sellers in 2000. Also in 1995, eBay was founded as an auction site which has gone on to become a giant of online retail globally. The takeup of broadband internet connections in the first decade of this century had a big part to play in this trend too.

Amazon set many of the standards for modern-day eCommerce by offering features that mail-order couldn’t, such as one-click shopping, comparison shopping across retailers, product reviews, quick and sometimes free delivery as well as easy returns.

In 2005, by adding a membership component with Amazon Prime that allowed for two-day shipping and later, access to its streaming service, and building warehouses across the US to be closer to the customer and cut delivery times, it revolutionized the supply chain management and fulfillment side of eCommerce. Etsy, the marketplace for crafts and small sellers, was also launched in 2000.

Membership is also how music streaming services such as Spotify and Deezer and operate – as premium subscription services – though actual streaming of music goes as far back as 1881 when the Theatrophone allowed listeners to listen to opera and theater performances via a telephone line. Netflix and Disney have, of course, done the same for video streaming, which has turned them into a club-type good.

While Amazon is the largest eCommerce store and marketplace globally in terms of revenue and market capitalization[2], Alibaba (founded 1999), Rakuten (founded 1997) in Asia and Mercado Libre (founded 1999) in Latin America are significant players in their markets.

Payment Infrastructure for eCommerce

In 1998, though, another important part of the eCommerce ecosystem, that of the payments that power it, launched when Paypal (originally Confinity) was founded. Paypal is now owned by eBay.

Since then, the proliferation of other digital wallets and peer-to-peer payment processing platforms such as Google Pay (previously Google Pay), Stripe and Apple Pay have made mobile payment even easier and more widespread.

Afterpay, Klarna and Paypal Credit are introducing customers to the idea of buy now, pay later, the practice of paying for eCommerce purchases in three or four installments like in actual retail, making it more widely accepted.

Anyone Can Have a Webshop

With customers not necessarily confined to a geographic location, there needed to be a way to reach them. Google Adwords, introduced in 2000, fulfilled that need. It allowed eCommerce businesses to advertise to people using Google search.

The arrival of Shopify in 2004 upended the till-then expensive coding and equipment necessary for the development of a webshop and point-of-sale systems and democratized it to allow anyone with an account to set one up using available templates. Shopify has built up a 20% market share in the US with WordPress plug-in WooCommerce themarket leader with 26%[3].

Types of eCommerce

Business to Business, B2b The traditional route where companies buy and sell goods and services with each other.

Business to Consumer, B2c This is the route when companies sell to consumers.

Business to Business to Customer, B2b2c A route where larger businesses sell to smaller entities who resell the product & services to a customer. A good example would be an HVAC company selling air conditioning equipment to a contractor who services the end customer.

Marketplaces This is where suppliers (business vendors and individual sellers) sell to buyers (businesses or consumers).

Consumer to Consumer (C2c) eBay is the best-known example of a platform that allows consumers to sell and buy products to each other.

Social, mobile and voice eCommerce applications

The future of eCommerce is all about shopping using mobile devices and apps and increasingly, voice. 81% of visits on Shopify sites is from mobiles[4]. SMS marketing is therefor becoming increasingly important. Social shopping has also taken off with brands using sponsored stories on Facebook and shoppable posts on Facebook, Instagram and Pinterest to reach customers.

Choosing an eCommerce platform

BORN Group has been around since eCommerce was in its infancy. Today, we are integrators for the major systems including SAP Commerce, Salesforce Commerce, Adobe Commerce, BigCommerce, ShopifyPlus, Commercetools, VTEX, and Elastic Path. To make informed platform decisions, we use something called a 5C methodology as part of our technical roadmap that we call the Feature Value Matrix at BORN. These include:

Conform We identify requirements that can be supported to conform to out-of-the-box features in a platform.

Configure BORN identifies requirements that can be supported through configurations made to the platform.

Customize We determine the necessary customizations that will need to be built into the platform.

Compromise The configuration and integration of third party tool or systems such as ERP, OMS and CRM systems that cover tax systems, loyalty programs, payment gateways, fraud detection, affiliate programs, email campaign systems, and user reviews

Connect Identifying all requirements that are supported through integration and offer accelerators for a shorter time to market at a reduced cost.

Through optimization of the 5C’s BORN Group is able to pinpoint your businesses specific needs and map those requirements to the most efficient solution.

eCommerce: Even more potential

Currently, only around 14% of retail sales is e-retail[5]. Moreover, 4 in 10 people worldwide don’t have an internet connection and over half the world doesn’t have a smartphone[6], so there is still a huge amount of potential with regard to eCommerce. Expect to see more omnichannel experiences, personalization, and artificial intelligence-enabled shopping.

The situation with Covid saw eCommerce sales accelerate around the globe – the US alone saw a 30% growth[7] – and is expected to touch USD 476 billion in 2024[8].

To know more about how BORN is leading the charge to merge usability with shopability by making informed platform decisions  to drive consumers online, click here.


[1] Michael Aldrich Invents Online Shopping, Historyofinformation.com,

https://www.historyofinformation.com/detail.php?id=4068

[2] Global Amazon retail e-commerce sales 2017-2021, Statista,

https://www.statista.com/statistics/1103390/amazon-retail-ecommerce-sales-global/

[3] Ecommerce Platform Marke Share in the USA, Oberlo, https://www.oberlo.com/statistics/ecommerce-platform-market-share-in-usa

[4] Shopify Announces Third-Quarter 2019 Financial Results, Shopify, https://news.shopify.com/shopify-announces-third-quarter-2019-financial-results

[5] E-commerce share of total global retail sales from 2015 to 2023, Statista, https://www.statista.com/statistics/534123/e-commerce-share-of-retail-sales-worldwide/

[6] How Many People Have Smartphones In The World?, https://www.bankmycell.com/blog/how-many-phones-are-in-the-world

[7] US Ecommerce Growth Jumps to More than 30%, Accelerating Online Shopping Shift by Nearly 2 Years, emarketer, https://www.emarketer.com/content/us-ecommerce-growth-jumps-more-than-30-accelerating-online-shopping-shift-by-nearly-2-years

[8] Retail e-commerce sales in the United States from 2017 to 2024, Statista, https://www.statista.com/statistics/272391/us-retail-e-commerce-sales-forecast/

Driving Digital Strategies with SMS Marketing

Driving Digital Strategies with SMS Marketing

SMS Marketing has seen rapid growth in the past few years, and for good reason. With the right implementation, it can prove to be an exceptional marketing tool for an eCommerce business. The numbers behind its success are staggering – when one considers that 98% of all text messages are opened, 90% of text messages are read within the first 3 minutes of being sent1, and that on average, SMS enjoys a 6-8x higher engagement rates than email marketing, it’s clear that SMS marketing is a tool that many eCommerce businesses can derive value from2. That’s why BORN Group and Yotpo have come together to help you navigate this channel which is acclaimed by Yotpo Customer Data to deliver a 25x ROI when successfully utilized.

This new outlet can greatly complement a digital strategy by serving as the most personalized channel for marketing updates and outreach. Given the higher rates of engagement and the fact that consumers spend twice as much time texting than answering emails, it is an excellent touchpoint within a marketing arsenal. Some may consider the practice intrusive, but according to Yotpo customer survey data, over 48% of consumers have already signed up to receive texts from a brand, with 51% reporting that they are interested in being able to have a line of text communication with a brand to check inventory and recommendations. So long as your brand performs outreach with consent by its consumer and allows them to begin the marketing by opting on, concerns of intrusion are wiped away. 

Personalized text message marketing finds such great success for a multitude of reasons. Mobile commerce has played a pivotal role in expanding eCommerce to where we’ve found via Yotpo consumer data that 65% of online shoppers choose to browse or shop online on their mobile devices, as opposed to a laptop or desktop computer. Furthermore, customers spend on average four hours a day on their mobile phones, with an average check-in rate of 150 check-ins a day. These metrics reveal how mobile commerce is essential to many eCommerce offerings, and tapping into SMS marketing is the most direct way to harness outreach to a mobile user. The 39% click through rate, sourced via Yotpo customer results, on all links in SMS messages means as well that there is a high chance the right content over a text message will find success in driving traffic.

Most SMS Marketing works via either setting up a campaign, which can be sent in bulk to consumers to promote special deals or new offerings on the site, or specific response messages for a consumer’s transaction. Yotpo utilizes SMSBump as its SMS marketing & automation app for Shopify sites with a 2x higher ROI on multiple step messages as opposed to one-off campaigns or automated responses. Building around multiple step messages has shown via Yotpo customer results a 4x higher ROI – and by highlighting SMS marketing during cart checkout, we’ve seen 47% of customers opt-in. Those numbers serve in your favor beyond promotion of sales too, as Yotpo customer data reveals how review requests via SMS  convert 66% higher compared to email due to the channel’s high engagement rates. This can transform a site’s user generated content when utilized effectively.

Altogether, SMS can play an exceptional role in driving marketing in ways conventional digital methods cannot. Given the nature of its opt-in first format, it is a key pillar when considering loyalty and customer experience for your consumer. 76% of loyalty program members will opt-in to communicate with their favorite brands via SMS according to Yotpo customer data – many businesses can stand to benefit from its array of its promotion of commerce, communication, and user-generated content.

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Footnotes

1. Marketing With 98 Percent Read-Rate and 10 More Compelling Stats, Adobe, 27 July 2015.  https://blog.adobe.com/en/publish/2015/07/27/marketing-with-98-percent-read-rate-and-10-more-compelling-stats.html#gs.ntun1x

2. 10 Reasons Why You Need SMS Marketing While Dropshipping, DoDropShipping, 5 November 2020 https://www.dodropshipping.com/dropshipping-reasons-why-you-need-sms-marketing/

The Benefits of Buy Now, Pay Later for Consumers and Retailers

The Benefits of Buy Now, Pay Later for Consumers and Retailers

Buy now, pay later integrations are set to stay.

As eCommerce booms with a growth rate poised to top 20% this year according to IBM’s U.S. Retail Index, vendors and marketplaces are trying to draw customers with a shopping experience with an extra payment feature that will help make it very easy to pay for their loaded shopping carts1.

The BNPL field is dominated by a few major players – Afterpay, Affirm, Klarna, QuadPay, Sezzle, Splitit, and most recently, PayPal Credit (formerly BillMeLater). As a payment gateway service that most merchants already offer, PayPal clearly has, despite its late entrance into the game, a natural advantage. Part of PayPal’s suite of pay later products, Pay in 4, is available to consumers who are making purchases between US$30 and US$600. Major brands such as CVS, Revolve, Nike, Levi’s, Urban Outfitters, Expedia, are offering these services on their eCommerce channels.

While the buy now, pay later (BNPL) model has been around for some time, this year it has gotten a particular boost. Splitit saw record growth of 176% quarter-over-quarter and 260% year-on-year during Q2 of 2020 while Afterpay had boosted its active US customer base from 1.9million to 5.6million within a year, an increase of 219%2,3

The BNPL phenomenon has its roots in credit cards and financing schemes of yore such as layaway. However, unlike its predecessors, as a modern one-click payment option, it feels like a win-win for both the customer and retailer. 

Popping up at checkout, the BNPL model allows customers to finance smaller ticket items with either no payment or just a small starting one and to pay the rest at a later date in a few installments, at either low or no interest rates. 1 in 3 US consumers have used a BNPL service while in the UK, 67% of UK millennials have used a BNPL service, according to research from management consultancy Kearney4,5. Retailers, on the other hand, have no risk as the BNPL provider takes it on in case of default. For this privilege, sellers pay a few cents per transaction as well as 2-6% of transaction value, which is more expensive than fees that credit card companies charge.

Innovations in technology such as artificial intelligence and machine learning have made it possible for financial institutions to reduce the risk of fraud and defaults, and their clients benefit from this as they now have an understanding of the buyer’s credit profile without affecting their credit scores.  

Customer demographic skews younger and has access to a range of financing

A report on PYMNTS.com on the BNPL industry showed that 87% of shoppers interested in the services were between the ages of 22 and 446

Consumers, especially the millennials and Gen Z among them, are also wary about the debt that comes with using credit cards. In the uncertain economic climate, customers are more inclined to take on more debt. However, issuers are lowering limits or closing cards altogether7. With uncertainty about the future on the minds of a lot of people, BPNL services stand to benefit from the sentiment. 

Credit cards, in any case, are just one of a range of credit tools available to young people.

Respondents said they use BNPL to buy electronics (43.65 percent), clothing or fashion items (36.95 percent), furniture or appliances (32.81 percent), household essentials (30.96 percent) and groceries (22.54 percent).

Benefits to customers

Customers have the option of buying items and paying for them with flexible terms ranging from 3 months to multiple years, depending on the provider, improving the customer experience and making it frictionless. They can receive their item before completing a full payment. The payments are interest free and sign-up is much faster than for credit cards.

Nearly 42 percent of BPNL users cite clarity of terms as a key priority when making purchases online, and 39.1 percent the ability to monitor spending8.

Benefits to retailers

The BPNL model is being used by retailers for high value goods or by those offering low value goods but want to increase conversions, cart size, reach new customers and keep existing ones. Payment provider Stripe – a QuadPay partner – says it is not a good fit for businesses selling services or software or those sensitive to cost, since fees are higher9.

  • Increased sales value Providers such as Klarna claim that the addition of a BPNL feature led to an increase of 33% in the value of sales at its client GymShark. QuadPay says merchants that have implemented its BNPL product for e-commerce have seen a 20 percent increase in conversions and 60 percent increased average checkout value10.  It is a way to ensure revenue without resorting to tactics such as discounting. 
  • New customers A BPNL option might attract customers who were previously hesitant to buy products because the price was out of their budget. Lifestyle brand BlackCool says its sales rocketed 600 percent after it launched its BNPL plans. Its CEO claims that it brought in “different demographics, including price-conscious consumers who may think our premium products are priced beyond their reach”11. The providers, with their own community, will expose a store’s products and brand to millions of potential customers.
  • Loyalty Customers who know this option is available on an eCommerce store, and like the seamless nature of the customer experience, are more likely to return for repeat purchases.

Retailers will however need to think about how they will be sharing the customer relationship with the BPNL provider.

Integrations

The greatest challenge to BNPL adoption used to be the fact that the direct integration into the retailer’s point-of-sale system is an onerous process. BPNL services are, however, increasing their integrations with existing eCommerce systems such as BigCommerce, Shopify Plus and Salesforce Commerce Cloud to make it as easy as a flick of a switch.

Drawbacks for customers

While the soft credit checks the BNPL providers run at purchase do not impact customers’ credit scores, late payments can. Customers who default may be banned from further purchases. The terms and conditions from the BPNL service providers are not necessarily clear at sign-up either, leading to unexpected fees.

The future of buy now, pay later

As the use of frictionless, contactless experiences, and mobile wallets at the checkout in retail settings increase, the uptake of BNPL should follow suit. BNPL payment methods went from 3% of all eCommerce payments in 2018 to 8% in 2019, according to the Global Payments Report 2020 by Worldpay from FIS12. Customers are steadily being offered BNPL services outside eCommerce as well to pay for purchases, and they will possibly one day become as ubiquitous as credit card payments.

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Footnotes

1. COVID-19 pandemic accelerated shift to e-commerce by 5 years, new report says, TechCrunch, 24 August 2020. https://techcrunch.com/2020/08/24/covid-19-pandemic-accelerated-shift-to-e-commerce-by-5-years-new-report-says/

2. As COVID-19 Continues to Fuel E-commerce, Buy Now, Pay Later Programs Evolve, WWD, 14 July 2020. https://wwd.com/business-news/business-features/as-covid-19-continues-to-fuel-e-commerce-buy-now-pay-later-programs-evolve-1203675418/

3.  Afterpay investor presentation, Afterpay, 07 July 2020, https://www.afterpaytouch.com/images/07072020-Investor-Presentation.pdf

4. Buy Now, Pay Later Services Growing Quickly Among U.S. Consumers, 20 July 2020, https://www.fool.com/the-ascent/research/buy-now-pay-later-statistics/

5. Credit uncrunched: why banks and retailers must develop more PoS credit services, Kearney, Jan 2020, https://www.kearney.com/financial-services/article/?/a/credit-uncrunched-why-banks-and-retailers-must-develop-more-pos-credit-services

6.  How BPNL Services bring value to small businesses, Pymnts.com, Apr-Mar 2020, https://www.pymnts.com/wp-content/uploads/2020/04/PYMNTS-Tracker-Buy-Now-Pay-Later-April-May-2020.pdf

7.  How Covid boosted popularity of buy now, pay later options, 4 Sep 2020, https://www.bizjournals.com/bizwomen/news/latest-news/2020/09/how-covid-boost-popularity-of-buy-now-pay-later-o.html

8.  Millennials, Buy Now Pay Later And The Shifting Dynamics Of Online Credit, Pymts.com, 10 Dec 2020, https://www.pymnts.com/buy-now-pay-later/2020/report-millennials-buy-now-pay-later-and-the-shifting-dynamics-of-online-credit/

9.  Stripe, Buy now pay later – Learn about buy now pay later methods with Stripe, https://stripe.com/docs/payments/buy-now-pay-later

10.  Changing the Game: The Rise of the Buy Now Pay Later Consumer,Finovate.com, 3 Nov 2020 https://finovate.com/changing-the-game-the-rise-of-the-buy-now-pay-later-consumer/

11.  How BNPL Helps Bring Consumers Into Stores, Pymnts, 23 July 2020, https://www.pymnts.com/buy-now-pay-later/2020/how-bnpl-is-helping-blackcool-boost-brand-awareness-and-availability/

12.  Global Payments Report 2020, Worldpay,  https://worldpay.globalpaymentsreport.com/#/en