The Next E-Commerce Disruptor

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The Next E-Commerce Disruptor

By Rob McGrorty - 04/04/2016
There’s no denying the tech world, regardless of industry, has had a messy love affair with the buzzword “disruptor.” Disruption in the world of e-commerce usually means selling or manufacturing something that changes the nature of the product, how the product is sold, or that product’s industry at large. For example, selling mattresses, razors, or eye-glasses online introduces much needed competition and variety to these formerly fallow brick-and-mortar industries. In spite of, or likely because of, the over-use of the word, it’s time to take a deeper look at what it really means in the world of e-commerce to be a disruptor.

Amazon was perhaps the first large-scale e-commerce disruptor, at first tackling an arguably entrenched and highly regulated book industry. One could view the situation as Amazon starting with one category and optimizing the heck out of pricing and the sales process to get adoption in the market. Another perspective is that Amazon understood what a majority of book-buying customers wanted: ease of discovery and purchase, low price, and fast results. Any way you look at the scenario, it worked.

Since then Amazon has grown exponentially by bringing in outside sellers to list and sell on the platform, all the while collecting data. A savvy observer would note that Amazon is testing millions of products, prices, descriptions, and all the various combinations thereof, while the outside seller foots the bill. Amazon then mines the information to find the most advantageous additions to their own catalogue—Amazon Basics anyone? Now Amazon does business in just about every product category and everyone—from SMBs to Walmart—is struggling to compete. As the new center of the e-commerce universe, it’s hard to see how Amazon’s business model will ever be disrupted.

The myth of omnichannel
In a post-Amazon retail world, the response of sellers—big and small, offline and online—is to grasp at an omnichannel utopia; one that bridges the experience of the retailer and consumer so they’re tightly entwined at all times. The never-ending loop of communication between retailers and customers through branded apps, email, text, and mobile wallets is a retailer’s dream: to have direct and constant access to the inner life of a customer. It’s reminiscent of the first direct-mailers and the early days of internet advertising, with all the potential for abuse that comes in tow. Built on the same mentality as these earlier tools, communication is likely to include special offers, price comparisons, loyalty programs, coupons, discounts, product information, reservations, bill payment, bill information, receipts, and digital ticketing. And that says nothing of the geolocation capabilities that will serve up a barrage of “pushed” marketing content as consumers walk through a day that can only be described as notification hell. Of course, we can’t fault the retailers, they’re only using what they know in order to achieve their goals of higher revenue and greater profits.

The constant contact of omnichannel may be what retailers want, but do consumers really want to be pushed to buy every second of every day? I believe that the retailer-focused omnichannel agenda is destined to fall flat unless it realigns itself around real consumer wants.

The ultimate disruptor
The eConsultancy report “The Customer Conversation” shines a light on a customer experience divide that will require far more than a push notification to bridge. In fact, while “81% of companies say they have or are close to having a holistic view of their customers, only 37% of consumers say their favorite retailer understands them.”

The report also points out an alarming disparity between the satisfaction of brands and consumers after a conflict or customer service issue is resolved: The data shows that 89% of brands were satisfied and only 28% of consumers felt their issues were solved effectively. That sounds an awful lot like survey results for a cable or cell phone company, and let's be honest: No one envies those company-customer relationships. What would happen to the e-commerce industry if retailers were truly willing to look at the buying process from the customer’s point of view? What if the need for more sales and higher profit was approached in a manner that was intuitive and unobtrusive, rather than instructive and interruptive?

As the trend toward omnichannel grows, the likely response from consumers will be to reach for a simpler, cleaner, more truly enjoyable retail experience. I predict consumers will gravitate to companies that take into account what they really want, companies that see the humanity in the experience of shopping, and companies that put a sincere emphasis on valuable service.

Since all disruptors create differentiation, the next retail disruption is likely to be a shift from interrupting and shouting at the buyer to a focus on listening and getting out of the customer’s way. To do this, multi-channel enterprises will need better solutions for running their companies in addition to better business intelligence tools that encourage focus and allow them to operate from a marketplace position of confidence rather than one that comes from fear of being hidden in the shadow of Amazon. By learning what matters to customers and innovating brands that address these needs, we will improve the entire e-commerce marketplace and build loyalty that goes deeper and lasts longer than any frequent-buyer app ever could. 

-Rob McGrorty

Rob McGrorty is the Director of Product and Operations at Webgility, Inc., leader of e-commerce software solutions for multi-channel enterprises.