The Future of Commerce is “Smart Ecommerce” – But What Does That Mean?
Change within an industry is at first predominantly quantitative, followed eventually by qualitative. Search 100 years from now will not be better links, just as the automobile, as Henry Ford famously stated, was not a faster horse.
Ecommerce is dominated by a few huge global players, Alibaba, Amazon, Ebay etc. Beyond a very short list of behemoth ecommerce players, second tier players such as the Netlix’s of the world are substantial but more niche players.
Ecommerce success today is driven by either size and selection, coupled with price and convenience, or by vertical expertise, private or special sales, or the like.
But just as search engines are predicted in the future to become intelligent personal assistants that you take with you rather than greater and more refined lists of links, so will the ecommerce leaders of tomorrow be intelligent personal assistants as well which you take with you.
And like any great personal assistant, they will be proactive rather than reactive.
Today, and this is a critical point, you have to primarily go out and find what you want or need to buy. But in the future, what you want or need to buy will come and find you. Including, increasingly when you didn’t even know that you wanted or needed at all.
We term this “smart ecommerce”.
Smart ecommerce has many aspects and applications, and is the focus on our world-leading technology ecommerce 2.0 startup, Media 2.0 (see description for link to company).
Predicting the future is, obviously, never a perfect science. You’ve probably heard the famous saying, "We wanted flying cars, instead we got 140 characters." from Founders Fund and Peter Thiel.
However, we can look across history and across industries to see what disruptive change may look like, and consider that in the context of major forces today, both generally and within ecommerce.
One overriding principle to keep in mind, going forward, is that while more than a few companies – and investors – have lost their shirt in ecommerce, sometimes falling prey to the “if you build it they will come” fallacy, the other important consideration is that commerce in general has a high floor, because there will not likely come a day when people do not need to buy things. And while brick and mortar is far from dead, as the shift in commerce continues to shift to the mobile, online and eventually also virtual worlds, ecommerce has, although there will continue to be winners and losers, certainly a bright overall future indeed.
So, what are the forces within “smart ecommerce”?
First, as the term smart commerce recognized, it is smart. It is smart in the sense that it is personalized, and it is smart in the sense that it is learning and increasing its capabilities and efficiencies over time.
So, today in ecommerce that looks like, for example, algorithm driven recommendation engines. “If you liked that, you may also like this” kind of thing. These can be extremely powerful and lucrative, but in the forms in which they exist today they are stone age tools in the history of ecommerce offerings to come.
Recommendations which meet you out in the world become notifications. Here is a coupon for this, for example, based upon your past preferences. Or the next book in the series you are reading is now available for pre-order. Or the band you saw seven years ago is coming again this summer to your hometown. Or the engagement ring you received years ago is due for its next cleaning.
Or, a bit in the future thanks to “The Internet of things” your car is texting you that it is past time for a tune-up, and your refrigerator is signaling that you are low on milk (of course for routine purchases such as milk, you’ll be autosetting your refrigerator to purchase your milk for you (and other groceries) when they run low).
Learning involves intelligence, which in the case of non-living things is artificial intelligence. Search assistants and ecommerce assistants will in many cases in the future likely be integrated together, if not one and the same. The Siri of today will be your friendly, cooperative, highly proactive and – critically – super intelligent assistant that learns what you want and when you want it. Of course, in the future, learning your communication and interaction preferences, your intelligent personal assistant will not only give you what you want – often before you know you want it – but give it to you HOW you want it.
Now that’s personalization. And convenience.
Ecommerce of the future eventually becomes, increasingly, an extension of you. An extension of your brain, and perhaps even an extension of your personality.
And perhaps part of you. Let’s look at the rapidly growing area of wearables. These are devices you wear on your body, or in your clothing, with sensors and computing power to tell you, for example, your exercise information, or your medical information. Someday it is hypothesized these will exist not only on you, but in you, implanted or traveling in the body providing all kinds of measurements and someday treatments or cures. Implants, temporary or permanent, in the brain may also serve medical functions and potentially virtual experience functions and other functions, possibly, which we can’t even imagine well today.
So, to keep things simple for now, let’s say you’re wearing a smart watch of the not too distant future which indicates that your hypertension is getting worse. This information, with your permission, is relayed to your doctor who writes you a new prescription. But not only that. The prescription is paid for by the same gadget that placed your order (and/or received the doctor’s new prescription). So wearables, or implants, and ecommerce could fuse as one.
In our company, Media 2.0, we’re working to perfect an additional revolutionary way in which ecommerce can find you, rather than you finding it.
What if the content locations for whatever topics you were most interested in also had the Amazon-like qualities of market size, convenience and price ecommerce offerings built into each content topic area? So, for example, because you are regular reader about motorcycles, and own three, motorcycle related ecommerce offerings related to both your specific reading and purchase history matched your interests algorithmically. What if I know that you are consistently reading New York Yankees articles from us and also that you go to Yankee Stadium five times a year, have New York Yankees products in your home and subscribe to several paid sports channels and a half dozen sports magazines.
How valuable would this combination of information be?
Pairing content and ecommerce effectively together is not easy by a long shot. If it was it would have already been done at scale. Let’s look at Amazon. They have some great product descriptions, photos and reviews but they don’t have entire sites, online magazines or blogs related to each type of product which you want to buy.
Amazon is a trusted site, but creating leading “destination sites” where the consumer returns over and over and over again, continually, to constantly gain the newest and updated content information that he or she likes to read, is an enhanced value proposition under which circumstances of ecommerce sales, when additional conditions are met, can thrive.
Historically, continuing to the present, content monetization has often become a race to the bottom, an attempt to capture the maximum number of eyeballs via the lowest or mass common denominator. to monetize via AdSense, ad networks and the like.
But eCommerce is a hugely higher potential revenue model than Adsense and Ad networks when well done.
Because we have demonstrated proof of concept and have world leading expertise in this area, we become, post funding as we scale, a leading acquisition candidate for any ecommerce giant who wants to add these lucrative ecommerce capabilities to its offerings (and in the build versus buy equation, there are a lot of hidden barriers to entry and the like which make buying rather than building a more attractive, and cost-effective, option).