In today’s “consumer anywhere, commerce everywhere” digital era, enterprises need to listen, predict, assemble and deliver a personalized customer experience, all within milliseconds — otherwise risk losing customers, revenue, competitive advantage, and brand loyalty.
This notion is proliferating, and you’d be hard pressed to find an organization that doesn’t know this is the future of commerce but, how are they putting it into action and beyond that, how are they finding success?
In this article, Elastic Path will go in-depth on what’s truly changed with consumer expectations, how organizations are taking advantage of new and emerging digital touchpoints and share real-life use cases from the industries striking gold with an API-driven headless commerce model. This article full of actionable insight on how to go beyond omnichannel to truly deliver commerce everywhere.
What Defines The Future Of Commerce?
Who Is Taking Advantage Of The Future Of Commerce Today?
How Customer Experience Leaders Deliver Frictionless Commerce Everywhere
Preparing for Digital Commerce Success
Customer-obsessed digital leaders understand the future of commerce is here. Though they come from different industries, they share one thing in common — they are embracing modern commerce to drive innovation and business agility. These business leaders are looking beyond “omni-channel” to truly deliver anywhere-commerce tailored to their customers’ unique journeys.
Today, modern commerce has moved beyond digital catalogs attached to shopping carts, serving the same content to every customer in the same way. Instead, enriched content management, WCM (Web Content Management), WEM (Web Experience Management) and CXM (Customer Experience Management) tools allow marketers to deliver unique and engaging front-end experiences, while advanced personalization, machine learning and emerging artificial intelligence engines are now pushing the right content, offers and recommendations to the right customer at the right time.
With this, the explosion of technologies like mobile devices, apps and sensors are forever disrupting the digital path to purchase. Today, digital is one of many interwoven threads within a new customer journey. Physical purchases are researched online, digital purchases are researched in-store, and a variety of smart devices beyond the mobile phone are filling the gaps — that said, the landscape is nowhere near finished evolving.
84% of companies fail at digital transformation
These disruptive forces bring great opportunity to connect with customers practically everywhere, solve their problems, capture new sources of revenue and differentiate from the competition. It’s no surprise that investing in an innovative customer experience is the number one priority for digital leaders. But in an age where 84% of digital transformation efforts fail, digital leaders are hesitant to embark on projects that are expensive, time consuming or risky. But this doesn’t have to be you.
In this article, learn how leading-edge companies are embracing modern commerce and taking advantage of the future of commerce today. Find out how they are getting ahead of their competition faster and cheaper without limiting their ability to evolve, pivot and adapt to new customer demands, being able to truly deliver anywhere-commerce tailored to their customers unique journeys.
What Defines The Future Of Commerce?
Gone are the days when commerce was its own contained “channel”, and leading-edge digital experiences could be handled by the commerce platform alone. Commerce has evolved beyond the cart to become a commerce ecosystem. Utilizing big data, POS systems, advanced analytics, personalization, artificial intelligence, content management and customer experience management allows digital leaders to deliver so much more, and embed commerce within content, context, and connection.
Commerce In Content. Video, digital catalogs, look books, mobile apps and games are just “marketing” without native commerce — even when they contain links back to a web store. The ability to embed “Buy” buttons and support a seamless transaction transforms them into microchannels that drive revenue and remove friction from the experience.
Commerce In Context. Personalization requires the ability to identify customers, track their behavior and infer intent in real time. Context can be inferred through data pulled from various sources throughout the enterprise, as well as artificial intelligence, machine learning, geoIP, GPS, web analytics, sensors and other tools. But they must be seamlessly connected to determine customer profile and intent.
Commerce In Connection. The future of commerce pushes experiences beyond the web store and mobile devices to any point of the new customer journey — in-store screens and tablets, kiosks, TV apps, AR (augmented reality) and VR (virtual reality) environments, within software and digital books, social networks, the Internet of Things — even a text message conversation guided by an intelligent chatbot. While the future of commerce delivers rich, real-time and relevant experiences, its capabilities and applications are also killing everything about Ecommerce 1.0.
Killing The Catalog. Rather than pushing all available options at customers to weed through themselves, personalized and predictive experiences surface only what’s relevant to the customer. Chatbots and digital assistants are already transforming the way customers discover and choose products. While a product catalog may still exist in the back-end, all the customer “sees” is a curated selection.
Killing The Click. New and innovative customer engagement has already moved beyond clicks or taps. Voice commands, gestures, SMS replies and even passive actions like walking past a sensor allow customers to take actions and authenticate transactions.
Killing The Cart. Not every product, service or business model requires a cart and checkout flow. For example, subscription upgrades, renewals and in-app purchases, or shopping environments when consumption is added to a virtual tab. Many retailers are already experimenting with checkout-less retail and pop-up stores, where customers place RFID-tagged products in a smart bag and just walk away.
Killing The Card. Will that be Visa, or Mastercard? How about accepting mobile wallets, virtual currencies, credits, loyalty points…or Tweet.
Who Is Taking Advantage Of The Future Of Commerce Today?
Meet The Leading-Edge Brands Disrupting Their Industries.
Telecommunications: Answering The Call Of Customer Centricity
With 81% of North Americans owning at least one smartphone, demand for wireless connectivity has never been greater. But in a mature market, wireless carriers face slowing growth, with cut-throat competition not only from competitors but OTT (over the top) services like WhatsApp, Skype and Netflix.
Reinventing rate plans and offering more for less is only a shortterm solution — these “differentiators” are easily copied. For telecom, the largest opportunity for customer acquisition, retention and differentiation lies in the digital customer experience. Despite the expansive footprint of physical stores and kiosks, McKinsey IT reports that 89% of telecom customer journeys take place partly or entirely online, and the digital experience trumps the physical. 76% of customers are satisfied with their digital-only journeys, compared to only 57% satisfaction with traditional channels. McKinsey estimates that digitization could lift telecom operators’ profits by up to 35%.
Conversely, enhancements to back-end commerce functions can be deployed without fear of breaking the customer experience.
Connecting Digital With Physical
Despite higher satisfaction with digital, much of retail still happens in a physical store, including post-purchase customer service. A “digital store platform” that integrates retail POS with ecommerce and systems like CRM, personalization engines and other data sources is the optimal way to close the loop on the customer journey and get the full picture of customer engagement across touchpoints. Centralizing commerce and content allows the same rich, personalized digital experiences to be enjoyed in-store. And access to customer data allows in-store reps to make the same guided selling, cross-sell and upsell decisions as the Web, and ensure all customer engagements are captured across their lifecycle.
A centralized solution also allows these experiences to be delivered through kiosks and pop-up shops on campus, at festivals, concerts and sporting events. Representatives can process new sign ups, award loyalty points or support other engagements right through a tablet or digital screen connected to the central commerce platform.
Monthly perks are a long-standing tactic telecom have used to keep customers happy. Today’s technologies offer the ability to personalize rewards based on richer customer profiles and digital interactions across the Web, social networks and even digital media consumption across other service offerings like broadband TV. Recommendations, upsells and promotions can be triggered based on service plan usage, membership milestones, interactive “gamified” communications and more.
Telecoms with sister brands and services can connect rewards across the enterprise. Virgin Mobile’s Inner Circle combines telephony with travel and lifestyle, providing free flights and nights through Virgin’s airline and hotels, discounts on its line of wine and passes to the Virgin Sports Festival. Redemption of these rewards provides Virgin with additional customer insights it can use to personalize across its entire range of offerings.
Centralizing commerce on a unified platform allows carriers to capitalize on new business models and sources of revenue. For example, co-loyalty or direct carrier billing opportunities with marketing and channel partners allows them to track interactions across these external touchpoints and leverage them for further personalized services and experiences. Telecom leaders understand winning requires as much investment in the end-to-end digital customer experience and customer service as network infrastructure.
Reinventing Customer Care
Carriers are racing to embrace emerging customer care channels beyond the typical email, telephone and @ conversations through Twitter. Smartphone users already love text and messenger apps, and T-Mobile ensures they’re accessible through a device’s native text app or Facebook Messenger.
For customers looking for help through Google’s mobile search, T-Mobile uses Adwords’ click-to-SMS Messenger extension that immediately connects to a care agent in the nearest store, based on the searcher’s geolocation. Both these innovations allow T-Mobile prospects and customers to receive personalized support, recommendations and even make purchases without ever touching the website.
Luxury Retail: Redefining “Shopping Destination”
Destination commerce is not just for the travel and hospitality industry. MonteNapoleone Association in partnership with Accenture and Adobe have organized One Luxury Destination, a collective of ten five-star hotels and 130 global brands in Italy’s Quadrilatero fashion district. Designers like Giorgio Armani, Larusmiani, Prada and Gucci can invite their top clientele to Milan for a luxury getaway that goes far beyond shopping and begins before the guest even boards a plane.
An Avant Garde Experience
Prior to their trip, guests can virtually tour famed Via MonteNapoleone through the OneLuxuryDestination.com website. Upon arrival they enjoy personal shoppers, private dressing rooms and a 24-hour personalized online concierge in the MonteNapoleone VIP Lounge. To and from the airport, guests receive free baggage transfers, pre-processing of VAT tax refunds, and a dedicated airport butler. Through the M Luxury App, guests communicate with their personal shoppers and concierge, with the option to bring a private and tailored experience to the VIP Lounge. On the Via, VIPs can use the beacon-enabled app to access augmented in-store and outdoor experiences through beacons as they browse the district, while the app serves content, offers and notifications of nearby events as they explore.
The pampering pays. MonteNapoleone Association reports the endeavor has boosted revenue by 21% since launch.
For destinations closer to home, many retailers are experimenting with augmented and virtual realities (AR and VR) which is one way to one-up Amazon. Through Oculus Rift, The North Face allows in-store shoppers to experience a virtual dog-sled ride through the mountains, a rock climb in Yosemite or a virtual cliff jump.
Social-conscious footwear brand TOMS uses virtual reality to show customers exactly where their one-to-one purchases go. For every pair purchased, TOMS donates one pair to someone in need. Through VR, buyers can take a virtual shoe-giving trip to Peru to experience the gratitude felt by recipients in the program.
Augmented reality and virtual reality are expected to drive $120 billion and $30 billion respectively across retail, education, entertainment, travel and hospitality industries. AR and VR are hot in hotels especially, with Marriott, Best Western, Carlson Rezidor, Shangri-La and even Airbnb leveraging them to show off rooms, properties, amenities, pre-booking, and upsell services after guests arrive. For example, Marriott’s VRoom Service allows guests to order virtual-reality experiences to their rooms.
Travel And Hospitality: Charting A New Course In Customer Experience
For real life excursions, Disney, Comcast’s Universal Orlando, Royal Caribbean and Carnival Corporation are all doubling down on digital, wearables and the Internet of Things. From Disney’s Magic Bands to Carnival’s Ocean Medallion, smart-objects communicate with a network of sensors, deliver personalized content and support seamless transactions.
Customer Experience In-Hand And On-Demand
Ocean Medallion is a BLE (Bluetooth Low Energy) beacon enabled device that can be carried in a pocket or wallet, or stylishly paired with accessories like sporty or luxury wrist-bands, necklaces, keychains or tote bags.
Frictionless, Floating Commerce
On-board, Medallion replaces everything analog about the cruise experience, eliminating the need for cruise cards, credit cards, and room keys — transforming the way guests interact with other passengers and crew. Guests can browse and book digital concierge services or order food and drink through 55-inch digital screens in every room and every floor of the ship, with crew members able to locate guests precisely, even as they wander.
Through advanced Experience Intelligence Algorithms, Carnival combines what it knows about a customer with what it observes them doing in real-time: pre-board, on-board and on-shore. This allows Carnival to suggest the most relevant services, tours, food and shows to each individual passenger, and even surprise and delight them with personalized invitations and unexpected freebies. Postvoyage, Carnival can tailor content and offers that encourage their next booking.
Exploring The Tech Below The Deck
Carnival’s connected cruise ships are essentially giant, seafaring mobile devices complete with hardware, an operating system, apps and paired devices. Carnival calls this xIOS – the Experience Innovation Operating System. Its expansive array of over 7,000 interactive sensors per boat and embedded equipment sync a wealth of data with Medallion and digital concierge Compass and support seamless transactions at every turn.
The Auto Industry: Driving Innovation
Today’s new wave of connected cars are not just vehicles, they’re hyper-mobile devices complete with hardware, operating systems and app-driven utilities that can support a variety of payments (literally) on the go. Gartner predicts that up to 80% of new vehicles sold in 2020 will be connected “smart cars.” Car manufacturers like Ford, Honda, General Motors, Jaguar, Toyota and Tesla don’t want to miss out on the “car commerce” opportunity — they’re all experimenting with a range of connected commerce capabilities.
GM’s At Your Service connects OnStar subscribers with partnered retailers, hospitality and service providers when and where they need them. For example, requesting directions to a point of interest can trigger personalized recommendations, offer and discounts from businesses like Dunkin Donuts for a re-fuel, Audiobooks.com to take the edge off the long drive or gridlock, Priceline for last minute hotel bookings, and Parkopedia to find the closest (and cheapest) open spaces.
Strategic partnerships are key to car commerce. Jaguar’s XE and XF models support in-car payments in partnership with Shell stations, with plans to support e-wallets Apple Pay and Android Pay. Ford’s Fordpass mobile payment app has partnered with Chicago’s ParkWhiz to reserve and pay for parking spots in advance. Luxe and Tesla have teamed up to offer New Yorkers valet parking, charging and add-on services like car wash, overnight parking and drive-home service, all booked through a mobile app.
It’s not just car manufacturers that want a piece of car commerce. Visa and Accenture are working on a proof of concept that supports contactless payments that don’t require a driver to interact with a touchscreen. Using IVR (interactive voice response), sensors and beacons, drivers can search for nearby amenities, reserve and pre-pay for services, and place and pay for orders all while keeping their hands on the wheel and their credit cards in their wallets. As with the Uber app, pilot merchants like Pizza Hut can receive alerts when a customer is about to arrive, and have the order ready at a pick up window, hot and fresh.
How Customer Experience Leaders Deliver Frictionless Commerce Everywhere
To truly deliver anywhere-commerce tailored to customers’ unique journeys, experience-driven leaders have abandoned restrictive, legacy systems for headless commerce solutions. With modern commerce, your enterprise has unlimited freedom to build what you need to take your vision to market faster to drive innovation and business agility.
Single-Stack Solutions Are Limiting Innovation
Truly engaging content and user experiences require more than the traditional ecommerce platform’s “out-of-the-box” content and experience capabilities. This is because they tend to result in rigid “cookie-cutter” ecommerce sites making differentiated customer experiences difficult. For example, shoppable video, highly engaging rich-media product pages, kiosks, interactive digital signage and displays, branded apps and many more user touchpoints can be better supported through purpose-built enterprise grade content and experience management tools.
For businesses looking to innovate customer experiences continuously, “onesize- fits-all” commerce platforms can be very constrictive. Additionally, these solutions are often delivered as multi-tenanted SaaS offerings, which limit flexibility and extensibility, ultimately stifling innovation and leaving brands with marginally differentiated customer experiences.
Traditional ecommerce solutions are built with the frontend presentation layer and back-end system too tightly coupled. In this type of architecture, there is too much dependence between the front and back-end software; even with an API (Application Programming Interface) layer in between, changes are difficult to implement quickly. This requires specialized software development efforts by programmers skilled in complex languages and environments, followed by a full deployment. As much as a single vendor, single-stack solution might sound compelling and less complicated, these solutions often sacrifice “best of breed” capabilities. They are prohibitively prescriptive and difficult to use in ways not considered by the software vendor. This approach slows down the agility of the business impacting its ability to make changes quickly, respond to market opportunities or customer expectations.
Single vendor, single-stack solutions only provide adequate implementations when one or two user touchpoints are required (i.e. web storefront and mobile friendly sites). However, as commerce interactions break free of traditional touchpoints, business leaders become more frustrated trying to innovate with new user engagement models and interfaces using single-stack solutions. As a result of the limitations and frustrations of these packaged solutions, new customer experiences are developed in separate components, creating silos that then cannot be easily connected back to the core commerce platform — leaving the potential for inconsistent customer experiences.
There is no reason why an online or mobile shopper should not have the same pricing and promotion when shopping in a brick-and-mortar store. When there are multiple sources of data and rules, businesses cannot provide consistent customer experiences across all touchpoints throughout the customer journey. Additionally, they cannot accurately measure the contribution of innovation to business performance.
Initially, most single full-stack implementations appear flexible and supportive of the business. Over time, however, implementation-specific modifications are required. These modifications have a compounding effect of making the system less and less flexible with each change. In the end, even the smallest modifications end up posing a risk to the integrity of the entire system. The bigger the stack, the riskier it ends up being. Ultimately, the once nimble and flexible system becomes brittle and absolute, as if hardened in cement.
Reinventing Customer Experience With Headless Commerce
Headless commerce solutions are decoupled, freeing the front-end from the back-end, allowing organizations to power customer experiences with best-of-breed content and experience management tools that are purpose-built to enable user experiences across a quickly growing set of interfaces and touchpoints.
Headless commerce provides future-proof flexibility and creativity as business users can innovate customer experiences the way they want, without requiring backend developers. This allows IT teams to focus on key areas like system security, availability, and auditability. Leaving the underlying code untouched ensures a stable platform that can be easily upgraded in the future. And when a new front-end technology arrives, the impact of experimenting on it has minimal effect on the entire system.
The evidence in favor of decoupled systems is quickly growing. As one of the leading-edge brands disrupting their industries, T-Mobile separated its singlestack platform into a headless commerce platform combined with Adobe Experience Cloud and they significantly increased their agility. The front-end teams were able to adapt and make changes rapidly and fluidly. They were able to iterate quickly and test various versions ultimately finding the right combination of user experience that removed 60% of clicks out of the path to purchase for new sign-ups, increasing prospect and lead generation by 300% and boosting digital conversions by 500%.
However, user experiences that work well one day do not always work well the next day. With ever-evolving customer expectations and increasingly constant competitive pressures, regular and continual adaptations to the system are absolutely critical. Agility is no longer a “nice-to-have” but now is very much a “must-have” for businesses to survive and flourish.
Headless commerce can further be combined with headless web content management, which separates content management from content delivery. This allows an enterprise to deliver contextual experiences that only pull the content types and formats required and opens up commerce to the Internet of Things. For example, a wearable device without a screen needs minimal content delivered through push notification, while an augmented reality experience in a mobile app requires even richer content than the web.
A best-of-breed system is cost-effective and unites capabilities from all your business platforms into a single API.
The API Platform Advantage
With the rise in popularity of headless commerce platforms, it is important not to get caught up in buzz words. Not all headless commerce systems are created equal – it is very important to consider the underlying architecture.
Having an API layer is simply not enough. Without a sophisticated experience abstraction layer, even some headless commerce platforms can still be limiting. It is crucial that the implemented architecture decouples the consumption of commerce services such as product catalog, promotions, inventory, customer accounts, order management, checkout, etc. from the underlying systems that contain those core commerce capabilities. When it comes to commerce platforms, one of the most important things to consider is how the functions and services of that platform are made available to the “consumption layer” or user “touchpoints.”
Every commerce platform exposes API endpoints using standards such as SOAP, web services and, more popularly these days, REST APIs. However, simply exposing APIs leaves a lot of complexity to the “consumption layer”, user interfaces, touchpoints and applications. The number of user touchpoints is increasing daily, with wearable devices, interactive digital displays, smart glasses, augmented reality (AR), mixed reality (MR), virtual reality (VR), mobile point of sale systems (mPOS), smart appliances, connected cars, connected homes and the steady stream of many new connected devices that will come from the IoT revolution. Hypermedia APIs which process the business logic required to support these devices will enable this revolution.
Extending Commerce To The Internet Of Things
While API-based commerce solutions dramatically enhance the ability to innovate across traditional channels like the web, mobile devices and in-store, they’re still missing a critical piece — the ability to deliver frictionless commerce everywhere.
By 2020, Gartner forecasts 25 billion connected Things will be in use, while Cisco projects 50 billion — nearly seven Things for every human alive. The opportunity to connect content and commerce to cars, home appliances, entertainment systems, digital apparel and accessories, stand-alone kiosks, virtual reality experiences and more has enterprises looking for solutions.
How “Thing Commerce” Works
APIs allow software programs to communicate with each other. APIs function like user interfaces, helping applications to interact with each other’s’ “things”, and to understand requests and responses back and forth. While most commerce platforms have APIs to make these types of connections, it is important to also note that not all APIs are created equal.
Bridging The Gap With Hypermedia APIs
Intuitively, Hypermedia APIs allow developers to deliver commerce anywhere. With Hypermedia APIs, client applications and interfaces do not need to understand the complexities of the commerce platform, it just has to know how to react to, and react with the platform. The logic lives within the API. Not only does this allow greater business agility but business logic does not need to be changed every time a new touchpoint or emerging technology is added in the customer journey. It also ensures consistent commerce experience across any, and all touchpoints. With Hypermedia APIs, an enterprise with a complex web of legacy systems can still tap into and use components of those systems. It is not realistic or even recommended to simply rip and replace a legacy network at once. Hypermedia APIs allow the business to move forward with innovation in the near term, while gradually transitioning to a more modern commerce ecosystem.
Most importantly, and because Hypermedia APIs do not require business to hardwire new experiences to today’s systems, it allows business to keep evolving their customer experiences by future-proofing their commerce ecosystem.
Business logic refers to programming that handles the “connection” between a customer-facing touchpoint and the back-end systems, and determines how they must interact to satisfy business rules. For example:
- What databases to call to identify a customer and validate their credentials
- How and when to trigger content or recommend products and services based on account details or user behaviors
- What user attributes, behavior or other criteria qualifies a customer for a promotion or discount
- What components are involved in authenticating a transaction and pushing an order back through the system
- How a customer’s profile, account balance or order history is updated after an action is taken
- What alerts or notifications to trigger and under what conditions
Preparing for Digital Commerce Success
Strategy: Ensure You’re Investing In Experiences Customers Really Want
Successful commerce projects are not built around shiny objects, they deliver true value to customers. Customer focused business leaders approach transformation from the customer’s point of view. What will truly fill a need, delight and support a customer along their journey? Use both quantitative (analytics and customer journeys) and qualitative (customer surveys) methods, inside and outside your business to formulate and validate your hypotheses. And when possible, test a small proof of concept before tackling a larger rollout.
Roadmap: Plan Ahead For Every Requirement
Ensure your project requirements are well-defined, customer journeys and flows are nailed down and you understand the intricacies of the necessary integrations before you start to build. Failing to plan carries the opportunity cost of delayed or abandoned projects, which translates to lost customer sales while giving your competitors time to get ahead.
It’s not just car manufacturers that want a piece of car commerce. Visa and Accenture are working on a proof of concept that supports contactless payments that don’t require a driver to interact with a touchscreen. Using IVR (interactive voice response), sensors and beacons, drivers can search for nearby amenities, reserve and prepay for services, and place and pay for orders all while keeping their hands on the wheel and their credit cards in their wallets. As with the Uber app, pilot merchants like Pizza Hut can receive alerts when a customer is about to arrive, and have the order ready at a pick up window, hot and fresh.
Platform: Future-Proof Your Projects
There comes a time when adding to legacy and homegrown systems becomes too restrictive, arduous and expensive — and for most organizations, that time is now.
To future-proof your commerce project, consider headless and Hypermedia API-based commerce solutions that give your enterprise the freedom to build what you need with the programming languages, developers, best-of-breed technologies and end-points you want, and take your vision to market faster with less IT burden.
Regardless of their industry, all leading brands featured in this article have one thing in common: they’re leveraging digital transformation to create opportunities — innovative, unprecedented opportunities to connect with customers practically everywhere, solve customer problems, capture new sources of revenue and differentiate from the competition.
The future of commerce is here. Are you ready to explore all the possibilities it can offer just like the leading-edge brands disrupting their industries? Take the next step towards the future and contact us today.
Source: Elastic Path