Digital eCommerce has surged forward by several years due to the necessity to move online during the Pandemic. As a core driver behind the success of global eCommerce, this focus on digital transformation is creating a new landscape that is propelling brands to adopt innovations like artificial intelligence (AI), virtual reality, algorithmic measurement and control over online sales and ultimately improve the DX (Digital customer experience) of your eCommerce brand. Along with these digital enhancements, we can only expect the overall customer experience to evolve with consumers expectations, and brands need to be ready to embrace this ever-changing landscape.
Your digital transformation journey
Far from a catchphrase, you’ve probably been hearing a lot about digital transformation and may already be in the process of implementing or enhancing your digital commerce strategy. If so, your timing couldn’t be better. According to Euromonitor International, by 2025 eCommerce is expected to account for half the growth of the global retail sector, expanding by an additional USD 1.4 trillion. It’s only through digital transformation that eCommerce companies, like yours, will be able to capture unprecedented opportunities to gain more market share and boost profitability.
At the helm of driving digital transformation throughout the eCommerce industry are large organisations like Amazon. However, to overcome the inherent challenges of selling on platforms like Amazon, you need a digital transformation strategy that places eCommerce at the forefront. Recently we partnered with Censuswide to conduct a survey of more than 250 eCommerce decision-makers across the UK, France, Spain, Italy, and Germany to get their thoughts on the importance of eCommerce as part of their digital transformation strategy. An overwhelming number (80%) of respondents agreed that eCommerce is an important part of digital transformation, however, 40% cited that navigating the constantly changing eCommerce landscape is a challenge.
To help you overcome digital transformation bottlenecks, here are the top three steps your strategy needs to take into consideration.
Step 1 – Identify and align business goals with desired outcomes: This requires a strong strategic vision that is led by senior management and communicated throughout the organisation. Be sure you include a prioritised list of the benefits you want to achieve from digital transformation and how you’re going to accomplish them. Your priority list should include both internal and external goals such as 1) internal – reducing operational costs, improving productivity, and gaining competitive advantage and 2) external – improving the customer experience, providing differentiated services, and developing customer loyalty.
Step 2 – Know your technical requirements: This takes looking beyond your current technology stack and determining what is needed to achieve your desired outcomes. For example, you may determine that artificial intelligence (AI) is needed to better promote product recommendations or machine learning (ML) for automation and collaboration. Virtual reality (VR) and augmented reality (AR) could enhance the customers’ shopping experience and consider incorporating internet of things (IoT) functionality for connected devices, wearable devices, and cybersecurity.
Step 3 – Measure and review your progress: Although you entered your digital transformation journey with a roadmap, the landscape is constantly changing. Since eCommerce is a dynamic industry, you’ll need to know how you’re doing at every step to make informed decisions on the adjustments needed.
Addressing the above issues takes a combined 1P and 3P strategy. This hybrid approach is enabling an increasing number of brands, like yours, to build up listings and history, grow sales and margins via Amazon’s 3P model, as well as protect their 1P relationship. This is where Luzern can help. We offer a 3P hybrid model that gives brands more price autonomy, facilitates price changes, and enables brands to regain control.
Capture unprecedented opportunities
It’s important to remember that digital transformation isn’t a one-and-done endeavour. It’s an ongoing process that you’ll be monitoring and adjusting, as well as implementing new technology as it becomes available. As you plan for the future of your digital transformation journey, it’s important to remember that in the eCommerce world, analytics, insights and real-time control over your pricing and branding will be paramount, while reducing operational and logistical costs need to be top of mind to ensure a healthy profit margin. When you put eCommerce at the centre of your digital transformation journey, you’ll be opening the door to opportunities that were previously unattainable.
For more information on why eCommerce is an important part of your digital transformation strategy