WARNING: this is a lengthy diatribe on ecommerce. If online retailing isn’t your thing then run away now. If it does float your boat then grab a coffee, my friend:

Scoble has been posting lately about the future of the Internet, calling it the Web 2010, others are more likely to call it Web 3.0. What will ecommerce websites look like in this future world? Amazon and the other ‘Web Whales’ don’t give us much of a clue what they are rolling out before the next Olympics, so here’s my take on some of it.

ECOMMERCE PROLOGUE
As the amount of data available to us grows exponentially, even the most naive of customers are suddenly morphing into prosumers (professional–consumer). Prosumers scan for information before actually shopping and they’re in your stores already. Armed with spec lists, reviews and price comparisons, they push back your sales team and POS with hard data and raw opinions.

Perversely, more data is seeing customers take longer to make decisions and impulse buys are now filled with doubt – “I should’ve checked the reviews on this.” It could be argued that retailers who engage the longest and build the most trust, will win the most favour (oh yeah, AND the most orders).

BLENDING
Firstly, from a marketer’s perspective, online wont replace offline. More than ever, we’ll see a blending of multichannel operations. Next.co.uk will still produce their very expensive catalogue and their website will outperform other channels, but their property managers will still have a job to perform. Ditto M&S and Tesco, but there is no question that the small and unremarkable of the high street will feel ever-more pressure from those dastardly dot coms.

DELIVERY
Free delivery is largely becoming the de facto choice online. With retailers pushing this, they’ll offer consumers in high street outlets the chance of delivery to home rather than carting it onto the bus. The visa versa of this is already becoming more popular but in-store collection is likely to be incentivised more as it’s a double opportunity for retailers: delivery is less costly as it remains within their own supply chain (they’re transporting from the hub to the high street anyway) and, as you collect, it’s far more likely that you’ll pick up that extra item (cross selling heaven).

MOBILE VALUE
Mobile web access will grow as smart phones continue to take hold but M-Commerce value will start from a low base – think ringtones and iTunes. However, these should see repeat visitors and as trust builds, value should grow. Until then, fears of data breaches and insufficient speed will prevent anything like widespread acceptance.

SEARCH
In-site search will gain intelligence as search engines are forever increasing shoppers’ expectancy of relevance, thanks to their ever-improving accuracy. Typing ‘white 16″ collar double cuff non iron‘ on next.co.uk results in “There were no documents that contained all of the words in your query. These results contain some of the words…” and they proceed to show me 225 products with a white luxury Percale bedset toward the very top. (Yes, they do list shirts with all those keywords.) Partnerships with the search guys are likely as algorithms need to improve.

SEARCH ENGINE PAYMENT
Facebook money and nano-payments are going to become a reality, but how about making your transaction on the search engine itself? If Google, Bing or Yahoo shows you a product you want from a five star retailer, there’s no real reason to jump through to the site at all. You could plug in your payment details right there, completing the transaction (Google checkout really starts making sense now, eh?). This will increase shopping speed where trust already exists.

AUGMENTED REALITY
Augmented reality will take place using your photo library. A plug-in will scan your local machine and online (esp Flikr and Facebook) to find an image that it can use to best display the latest wares from Asos.com and TopShop.co.uk. It will superimpose clothes onto you and put you on an exotic location, not a paid model, in true CSI style.

SIZE AWARE
Zappos, the US shoe mail order giant, budget for a 20% return rate. Size aware sites will pummel that kind of error. Using the augmented reality above, you could see yourself in specific sizes: perhaps the large (your normal size) is a little too loose and viewing the medium shows it to be more correct. Obviously, very accurate pixeling and measurements from the site are a prerequisite. Women will be addicted to this feature; men might well become extinct from the high street.

3D
Why wouldn’t future sites look like merchandised finished stores? We’ve all seen Second Life and other virtual reality sites. Well, imagine you could ‘walk’ the whole store or teleport to the men’s shoe department. The store’s branding could even change to suit your mood – upbeat and funky, or perhaps click to change the ambiance to sedate and sophisticated.

SOCIAL PLUG-INS
This is where the likes of Facebook are betting on the big money. You’ve seen the sonar picture in the Batman movie where Morgan Freeman can view the whole of Gotham thanks to everyone’s mobile phone acting as a radar device. Well, as you ‘walk’ through the 3D reality store and into others in the shopping centre (because they’ll collaborate, as retailers know proximity brings success), you will be aware of your social media contacts – Julie is 50m off to your right, David is in the café upstairs. Virtual geotagging would allow you to meet them/talk/show as busy.

FRIENDLY FOCUS
Social advertisers are of the mindset that if you like snowboarding, heavy rock and fast convertibles, they can serve you ads that will interest you i.e. heavily targeted. They’re also of a mindset that your friends wont be too far off that choice spectrum either. If you’re golf mad then it stands to reason some of your contact book will be fellow golfers, right? Therefore if they can define you, they reckon they can define your group.

If our virtual store knows that ten of your friends bought something from the homeware department, it might well show you an offering from that neck of the woods. If it knows two of your mates browsed a particular shirt and another one bought it, perhaps it might show you the shirt. But wait, you don’t all want to look the same (though you may well want to buy identical music and games) so the store’s intelligence shows you similar styles, but not an identical shirt.

4th DIMENSIONAL WEB
The focus on friends and your group above is referring to the social graph (a modern take on six degrees of separation, if you like). The problem with that graph is that as your social list grows, the trending becomes diluted. Let’s say you ‘friend’ two people you work with: one is into motorbikes and cooking and has married four times; another is a spinster and likes books and knitting – correlation is becoming far more difficult (simple example, but you get the idea).

You ‘friend’ people almost on a daily basis because you’ve touched each other in some way. But it is NOT an indicator of similarity. However, if you and I are connected *and* we’re both members of the Chartered Institute of Marketing and the Institute of Directors and we also list similar books and blogs as of interest, then the algorithm could rightly pair us on the same graph. The trouble is, which graph: perhaps occupation (to serve job ads), but music and clothing? How about sport and movies? Will we both like cricket?

Incorporating the social graph along with real time search is what the master mathematicians are coding right now. It will make the web more than 3D. The intelligence and relevance will mean no serious retailer will have a standard look. Very few visitors landing at the home page will see identical layouts and offerings. The big players will become more relevant and successful because of it.

VOTING RIGHTS
Scoble had this down when he said, “So, if someone says “Pluto’s rocks” there should be an aggregator that lets you see how many people talked about Plutos. Obviously only people writing on their iPhones FROM Plutos on University Ave.”

He’s talking about your contacts (friends again) informing you of what’s well regarded, but there’s also the possibility of the wider view from perhaps the whole of Twitter or Friendfeed. I’d say this could split in two, similar to paid ads appearing above the SERPs in a Google search with your closest friends (easily ID’d beause of most interaction) biased toward the top. The intelligence knows that I’m biased to my friends views, but still shows me what the masses think.

MOBILE NETWORKING
Jason Calacanis says that the Mobile SNS (social networking services) is up for grabs in the United States. I’ll take his word on that, and I’ll completely agree that social networking will shift from the desktop to your pocket. The phone coupled with geolocation tools will become networking nevada.

BRILLIANT BAR CODES
The cubic generation of bar codes is coming where data matrix squares will replace the traditional lined rectangle. But we’ll also see QR (quick response) codes more frequently in the UK (they’re common in Asia and North America). The QR code can look like art, but when scanned, usually by a mobile phone camera, it reveals data. These can take you to micro sites, or vouchers, or secret passages to hidden info (known as easter eggs) – like game cheats and movie trailers for example.

Gorilla marketers will appear to make these bleeding edge, scattering them around cities and towns, but within a year the Pepsis and Fords of the world will drag them to the mainstream.

CHANNEL CONFLICT
Manufacturers want greater penetration and control and they can achieve both by cutting out the middle man and going direct to the consumer. When your products are as hot as Apple’s you can do as you please. Retailers are still falling over themselves to tout Apple’s wares despite the possibilty of losing a sale to apple.com. However, the majority of brands have their hands tied by the threat of retaliation (i.e. refusal to buy) from their retail partners.

It’s thought that 50-60% of customers looking for a branded product begin their search at the manufacturer’s website. Manufacturers will look for ingenious ways of capturing that consumer rather than just being a megaphone of information. Ship to store is the most obvious route but the marketing steps ahead of that will be ingenious – hooking in TV advertisment widgets for instance.

BRANDS
Own brand products will become even more obligatory. Did you know Amazon has had their own private label line-up for five years? China’s best will also feature far more in Europe as they cash in on the knowledge we’ve given them. It’s bite-the-hand-that’s-fed-you time.

{ 1 comment }