Things to keep an eye on in the eCommerce space

ECommerce has come a long way in recent years. We’ve all heard about how online shopping was responsible for the death of the high street, but eCommerce is now about much more than the likes of Amazon and eBay. As an industry, eCommerce is expected to be worth $6.7 trillion by 2020 and now encompasses relatively recent technological developments such as mobile payments and cryptocurrencies.

The convenience offered by eCommerce is proving hugely popular with consumers and so it is not surprising that some of the tech industry’s biggest players are looking to dominate the market. However, eCommerce is becoming increasingly diverse, so there are plenty of options for businesses that are looking to make inroads, whether you specialize in retail, security, or something else.

Mobile Payments

Mobile payments have been around for some time now, but it is only recently that they have begun to have a major impact on consumer and business behavior. Google Wallet, for example, was released in 2011 but failed to gain much traction before being rebranded as Android Pay in September of last year. The impetus behind Google’s renewed efforts and an increase in mobile payments more generally comes from the launch of Apple Pay.

Apple’s mobile payments service allows customers to make purchases using iOS apps or at contactless payment terminals. According to Apple CEO Tim Cook, more than 1 million credit cards were registered with the service in just three days following the launch. These are the sort of figures that businesses cannot afford to ignore and Apple Pay has already secured support from a number of banks and retailers across the world.

However, it is not only Apple and Google that are looking to dominate the mobile payments environment. Samsung, Barclays, LG and a host of smaller startups are all looking to find their own niche. For businesses, the key is being able to offer support for the kinds of services that their customers demand. Mobile payments offer great convenience for shoppers, and so businesses will be keen to back the winning horse in the mobile payments race. However, this may require technological investment in order to process payments. Businesses will need to weight up this cost against the threat of customers joining a rival service that is offering mobile payments.

Bitcoin

Cryptocurrencies have hit the headlines recently, but usually for controversial reasons. The rapid rise and subsequent fall in the value of Bitcoin in 2013 reinforced claims over the currency’s instability, while online black markets mean that cryptocurrencies are sometimes unfairly typecast as part of a criminal underworld.

However, Bitcoin does have a legitimate role to play in eCommerce. A number of businesses have begun accepting the currency, including Amazon and Microsoft, legitimizing the currency to a certain extent. Bitcoin, and similar cryptocurrencies, are particularly useful for facilitating transactions amongst individuals that do not have a bank account.

Bitcoin has enabled women to receive payment in countries where they are still not allowed to open their own bank account. This is just one example, but Bitcoin has the potential to reach millions of "unbanked" people all over the world, as well as those that simply prefer the anonymity it provides.

Big Data

Many businesses think of eCommerce purely in terms of facilitating transactions, but there are other uses when it comes to digital transactions. ECommerce could provide a huge data source that ultimately enables businesses to better understand their customers. Although physical retailers can develop an ongoing rapport with shoppers, it is hard to back up any supposed trends with data.

With online and mobile transactions, however, businesses can acquire visibility into which customers are buying certain products, when they are buying them and their reasons for purchasing. When all this eCommerce data is combined with analytics programs, businesses can generate the kind of insights that foresee retail trends in advance and drive revenues forward.

Staying Secure

Despite recent strides, there is an ever-present threat to the growth of eCommerce: security. High-profile cyberattacks can shake consumer and business confidence in the industry, pushing individuals back towards more traditional retail options, even if they lack the convenience and flexibility of online technology.

For businesses to retain consumer confidence they should adhere to the highest security standards within their eCommerce platforms, whether it’s a mobile app or website. Companies should only retain customer information where it is absolutely necessary and sensitive data such as credit card numbers should be encrypted.

Businesses should also regularly update their applications and general security protocols to ensure that they are resistant to the latest threats. Ensuring that your business is compliant with the Payment Card Industry Data Security Standards (PCI DSS) is vital for any organization looking to enter the world of eCommerce.

Finding Growth in Emerging Markets

One of the biggest growth areas for businesses looking to embrace eCommerce is found in emerging markets. China is expected to be the largest online B2B market by 2020 and we have already seen domestic businesses like Alibaba take a foothold.

Shopping using a smartphone, in particular, is key in many developing countries, where mobile Internet is relatively developed compared to fixed-line connections. In addition, the physical, bricks and mortar shopping experience is also less developed in emerging economies, providing further opportunities for eCommerce firms.

Competition is fierce amongst organizations looking to dominate the eCommerce market in the likes of China and India, so businesses would be wise to act quickly to avoid being outpaced by their competitors.

See Change As an Enabler, Not a Threat

ECommerce may require businesses to invest in more staff training and new hardware, but it is likely to prove worthwhile in the long-term. ECommerce can enable organizations to grow their online presence, attract new customers and save on operational costs.

For businesses cautiously watching the growth of eCommerce from afar it is important to remember that time stands still for no-one. It only takes one look at some the UK’s high streets to realize that.

Published under license from ITProPortal.com, a Future plc Publication. All rights reserved.

Photo Credit: Nonnakrit/Shutterstock