Author Archives: Ola

Evolving the e-commerce by creating impulsive buying in an online world

To some extent it must be rather devastating for Ernst Malmsten, Kajsa Leander and Patrik Hedelin, who founded back in the late 1990s, to see what currently is happening within e-commerce. Why? Because for several of their ideas they were actually rather spot, however they were just over a decade to early. Their vision was to provide some of the best and most vital parts and benefits of offline shopping in an online shopping world. And you know what, that is actually currently the next thing to do to evolve the e-commerce industry to the next level.

Initially e-commerce focused on low prices and mostly had cost-saving people in mind. Rather soon, after the first wave of e-commerce stores, price-comparing sites were launched. The main focus for e-commerce store became to provide the lowest price. This since it was the easiest way to get visitors and buyers, due to the amount of visitors the price-comparing sites provided. However, since then things have changed a bit. After a while the buyers have learned that price is not always the most important factor. Instead additional focus has been put into providing great product descriptions, an enhanced shopping experience and improved customer service such as express deliveries and free returns.

The next boom for e-commerce was initialized by those living in smaller towns, villages and rural areas. Thanks to e-commerce the availability of products and brands were suddenly heavily increased. What the previously only had possibilities to reach out to and pick up perhaps a few times a year were now available every day only a couple of clicks away. In this case circumstances such as the initially uncertainty of using credit cards online were negligible, compared to what could be a several hour trip to the nearest bigger city. Or in some cases only were available in the three major cities in Sweden; Stockholm, Gothenburg and Malmö – which could be a day-trip away at least.

This even further reduced the impact of price as the most important factor. In this case price was not always that important, at least if the online store provided stuff that in either way was not available for the customer within its area.

Nowadays e-commerce is a big player within more or less every part of the retail industry. It is nearly impossible to find a spot that has not a least a couple of e-commerce competitors. And since e-commerce now is a regular part for a lot of people, the regular stores have been forced to adapt. E-commerce and regular commerce have moved toward each other, and multi-channel commerce is now by a lot of people seen as necessary to be able to truly compete in the market.

Several players within different sectors have realized the impact and benefits of multi-channel commerce. Regular stores have complemented their business with e-commerce and companies originated as e-commerce players have opened regular stores or show-rooms. Grocery stores provide pre-packed grocery bags that could be ordered over the Internet, side by side with their original concept.

Addnature, a Swedish retailer within sports equipment, combines their e-commerce with physical stores. The prices are the same regardless if the customers place their order on Internet or if they visit the physical stores, the main difference is the larger assortment in the online version. However, people can order products in the e-commerce to be delivered to the store were the can actually try the real product before they make their decision. This is done free of charge and they actually suggest people to, if they are unsure about the size for that new shell jacket, to place and order on two sizes and then choose the best one in the store. This is a great example of how e-commerce and regular physical stores can enhance each other. The physical stores does not need to have the whole assortment, still the buyers can access the benefits of it.

Apart from the obvious benefits for the customer Addnature as well get the benefits of a physical store compared to the online version. Let me explain. One of the largest benefits for a physical store compared to an online version is the opportunities for impulsive buying. Great examples of this are the smell of fresh-baked bread in the Supermarket and the socks and accessories within the counter area at H&M. E-commerce stores have of course tried to translate and copy this into their environment, with functionality such as “Others who bought this also picked up these items” and similar. Still, the conversation rate for this is rather low and it is rather hard to create an environment online that supports impulsive buying in the same way as in physical stores. However in the Addnature case described above, they actually get the customer to visit their physical store and the have the possibility to achieve this impulsive buying through the personal contact with the customer as well as the regular factors. The loss related to the delivery of two shell jackets, even though only one of them is finally bought, is low compared to the benefits achieved.

To further enhance the e-commerce business, and increase the revenues, impulsive buying should be one of the great focus areas. Airports stores is a great example of a business mainly focused on impulsive buying, and e-commerce stores can learn a lot from this. In the airport case people have an hour or two with nothing to do and that is how and when their attention is caught by the stores. In an online world we need to find similar events when we can catch someone that is actually doing something else and convert their action to an impulsive buying.

One example of this could be to use and benefit of all that time people spend on looking for a new apartment or home on Hemnet (the major real estate brokers site in Sweden). In this case the visitors spend a lot of time looking at different pictures with usually great looking furniture and equipment, canvases and so forth. It is rather common that you might find yourself looking at a couch or similar that you actually could want to have yourself, however it is usually pretty hard to find out which brand it is or where you can buy it. A great tool in this case would be to provide a tag or note about its brand and a link to where it could be bought.

This is just one opportunity of how impulsive buying could be generated in an online world. People spend tremendous time online; on web pages, blogs and social media sites. This is done at home during the commercials, at the bus and while waiting to meet up with that friend who always is late. All this time can be converted into impulsive buying, and the players who lead this race will have a great opportunity to have a competitive edge against their competitors.

The business of tomorrow

When looking into different industries and markets I surprisingly often find myself asking “Where is the IKEA within this industry?”. And this is not about IKEA. Usually the question could be revised, replacing IKEA with another company who has truly challenged and evolved their industry. What I am trying to pin-point is how non-evolved several industries and markets are. A lot of markets are usually instead very traditional, with traditional players and a traditional setup of services and boundaries. Together they have created informal rules of what’s within the particular industry and what’s not. You don’t sell fruits in the same shop as iPads (despite the name of the manufacturer). The setup may have been the same for decades, with no revolutionary changes for what seems like decades.

We may use the banking sector as an illustrative example, but we might actually use almost any kind of industry. Within banking we have old, fancy, large, traditional players. What’s considered as banking is rather pre-defined. You better have some large corporate office in buildings from the last century, some waving flags, a lot of suits and limited opening hours. This is how you do banking, at least the private one – right?

Well, maybe not. We do of course have some new players on the ground, such as (here in Sweden) NordNet, Avanza and Skandia. They are all in some extent trying to redefine what banking is all about. Skandia, for instance, has no bank offices. Still I see no big player trying to lead the way, challenging the traditional banking and financial sector. A player who questions the setup of rules and informal understanding of what the industry is all about. Rather they are all playing the same game according to the same rules as ten years ago. And I guess I don’t need to tell you why that is bad. The easiest way to win the game is to change and define the rules yourself, instead of acting to according the rules of someone else.

In ten years a lot of things have happened. We may just take a look at the mobile devices, who could imagine that outcome? Actually, some did. When the CEO of Ericsson predicted that we will have 50 billion Internet connected devices by 2020 some people laughed. Today they are not. Some would actually say that we at that point may laugh about the figure, but then of the opposite reason.

However this is not about predicting the most distinct figures, it is about challenging the mindset and dare to imagine a truly changed world. Since the world has changed a lot during the last ten years, why shouldn’t the same occur for the next ten years? It is more likely that a particular industry will not look the same in ten years, than it will remain intact. It seems rather logical. However still many major players are rather trying to defend their territory instead of exploring the emerging world around them. The players within the industry who will survive are those who dare to lead the way and change the industry. Not the ones lagging behind.

And this is where consultancy companies, like Avanade, should take advantage and capitalize. We should help our customers, showing them the different alternative paths, explain their implication, suggest the groundbreaking one and held their hand while they are moving themselves into the new territory. Why? Since this is what technology is all about; changing the world, evolve the business landscape and redraw the business rules for all of its participants. Then we can talk about “Results realized”.

We must be the very one helping out client to trespass all the traditional rules of the business within their industry and market. We need to help our client redefine the rules within their industry. How? Change management and connected processes definitely needs to be a core competency within the company. This since we must not just utilize from change, we need to promote, push and deliver change. We are not (or at least should not) selling just a logistics system, we are selling supply change. Change is the key to success for companies across all industries. Change is needed to create the business of tomorrow.

We need to be able to help and assist our customers in creating their business of tomorrow.
That is actually our business of tomorrow.

The next generation maps

I remember when Google Maps was released and which huge impact it had on the possibilities to create new services. It was more or less a small revolution for developers, entrepreneurs, academics, students, companies and actually everyone of us, even though a very few ones of us realized it back then. However some of them who did created their whole new business on the new tools that Google made available for us. What previously would have needed either a lot of money or the amount of effort that made most of us postponing such projects were now within reach.

Ted Valentin was one of the entrepreneurs who understood the possibilities and made reality of his ideas; to create a whole network of web pages were maps the actual baseline of the service it provided to its users. To name a few badkartan shows and lists different bath spots around in Sweden, with sushikartan it is easy to find a rate local sushi restaurants and with wifikartan it is a breeze to find a wifi hot-spot.

Lately some of the above services has met a lot competition from social media as well as particular apps and new web sites. My belief is though that there is a new tool available that might have the power to become the new revolution of map services; dynamic data visualized on maps. When we previously were limited to (roughly) add coordinates and display different kind of pins with information, we now have a whole new set of amazing tools to visualize dynamic data on maps thanks to the great service of CartoDB. If you have not taken a glance on this yet you better do. Carto enables you to visualize hardly any kind of data on a map and illustrate your concept in a way that previously required a huge amount of skills as well as effort. Their own provided examples gives a good introduction to what is possible: Climate changes and how it affects different areas, the US election result in real time divided per state and more odd ones such as a presentation of naval ships during world war II.

Additional to create entertaining maps I see a lot of opportunities of how this could evolve different business needs; such as illustrating sales in real time, display and plan routes within supply chain and visualize market analysis for different regions. National Geographic and The Guardian has already realized the greatness of these tools, I suggest you to do the same as soon as possible. Well prepared and with a good business insight it should be a rather smooth thing to sell in this kind of custom developed dynamic data driven maps to customers. According to me, showing our customers how their business can be enhanced with technology is one of our main parts as a consultant – and therefore everyone of us who are within the consultant business should definitely evaluate how these tools can provide such enhancements (and add new business) at our customers.

The next generation maps are here, for sure. Remember were you read it.

The giant leap of the first post

Social software within companies is a rather complex project. Not as a technical matter. You may choose and deploy among a large set of more or less complete out-of-the-box solutions. The hard thing is to get people to use them. How do you get your employees to share their knowledge using social collaboration tools? Well, that is the real question. And I am sorry to say that I don’t have the complete or perfect solution to offer in this post; however I do have some parts to share.

Knowledge workers are usually very eager to help each other and share their knowledge to peers. At least when asked to. But to get them to write a blog post or share their thoughts as a tweet (or similar micro-blogging service) is very much harder. Especially to get them to write the very first one. And this should not be very surprising.

In my earlier studies of social activity within companies I actually found out that one of the largest barriers and most tricky obstacles to climb is the very first post. As a new writer is very easy to think twice about such things as: “How should my first post look like?”, “Will I forever be judged depending on this very first post?” or “Will people go back to this very first post?”. Like, if the first post is going to be the first chapter of a book. And to some extent that is of course true. However we must not emphasize the impact of the first post, and we need to help our employees to write their first post.

And to be honest, your very first post will usually not have that much readers (obviously, since you have not written anything before) so why make such a big deal of it? Just write it. Continue. And learn from others. That is what sharing and knowledge transfer is all about.

If I thought twice before posting this? Actually not. And I guess that is the reason that it actually was published. So let us all forget about thinking twice when writing our first post, deal!?