How Virtualization Will Drive the Next Phase of E-Commerce
When the first 3G-enabled iPhone launched with much fanfare in June 2008, nobody knew what an app economy could look like. Yet within a decade, the smartphone, propelled by the adoption of 3G and 4G technologies, has upended the world of commerce.
The Digital Transformation
Over the past decade, digital has made it easier to buy products, yet it has primarily existed as a parallel channel to offline and without an integrated experience. Consumers crave the “event-like” personal experience that comes with a trip to a store — browsing products, having touch and feel, a representative to help you or a friend to shop with.
As we stand at the precipice of the 5G launch, we expect another leap in e-commerce. If the past decade was about moving traditional experiences to digital, the next decade will be about the virtualization of those experiences.
Virtualization of Commerce
At its heart, virtualization is about making the act of shopping rewarding by making the digital experience more natural and human, using digital to create a more efficient in-person buying experience and removing friction from the mundane tasks of shopping.
So, what are the opportunities in virtual commerce?
By now we're used to the phrase, “Order and get delivered.” It's far easier to order online instead of in person. Hence, we're rapidly adding other phrases to the lexicon: order and pick up (e.g., pizza, coffee, groceries), order and dine-in, order and visit (e.g., dentist, doctor, haircut, nail salon, trainer), and order and reserve (e.g., car, concert, movies). The order-plus economy will continue to grow and increasingly transform “service” commerce. This will require building bespoke solutions that address the workflows of those respective use cases and the back end needed to offer and manage a seamless order-plus experience.
Live Social Shopping
For many people, shopping is a social experience. Mothers shopping with their daughters, best friends spending an afternoon at the mall, or parents doing back-to-school buying are common rituals.
At any given moment, millions of people are on a merchant’s digital storefront, yet sadly our commerce sites are largely static, stuck the way they were conceived in the mid-1990s. A dynamic digital storefront with a real sense of popularity, inventory, social cues and visual promotions will make online shopping more accessible and fun. We also need a greater injection of virtual reality to make browsing a website more like being in a store. In a world where there are more social tools than ever before, where synchronous game play and augmented reality are becoming better every day, bringing social shopping to life could make the experience more rewarding and significantly boost customer engagement.
One of the benefits of shopping in person is the assistance provided by a store rep. Great reps can not only close a sale, but also create a deeply loyal customer relationship. As digital commerce grows, a “digital concierge” experience could make customers' lives easier. Blending communication, automation, commerce and payment functionality to guide the customer through the shopping journey and making it easier to check out, execute changes, or manage shipments are areas that could be improved through better application of back-end and front-end technology.
Check in to Check Out
Filling in the mundane payment and shipping details, remembering the promotional code, and doing the routine tasks of checking out adds friction, resulting in abandoned carts. Imagine if a customer is instantly authenticated and onboarded when they land on a website so they don’t need to check out, or a merchant can offer an in-stream promotion, financing or warranty based on instant access to a customer’s preferences and potential. These ideas can significantly reduce friction and personalize the customer experience. Merchants need services to seamlessly verify identity, onboard preference and payment instrument, and use artificial intelligence-based decisioning to action new experiences in-stream — areas ripe for innovation.
One of the most profound developments of the digital age is the growth in customer reviews, which provide a consumer instant access to feedback on a product or service. While the unstructured, uncategorized information embedded deep in customer commentary is highly valuable, it’s hard to get to. Understanding fit, durability or true color when buying clothes or visual sense of location and amenities when booking a hotel materially impacts the customer’s choice. Bringing this unstructured data to life in easier and visual ways could significantly improve the shopping experience.
Global commerce has been upended by the transformation in communication technology. With the launch of 5G, we're entering the next phase of this evolution which is all about virtualization — and creating a more natural and rewarding customer experience as they transact on the go. The end goal is aimed at breaking down the barriers between online and in-store experiences and maximizing the rich opportunities that 5G enables across every facet of commerce. This is an exciting time for the industry and one that will lead to tremendous change in how brands interact, drive commerce and build goodwill with their customers.
Dhiraj Kumar is a chief marketing officer, board advisor, and former executive at PayPal and Facebook.
Dhiraj Kumar is a CMO, Board Advisor, and former executive at PayPal and Facebook.
A senior marketing executive, board advisor and digital expert, Dhiraj built a track record in scaling multi-billion dollar businesses and building best-in-class go-to-market functions at high-growth companies such as PayPal and Facebook.
With multi-disciplinary expertise in organizational and P&L management, customer marketing, e-commerce and technology, Dhiraj has driven transformative change in rapidly evolving digital enterprises. He is known for creating a team culture that is centered around the customer, values excellence, fosters diversity of ideas and thrives on a test and learn approach.
At PayPal, he helped re-ignite growth and supported the establishment of the online payments system as a leading brand in North America. Previously, at Facebook he led efforts to establish it as a leading advertising and marketing performance platform in the Americas. Earlier in his career, he held several engineering positions before serving as a senior executive in the advertising research and measurement unit at Nielsen Holdings Plc.
Currently he works with founders, investors and growth companies in shaping go-to-market strategies, advising on technology investments and helping build scalable organizations.
He loves history and is a strong believer in its power to educate and inform. In his spare time, he mentors emerging marketing talent and works with educational institutions on technology applications in improving learning.
He holds a Master in Business Administration with honors from Columbia University, a Masters in Electrical Engineering with honors from University of Minnesota and a Bachelors in Electrical Engineering from Indian Institute of Technology.