Personalization and Globalization Represent the Future of E-Commerce
It's not just a tech blogging sensation — actual 3-D printer stores are popping up in major cities around the world. For example, New York City-based MakerBot already has three store locations, one each in Manhattan, Boston and Greenwich, CT. But are brick-and-mortar 3-D printing stores just a marketing tactic, or can they become a primary business model?
It's easy for the naysayer to doubt whether 3-D printers will ever become mainstream. At the advent of the world wide web more than 25 years ago, however, few people could have predicted its impact on nearly every aspect of our lives. And when Steve Jobs and Bill Gates started building hobby computers in the mid-1970s, almost nobody imagined PCs would become a modern home fixture. The cell phone's journey from brick-sized car accessory to pocket-sized computer? Fairly unpredictable.
With this in mind, it no longer seems so far-fetched that a technology like 3-D printing will make a similar journey from a niche luxury to a mainstream consumer product. In fact, 3-D printing, with its potential to build customized products tailored to the user, is just one example of a much bigger e-commerce transformation that's shifting power to consumers. This shift is primarily driven by two forces — globalization and personalization.
In one form or another, globalization has always been a challenge for companies operating in international markets. The e-commerce phenomenon has just intensified this. Consumers around the world expect the same experience on e-commerce sites, regardless of their location, language or device they're using. For example, a consumer shopping via smartphone in Bulgaria needs the same experience as one sitting at their desktop in Vancouver, even if there are no on-the-ground sales reps to localize the transaction. It's not just distance, language and culture that are barriers to international online transactions, either. Local policies, regulations and infrastructure limitations all add to the globalization puzzle.
In an effort to understand these challenges better, Peer 1 Hosting surveyed 300 e-commerce decision makers and found that their top concerns included data privacy laws (58 percent), regional tax codes (55 percent), localized customer support (52 percent) and maintaining low latency for all regions (42 percent). How can online retailers cope with this complexity?
It may sound counterintuitive in a global market, but localization is the first necessary step. According to Peer 1's survey, one in five brands are expanding their international capabilities this year, including offering local website translations and making purchasing options compatible with local currencies. These tactics go a long way to differentiate companies in competitive and diverse markets like the Asia-Pacific (APAC) region, where, of those companies in the survey that didn't already have an APAC website, 23 percent plan to target in 2014. It's simple: The more markets a website is optimized for, the more responsive consumers are and the more likely they are to convert.
It's important that websites optimized on the front-end for international audiences are also supported at the back-end infrastructure layer. For instance, even if e-retailers are leveraging local networks in the regions they're targeting (which may suffer from significant gaps in developing regions), they must also withstand burdens including unexpected disasters and sudden spikes in website traffic, which may occur at different times and on different dates than in the e-retailer's home country.
To be prepared for this wide range of regional challenges, e-commerce organizations need a hosting or managed services provider that can cater to their specific international strategy, including leveraging local third parties to analyze best e-commerce practices for target markets. The hosting provider and its staff need to be as clued in on globalization — and localization — as the e-retailers themselves.
Clearly globalization is an essential piece of the e-commerce puzzle for companies looking to extend their reach and grow sales, but organizations of all sizes and in all markets must also be tuned in to the second force transforming online retail today: personalization. In many industries, online buying is replacing in-store buying. However, if an e-commerce site doesn't enable visitors to see and feel a product before buying it, can it really offer users the "personal touch" they get in-store?
Actually, personalization can in some ways improve on the traditional shopping experience. For example, you could visit five cycling stores before finding an employee knowledgeable enough to set you up with the perfect bike. Yet e-commerce technologies like smart sizing calculators can match you with a perfect bike regardless of where it's purchased (and some years down the road, a 3-D printer could build it right in front of you). Other developments like same-day delivery, virtual dressing rooms and "click and collect" are blurring the line between online and in-store shopping, and bringing personalization to the forefront of e-commerce strategies.
We don't have to think of in-store and online shopping as in opposition to one another. In fact, they complement each other quite well. Big data analysis enables retailers to become more and more targeted in their marketing and sales efforts by personalizing ads and website content, as well as conducting real-time analysis with new technologies like iBeacons, which tracks consumer behavior in-store. The same technologies allow retailers to stock physical stores with the types of goods they know local customers will buy, so the benefits work both ways. This is good news for both retailers, which save on logistics and shipping costs, and consumers, who don't have to wait ages or travel far to get the products they want.
As online shopping becomes more prevalent, an organization's website is literally its brand. Peer 1's survey of e-commerce decision makers found that 76 percent believe the quality of the user experience on their website directly impacts perceptions of their brand — which is why 29 percent plan to invest in improving the overall user experience on their websites this year. As geographically widespread and diverse audiences visit e-commerce sites, they all expect the same in-store-like experience, and the human element of online shopping really starts coming into focus. No amount of back-end or front-end website optimization can fully address this human element; real success requires knowing your customers and engaging them with attentive support and staff.
It's a global, local world in e-commerce today, and it will only become more so. If it's 3-D printers, the Internet of Things and big data that are key forces today, who knows what's to come. What's certain is that the way we buy and sell things will never be the same again, but that doesn't mean the online shopping experience has to be impersonal. Instead, it should help power the human potential of the internet to create better human interactions and user experiences around the world.
Robert Miggins is the senior vice president of business development at Peer 1 Hosting, a provider of internet hosting services.