According to the US Department of Commerce, 11.8 percent of retail sales in Q1 2020 occurred online. Surprised by that number? Is it higher or lower than what you expected?
Regardless, one thing we can all agree on is that consumers, the world over, are conducting more commerce online. Every business needs to understand how the “Internet” impacts their sales.
In the broadest terms, all forms of online commerce can be called electronic commerce or eCommerce. For many digital marketers, we divide eCommerce into four discrete versions since the marketing strategy changes based on the type of commerce pursued. The goal of this article is to define these different types of online commerce and examine the types of marketing they use.
The modern definition of eCommerce is the online selling of physical products or services with traditional business models. Features like product spotlights, catalogs, “buyer recommendations” and shopping carts are the primary functionality. There are many eCommerce technologies that serve both B2B and B2C companies. Today, you can find, negotiate, and procure almost anything via eCommerce.
For examples of eCommerce experiences, two-thirds of Americans turn to Amazon. Facilitating 49% of all online transactions, Amazon drives online commerce and sets the standard for functionality and user experience. Other eCommerce giants include Alibaba, eBay, Jingdong, and B2W. If your goal is to “have an online catalog” or “sell products” online, turn to these sites for inspiration and instruction.
eCommerce marketers use content marketing, email marketing, search advertising, and display advertising to drive traffic to an eCommerce site with the goal of an initial or introductory (perhaps, impulse) purchase. Once a customer is acquired, email/push communications are sent to a buyer, based on previous activity or data, to keep the eCommerce brand top-of-mind.
dComerce is the buying and selling of digital goods and services using the internet, mobile networks and commerce infrastructure. Primary offerings include subscriptions and memberships, eBooks, webinars, and other knowledge assets. dCommerce expands the reach and impact of many professional services industries whose traditional business models are limited by geography.
dCommerce disrupts many industries as it allows experts to monetize their knowledge without traditional “brick-and-mortar” limitations. From healthcare and expert counsel (legal, financial, business) to innovations in education, entertainment and publishing, dCommerce is encroaching on traditional business models.
Leaders in dCommerce include subscription services Netflix, online communities like Stream and Twitch, and activity services like Peloton. The current world pandemic has helped fuel a rapid expansion of dCommerce products.
dCommerce marketers focus on strategies centering on the “user journey” and introducing prospects to the power/value of their knowledge. The most common way to initiate the engagement/relationship is offering to “trade” a prospect their email or mobile contact information for a digital trial, subscription or sample.
mCommerce is the name given to eCommerce technology that focuses on mobile interaction. Though many eCommerce giants have robust mobile technology/mobile platforms, mCommerce sites embrace the fact that over 55% of all online commerce takes place over a mobile connection.
The mobile form factor requires a streamlined experience, smaller catalog listings and often a robust use of video. Typical purchases include location-based goods and services, financial transfers and mobile banking.
mCommerce has ushered in entirely new business models with many of the most impactful/disruptive companies around leveraging mCommerce. Many mCommerce solutions start with a downloadable app.
Driving engagement through an app, often registered through a social media profile, leaders in mCommerce include Uber, Starbucks, and Square, LetGo and Sell.App. mCommerce has not only disrupted traditional businesses, it is driving technology infrastructure in many parts of the developing world.
Digital marketers looking to drive mCommerce sales, focus on securing app downloads, membership/registration through a mobile number or social account and communication to the mobile device. Awareness is often created through location marketing/advertising (signage, outdoor and mobile billboards) and engagement is via app, SMS, and email alerts.
4. Social Commerce
Social commerce is considered a subset of eCommerce, though its impact, value and importance are growing. This technology involves social media, online media that supports social interaction, and user contributions (content/word-of-mouth) to drive online buying and decision-making. Increasingly buying is taking place within social channels themselves.
Social Commerce has grown out of the maturation of our collective use of social media. No longer just a way to monetize social influence, social commerce technologies are now fully fledged business models. From early community commerce tools like Etsy and Kickstarter, social commerce solutions now exist for every social platform with tools like Soldsie and Lyst. It can also be argued that platforms like Pinterest and Spotify fall into the category of social commerce as well.
Marketers focusing on social commerce shift the focus of their messaging from the product or transaction to the relationship between the brand and the consumer. Content marketing, especially via the social channels where the transactions are available drive social commerce marketing.
One last thing …
While understanding how to use online commerce technology to generate results is vital, you still need effective marketing to succeed. In fact, marketing can help overcome technical limitations.
Just remember the early days of Amazon and their tremendous growth despite technical limitations. As more commerce moves online, excellent marketing will play an increasing role in determining the winners and losers.
If the idea of executing on an eCommerce strategy seems overwhelming, know that you don’t need to go it alone. We’re in this with you. If you need a little help, just drop us a line, anytime.
Rainmaker Digital Services