Jesse Weltevreden works as a professor of digital commerce at the Amsterdam University of Applied Science, where he heads a team of approximately 15 researchers, delving into e-commerce (as well as its associated fields — think online marketing, future-proofing shopping centres, and how to use tech to increase in-store turnover). He also acts as the research director at The Ecommerce Foundation in Amsterdam, which aims to stimulate the global ecommerce trade with key insights and the world’s first international ecommerce trustmark. We sat down with the professor to get a comprehensive look at international ecommerce in 2018.
How are brands in different countries adapting to the rise of ecommerce?
The way that brands around the world are responding to ecommerce is influenced by the maturity of their domestic market. Northern America, Western Europe and parts of Asia are already advanced when it comes to online shopping. But there are a lot of countries which aren’t that advanced, if you go to Africa or parts of Asia, Eastern Europe and South America there are still many people that don’t have good internet access or a bank account which makes it difficult to buy online. In such countries, many brands still have a long way to go when it comes to e-commerce.
China is more contradictory. A lot of retail innovations come from China and it’s the biggest e-commerce market in the world — it’s going to only get bigger in the near future. But about half of the population still has no access to the internet and there are over a billion people in China so there’s still a huge market to unlock there.
China is very strong when it comes to mobile commerce so a lot of online shopping takes place via mobile phone (much more than in Western Europe, for example). That’s a very easy way to increase penetration of online shopping in developing markets in general and rural areas in particular.
There’s also the need for brands to start translating their content to respond to the rise in cross-border sales. With the growth of online shopping around the globe, online retailers experience more competition from foreign players and to stay competitive they also need to look for opportunities in other countries. As an example: the Netherlands has the seventh largest commerce market in Europe and around 90% of online shops in Holland sell across the border. This sounds very nice when you think about the figure but when you look beyond this number you see that actually Dutch shops aren’t very successful at cross-border sales because the majority of the websites are only available in the Dutch language and primarily focus on the Dutch speaking part of Belgium. You’d expect in a country like the Netherlands, which is mature and has a well-developed ecommerce market, that we’d cater more to foreign customers in terms of language and things such as payment methods and country-specific content. But that’s not the case. Localization is the key to success in cross-border ecommerce!
We often associate tech with the digital side of the shopping experience. But how can technology improve a customer’s visit to a brick-and-mortar store?
In lots of ways! How long do you have to talk? (laughs)
You can also use technology to increase traffic to the store, like using a digital screen in your shop window to attract attention. Your customer could also use the screen to get a better idea of what the store is offering, even when the store is closed. Or if they have a customer card and you see they haven’t visited the store in a while, you could send them an email or push message on their smartphone (using geofencing) with a special offer attached.
Or you have technology that measures how frequently a product is picked up by a customer and where the customers are located in the store via smart cameras so you know what the hotspots in your store are. You could then place products that have a high margin or that you really want to sell in all the right parts of the store. And technology like smart mirrors and augmented reality can help to enhance the product experience within the store.
How can brands use technology and marketing to future-proof their businesses?
Companies are becoming more data driven, like [the Dutch company] Picnic for example. They base their marketing and strategic decisions on big data and analyse their customers’ behaviour, see which products are popular and adjust their strategy based on data and that’s really the future.
This is challenging, it requires a lot of skills and investment in the right systems (on many occasions you work with personal customer data that really needs to be stored safely). You need data analysts in your company and marketing managers who can ask your data analysts the right questions. But also other parts of the company (eg. purchasing department) need to see the value of data for decision making.
But this data can also complicate things. Everything is transparent at the moment so it’s hard to compete on price. For example, there are companies like Media Markt who use dynamic pricing, adjusting their pricing continuously throughout the day based on their competitors’ prices. If they see that their TV price is more expensive than that of a competitor, you see them adjusting their prices on digital displays in store which is really amazing.
But if you focus too much on data, you can lose the personal aspect. People are social beings so ultimately, customers don’t like being treated as just a number in a data set and having the company act accordingly. You still want a human being who can interpret the outcome of data. Algorithms aren’t always advanced enough to know how to address customers or to know what the next step is in targeting a customer, although technological developments go very vast in this area. The social and personal aspect remains very important for a brand in order to really engage with the customer. Being completely data-driven can be dangerous in that respect. But I think in the future, more and more processes and decisions will be data driven. As such, I am looking forward to chairing Savant eCommerce Amsterdam’s second day, when we will talk about customer-centricity in a digital and data-driven landscape!
Catch Professor Weltevreden at Savant eCommerce Amsterdam on the 25th of April, where he’ll be chairing the event and giving more insights into how e-commerce brands can future proof their businesses. Get your tickets here.