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Oct 25, 2017 | 5 minute read

Hype in Digital Commerce: 5 Rising Technologies to Watch

written by Harry Chemko

Digital commerce is playing a pivotal role in customer experience strategies. The world's leading research firm, Gartner, recognized that digital commerce is a key way to acquire customers, develop relationships, drive revenue and reduce costs.1

Digital commerce initiatives affect both operations and customer experience management. They provide more ways to sell products, interact with customers, and differentiate from the competition. In their recent report, Gartner analyzed several emerging digital commerce technologies. We looked at the top five for delivering great customer experiences, including personalization.

API-based digital commerce

Application programming interface (API) based solutions have gained more popularity with businesses that recognize digital experiences are a key differentiator in their customer relationship strategies.

Commerce has gone beyond the storefront with the emergence of new touchpoints and technologies. Customers today engage with companies through social media, wearables, smart home devices and their connected vehicles. They expect their in-store experiences are simply an extension of all of their other experiences.

API-based commerce facilitates consistency across all of these experiences.  By decoupling the presentation layer from the business logic, businesses are more agile and flexible to support multiple digital and physical channels, and contextualize content that makes sense to the customer.

For businesses that want to stay ahead of the competition by quickly innovating and experimenting new customer experiences, API-based digital commerce is the appropriate choice. (Read our article on The State of APIs to see what a difference that makes.)

API Based Emerging Digital Commerce

Augmented and virtual reality commerce

The augmented reality game, Pokemon, has been downloaded over 100 million times and has more than 20 million active users. However, augmented reality and virtual reality have uses far beyond the gaming industry. Both can increase sales and conversion by enhancing the shopping experience.

IKEA publishes augmented reality catalogues. Converse has a mobile app that lets you try every shoe just by pointing your phone at your leg. Sephora is working on an augmented reality platform that uses face recognition so users can try on different looks – then add the recommended products into a cart. The three-dimensional technology is particularly useful in travel, real estate, engineering and esthetic medicine. Customers can simulate and visualize the results of the product they are searching for and create an immersive experience.

AR and VR are still in the early stages of adoption. There are still some technological issues that need to be addressed to enable maturity and utilization. Businesses should look at how AR and VR might fit into their overall business strategy, and articulate how to leverage them to improve business results. A good way to determine whether an experiment is working is to use A/B testing to measure sales impact.

AR Apps Augmented Reality Pokemon Go IKEA

Conversational commerce

Conversational commerce is where messaging applications and shopping intersect. Customers can reach out to company reps or a chatbot through messaging apps, chat apps or voice technology to make inquiries or get recommendations. It uses technologies consumers already use like WeChat stores, Facebook Messenger, and Amazon Echo (Alexa) to discover and purchase goods and services.

It boils down to customer engagement across the entire customer journey. Be where your customers are, and be there at the right moment. Conversational commerce allows customers to engage using their method of choice, taking channel transparency to a whole new level.

Eventually, natural-language interactions will become the norm in terms of how people expect to interact with companies. But there’s a caveat. The challenge is that conversational commerce is also in its infancy. Tech firms of all sizes are working to simulate human to computer conversations, but there are limitations in terms of customer context. It works for simpler actions like product recommendations, rebuys, and other linear conversations. Complex issues like customer complaints may still be best handled by a human being.

Conversational Emerging Digital Commerce Chatbot Phone Mobile

Thing commerce

 “Thing commerce” has morphed from the smartphone to the smart home. Now it’s the smart home filled with objects programmed to make repeat purchases based on pre-set rules, preferences and context. Amazon offers the Dash Replenishment Service, which sets up appliances to reorder when supplies run low.  More companies (and people) will start talking to embedded digital assistants in refrigerators and other appliances or to assistants like Alexa who can shop on their behalf. IHS forecasts that the IoT market will reach 30.7 billion devices in 2020 and 75.4 billion in 2025.

Companies driving innovation are getting ahead of the competition and seeing the benefits of early adoption. The question for every business: How should we prepare to take advantage of “thing commerce”? Actions might include embedding sensors or touchpoints in existing products, and integrating analytics to capture data. Identify short-term actions, future capabilities, ongoing operations and maintenance. It’s critical to map out the business case for any IoT play.

“Thing commerce” enables frictionless commerce experiences, resulting in increased revenue and a much better customer experience. In addition, the data that IoT devices gather exponentially improves customer insight and can fuel personalization.

smart fridge analytics

Digital experience platforms (DXP)

A DXP is your technology toolkit for creating digital experiences for your audience. It can mean one product or an entire suite of products and technologies from other vendors.

A DXP provides customers with a consistent brand experience in spite of organizational silos and legacy technology challenges. It enables a business to provide and improve customer experiences across diverse digital experiences and audiences.

A good DXP should be agile, flexible and easy to extend. Usually, the DXP platform combines technologies and systems to support specific business needs. It provides the foundation for all digital experiences, as new devices and channels are “plugged into” newly defined experiences.

Some questions to ask when assessing DXPs include: “What can we do now? and what can we do in future?  What challenges will we face when upgrading the solution?” Consider time to market, deployment costs, and if customizations will be required to integrate well with other components. Considering the pace of digital commerce, the worst thing you can buy is a DXP dinosaur: slow, difficult to alter, and vulnerable to tech change.

To evaluate any DXP, take inventory of your existing DXP across different channels and devices. Walk through different customer experience scenarios. Find synergies and overlaps between vendors. Set business goals and identify what you need in a new DXP to make them happen.

Swiss army knife DXP options

1 Gartner Hype Cycle for Digital Commerce, 2017