It’s not easy connecting all your sales channels. Making sure that brick and mortar stores, the online store, live shopping channels and others are all in sync can become complicated. Retailers need to get all departments, all sales channels, suppliers and fulfilment operations on the same page. That’s why I’ve put together a list of the top software vendors in omnichannel commerce – to help you skip the software sourcing part.
It’s not an easy task to connect an omnichannel software vendor to existing systems. Fortunately, some companies are really good at it. Others – just good at saying they are.
And here come the knights in shiny digital armor to rescue the day. The following 5 vendors have built omnichannel retail capabilities ready to be plugged into existing retail ecosystems. They are now the go-to elite for large retailers in need of upgrading their IT infrastructure.
5. Kibo – unified commerce.
Number 5 on our top software vendors in omnichannel list is Kibo. In 2015 former Shopatron became Kibo. The company now sports an API-first, microservices based platform that enables B2B and B2C ecommerce as well as order management, inventory systems and point of sale solutions.
The company was founded in September 2000 by Ed Stevens and Sean Collier. Since then, it has evolved into an integrated SaaS platform that connects offline and online orders management, making it easier for customers to purchase from retailers.
The company offers specific omnichannel solutions, most important being:
ship from store
Shopatron targets midsize retailers and its main benefit is the advanced order routing. The platform combines online and offline sales and claims inventory visibility across channels.
great fit for midsize companies
developer friendly and easily integrate-able due to its API-first architecture
headless commerce structure – enables building disconnected systems on existing software structure
good fit for larger retailers that look for a quick roll-out for the solutions listed above
can connect multiple sales channels and direct orders to the right fulfilment point
works for both B2B and B2C commerce
reduced costs and quick roll out
implementations can become costly due to development costs
backend can seem outdated or complicated
analytics may not be its strong point
4. NetSuite Suite commerce
NetSuite was already rocking a great SaaS ERP product and a fully flavored ecommerce solution when it acquired OrderMotion in 2013. Now the company can provide inventory management across channels, a single customer view, business intelligence data and omnichannel order management. In the past years the product has made the company one of the top software vendors in omnichannel with its SuiteCommerce collection of products.
NetSuite started as NetLedger, envisioned as an online accounting tool, that later turned to an wider array of company management tools.
Prior to its Oracle acquisition, Netsuite was very active in acquiring companies itself. In 2013 it acquired Retail Anywhere, a POS solutions company that became its POS commerce solution. In 2014 it acquired both Venda, an ecommerce SaaS company, and eBizNet Solutions, a company focused on WMS (warehouse management system) solutions.
Netsuite has decided omnichannel is a perfect mix when it connects companies focused o separate blocks in the retail chain.
Extensive know how of retail operations management
Integrated SaaS solutions
Great record of acquisitions
Single view of customer across channels
Multi-channel channel inventory view and order management
Extensive list of customers, a lot of them enterprise Oracle customers
NetSuite is “broadly focused”: its solutions work with healthcare, finance, manufacturing and many, many others. That leaves little room for actual retail innovation
The solution is targeted at enterprise customers or midsized to large companies, a lot of them Oracle customers
Complicated to operate and train staff on
Complex pricing and licensing structure
3. New in the top software vendors for omnichannel: VTEX
VTEX was nowhere to be seen on this list 5 years ago. The company started in Brasil as an ecommerce company catering to the local market. It’s innovative technology caught the attention of Walmart as it entered the Brasil retail market. They’ve created a solid presence for the company in the country and expanded regionally in LATAM.
Companies such as Sony, Samsung, Adidas and many others has chosen VTEX as their B2C and B2B multi-channel software suppier.
From all the other companies on this list VTEX is the best in many fields, chief of which is its modern infrastructure, matched only by the likes of Shopify, which is more aimed towards ecommerce rather than multi channel sales.
Great user experience
Headless, API-based ecommerce
Apps marketplace and third party developers
Great developer support
Fast time to market implementations
Not much customisation can be done on the core platform. It’s a multi-tennant cloud platform.
The platform can be sometimes slow
2. SAP Commerce
SAP commerce was once a thriving, innovative company called Hybris. Afterwards SAP purchased it and there’s almost no way to find out how you can implement the software. Just trolling. The solution is good and it used to be number one on this list. Not anymore.
This omnichannel solution is scalable and built on a modern and flexible architecture, that allows interaction with all interfaces. Its order management solution, inventory and commerce application are built to work together seamless and easily connect with other systems.
SAP commerce’s solutions work both B2B and B2C and can handle inputs from multiple inventory sources and outputs on multiple sales channels. Moreover, the solution features a central content management system that enables retailers to push content across a multitude of interfaces.
fully integrated solutions
works B2B and B2C
supports multiple interfaces
works online, offline and on multiple other channels
flexible enough to work with open source technologies
training may be expensive
professionals able to implement and train are hard to find, due to an increase of platform demand
customization and setup can be time and resource consuming
it’s part of SAP
1. Shopify Plus
Shopify is an amazing company and its communication, style, products and company culture really stand out. It used to be the small kid on the block but now, in term of product, market reach and its huge growth in 2020 it really shines.
It makes sense that its core enterprise product can work on multiple channels. It’s incredibly stable as an ecommerce platform, migration is extremely fast, works as a point of sale solution and you can integrate all logistics on it. Plus, it comes with the experience of having more stores on its platform than any other company.
Shopify Plus takes the crown on my list of top vendors for omnichannel software, 5 years after it was not even included here. Kudos, Shopify.
So that’s it – these are the best of breed. Of course, there are more out there that deliver great products and I could name Intershop or SalesForce Cloud . They, however are less inclined to omnichannel or have a really new found love for omnichannel retail. The vendors mentioned above are leading the pack in omnichannel retail implementation, especially for large customers.
Ecommerce sales strategy for beginners is a must. Even if it sounds a bit daunting at first it’s a must have if you are planning on stepping up your sales in 2021.
Maybe you’ve just set up your online store or you have some traction already but you know there’s room for improvement. I’ll help you understand how you can extend your online sales with additional channels and strategies you haven’t thought of.
Let’s dive in with a favourite topic of mine:
Using new Sales Channels in your ecommerce Sales Strategy
First of all – what is a sales channel? Simply put: any method of getting products to the market so customers can purchase them. For example, your online store is a sales channel. It showcases products, it tells their price and allows customers to purchase the products.
Let’s assume that by now you have already started your online shop. Ecommerce strategy for beginner tip no.1: start an online store 🙂 . Alright, that was obvious.
The web store is up and running and customers start showing up. But the web store should not be your only sales channel. Your customers are real human beings with all sorts of habits. One day they’re browsing your store, the next they’re hanging out on Facebook and meanwhile they search product info on their mobile phone. You should be there also.
Start a live shopping session. Maybe add your products to a Facebook store. You could build a mobile app that engages customers outside your store and collects orders.
It’s not just online, either. Offline engagement shouldn’t be a taboo either. Maybe a brick and mortar showroom for your main products is not cost – effective. Especially during a global pandemic. But you could set up a pop-up shop occasionally, following health protocols and engaging your fans.
There are numerous ways you can add sales channels to increase your market reach and some are really easy to set up. Others are a bit more complicated but in the end it’s mostly about your product, your brand and of course your budget. Let’s see which are the most popular sales channels and how you could benefit from them.
Live shopping has taken the world by storm. It’s engaging, fun, allows you to connect to your fans and has conversion rates of up to 9%. It’s one of the most effective ways you can use to improve your conversion rate while also improving customer experience.
The basic concept is that you start a live video stream and present and sell products to your customers. They are watching you either on their favourite social media or on your website (this can be done with a live commerce software). They interact with you by asking questions or chatting with one another. Through these interactions you get a sense of what the market actually needs and wants from you.
This is a great ecommerce sales channel for both beginning ecommerce startups as well as big retailers. In China, for example, it’s so big that some live shopping assistants can sell up to $140 million worth of merchandise a day during live shows.
Out of all the sales channels you may choose there’s really just two that really fit together with your online store. One is live shopping, presented above. The other one is the call centre, which can be as simple as a phone line for customers that need more info on products. But it can also be much more than that.
(Zappos’ call center is legendary and effective. It’s both a sales and support channel.)
It can just as well be a full fledged business operation with live assistants answering calls and helping customers choose the right product, handling orders and managing complaints. It can also mean people calling prospects or indecisive potential customers or just plain cold calling sales leads. Or sending them personalized SMS’s. No matter the choices you will be making, the phone is a great connection to the customer and you should build a smooth phone support operation.
You could ask – isn’t social media more about marketing and communication, connecting and understanding your customer? Yes it is but it can work just as great as a sales channel.
For example – Facebook is betting big on ecommerce, Twitter used to test ecommerce options (they’ve since dropped it) and YouTube partnered with QVC to set up live shopping. Pinterest is huge for ecommerce and their users spend 50% more than other users on online shopping. That is great news as Pinterest is more efficient into turning views to sales than any other social network. It works awesome for industries such as travel, home-deco and fashion.
What is the device you think customers use the most throughout the day? It’s the smartphone. Mobile usage has gone through the roof lately and it’s bound to continue.
So you want to be close to your customers. Mobile apps provide a special sales channel, one that’s personal and it makes impulse buying all the more attractive.
How do you add a mobile sales channel?
There’s an app for that. Actually more:
Shopgate makes it possible to turn your store into an app. It connects with Magento, Shopify, Prestashop and other ecommerce platforms to enable store owners to build mobile apps. It works on both iOS and Android operating systems and provides support for both smartphones and tablets. It also allows you to set up online to offline processes such as order online, pick up in store.
Shoutem is not built specifically for eCommerce but among others it supports building mobile apps for your Shopify store. The interface is quite simple and doesn’t offer many options but it gets the job done if you happen to be a Shopify user.
Give mobile apps for your store a try. The more smartphones become a part of our daily lives, the more we will use them. Your store can benefit from it.
So that’s that for mobile sales strategy for ecommerce beginners. Let’s step up your game with …
I know. The physical stores are dead and all. Except they’re not. People still like to see and feel products.
Pop up shops are temporarily stores, in the real world, where online store owners can showcase their products and interact with their customers. The pop-up shop sales channel has really taken off (with a bit of sudden drop during the pandemic but don’t mind that). Store owners have started adopting this online-offline connection. It’s effective, doesn’t tie you to a long, fixed cost and it allows you to get an upper hand, especially if you have a great personality. Which I bet you do.
(Adidas pop-up shop. Not exactly low-budget but hey – one can dream, right?)
Setting up a pop-up shop is a personal choice but works great if it’s posted either in a high-traffic area (such as a popular shopping center) or at an industry event. For example you could set up a pop-up shop at a home-deco event if you are a store selling home decorations. It is a great way to interact with customers and get feedback on your merchandise.
Companies such as Storefront help shop owners find retail space temporarily by connecting them with retail space owners. To help online stores they’ve put together an ebook that is free for download. I encourage you to have a look at it as it explains the main steps in setting up (pup-up) shop.
Last but definitely not least – the marketplaces. Amazon, Ebay, Etsy, Sears, Buy.Com, NewEgg.com and more. You name them. They provide lots of options to lots of users and chances are your next customers are there shopping right now. Now more than ever as many buyers are flocking to the online marketplaces to discover things they cannot buy in store anymore.
( Ebay – the original online marketplace )
Online marketplaces are key to ecommerce strategy for beginners. The reason marketplaces are the last on potential sales channels is because I want to emphasise just how important they are. Just like the “old” shopping centers, customers go to marketplaces because diversity means options and options mean they can find what they are looking for.
Diversity drives customers. It drives sales. So you want to be there but plan ahead before you dive in.
As an online store start-up you should be looking for as much exposure as you can get but still try to focus on the right marketplace. Amazon and Ebay key parts of the ecommerce strategy for beginners but before you join them, ask yourself:
are these marketplaces right for me? Not all that’s great is great for you. Just because they have traffic, that doesn’t mean you will get traffic and if you do, you don’t know whether that traffic will turn to sales. The most important aspects you should be looking for are exposure and sales.
can my product be found? expect to have competition. If you are among the few selling the product AND your product is popular, then the answer is YES, the product will be found by the customer. If your product is also sold by hundreds of other sellers, there are thin chances you will be the one showcasing the product. Part of your ecommerce sales strategy should be to make your product stand out. That means – make it look special and attractive through copy, media and of course, price.
will my product be purchased? If you have indeed managed to get customers to have a look at what you are offering, you must also get them to buy. Most important things are the way you showcase the product to create urgency and scarcity. Think of this in terms of sales strategy: “A beautiful hand-crafted lamp” is … meh. “A beautiful hand-crafted lamp in LIMITED offer” creates the feeling of scarcity and therefore urgency in purchase decision. P.S. – just to seal the deal – add a sprinkle of affordability (“just $49.50“).
do customers trust me? Marketplaces usually have some sort of peer-review mechanism. Customers can review sellers according to their fairness. Your reviews are your digital reputation. Positive reviews mean more sales, negative reviews can mean NO sales. So try to be as fair, effective and open with your customers.
Handling orders from marketplaces.
Part of the ecommerce sales strategy for beginners is making sure you can receive and fulfil orders. Listing your products on all marketplaces can seem like the right choice but it’s usually not. Each marketplace is a sales channel itself. You should be sticking to those that work for you and improve your experience there. Until your business is large enough to allow you to handle orders from more marketplaces, focus on fulfilling orders effective and quickly.
Most marketplaces offer some form of integration with your existing store and you should use those. If not native, there should be some plugins or products that make integration possible.
Product information should be going out of your online store and orders should be synced with your order management system. This way, the order management team can have a single point of entry for orders instead of getting lost in a dozen of order management systems scattered throughout the marketplaces you are using.
The big ones will get bigger
Marketplace orders will continue to be a large part of your business. You can be sure this is a cornerstone of ecommerce strategy for beginners. Marketplaces will become so large in the future that they will dwarf those from your online store. The reason is people tend to gather and shop where they will find diverse products and retailers. Just like in the real world. Online is even more so – marketplaces get even more traffic from search engines, have more money to spend on ads and are better at keeping customers returning.
Connecting sales channels – a key part of ecommerce strategy for beginners
Each sales channel you will be adding will bring you more exposure and more sales if handled correctly. The sales channels I’ve described so far are the most popular ones right now. But they are not the only ones. As technology evolves, so will commerce. Live shopping didn’t register as a trend until two years ago. New channels will pop-up and some I haven’t mentioned here will probably increase in importance.
Think about the impact Internet of Things will have. Maybe in the future the greatest sales channel for groceries will be smart appliances. Think of a refrigerator than can place orders for customers when it’s depleted. It sure is going to be an interesting challenge to integrate those in a sales channels mix.
Marketing – used by many, done by few, deeply understood by very, very few. You need to incorporate marketing and especially digital marketing in your ecommerce sales strategy, even if you are a beginner.
Marketing means first of all communication. Talking, showing, describing products to the people most likely to buy it.
It’s that simple. The basics need to be simple.
If you are going to survive as an online store owner, you need to keep your marketing basics simple. You have a product. Hopefully a great one. There are people who want to buy that product. Most don’t know they want to buy it from you. You need to show them why they should buy the product you’re selling. You need to show them why they should buy it from you. And then, if everything I’ve shown you so far has been decently implemented, just let them buy it.
Everything else is gimmicks. If you’ve got the basics right, everything else will fall into place.
Ecommerce sales strategy for beginners: find the right market
To get people to buy your product, you need to know who these people are, what they want and how they act. Most likely not everybody will want your product. But if you’ve done even a bit of ecommerce sales strategy for beginners, you will be in the upper percentile in your market.
Yup, your customers are “the target”. Why is it called that, you ask? Well, because your communication targets them. Until the internet became the norm and we’ve started gathering more data than we can handle on customers, we used to define them through demographics. That means basic info on consumers. Age, sex, marital status, location, education … this kind of data.
( Pictured here: advertising in the 60s – the Mad Men show. Not pictured here: Google algorythms and tabacco advertising ban )
These targeting methods were made popular when mass marketing was just blooming, in the days of TV, print and outdoor ads made by the likes of Mad Men. When you ran your ad in the magazine or on national TV, you needed to know who’s going to use your product, make sure you understand their psychology and shout from the top of your lungs how cool the product is. Once the ad was approved, there was no going back. Advertising agencies would research, create and test the ad before the campaign was launched because there was no way you could change, tweak or even pull back a campaign in real time.
So demographics were the bread and butter when you would push your message to the market. But the Internet changed that into …
Ecommerce sales strategy for beginners: Targeting behaviours
Basically, if you were a mid-class urban wife with no college education in the 60’s there were slim chances you would receive ads trying to sell you repair tools for your car. Even if you were actually a mechanic. The same would hold true if you were a man and would be looking for a sewing machine to fulfil your lifelong passion of becoming a fashion designer.
You would have to find those products yourself. We’ve come a long way and thankfully, we now have the freedom to fix our own cars and sew our pants, no matter the gender. Note: we should make this better.
Big changes in sales and marketing strategies started being needed when contextual marketing (the ads you see when searching on Google), interactive advertising or behavioural marketing hit the … shelves (?).
The last one, behavioural marketing, is probably the single most important aspect in online retailing. Technology now personalizes marketing and responds to customer behaviour.
For example Amazon’s recommended products (“See what others have purchased”) is a form of behavioural marketing that is based on a complex research on previous customers behaviour before they purchased something. Simply put, when people would purchase something, their interaction trail (the products they’ve seen so far) becomes an indication that people taking the same or similar steps would most likely purchase similar products. This is called a recommender system (or recommender engine). It’s kind of a big thing in our world today.
The ads you see on Google feature a similar concept. They are shown as to answer your needs. Some ads respond better than others at what you are looking for and thus have a better chance of getting clicked. Google trusts this system so much that they invoice advertising on clicks, rather than how many people have viewed the ad.
In terms of sales and marketing strategy we went from effectively targeting people to targeting people’s behaviour. Still, demographics and customer profiles are very important and a lot of what you will be doing is to try to guess customer responses based on demographics assumptions. Such assumptions might mean you will favour ladies over men if you are selling women’s clothing (doh!) or rather more complex assumptions such as “Men over 32, employed and married are more likely to buy a family car”.
Indifferently of your assumptions, test them and always quantify your results with …
How to use analytics software in your ecommerce sales strategy?
Here you go … numbers. Charts. Estimates. Hope Miss N., your math teacher, was your favourite back in school, because this is going to be damn complex. Nah, just kidding. Most analytics software is pretty much plug and play and the numbers and charts I mentioned are usually generated on the fly and in such a manner you can easily understand.
You can’t have marketing without analytics and research. Fortunately, it is a lot easier now for a small online store than it was 40 years ago for the largest companies in the world. What is not so fortunate is that it’s easier for everybody so you’ll have to dive deep and understand what your analytics are saying. So will the competition.
Once you have installed Google Analytics or one of these other ecommerce analytics software, you will probably dive in and see what your customers are doing. What you will want to look for is patterns that lead to increased sales. Patterns are key in ecommerce sales strategy for beginners (and advanced) retailers. Special products, a certain type of copy, products featuring media versus those that don’t have media. Look for what makes your sales increase.
Targeting, knowing, marketing – the most important ecommerce marketing strategies for your online store
So you know the target, you have the analytics figures, now it’s time for the actual marketing. The web is full of resources to fine tune your online marketing understanding. I will show you which are the most effective ways of marketing so you will have a bird’s eye view on what makes an online store sell.
Search Marketing: SEO
As a startup there are really little things you can do better with smaller budgets than writing quality content and optimizing for search engines. SEO (Search Engine Optimization) is a really large concept and many people earn their living through SEO services. You will probably ask a SEO expert to help you find the perfect balance so your store will show up in search engine results. But before you do that, have a look at the basics. These are the things you will need to keep in check so Google will bring the right customers to your store:
content: write great and extensive content. For humans. Describe your product like you would want it described for yourself. Don’t do “keyword spamming” which is the result of cramming keywords in your description so more people would find you. It just doesn’t work that way.
code: your ecommerce store is visible on customers’ browsers thanks to programming languages that output information in the way we are accustomed to. Search engines index this information and if you are to have your store indexed properly, you need the right code. If you are not technically savvy, better call someone who knows what they are doing.
links: get other (relevant) websites to post links to your store. This must count as number one when it comes to SEO in any ecommerce sales strategy for beginners. Links are the key for search engines (aham…aham…Google) to rank your website.
Ask your customers to leave you their email address so you can update them on news and offers. This is a great way to get people right back on your store.
But don’t annoy them and don’t do spam! Everybody hates unsolicited email. Make sure your customers give you their permission to send them emails. You can use apps such as Mailchimp or CampaignMonitor to save customers’ emails and then send them newsletters.
Social media marketing
Where would you go if you were to market a product? The answer is fairly simple: where people gather and interact. Social media outlets such as Facebook, Twitter or Pinterest are now used by billions of people. That’s where your online store should be.
Just like interacting with friends, some things work better than others. Here are some tips on how to use social media to interact with potential and existing customers:
listen first, talk later: social media is a great place to gather insights on your market, your products and even your brand. Some of those insights may not be friendly but you should pay attention to them nevertheless.
focus on building strong bonds rather than gathering masses: it’s just like with your friends. It doesn’t matter if you have 10 or 10 000 friends. What matters is how strong your connection with said friends are. And probably you will not reaaaaly have 10 000 real friends. It’s better to have few, engaged fans rather than many fans that do not relate to your brand or product.
find the influencers: some people wield more influence than others in their social circle. And they somehow do it naturally. You should get close to these people, develop relationships with them, show them your products and share content they might find interesting.
provide value, not sales pitches: yes, your products are great but don’t bore people with constant product sales. Provide content. If you sell hats, show fans their history, tell them about the manufacturing precess, showcase famous hats. Make it interesting and valuable.
be patient and constant: don’t tweet 40 times one day and than stop for a month because no one followed or retweeted you. Social media success takes time, patience and constant effort.
If your social media strategy is not going the way you’d want it to, there are always the ads. Most social networks provide ways for you to get closer to your potential customers, faster. Most people call them ads . Facebook, Twitter and Pinterest – they all provide advertiser with the possibility of engaging fans through ads.
And speaking of ads, one of the most effective way of advertising your store and products is …
Using paid search as key driver in ecommerce sales strategy for beginners
Remember those Google ads I’ve mentioned earlier? That is Google AdWords, a very effective form of advertising that places ads on search results, ads that are directly related to your search.
For example, if you were to search for “cars”, you will be shown the natural search results AND special search ads. These ads are fuelled by advertisers that pay each time someone clicks one of their ads.
You can be one of those advertisers. By carefully analysing traffic and allocating search ad budget, you can determine with high accuracy the number of clicks you need to convert visitors to buyers. Because search ads are contextual, this means you can optimise your ads in such a way that only those interested in purchasing your product might click it.
However, paid search campaigns are usually better managed by professionals. Even though you might spend a little extra for someone to handle your ads, just leave it to the professional.
And one more thing: Google is not the only one providing the option for paid search ads. Bing does it and so does Amazon.
Performance – well that sounds nice. What is it?
Performance marketing is a broad term that means advertisers pay a fee depending on how well an action is performed. This action can mean showing an ad a certain number of times or making that ad transform into a special action. The standard actions you might want to encourage are:
downloading a certain file (say a product catalog )
showing interest in a product (the user becomes a lead)
buying a product
And because marketing people happen to love acronyms, you might find the info above coded in three-letter words:
CPM means Cost Per Mille (that’s Latin for thousand) – one thousands being the standard minimal block of ad views you can purchase to show an ad.
CPA means Cost Per Action – the generic code for any action you might define with those selling the ad space. It is used for sales and therefore sometimes referred to as Cost per Acquisition.
CPC means Cost Per Click – the cost you will be paying whenever someone clicks on your ads
CPL means Cost Per Lead – the cost paid whenever a visitor shows interest in your product
Performance marketing is sometimes used interchangeably with affiliate marketing. That is more of a misconception, as affiliate marketing, though popular, is a subset of performance marketing. It works as a shared revenue deal, where the retailer shares a portion of the revenue with the publisher (the one displaying the ad), whenever advertising turns into purchases.
Which are the major affiliate marketing sites?
Affiliate marketing is a very important part of any ecommerce sales strategy for beginners. Affiliate ads are ran through affiliate marketing services. These cover three very important aspects: they connect advertisers to publishers, they make sure all sales are registered and attributed to the right publisher and they handle transactions between advertisers and publishers.
If you decide to go along the affiliate marketing path, here are the most important affiliate networks that can help you sell your products:
CJ Affiliate (formerly Conversion Junction) is the global leader in pay for performance programs. It is the home to many publishers that can help you run your ads.
Rakuten Advertising is the big contender to CJ Affiliate and a fast growing one.
ShareASale is a great affiliate marketing resource for retailers. Slightly smaller as it may be, it is still very effective.
ClickBank works great for entrepreneurs and content creators. It is effective and easy to use.
2Checkout is another fast growing performance marketing company that’s focused on software and digital products.
Using Comparison Shopping Engines to get in front of your customers
A great way to get your product out there is to place it in comparison shopping engine. These applications gather information from more online stores and show potential customers what is the best way to shop in terms of pricing.
It basically works for those that are price competitive so before you join such a program, make sure your prices are aligned with the market.
(Shopzilla is one of the most popular comparison shopping engines)
Most comparison shopping engines are CPC based and you will pay anytime people click your products, arriving at your web store. The top four most popular are Google Shopping, Shopzilla, Shopping.com and Pricegrabber. Getting listed can draw targeted traffic and can mean a very scalable way of converting traffic to sales.
Other marketing options
So there you have it – these are the most effective ways you can market your new online store. This is the start of creating an amazing ecommerce sales strategy for beginners. But don’t stop here, don’t settle. Marketing in the digital world is usually a matter of imagination. Be curious and try new things that might be fit for your online store.
For example you can attract relevant bloggers to mention your store and review the products. You can put out press releases and talk to the media. You can run contests and sweepstakes to increase reach and turn fans into loyal customers. Once you have the basics up and running, you will be ready to add more and more marketing options to your online store.
Testing and optimising your ecommerce sales strategy for beginners
Remember: your work is never done. If you want to keep your customers happy and sales growing, you need to constantly optimise and tweak your store. To do so you can run tests that determine what works and what does not. When testing you will be looking for either errors, bottlenecks or usability issues. Do so through:
Functional testing: test your store’s functions. The navigation, user account, user login and others. Each needs to be thoroughly tested and improved
Process testing: we are talking business processes here. These are things like managing orders, fulfillment, shipping or warehouse management. If your company process don’t run smooth, customers get their orders delayed, mixed or canceled.
SEO testing: as I’ve mentioned previously, search engines will always be a very important factor in driving traffic to your online store. Check to see how you stand against competitors and against previous positioning.
Mystery shopping: put yourself in the customer’s shoes and see how’s everything going. Place an order and see how operators behave, how long does it take for the order to arrive and more. You might find some interesting things there.
Hot areas testing: some parts of your shop are more important than others. You can improve conversion rate through a careful inspection and recurrent A/B testing of what you could call “hot areas”:
Forms requiring customer input
Customer journey maps
A great way to see how customers interact with your company is using customer journey maps that help improve customer experience. These “maps” show your existing sales channels and how customers interact with them. Customers may find you on social media, browse products on the web store and place orders through the phone. This is a customer journey map.
When these journey maps get too complex you have to constantly test and look for signs of problems of sources of frustrations for your customers. It may be a poorly designed checkout cart or the voice of your phone operators. By understanding your target customers and their journey maps you can have a guide to testing what works and what doesn’t on your store.
Testing means improving and you should strive to make your store better and better. Little improvements and constant focus on making the customer experience better turns your store into a success. So keep testing :).
This is your basic ecommerce sales strategy for beginners
Wow! If you’ve managed to get this far I believe you are ready to start your own store. Give yourself a pat on the back for having the patience to get through all this data. It’s not easy, I know, but it is a lot easier than just starting a store and then figuring it all out along the way.
I am more than happy if I’ve managed to help you on your path to becoming an ecommerce entrepreneur. If this guide was useful to you, please refer it to someone else who may be in the need for know-how.
You’ve taken a large step ahead to running your own business and online store. You may be anxious and a bit scared but rest assured. So was Jeff Bezos when he started Amazon. Knowledge, hard work, innovation and persistence will get you far. Have a safe trip in reaching out for your dream!
“Bitcoin doesn’t matter” is quite a statement when the price jumped from $37k to $44k in one week. But hear me out.
I see three things that are governing our society. It’s been the same for the whole recorded history.
This things are power, debt and value.
Power is what a nation state uses to coerce its citizens into following (fair or unfair) rules. It keeps the world in a relatively ordered state. It comes in the shape of laws and regulations, police or military action, institutions.
Debt is arguably the single biggest driver of how the economy shapes the society. It’s not the money, it’s debt. Debt owed to your bank, your government, your peers. It comes in many shapes or forms. You might find it in concepts as credit, duty, return on investment, even money.
Value is what us humans provide to other humans. It’s the product of our creativity and labour. It comes in the shape of the products, services and culture we’ve built for one another.
Power, debt and value are quantified in many ways. Usually, one is quantified in the form of another. Power earned can be exchanged for units of debt (money). Debt can be covered in units of value.
Rather recently, with the downfall of monarchy and rise of the bourgeois, value provided could be transformed into power, to a certain degree.
Power, debt and value are the concepts we all share and trade. It doesn’t matter if we quantify them in dollars, yens, favours, goats or bitcoin. What matters between all of us is how much of these things we are worth.
Power is a vague and hard to define term. However, this scene in Game of Thrones might help:
What you can see above is an example of what has ruled our world for a long time. It still does. Power in the form of expressed or implied violence. Either through direct speech, as Cersei states above, institutions (“of power”) or geopolitical relations.
For a long time I believed in the idea that money emerged as a means to trade goods. When we think of the inception of money we often picture some middle ages worker, maybe a blacksmith or a shoemaker, trading goods with a farmer. One awkward negotiation might appear – how many goat skins is a pair of boots worth?
The shoemaker and the farmer go back and forth about the parity between goat skins and boots. They might settle it but what happens when a third variable enters? Like a sword made by the blacksmith. What’s the parity between swords, shoes and goat skins? What happens when you add hundreds or thousands of other wares?
Well – here’s a bright idea if you’re a 19th century economist in the British empire: people found a common denominator and traded in that. Like … gold. Or coins.
But it seems that’s not the case. In his brilliant book Debt – the first 5000 years, the late anthropologist David Graeber argues debt came long before money. Debt and credit units were the first forms of “money”. Debt made and destroyed empires, brought us slavery in its many miserable shapes.
Graeber argued we live in a world that is still ridden with indebted serfs in developing and developed countries, who’s main reason of getting up in the morning and doing a job they may hate is a form of implied or express debt and society’s pressure to fulfil this debt.
However you feel about power and debt, they have indeed shaped our society. For most of our recorded history, they were the only tools you could control the world around you. They were also restricted to a select few. The nobles, the bankers, the priests.
Then came the Magna Carta outlining a world where everyone played by almost the same rules. It started as a way of making peace between an unpopular king and his barons. Still a pretty elitist thing. But it spread to include the masses and lead to the wonderful place in history we are living in now: the democracy.
The industrial revolution and protection of intellectual property handed even more rights to everyday folks that were unlucky enough to not be nobles.
You could have an idea that improved the lives of others, put it into reality and build yourself a better life than all your ancestors.
This lead to inventions, and industrial age and the rise of those that could bring better goods and services to their fellow citizens. It helped build capitalistic enterprises where the one creating value could be in no connection with networks of power or debt. It still relied on them but they were not prerequisites.
We then ended up with computers, the internet and AI and spaceships built by people that couldn’t chop off your head. These people called entrepreneurs rely on debt to finance their ideas rather than using it as an instrument of control. Because now, the value you provide to the world really matters.
There’s many ways you could define Bitcoin – a social perspective, an economic one, a political one. My favourite is that it is a decentralised quantifier of value.
My early childhood was spent in a communist regime, in the Eastern block of Europe. At that moment owning one dollar meant you were prone to investigation by the institutions of power of the state. Why do you have a foreign currency? Are you trying to topple our glorious economy by undermining our glorious currency? Do you not think our glorious nation is the best ever?
But the regime failed. It was not toppled. It just failed. It couldn’t provide enough value for its citizens. Its “value” was fake. It was worth whatever the central authority said it was worth. And this was bad. No central authority should tell you how much your work is worth, right?
Enter the mystical figure of Satoshi Nakamoto. Legend has it he (or she) came down from the bits and data heaven and handed us the secret to decentralised transactions. Bitcoin. The more people used it, the more valuable it was. No one controlled it, except if they owned 50% of the computing power that managed the system. Which was technically impossible.
Why bitcoin doesn’t matter?
Today, blockchain(s) hold hundreds of billions in value. They’re the next big thing. They will change the world. Those that don’t own bitcoin will starve and die a slow and painful death.
Except they wont.
Because they don’t hold formalised power. They don’t handle debt. However, they do store value.
This is what matters. If Bitcoin, or any other blockchain based currency will rule the world one day, that’s a good thing. But it probably won’t change how much power you hold, how your debt is handled and how much value you put in the world.
If you provide value, this can easily be translated into any currency.
If you own or owe debt, this will still be expressed in some form of currency. Centralised or decentralised.
As online and offline commerce are getting closer to each other and customers schedules are getting more and more crowded, pick up lockers seem to become more useful and popular. Ever asked yourself – how do pickup lockers work?
Listen to this article below:
They are versatile, easy to use and something customers need from online and in-store retailers. So let’s dig in and see how they work and who should use them.
What is a Pick Up Locker?
First off – what is a pick up locker? Simply put it is an area of lockers where retailers can drop off merchandise and customers can pick it up. Amazon has been a pioneer in this field, with Amazon Lockers opening up the gates to a new type of fulfilment.
The pick up lockers work by assigning a specific location to packages and sending pick up codes to customers. The customers can then go to their designated pick up location, enter the security code and grab their packages.
After Amazon has built their first experimental pick up lockers, others soon followed.
Some of those that developed their own systems of pick up (and ship) lockers are 3PL companies. For example FedEx and UPS have developed quite advanced pick up and drop off locations. UPS has named theirs “Access Points” and they’re building a network able to sustain growing demand.
FedEx has developed a network of “Ship&Get Self Service Lockers“. With their lockers one can drop off items for shipment or receive packages.
Both are growing really fast and soon others will follow suit. Even startups have ventured in this area with some highlights being Swapbox, an Y Combinator startup and Bufferbox, a company that was recently acquired by Google. However, due to the fact that this is a very competitive, capital intensive niche, both startups are now dead.
So yes, they are popular but how do pickup lockers work, especially from a retailer point of view?
How do pickup lockers work for large retailers?
One very specific use case for the pick-up locker system would be large retail chains. For example Walmart announced their Grab & Go lockers following their Site to Store Self Service Lockers experiment.
Apart from the internal fulfilment challenges, retailers need to focus on some key aspects regarding the development and implementation of such pick up locker systems:
1. How can pickup lockers be secured?
For obvious reasons there needs to be a secure access to shipped goods. To do so each drop off will have to issue a security code that can be decrypted and accessed with the private code the customer will receive.
The systems will also have to have fall-back security systems such as video surveillance and locking systems in case of hacking attempts (there will be some).
Security code should work online but also have a fall-back local solution that can work in case internet connection is off.
2. Connecting the lockers with logistics
The pick-up locker system works with other fulfilment operations and will have to input status data directly into TMS (transport management systems) so shipping personnel could be directed to the correct pick up locker area and the specific pick up locker.
As packages differ in size, specific information regarding the type of lockers that are available should be available in real time so packages are stored correctly.
3. How do pickup lockers communicate?
So far most pick up lockers use alphanumeric codes to help users get accustomed to picking up their packages without any hassle. But these codes pose threats in terms of security. While these codes can always be an option and can be easily sent to any device, with smartphones and smartphone apps on the rise, some other solutions may work even better.
One such option would be QR codes embedded in the retailer’s mobile application. The codes can be generated on the fly based on a secured algorithm that neither exposes the code and can also work within the application the customer already uses, thus improving loyalty.
4. What is the future of connectivity for pickup lockers?
With so many developing their own pick-up locker systems, a connectivity protocol should become the norm. With such a protocol FedEx could ship to either Amazon, Walmart or even UPS lockers for example, improving cross-retailer experience and creating economies of scale.
That being said, the development of pick-up locker systems is obviously a bit more complex than these few paragraphs but I wanted to give you a starting point and explore some of the challenges.
As the world is increasingly consuming more and more streamed content, events have shifted towards the virtual world as well. To make virtual events happen, professionals need virtual event platforms. Here’s the top 5.
As the world is increasingly consuming more and more streamed content, events have shifted towards the virtual world as well. To make virtual events happen, professionals need virtual event platforms.
As demand has increased – so has the supply. With so many solutions out there, we’ve tested the most popular ones and came up with a short list of 5 that we recommend. Below you’ll find the top 5 recommendations, with a brief intro, pros and cons.
With many of us working from home, there is no wonder why Zoom became such a popular video conferencing tool. It is one of the leading video conferencing software apps on the market. It allows employees to virtually interact with their colleagues when in-person meetings are limited or restricted. It has an integrated live chat feature and it allows users to record video and audio sessions to view later. Zoom is considered the most popular video conferencing solution for companies with 500 employees or fewer, and the second-most popular solution for businesses with over 500 employees.
Unlimited one-on-one meetings – Users can spend as much time as they want, without any costs involved when conducting one-on-one meetings
Screen sharing feature – This built in function enables users to share their own screen during live calls. This way, participants can easily understand what is presented.
Participants don’t have to create an account – In order to join a meeting, a Zoom account isn’t required. The only person that needs an account is the one sending the invitation links to other participants. However, it’s still important to have your own account in order to keep track of appointments and begin to host your own meetings.
Unpredictable video quality – According to many users, at times, the video quality on Zoom can be blurry and pixelated.
40 Minute free video chat limit on group meetings – If you plan to host a meeting with more than two participants, the duration of the call is limited to 40 minutes. To avoid that, users need to subscribe and pay a monthly fee.
Security vulnerabilities – Even if Zoom employees are currently doing their best to solve this issue, it still seems to be disturbing for many users. It seems that random people would show up during video conferences, disrupting attendees with offensive content. Users with free Zoom accounts can avoid this by using a password for all meetings.
Streams.live is an innovative video-streaming platform designed to transform social distancing into an opportunity. it works great as a virtual event platform. It brings in features of traditional event management software and it enables content creators and entrepreneurs to easily monetize their work in a virtual environment. The cross-platform functionality enables hosts and viewers to access their passions from any device. The video stream can be fully customized from a simple logo detail to full background customization and viewers can participate in two-way conversations, thanks to the available engagement tools (claps, live chat, live polls and direct messaging).
Paid access to streams – This feature might be the key differentiation between other streaming solutions. Content creators can simply monetize their hard work virtually. By purchasing a ticket, virtual attendees can simply input the ticket code and get instant access to paid content.
Live Stream Shopping – This feature is designed for businesses that seek to sell their list of offerings in a fun and interactive manner. Viewers can purchase presented products, without leaving the streamed event. Also, the chat room enables viewers to ask product related questions in real time.
Instant payments – With more than 135 currencies and 57 cryptocurrencies accepted, content creators don’t need to wait for their money. Streams.live has well-established partnerships with Stripe, PayPal and Crypto.com.
Only the host can stream video – Since this is a solution designed for content creators, as a viewer, streaming your own video is not an option. However, the engagement features (live chat, polls, direct message) allow viewers to interact with one another.
Onboarding process – Some users might need to go through an onboarding process to fully understand the variety of features available. However, online and phone support is available 24/7.
Part of the Adobe Acrobat family, Adobe Connect is a web conferencing software used for organizing virtual meetings, webinars and training sessions. Meeting rooms are organized into ‘pods’ and each pod is designed to perform a specific role (chat, whiteboard, note, etc.). Adobe Connect is meant for Learning, Webinars and for Meetings.
Audience engagement tools – During conferences or online meetings, participants have several features that allow them to interact with one another. Among these features, this solution come with things such as live chat, integrated survey/quiz tool, a digital whiteboard and viewers can also share files during a call.
Participants can record calls – This build in function enables viewers to record calls (audio/video sync is lost if exported to MP4) with the host’s permission.
Virtual room design – This feature enables organizers to design their own virtual room for a more realistic experience. It can be customized with layouts, pods and content and it can be saved for further meetings.
Complex software with no personality – Some users consider that further support is needed to use the software at its maximum capacity. Besides that, the interface feels very corporate and impersonal, with white and grey colors.
It’s a bit pricey – Pricing information is limited on their website, but users seem to consider this solution a bit overpriced.
Cisco Webex products deliver collaboration tools, such as online meetings with integrated chat and file sharing features. This cloud-based suite of productivity tools consists of WebEx Teams, WebEx Meetings and WebEx devices. It is used for both small group collaborations and enterprise-wide deployments. For a clearer idea, here are the key offerings provided by WebEx: video conferencing, webinars (up to 3000 attendees), training sessions (instruct through a digital whiteboard and charge for your training), remote support (real-time service for customers in need) and cloud calling.
Cross-platform functionality – Users can attend meetings from any device. Being a laptop, a tablet or a smartphone, participants can connect from anywhere as long as internet connection is not an issue.
Branded devices – The Webex devices are optional and include tools designed for a more efficient team collaboration. For example, the Cisco Webex Board is an all-in-one conference device capable of sharing live presentations with a broad audience.
Large-scale virtual events – This feature enables users to host large-scale virtual events for geographically dispersed audiences. It supports up to 3000 attendees in a single event and up to 1000 on video.
Limited customer support – For the free and starter plans, customer support is limited. The free plan only provides online customer service options, while the Starter plan requires users to call a representative during regular business hours for support.
Internet Explorer as default browser – Webex is designed to work at its maximum capacity on Internet Explorer as a browser. For those that would rather use Firefox or Chrome, additional setting are required before clicking on a link shared through their software.
WorkCast is a platform that provides solutions for webinars, webcasts, and virtual events. This cloud-based technology enables organizers to accommodate up to 50,000 attendees. It has a good reputation for its branding capabilities, designed to have an end-to-end event experience that looks just as good as a website. Since its foundation in 2008, WorkCast has run over 8,000 events for more than 1 million attendees across 20 countries.
Excellent support – Users are very pleased with the responsiveness of the WorkCast team and their innovative solutions to accommodate special request.
Easy to customize and onboard sponsors– The branding and customization features are user friendly and enable sponsors to get the right amount of exposure in a virtual environment.
Virtual open days – This feature enables educational institutions to present their university grounds to prospective students.
Regular updates – Even if these updates are made to deliver better experiences, users need to get in touch with a representative to find out how new features work.
Test events before going live – Users testify that they were better off with a couple test events in advance.
Ever thought what happens behind the curtains before a new product hits the shelf? Or what makes customers decide they love product A but definitely hate product B, although they are almost identical? Or what makes great products … well … great?
Many have and there is no clear answer to these questions. What works when Apple launches a music player may not work when Microsoft does it (Remember Zune?). There are many variables involved and no matter the size of your R&D budget, sometimes things are not going to go right.
But there’s only one way to see if the product is really fit for the market. That way used to be simple and a bit risky. Teams including marketing, product development, engineering and manufacturing experts would dream, design and build products. They would test the products on selected customer groups and if the results would look good, they would push the product to the market.
However even involving budgets, experts, consumer insights and marketing bucks, sometimes products flop.
Two things changed this: crowd-sourcing and crowd-founding. Together they’ve formed a type of customer experience previously unknown: the pretail.
Testing the waters with crowd-sourcing and crowd-founding
In the past, teams were involved in trying to guess what customers would want. Now we can just go ahead and ask the them.
Pretailing is a term describing any activity introducing customers to brands or products, before the retail process. It assumes that using crowd-founding sites such as Kickstarter, inventors and innovators can test their concept before involving big budgets. Essentially they are asking potential buyers to invest their dollar-power in their product.
This, in turn, creates an experience previously unknown to the consumer. The consumer is effectively buying into a vision. Pretailing creates a new type of sales channel that works before the product is even manufactured. Unlike traditional retail, this type of commerce can shed light on what the market wants at any given time.
Online stores such as Quirky, Threadless or Japan-based Muji have one thing in common. They use their communities to find the right ideas and products to design and develop. Quirky is focused on inventing cool gadgets, Threadless leverages its designer community to create t-shirts and Muji sells home&deco products designed by the consumers.
They all engage in pretailing. By tapping into the collective minds of their communities they can ask for the type of products most customers would purchase. Before they manufacture and sell, they ask what to manufacture and sell. This in turn creates a sense of belonging to the community for the customer. For the retailer, it decreases the risk of manufacturing and stocking up on lousy products.
Crowd-founding is another way of tapping into the market and pretailing. We all know Kickstarter but other, more product-oriented crowd founding platforms fare even better for this concept.
CrowdSupply is just one of the places where you can see what customers have backed before manufacturing. The products we can see there range from open source toothbrushes to one-wheel skateboards.
The results are amazing. With unlimited creativity comes an unlimited supply of innovation. And by tapping into a large market of early-adopters, only the products that are really fit for distribution get funded and survive.
Big retailers have picked up on the trend and are now using pretailing to test new products and improve their logistics to fit the estimated demand. Apple, for example is one of the companies that showcases products before they are available in retail stores, interacting with developers and customers to improve the experience.
Pretailing is a thing of the crowds
Beyond the crowd-founding and crowd-sourcing, pretailing can come from anything involving large numbers of potential customers. By tapping into online traces, retailers can get insights on potentially succesful products.
Pretailing can start with a simple research with Google Trends. It can be an analysis on the search trends on your own web store.
It can just as well be an overview of the most popular trends on Instagram. For example Crane & Canopy releases new high quality duvets basing their decisions on Pinterest and social media trends.
The conclusion is that in this highly competitive market, retailers need to engage their customers before they start the retail process. Pretailing means tapping into the wisdom of the crowds and extracting the perfect products before competitors do. It is not only a matter of product development but a matter of understanding the customer and providing the best experience on the market.
The term “robot” essentially means “worker”. It was coined by Czech author Karel Čapek in his science fiction work R.U.R. and since then it has become the standard term to define semi-autonomous machines.
It really is hard to define what we actually think of when we say robot. It may be an anthropomorphic fun figure such as Honda’s Asimo or a somewhat creepier animal version of it, such as Boston Dynamics’ Spot.
But it can also be a simpler and more applied machinery. Robots can be built to handle some of the most menial and repetitive tasks, including those that have to do with ecommerce fulfillment.
In terms of operations, fulfillment means everything that has to do with getting ordered merchandise to the customer. It includes picking and packing and let’s face it – it’s boring and repetitive. The robots below do just these things. Robots, unlike people, require no pay and are available 24/7. Whether using robots is effective or not, moral or not, it’s up to you to decide. But no matter your view on the subject, you have to admit they look awesome.
Fetch and Freight from Fetch Robotics make the company grow from less than 10 to more than 1500 employees in just 5 years
Back in early 2015, Fetch Robotics was startup company. They’ve received $3 million in founding and started working on a mysterious warehouse robotics project.
They’ve unveiled not one, but two robots aimed at helping warehouse staff make it through the long corridors. Their names: Fetch and Freight. Below is Freight, my favorite, a little guy following around picking staff and going back to base when orders are finished picking:
In 2020 they are beyond their Series C, with $94 million raised and over 1500 employees. Seems things are going great.
From 15 000 to 200 000 Kiva Robots in Amazon Warehouses in just 5 years
In 2012 Amazon paid $775 million for Kiva Systems, a Seattle based company manufacturing warehouse robots.
In just two years Amazon integrated the technology and in 2014 there were 15 000 Kiva robots doing the picking and packing job twice as fast as humans could. Inventory was moving twice as fast and products were delivered to packing stations in just under 15 minutes, faster than any human could.
We are at the peak of our civilization in terms of economic development, social cooperation and global communication. Though conflicts still arise and will probably exist for the foreseeable future, we are witnessing a historic moment: for good and for bad we are on top of our game.
This change has been made possible by a lot of factors including recent destructive conflicts and potential conflicts (nuclear destruction), improvements in communication technology, improvements in transportation and more.
But if we were to point out a specific factor in the emergence of this globalized society, that must be the fast evolution of organizational management tools and techniques.
Whether we are talking about multinational corporations, governmental or military organizations, they have all evolved due to technological and know-how management advancements.
Companies can now grow bigger than ever and governments extend their influence farther. Military organizations are now stronger and can perform better than ever in terms of logistics and operational management. According to prof. J. Bradford DeLong from UC Berkley, the estimated GWP (Gross World Product) is at its highest and growing the fastest:
So basically we are working better, faster, more productive and yet it seems the world stumbles from one financial crisis to another. Many theories have been put forward regarding as why this happens. These theories range from pure economic theory to sociology, psychology, geopolitics and more. Don’t be fooled – we don’t for sure know why this happens. It’s a paradox that we are more productive, fare better in terms of conflicts and have a more connected world and still we deal with inequity and financial strains in the form of huge debt.
But there is hope. Whenever humankind dealt with seemingly insurmountably issues, we appealed to metaphors to change our perspective. The metaphor I’m proposing today is the computer hardware – software ensemble as a way of thinking of human organizations.
How do organizations work now?
In this metaphor we have the human nature and human nature as the hardware and management acting as the software. With a combination of these two we were able to reach our present position.
Most of management theory and lingo are adapted from military procedures. As the military has been the single most enduring form of human organization throughout history (seconded only by religious organizations), it seemed logical to approach civil management in a similar way. The largest companies known are organized and behave just like armies. Top down command with intel going upstream and orders going downstream. The multinational companies “conquer” markets, “target” customers and “secure” market share.
As companies need effectiveness to stay profitable, strategy is designed by a small group of people (the board of directors) and implemented top-down by an executive staff. To do so – the executive staff uses company process design and procedures that are followed by those lower on the hierarchy.
This same principle was also used in the beginnings of computer programming. Programs were fed into computers to compute differential equations for things such as the trajectory of a shell, a blast radius or weather predictions. These programs were fed into a general purpose machinery (the computer) and based on these instructions computations would be made.
But as the computer industry grew, so did the computers’ capacity to run programs. With the digital revolution computers became more than simplistic machinery built to output specific data. Programs could be now written to answer mathematical questions but also to output imagery, sounds, allow users to play games and more.
To make this possible, a new paradigm in computer programming changed the way programs were written. Instead of the previous functional (procedural) programming, the concept of building a program started working with the concept of “objects”.
Technically, objects are a collection of data and functions. Conceptually they are the bridge between machine processing and human conceptual thinking. We are able to tell a fork from a spoon and still see the resemblance between those because we think in terms of “objects”. Previously programs were working mostly on concepts of functions. Simply put: If this, than that.
That made writing complex programs extremely hard. It also made maintenance even harder. Without becoming too technical, OOP (object oriented programming) allowed for even more complex programs to appear and made it easier for software teams to build, update and maintain these programs.
The difference, if you will, for those programs is the difference between the old DOS versions and today’s Windows OS or Apple’s iOS. It’s worlds apart and today we are in a DOS world trying to build video games.
The need for Object Oriented Organizations
Though it may seem strange to use software development lingo when it comes to managing organizations – it makes sense in the metaphor proposed earlier. Human organizations (the hardware) may yield a lot more than they do today. As robotics may soon take over menial jobs, they have to.
The problem does not lie in the hardware (human intellect, creativity and production) but rather in software (the ability to manage this creativity and productivity).
We are not fit to deal with this level of complexity in the way we do today. Think about the basic organizational challenges. They are not production or infrastructure related, but rather human complexity related. Someone from the headquarters of Uber may devise an absolutely brilliant software and business model, but they still have to deal in terms of organizational management with the fact that Paris taxi drivers hate competition. And the fact that the french government will not allow the company to function without the right permits.
To make such a global organization work, there have to be some type of new management technique in place. One that can use the managerial basics but still be able to develop specific procedures to handle cultural differences.
That’s exactly what OOP (object oriented programming) works for. Handling complexity through object manipulation.
So how would such an organization look like?
How to build an Object Oriented Organization?
To help you glimpse into the structure of a potential OOO (Object Oriented Organization) I will use the basic characteristics of a software object and translate those into organizational concepts:
The term (data) encapsulation points to objects being self-contained in terms of both data and functions. The object keeps the data and functions protected from outside (potentially harmful) interventions.
If you’d like to think of objects in terms of organizational objects I’d advise you to look beyond the usual “department” paradigm and rather into specific teams. Think of the product design team at Apple. That is an organizational object, that stores both specific data (things such as product specifications and test results) and functions (builds product demos, designs usable products etc.).
The organizational object could, in theory be self sufficient and usable in any part of the organization or even within external organizations.
The idea of polymorphism may seem complicated but it actually solves a lot of complexity issues. Simply put, it allows for contextual responses.
Take the previous Apple design team for example. If the iPhone development team were to ask it for a design it would probably forward the team the specs they are working on and receive a few sets of product designs. If the iMac team would ask for a new design, they would also forward the iMac specs. They will however, receive another type of design, one fit for their product.
The idea of polymorphism, in the organizational sense is that decisions based on context would happen within the design team object. Both the iPhone and the iMac team, or any other product design team could ask for a product design and receive something that’s fit for that specific product.
But let’s take that a little further: what happens if the marketing team needs a specific page covering the new iPhone. Wouldn’t the product design team be the one best fit to output such a page? Probably so, but some upgrades may be needed and this is where the third object oriented organization principle comes in:
This term shows that one object can be the prototype for another object. In our example we need Apple’s product design team “upgraded”. So far they have been doing product design so they may not be able to output iPhone’s webpage so well.
By building on their expertise, we may assign a new member to the team, a member that is specialized in designing web pages. By working with his or her team peers we will have built a new organizational object on top of the previous one. The marketing team will request a specific design, by forwarding some specifications. At this point all three external teams (iPhone product development, iMac product development and marketing) have basically done the same thing: asked for design-related work, by forwarding specifications to the the design organizational object. The work was done within the object and results were output successfully.
Notice also that there is no absolute need for management. Objects interact with one another thus leaving management in charge of developing these organizational objects and the overall purpose of the company.
Why build object oriented organizations?
The one big reason is complexity management. We have not put a man on the moon using the abacus. We have upgraded our tools to reach further. Object oriented organizations can be a new breed of organizations in different sectors where effectiveness rather than hierarchy is important. These areas can range from business to NGO’s to governmental agencies to banking and more.
Basically each organization that deals in large numbers of either employees or “customers” can benefit from a networked object oriented organization approach.
Why do that? Think about how today’s concept of having a job feels. Most employees report their bosses are awful. But it’s not that simple – it’s not that the boss just wakes up one day and thinks … “hey, I’m going to act terrible to my fellow colleagues”. Today’s managerial concepts and techniques are outdated and provide managers with poor tools.
This results in “less than perfect” working conditions, poor performance, organizational ineffectiveness and overall social tensions. With our current management system the world has grown more productive yet more indebted. Productivity has risen yet poverty stayed the same or increased.
The fact is we need a new type of leadership and chances are this too is a human problem with a software solution.
We expect historic changes to be a bit dramatic. We think of “Evrika!” moments when inventors discover new technologies that make our lives better.
The reality, however, seems to sneak up on us. We now know how important the Internet is but few would have guessed it when it was used to exchange short bits of information between academics. Same for Google – it is now easy to see how important having the global stream of information at your fingertips actually is. But it was a lot harder when the concept was still in its infancy.
Not even Steve Jobs could have predicted the impact the iPhone would have on the world. And I believe Elon Musk will look back on these days and be surprised by the changes Tesla brought to the world.
When Elon Musk announced the Powerwall, the world shook a little bit. Its beautiful design and promise of energy independence seemed almost dreamlike. But the Powerwall shows a far larger vision than just making the home energy independent.
It is a promise that we could harness the virtually unlimited energy of the Sun and store it. Storage, you see, is the real problem. The complex systems we use are powered by energy that is consumed almost instantly. Our cars, our electronics, our planes – they feed on streams of energy as it is formed. Even the best energy storage systems fail after a short while.
The batteries that can save the world
The promise that one day a company (could it be Tesla?) can find a way to harness and store the sun’s energy (or any type of green energy for that matter) has an impact we can hardly predict.
The implications range from pollution reduction to geopolitics to economics. Especially economics. To understand how much we could save by switching to green energy, have a look at this estimate for an average Tesla car compared to one running on fossil fuel:
Think that’s a lot? That car “only” logs 120 000 miles. Compare that to the 397.8 billion miles logged by all trucks used for business purposes (excluding government and farm). In the US alone.
Now mix the numbers and add the savings Tesla’s technology can bring.
Add something else: sun-powered electricity. Think of trucks and ships that can move goods around without any need for refueling.
Because that’s where the real change comes in. When products are manufactured and shipped at a tiny fraction of what they are today, everything changes.
When we take out the distribution costs, the energy costs and any other costs associated with energy from our current commerce paradigm, everything changes in the world.
The products we buy would have costs that would be driven to the ground. Without costs associated with energy consumption and storage, goods would be manufactured cheaper and faster (instant energy), shipped cheaper and faster and consumed by more. We could have cheaper products, consumed by more and believe it or not, more profitable to sell.
But how could the system change?
There is only one thing stopping this: the current transportation and energy system. Musk’s vision has already stirred things a bit with car dealers. What happens when the company will go against the global leaders in energy and transport companies, the ones still relying on fossil fuels? These companies would have to change or fight the change. The former is what one might expect.
That’s where the Uber concept comes in. Uber connects, as you know, smaller professionals that provide transportation services. Right now this is limited to personal transportation. Uber, today’s Uber, acts as a glorified cab dispatcher.
But tomorrow’s Uber may have bigger ambitions. Somewhere behind the scenes, investors know that there’s more to Uber than meets the eye. The reason the company landed a $41 billion valuation is that it has the potential to change the global transportation system. Not just personal transportation but all kinds of transportation.
That includes making sure goods are quickly moved from manufacturing to storage to the consumer. Don’t take my word for it. Uber has been experimenting time and again with logistics. And if Uber won’t, there are other companies that will.
So you have virtually unlimited power. You have storage. You have the a system that makes sure goods are sent to the right destination by the optimum freight. This means the kind of change we now can’t fully comprehend.
With the launch of its first digital edition of the annual report, L’Oreal steps into a new era.
The report is an impressive tool on its own, aimed at investors, shareholders and journalists. But the real change comes with the overall shift to digital as a tool to engage consumers.
For example, the “Digital” section of the annual report states just how important naming the first Chief Digital Officer actually is. This move shows L’Oreal as an up and coming major digital player. The company will probably focus on ecommerce, data technologies as well as engaging consumers both online and offline.
An example in the digital report shows just how promising ecommerce is, especially in China:
“In China – the world’s number one online-purchasing market(1) – e-commerce already accounts for 10% of L’Oréal sales, and more than 15% for brands like VICHY, LA ROCHE-POSAY and MAGIC(2). These promising results are underpinned by partnerships with online distributors like Alibaba and Tmall. On Singles’ Day, a very important day of special offers, L’Oréal’s brands performed well, particularly MAYBELLINE NEW YORK – the number 1 make-up brand in the country(3) – and MAGIC, which sold over 11 million face masks in 24 hours”
The shift towards omnichannel marketing AND ecommerce is spectacular. L’Oreal has traditionally relied on third parties to distribute products to consumers through retail shops. Could this shift be a change in strategy with a direct-to-consumer approach or will it be an improvement in dealing with online and omnichannel retailers? Nevertheless, the move will probably ripple trough and be adopted by others.
It may be a tectonic shift in manufacturers switching from traditional models to new digital models, engaging their customers, as well as providing them with the opportunity to purchase. How will this affect traditional partners remains to be seen.