With growth exceeding 22% in the first semester 2012 (compared with the first semester 2011), the e-commerce market is estimated at around 42 billion euros in France (source: Fevad). Suffice it to say that in a period of economic downturn, there are few other market segments that are doing so well. This success can be explained by the fact that the e-commerce business model, and more generally the distribution business model, is changing, which has a strong impact on the entire ecosystem of stakeholders, including software vendors and IT service providers.
Indeed, the maps are blurred because pure e-commerce players are opening physical stores and traditional distributors are setting up on the web. The low cost model of e-retailers is no longer enough for consumers who want a consistent and satisfying experience, irrespective of their interaction channel. “Omni-traders” not only have to adapt their offer now to new customer behavior (by providing horizontal diversification, a marketplace, etc.) but they also need to transform their information systems so that they will be agile enough to support these new requirements. The first challenge is, of course, business performance and securing competitive advantage. Thus, many retailers are working on evolving their infrastructure to support more powerful search engines, more flexible sites architectures, HTML5 developments to produce multi-devices sites, a higher level of treated volumes, or more intelligent navigation and personalized websites. It goes without saying that these infrastructures must deal with connected applications, like product information management (PIM) or media content management (MAM), ERP, CRM and other enterprise applications that will serve the site and enhance the products on the platform. These new requirements lead software vendors to adapt their solutions, especially since many small software vendors specialized in these subjects challenge the established mastodons who are therefore often forced to acquire specialists.
Major IT services companies are also challenged by these new needs since many micro-specialist software vendors also offer consulting and integration services around their solutions, especially in a SaaS mode, thus reducing the complexity of projects and the cost for end clients. This model is particularly attractive in a context of budgetary restrictions. Finally, digital agencies are the third type of player involved in this market. Originally specialists of web projects, they have extended their fields of action thanks to a service offering that is well balanced between business issues (marketing & communication) and IT issues (integration). These agencies are able to compete very seriously with large IT services companies.
Omni-traders can expect to maintain their competitive advantage, and win even more, thanks to a significant differentiation based on smart investments in their information systems. Meeting these challenges also requires a change management with internal business teams to break the idea of cannibalization between channels, while omni-channel issues boost overall trade.
Post by Aurore Goncalves