Why data will be the key to success in the global e-commerce boom
BY OMER FAROOQUE
Everyone is looking to solve data management problems in the digital age. This article helps answer the core questions of what makes e-commerce tick across the globe, especially around helping clients understand why data must be wielded as an enterprise asset in order to win in the digital age.
“Six billion shoppers” by Porter Erisman is a must-read for anyone who is either empowering, enabling or realising digital transformations within their spheres of influence. A few noteworthy messages from the book are that one size doesn’t fit all. What works for e-commerce in North America won’t automatically work in the rest of the world. Even though Amazon is big kahuna in the United States, dismissing the likes of Alibaba as copycats and not taking them seriously is being downright narrow-minded and ignorant. The reasons for this is that China is now the biggest and largest e-commerce market in the world, spending nearly 2.5 trillion Dollars online. That is 3.5 times as much as the United States. The current figures of 575 million online Chinese shoppers, which account for 60 per cent of worldwide sales, only represent about half of the country’s population.
So, the room for growth is huge. E-commerce in China represents about 14 per cent of total retail sales in the country, compared to the 8 per cent in the United States. By the year 2020, this number is estimated to reach 21.5 per cent of total retail sales in the country. While Amazon is focused on “selling everything” to the B2C market, Alibaba started out creating a B2B market place where buyers and sellers were free to engage openly and without transaction lock-in to Alibaba. This is one of the main reasons it survived and became the formidable internet behemoth in China it is today, resulting in the 25 billion Dollar IPO in 2014 – the single largest in the history of any company.
E-commerce started in the US to kill old retail incumbents refusing to change. In the emerging markets, it’s proving to be more creative than disruptive by creating opportunities that otherwise would not have existed. In fact, the digital age could be the magic wand that solves world poverty by creating opportunities where none existed for the past millennia or so, for entire classes of people who were stagnating, with no way up or out.
Applying business practices, technology and data to disrupt and solve the needs of the digital consumer is a diverse and nuanced problem that’s characterised by social, economic, infrastructure, environment and mobility levels. What needs to be done in each of these countries and regions within or across borders must rethink or evolve how a business problem is tackled today. Just like Jack Ma, CEO of Alibaba, set out to do with his open marketplace to connect sellers and buyers in the B2B market in China. The ones who succeed are the ones who have figured out which situations are ripe for disruption through the data first capabilities.
This brings us back to why all this is relevant in succeeding at your digital transformation. With the example of products, it is better to understand what this means. To engage with your digital customer, you need to understand their methods of consumption, and gear products or services and, more importantly, the content or data that will be used to engage. This differs from market to market around the world. Access to the internet outside of the US and Western Europe is for the most part largely through mobile phones. Most may have not ever interacted with a traditional computer in their lives. How should content and or data be organised and delivered to this audience? The screen size on an average Chinese smartphone, for example, is larger than the phablets in the US – meaning the target user base actually expects rich and engaging media to interact with the offering.
The quality, bandwidth and throughput of the internet connection also cannot be assumed to be good or consistent. What kind of variability would the data management solution need, and can it adapt to the various contexts, such as time of day or unplanned events?
Another difference is the modes of engagement. Why is e-commerce more social in China than in the US? How to engage with customers based on social data? Can this be used as an input signal to be context-specific or targeted? For example, social commerce in China is way ahead of anything people in the western world are familiar with. Case in point, the Wechat ecosystem which is Facebook, LinkedIn, Zynga and Twitter with content, commerce and community, all seamlessly integrated into one.
Then of course there’s the ownership of data. Between GDPR in Europe, the privacy laws in China and the ones being enacted in other markets – suffice to say this is becoming one of the hottest topics and challenges. What processes, tools and technologies does one need to even assess where they are with this, much less answer the question “are we compliant?”
The last point is the mode of deployment. Germany, for example, requires that any business engaging with its citizens has the systems deployed on their sovereign land adhering to their policies and laws. China has something similar yet constantly evolving, hence making it harder to comprehend. Similar patterns in other countries are coming, and soon. What and how should the data management solutions be able to adapt to whatever gets thrown at them? More importantly, what should we not do today?
The answers aren’t in a “one size fits all” or “copy Amazon or perish” philosophy – if anything, this will neither work for you nor will it be rationale for customers to increase engagement in a global or regional arena. If this has created a sense of urgency and anxiousness – don’t worry, that’s a good thing. If anything, we will find there are different ways being pioneered in each market catering to their specific needs and nuances – it’s imperative to assess these as opportunities that can be leveraged. The approach to one market may make some do things that they have never done before, and that’s a good thing.
Riversand is an innovative leader in master data management and is leading the next generation web scale MDM solution offering using big data, NoSQL technologies, functions such as dynamic governance, adaptive workflows, comprehensive user experience and more. Riversand provides a uniform, integrated, scalable, and robust MDM platform that caters to a variety of uses across multiple verticals, from small to very large enterprises.
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100 days in the new job – The Produktkulturmagazin spoke with Ben Rund, the new General Manager DACH & Eastern Europe at Riversand.
Mr Rund, you have now been on board at Riversand for 100 days. How are you? And, as an industry insider, why did you go to Riversand?
Quite clearly, I lost my heart to the topic of MDM/PIM many years ago, and I’m pleased to have participated in the development from “PIM, what’s that?” to “we need good data for our digital business.” I am doing splendidly because there are two important aspects that converge at Riversand. First, there is the platform that keeps our customers future-proof in an era of real time, cloud and big data; and then there is the opportunity to shape this personal opportunity.
What do you say to people who ask if Riversand is represented in Germany or anywhere in Europe?
That is a fair question. Riversand has long been focussed mainly on the very large, North American market. With the largest Series A funding in the MDM market in 2017, we now intend to position ourselves firmly in Europe, and in the DACH region especially. New offices are set to be opened in the Stuttgart and London locations. We are also doing a great deal of hiring in Professional Services, Solution Management, Sales, Pres-Sales, and Marketing. We are looking for colleagues who forge new paths and who are able or willing to deal with new technologies.
You also take care of business development in Europe. What exactly does that mean? What is your focus?
Yes, that’s exactly right. I oversee the expansion of our partner network in Europe. This network consists of global service integrators and regional implementation partners, but also complementary software solutions. Added to this, of course, are also regional influencers and analysts. The most important factor for our growth are well-trained partners, because this is the only way to ensure satisfied and successful customers.
Which implementation partners can Riversand rely on, particularly in the DACH region?
Advellence and Tata Consulting Services have been partners to Riversand in the region for a long time. I am very pleased that we will now also be working with PwC and Parsionate. At the European level, we have exciting projects with Comma Group in the UK und the USA, with Cognizant in various countries, and with Yellowground in Benelux, to name just a few.
You mentioned the Riversand platform. Why is it different?
We understand there is scepticism about the cloud, particularly in Germany; but we are the only omnichannel & omnidomain cloud MDM provider in the world. Many in marketing may claim this, but it pays to take a closer look. Everyone is talking about digital transformation. But we MDM/PIM providers must reinvent ourselves, too. Riversand set the right course for this long ago, but others have only just begun to do so. What all this means in detail – for scalability, flexibility and a real-time and intelligent user experience – I would be happy to explain in a personal consultation.
This article was published in The Produktkulturmagazin, issue Q1 2018. Picture credit © Alija / Getty Images