How to Prepare for Increased eCommerce Activity
eCommerce had already been doing well even before the COVID-19-induced shutdown of brick and mortar businesses. Its growth was driven mainly by the increased adoption of mobile shopping with new touchpoints such as voice assistants, chatbots, and social media.
Then the COVID-19 pandemic kicked this ongoing digital shift into overdrive. Both consumers and businesses have been forced to adapt within weeks.
But are manufacturers and distributors keeping up with these changes?
Some have been slow to adapt due to the inertia of existing dealer networks and supply chains that have worked well enough for decades. However, the global business and policy response to the pandemic exposed vulnerabilities in global supply chains as online demand for certain products surged, causing shortages and delivery delays.
However, at the same time, lucrative market opportunities are now opening up for manufacturers willing to address their inefficiencies by digitizing their legacy processes and strengthening relationships with producers, suppliers, and consumers.
Ballooning amounts of product and customer data
While not guaranteed, such digital transformation may be a boon for manufacturers and distributors in the eCommerce market. However, businesses need to replace inefficient and expensive legacy systems with advanced eCommerce platforms integrated with ERPs and vast data repositories.
Digital transformation, while necessary, is a huge undertaking that requires sharp foresight of potential challenges ahead, sufficient resources, and support from the right experts. Many companies have not succeeded with their digital transformation initiatives because they neither were able to anticipate hidden challenges nor had the resources to support it. For successful planning and execution of their digital initiatives, manufacturers may turn to managed IT firms with digital transformation experts.
With the sudden spike in digital commerce, manufacturers need state-of-the-art data management and product information platforms to gain complete visibility of their supply chains and to understand customer behaviors better. Having such cloud-platforms as opposed to on-premises legacy infrastructure allows manufacturers to be more agile, respond quicker to shifting demands, and become more competitive in their sector. They need the capacity and infrastructure to store all this data and the analytical tools to personalize interactions at all touchpoints. However, because there is so much data, so many channels, and high consumer expectations, organizations using legacy technologies struggle to keep up. Handling such huge volumes of information is impossible for humans, but not for artificial intelligence (AI).
AI applications tailored for eCommerce platforms
AI can process customer and inventory data faster with higher efficiency, freeing humans to focus on strategic initiatives. According to Salesforce’s Global Shopping Index, it has already shown promise driving relevant product recommendations to boost the average order value (AOV) by 26%.
AI combines machine learning algorithms with training datasets to recognize common patterns, learn customer behaviors, handle localization, and what works best in which channels. This learning phase helps AI develop accurate insights from live customer and product data.
However, most AI applications in eCommerce remain under-developed. We’re not yet at the point where we can just plug-and-play an AI application into our platform. Still, early-bird adopters of AI have already gained an unfair advantage over their competitors. They see the following benefits from AI:
- Optimized inventory management that eliminates friction and improves delivery
- Accurate insights into customer behavior based on omnichannel analytics
- Lower customer acquisition costs at point-of-sale
Although some early adopters are already using AI, this remains an under-explored opportunity in the manufacturing sector to manage inventory more effectively. It is, however, necessary to have the right platform and supporting infrastructure to take advantage.
Finding the right cloud solutions for eCommerce
We provide an overview of which solutions are needed to build an intelligent cloud commerce infrastructure for a post-pandemic economy where the global commerce cloud market size is projected to reach $55.7 billion by 2027. These solutions include:
1. Enterprise Resource Planning (ERP) System: An ERP is necessary to integrate data from all areas, including human resources, accounting, customer information, product information, supply chain logistics, and distribution.
2. Product Information Management (PIM) Solutions: Vast repositories of data are needed to manage information about products, customers, dealers, and suppliers. But many manufacturers still use spreadsheets. Even if manufacturers use ERPs, most ERP systems don’t store product information, and this is where PIM solutions come in.
3. Cloud-based eCommerce Platforms: The best eCommerce solutions will provide customization, integration, and personalization capabilities. Some leverage AI to generate insights about customer behaviors and reports to support decision making.
The following are some of the popular cloud-based eCommerce tools used by manufacturers undergoing digital transformation journeys:
- Ucommerce and Progress Sitefinity are cloud-based platforms that improve customer data security by eliminating vulnerabilities within legacy environments.
- Coveo creates AI-driven experiences not just for customers, but also for dealers and suppliers tasked with getting the right products to the right places as quickly as possible.
- Episerver is another AI-based product, cloud, and content platform that helps manufacturers manage their supply chains while expanding to new markets.
- Sitecore is a “headless” solution that separates the user interface from the core, allowing enhancements to the user experience without disrupting internal workflows.
- Akeneo is a PIM solution-oriented toward Product Experience Management, which integrates with most popular eCommerce platforms on the market.
These cloud-based eCommerce solutions empower businesses to address customer demands with omnichannel shopping and personalized delivery experiences and enable faster speed-to-market, lower IT costs, and optimize inventory management.
With the surge of digital commerce activity, manufacturers and distributors are scrambling to keep up with increasing online demand. While this exposes businesses that still rely on legacy infrastructure, this also creates new opportunities for digital transformation towards increased agility and competitive advantages in the manufacturing sector.
Cloud-based eCommerce platforms with AI capability and PIM functionality backed with sufficient infrastructure to hold large amounts of data hold the keys for manufacturers to stay competitive in the post-pandemic digital economy.