On the 10th of March 2010, Sue Pratt (An account Director at Salmon) presented at Internet Retailing‘s eCommerce Platforms Jumpstart.

The Internet Retailing Jumpstart programme is a series of short, sharp half day events that take an intense look at some key procurement issues – focusing on identifying and presenting the key questions merchants should ask, rather than presuming to advance some generic, one-size-fits-all maxims.

Sue’s presentation started with a bang. “eCommerce is dead – long live commerce” she said.

You can view the presentation below.

I asked her why she used that phrase, and why its important.

“As a phrase, eCommerce was invented to distinguish it from other kinds of commerce, for example, high street, markets, retail parks, mail order and party based shopping.  However, everything is ‘e’ nowadays. ‘E’ is just a part of normal life and therefore redundant – the way we shop, interact with friends, music, photos, the way we consume media – they’re all ‘e’.

“To quote Douglas Adams – ‘Anything that is in the world when you’re born is normal and ordinary and is just a natural part of the way the world works. Anything that’s invented between when you’re fifteen and thirty-five is new and exciting and revolutionary and you can probably get a career in it.‘

“This means that for the current teenage generation the internet and particularly mobile and smart phones are just a normal part of the world so we should stop referring to eCommerce as if it were something new or different. All commerce is now ‘e’ in some way or another so let’s just call it commerce.

On the video above, Sue goes on to present on a further three areas;

• Three trends influencing the eCommerce platform decision
• New Business Models and Technologies
• Four factors to consider when choosing a new eCommerce platform

I’ll author additional posts on these later this week.

Just been reading through a presentation by Gartner on the future of media with respect to social networks. In this the article categorises users in terms of Creators, Critics, Collectors, Joiners, Spectators.

The presentation then focuses on various age groups. In this it highlights that the younger generation is more focused on creating content, whereas the older generation are far more passive and are either inactive or just browse information. I wondered what the reason for this is? Is it the natural habit of one generation to use social networks? Or is there an alternative driver which forces this behaviour?

One example would be that the younger groups are more switched on to social networking and it is more natural for them to promote themselves via social networks as this is how they would naturally communicate to their friends and family through Facebook, Bebo, MySpace etc…

Conversely, it may be that the older groups have spent many years developing their own personal social networks based on their experiences through their working life. They have less of a need to promote themselves through an electronic social network. Whereas younger people have not had time to develop their personal network and therefore rely on business focussed social networks such as Linkedin, Plaxo or Xing as a form of self promotion.

These are just guesses at the reasons for the skew in behaviour. I guess the question is, why does this distinction matter? Well, if I were considering my social networking strategy, I would seriously consider who my target market was, and that would help to determine the most effective use of social networking. For example, if I were running SAGA who’s target market is the over 50′s, according to this study you should consider pushing information out through blogs to engage with your market. However if your target market is more youth based, then you perhaps want to look at more informal social networks like facebook and consider techniques such as understanding sphere of influence to help drive  your message.

So what is my point? Don’t just go head first into all aspects of social networking. Look at your target market, consider their online habits and then adopt a strategy that is aligned to those habits.

Oh and here is the link to the presentation, draw your own conclusions.

http://www.slideshare.net/jeremiah_owyang/the-future-of-media-in-the-social-era-presentation

Simply a seriously powerful tool bar to fine tune your search results:  Meet ‘Google Search Options’.

Here is a screen grab where I have googled an iPhone 3G, and started to drill down into search results by ‘reviews’ in the past ’24hrs’.

Don’t forget to look at the ‘Wonder Wheel’ feature too.

This Google Video will demystify all.

I’ve just been to get my first sight of Microsoft’s Azure services platform. My first impressions are that it looks no different to any other .Net development approach, one that can be adopted extremely quickly by the majority of the Microsoft development community especially when Microsoft provide their usual kit bag of SDK’s and VS Tools.

Its a far more productive development experience than that offered by the other cloud service providers. It does enforce a structured approach to your development, but to me that is a strength, a little structure to code is always a good thing!

The biggest thing for me however is that Microsoft is having the same challenges as the other major SaaS players are having with regard to the Software + Services model (i.e. on and off premise composite applications).  And that is they still have fundamental business challenges around data protection, service level agreements and application security to think through. It’ll be interesting to see how the platform evolves over the coming months, especially as the commercial models are released later this year.

If anyone wants to get involved in Azure, then Microsoft is in the process of trying to establish a UK user group. So feel free to join in.

And on a final note, if you’re an avid reader of the register and noticed the recent outage on Azure, take note, IT’S STILL PRE-BETA!  Don’t expect it to be stable!  And will it be anything like this (n.b. Be mindful of the date today)

The world has changed.  The second half of 2008 saw events that previously would not have entered our wildest dreams. Who would have thought that one of the UK’s largest banks would pass into state ownership? Who would have thought that one of the longest periods of uninterrupted economic growth would stop dead in its tracks?

With this in mind, employees at Salmon recently put their heads together to author a manifesto (in 6 parts)  for Directors and Managers of Insurance companies, who have a responsibility for eCommerce and eBusiness.   Part 1 is available now as a downloadable .pdf, and considers “Will your Customers Change?”

It is our belief that at least six key issues need to be considered by insurers right now.  We will explore each in full in due course so register here to get each part of the manifesto emailed to you.

Here are the issues as we see them.  What do you think?

• Issue #1:  Will your Customers Change? Even counter-cyclical industries, like general insurance, need to carefully consider this question.  After all, any business is only as stable as its customer base.  As we shall see, answering this question is not straightforward.  There are indications that we will have to think about meeting at least three shifts in customer demand and buying behaviour.
• Issue #2:  Flexing our Cost Base Reducing operational costs has been a major component of most organisations’ plans over the last decade but there are new challenges.  Firstly, living through an economic downturn means that we have to rethink the minimum critical size of our operations.  Secondly, economic, political and social pressures may mean that we have to revisit past strategies based on outsourcing and offshoring.  These now established recipes might not serve us too well in the coming years.
  
• Issue #3:  New Channel Relationships Emerging evidence points us to the fact that customers’ buying criteria – how they make purchasing decisions – may be changing both in commercial and consumer markets.  This means that current web based distribution will have to change if it is to deliver real value for both customers and suppliers.
• Issue #4:  How to Unlock Markets Extending the reach of offerings into new markets is a commonly cited piece of advice for organisations facing an economic downturn.  A better and more astute move is to unlock markets that traditionally minded competitors think are either unprofitable or can only be served in one time established way.  To keep ahead of the game we have to consider how technology can act as a key to redefining markets that others pass by.
• Issue #5:  Regulation – The Tool of Change:   There is no doubt that the current downturn will produce a globally co-ordinated push for new regulatory approaches to prevent another financial crisis.  November 2008’s first meeting of the G20 – the countries that will reshape the business world – put regulation right at the top of its global action plan.  All we know now is that the regulatory demands on organisations – especially in the financial services sector – will change.  The impact could range from more disclosure regarding investments, through to increased customer education and new roles for directors.  The demand for information will increase and new co-ordination and control systems will be needed.
• Issue #6:  Information for Tough Times:  Research tells us that organisations that survived the last real downturn – in the early 1990s – managed their businesses in a totally different way to those that failed and disappeared.  Those that succeeded were closer to their customers and used a far broader range of management information than did the failures.  These winners were better at getting and using customer and market information.  So, systems for decision making have to go way beyond traditional financially based approaches if our businesses are to survive and grow in the current environment.

There is no doubt, rather than entrenchment, this is a time for innovation in how business processes and systems really deliver value. I hope you like the manifestos.  Please feel free to share and re-use.

IMRG reports that Monday 1st December recorded the UK’s largest ever online shopping volumes, but the anticipated VAT-driven spike failed to materialise, leaving sales values and traffic volumes flat.

It all makes interesting reading, in a week when: Zavvi, has been forced to suspend web sales of DVDs, games and music products, Woolworths closes down, 247 Electrical does too, and Debenhams’ site crashes out of action (Debenhams had an availability rate of 28.01% between Thursday 20/11/2008 and Wednesday 26/11/2008, according to this Keynote Systems Performance Index.

***Shameless plug***:  Salmon’s client Argos ranks pretty damn highly in said index

A few weeks ago I wrote a post about taking advantage of cloud services, SAAS and other online services to help accelerate a new business. Rightly so David Deans, from the Business Technology Roundtable, posed the question ‘how does this affect scalability?‘ When should you consider a dedicated managed service (internal/external)?

Scalability is an interesting term as it has a different context depending on the person you are speaking to. I’ll put other articles up in the next few weeks to consider different perspectives, however I’ll start with probably the one that is key to a lot of new businesses and that is COST!

In order to understand the operating cost of an environment you would look at possibly the lowest factor which is the cost per transaction. This figure is commonly made up of the following costs;

• hardware infrastructure (servers, storage, backup devices)
• network infrastructure (telecoms, security)
• support overheads (backup, performance optimisation, user support)
• software overheads (license, vendor maintenance & support)

Note: I’ve not taken into account the cost of the person actually executing the transaction, as this is required no matter where the solution is hosted.

In a new business venture, the cost per transaction tends to be extremely high for an internally managed infrastructure, as the costs cannot be absorbed efficiently across a transaction. When a cloud service provides a business with a cost per transaction, they are charging you for all of the above factors, but they are spreading the cost over many customers and hence obtaining an economy of scale.

Let’s take a very simplistic scenario. A new business is considering the most appropriate infrastructure. They’ve got 2 different options, 1 is a SAAS product and the other is a dedicated managed service.

The managed service will charge around £360k for build of infrastructure, and then an annual charge of £230k for annual maintenance and support. The hosted service is offering a £30k setup fee and £1.50 per transaction fixed for 5 years. Based on 100,000 transactions and an annual growth rate of 20%, you can see that by year 4 the managed service is actually more cost effective.

Now this is an extremely simplistic scenario, and in real terms the benefit of the managed service may be realised sooner or later depending on how you absorb the cost of the initial platform or add functionality. The key for me is in the growth rate, as this will determine the point whereby a business will realise economies of scale through controlling their own infrastructure.

This leads me onto my next article in considering the value-add of a cloud service or SAAS solution and how you should factor this into your decision process.

The IMRG Senate Christmas statement makes great reading. Here it is in full:

Christmas is coming and it is going to be bigger than ever this year online with over £13.8 billion to be spent by the UK’s 27 million e-shoppers during the festive season, according to Forrester Research*, which compared to IMRG’s 2006 data is up 42% on last Christmas.

So what is contributing to this huge uplift in spend online? Shoppers are migrating online to find more choice, convenience and better prices. But more than that, the internet is all about independence, immediacy, modernity, attitude; it’s where many people now feel most comfortable. Some 61% of UK homes are now connected to the internet, 15.2 million households, according to National Statistics, and with 84% of online households in the UK using a broadband connection, shopping online has never been quicker and easier. And as well as sales going up, consumers’ confidence in shopping online is also rising.

According to the latest IMRG Customer Service Index by eDigitalResearch and ipoints, confidence in web site security rose two percentage points in the past quarter to 75.6%. Commenting on this Gerald Kitchen, CEO of SecureTrading said that “growth is set to continue as consumers become more comfortable with the security aspects of trading and purchasing online. It was not long ago that consumers were uncomfortable with even purchasing low ticket value items like a CD. Today, we are seeing consumers purchasing items costing thousands of pounds”. The IMRG Customer Service Index also revealed that customer delivery satisfaction had risen to 80.2%.

The demographic profile of the web is changing from the young male dominated scenario of recent years and this is feeding into the sales growth online.

Women aged 18-34 are now accounting for 21% of all time spent on computers in the UK, which equates to 13 minutes out of every hour online, according to Nielsen/Netratings. And there are twice as many women aged 18-34 active online as there are girls under 18 or women over 50. Over 50% of women under 25 now buy clothes online every month.

At the older end of the age spectrum around 30% of total time spent online in the UK is accounted for by the over 50s, with the number of broadband users aged over 55 growing at nearly twice the overall adoption rate among European internet users, according to the European Interactive Advertising Association. Also in the UK internet users aged 55+, the ‘silver surfers’, are the 2nd largest demographic group online, according to Hitwise. The UK internet population is now split almost equally between males (51.5%) and females (48.5%), according to the latest Nielsen/Netratings.

Reflecting this change in profile of online shoppers, retailers are seeing buying patterns altering on their sites and in some cases are opening new departments and product areas to capitalise on these new customers, especially in the run up to Christmas.

Commenting on how sales patterns are reflecting the change in online user demographics, Ulric Jérome, Managing Director of IMRG Member Pixmania says: “We have seen sales growth among the older generation of ‘silver surfers’ and women. They now see the value of technology and have more disposable income than previous generations, meaning technology products are becoming a part of the DNA of their lifestyle. They now embrace technology and understand the ease-of-use and convenience of online shopping better than ever.”

Another IMRG Member, Amazon, have launched four new stores on their UK platform this year and look to capitalise with a broad product range offering in the run-up to Christmas. Brian McBride, Managing Director for Amazon.co.uk said: “2007 has been a great year for Amazon.co.uk. Not only have we seen the launch of four new stores – Sports & Leisure, Jewellery & Watches, Shoes and Baby – but we have seen record breaking sales for the likes of ‘Harry Potter and the Deathly Hallows’ and ‘The Exclusive Catherine Tate Comic Relief Special’ DVD. The proliferation of broadband in UK homes is certainly allowing a greater proportion of the UK public the opportunity to shop online. This means that every age group, across both sexes, is now well represented in the share of internet retailing spend. Whilst there are certain areas that have seen accelerated growth, like the so-called ‘Silver Surfers’, there will be a continued strong increase in internet retail spend across all groups of the UK adult population for a good time to come. This promises to be our biggest Christmas on record and we look forward to serving millions of customers with an incredible product selection, at customary low prices and with a delivery option to suit every shopper.”

The strength of the female purchasing power is no better illustrated than at Play.com, where their influence is being felt in the all-important top selling albums for Christmas. Commenting on this Stuart Rowe, spokesperson for Play.com said: “What is going to be number one selling album at Christmas is the burning question on everyone’s lips. It’s looking set to be the battle of the divas, with Play.com already receiving massive pre-orders on Leona Lewis, Kylie Minogue, Celine Dion and the Spice Girls. However when it comes to gifting, anything goes. The Now That’s What I Call Music series always does well with the general public, and Live Lounge 2 and Radio 1 Established 1967 are already proving very popular choices with our customers. If we had to suggest what will be the biggest seller on the site as a gift purchase, we think it’ll be a 3 way fight between Kylie, Leona and Westlife, who should never be underestimated in the Christmas market – last year they took on both Oasis and the Beatles and won. Music is a great gifting option at Christmas. It is affordable, accessible and instantly rewarding.”

Are Christmas sales online heading for another record amount? With more people online, greater choice and availability and even more parcels being delivered than ever before it certainly looks that way. Jonathan Wall, Marketing Manager at dabs.com, observed: “Shoppers continue to use the internet as an easy way to seek out best value, especially at Christmas time when budgets can be tight. Retailers such as dabs.com have used the flexibility of their online store to create special “bundle deals” which offer extra discount and help stretch the festive budget even further.” Val Walker, Royal Mail’s Head of Multi-channel Retail Marketing, said: “Royal Mail is geared up to deliver a record breaking online Christmas and expects to handle more than 100 million gifts and presents ordered on the internet during the festive period. Royal Mail has responded to the needs of the online shopping community, both shoppers and retailers, with the introduction of a new service which improves the delivery experience. ‘Royal Mail Tracked’ enables retailers to provide their customers with a tracking number when the goods ordered are dispatched so that they can track the progress of their delivery themselves. The service also enables retailers to give their consumers the opportunity to specify an alternative delivery point, such as a porch, shed or a neighbour, should they not be at home to receive the item. This new service builds on the success of Royal Mail’s Local Collect service which enables online shoppers, who are not at home to take delivery of an item that cannot be posted through the letterbox, the opportunity to ask for it to be taken to a Post Office branch near their home or work.”

Jo Evans, IMRG’s Managing Director commented: Like a lot of people, I have already begun my Christmas shopping without having to battle with traffic and crowds, by buying online. I have thousands of shops available to me, and if they are displaying the ISIS / IDIS logos, I know they are trustworthy and reliable, and I can shop safely and securely receiving my purchases at home in good time for giving to my family and friends.”

Footnote: * Source: “Europe’s 2007 Christmas: An Online Retail Wonderland”, Forrester Research, October 2007.

A seven year long research project revealed recently by online market researcher eDigitalResearch has shown a steady rise in multi-channel retailers’ ability to challenge the dominance of pure play retailers.

Play.com, Figleaves and Amazon have consistently scored highly overall, often topping the tables in a variety of performance categories, but multi-channel retailers have gradually worked their way back into contention and are now challenging for the top spot.

The research is echoed by IMRG who last month ranked Salmon’s customer Argos, the 2nd most popular online retailer in the UK in their Hitwise Hot Shops List – which ranks the top 50 UK e-retailers by number of visits.

The Retail Bulletin adds; “There has been a general improvement in technology over the last seven years, assisted by the increase of reliable broadband connections, which has raised the standard of online retailing. As a result the common problem of critical pages such as checkout and payment confirmation not loading correctly has gradually been ironed out and encouraged more confidence from users.

New online investments have consistently been seen throughout the seven years, including improved search engines, improved product presentations and security, have shown themselves to be crucial to maintaining market position. Generally, an overall increase in site development investment has mirrored the consumer shift in spending patterns.”