Digital Commerce

Digital Commerce

Digital commerce is the successor to eCommerce (buying and selling online, usually on a website).

Digital commerce is the process of buying things online without human intervention. The difference is subtle, but if eCommerce were to be fully automated, right from marketing and sales to product delivery, it would be digital commerce. While full automation does seem like a stretch, some of the largest retail conglomerates in the world are already implementing this system.

Aspects of Digital Commerce

Digital commerce accounts for all of the elements of purchase decisions. All of these elements are significant, and the digital commerce experience would be woefully inadequate without them.

Usually, digital strategists work on mapping the entire consumer journey, whether product or service, determining how much importance to assign to each purchase milestone, and creating consumer journeys that provide a seamless experience to the end-user. The aspects of digital commerce include but are not limited to:

  • Content marketing

  • Product descriptions, images, and other media

  • Marketing as a function, promotional campaigns, social media engagement

  • Analytics

  • User experience mapping

  • Customer service

  • Order fulfillment and supply chain management

How Does Digital Commerce Work?

Automation is the core feature of successful digital commerce and is most successful when it is supported by data. Digital commerce works on fairly complex automation and on the availability of vast swathes of data, along with analytics capabilities.

Global supply chains are cost and time-efficient, but they also tend to be fragile, affected by everything from weather events, pandemics, political unrest, and much more. In such cases, data serves as the backbone for predictive analytics, allowing digital commerce retailers to foresee adverse events well in advance based on frequency, seasonality, and more.

Digital commerce is omnichannel and is present wherever the consumer is. This level of granularity is only possible when roadmaps are drawn for every possible scenario and supported by automation tools that control everything from inventory movement to customer satisfaction.

On a micro level, customers usually do not have to think about where their Amazon product is shipped from or how it might be packaged. Instead, the consumer focus is on urgency (how soon an order is delivered), quality (whether the product offers monetary value), and relevancy (how accurately the product delivered matches the product represented).

As a global retailer, Amazon fulfills a few thousand orders every second; the only way for the company to fulfill these parameters every single time is to use automation both at the supply level, as well as the warehouse level, making Amazon a true representation of digital commerce.

Source: Deloitte Digital

Digital Commerce in The Business Environment

Services are also delivered in the digital commerce model, and SaaS (software-as-a-service) applications are just one example of digital commerce’s utilization in business.

Broadly, digital commerce in the business environment works across four categories of business models:

  1. Business to business (B2B model)

  2. Business to consumer (B2C model)

  3. Consumer to consumer (C2C model)

  4. Consumer to business (C2B model)

B2B Model

In the business to business model of digital commerce, businesses sell products to other businesses that need them. These deals are usually larger but happen less frequently. Some businesses work around this limitation by providing monthly and annual subscription solutions that renew automatically.

The most common examples of B2B digital commerce are products and services bought without human interaction. Examples include collaboration tools such as Slack and Trello and automation software products such as HubSpot or Lightspeed.

B2C Model

Business to consumer digital commerce is quite similar to the first use case, except that the buyer is an individual consumer, purchasing for personal consumption. Most smartphone apps that require payment are an example of B2C digital commerce.

C2C Model

The consumer to consumer digital commerce model is harder to understand, but Etsy is the perfect example. Sales of digital products on marketplace platforms like Etsy happen through complete automation. The consumer makes a purchase, and the product is delivered to their email inbox.

This is C2C because the platform has no role to play in the actual transaction, except for facilitating it. Moreover, a consumer can be a seller as well as a buyer.

C2B Model

The consumer to business digital commerce model is best illustrated by review systems. On Amazon, review requests are generated automatically by the platform, and consumers are rewarded with badges and cashback points for useful reviews. The transactional value is extracted from the customer because a detailed review can generate more revenue for the business. The value transfer is happening from the consumer to the business, making it C2B.

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