Ten Themes for 2009: eCommerce Technology


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[posted by Brian K. Walker]

If the last year has taught us anything it is that none of
us have any idea how to predict the future. I think we can all agree, the year
was full of surprises. But one of the great luxuries of the job we have at Forrester
is that we talk with lots and lots of people in and around the industries we
cover. In my case I am lucky to have the opportunity to talk shop with
eCommerce business leaders, multichannel retailers, IT leaders, eCommerce
technology vendors, industry media and thought leaders, and (last but not
least) my colleagues at Forrester.

 

I am not going to venture out with any “predictions”, but
based on all those conversations I want to touch on some eCommerce technology
themes I believe we will see in 2009.

 

So, with that, and in no particular order:

 

  1. SaaS & hosted/managed platforms go
    mainstream
    .
    Increasingly online and multichannel retailers
    cut-to-the-quick and point out at the top of my conversations with them that
    “we are really only interested in something we do not need to support
    internally or host in any way.” While true SaaS products still leave some
    enterprise-class customers queasy, they are increasingly interested in looking
    at these offerings. And nearly all are open-to or motivated-to hosted/managed
    offerings. Look for incumbent software offerings to add hosted/managed and SaaS
    offerings to the portfolio and for business models to be tweaked all around to
    overcome obstacles in both traditional license and revenue-share models. We
    will be publishing a Wave report on the top 10 world-wide B2C eCommerce
    platforms very soon in January 2009.
  2. Social shopping picks up steam and the
    experiments begin in earnest.
    Over the last couple of years we have all seen and
    participated in the proliferation of the social platforms. Look for retailers
    to seek out ways to participate. Email is maturing for many, and Search is
    annualized, time for the new pony. ROIs may be elusive, but the experiments
    will be many and interesting. Look for affiliate marketing, RSS, comparison-shopping,
    and web-services to all be used in various combination.
  3. B2B eCommerce platform demand picks up.
    For years platform vendors have waited for the tsunami of B2B deals to come
    rolling in, and it really does make so much sense… efficiency, customer
    experience, CRM, globalization, multiplying channels, and traditional
    distribution channels under threat. Well, it is not a tsunami, but rather
    gravitational pull of another planet. Subtle but there. We will see demand for
    B2B eCommerce applications developing, and it will be lead but forward thinking
    organizations who are looking to do it right and who are not in any hurry. This
    is why, in this economy, it is going to build slowly. I will be covering B2B
    platform offerings with a market overview in Q2 2009.
  4.  B2C eCommerce platform demand moderates but
    remains healthy.
    If you are a client, I wrote about this recently here,
    but in summary - and in honor of Spinal Tap - we are seeing the volume going down from eleven to eight. Many
    multichannel retailers are seeing an eCommerce beacon if light in the terrible
    retail storm. And branded manufacturers need to replace eroded demand in their
    traditional retail distribution models – making the channel conflict questions
    much easier to navigate. All that though needs to be mixed with a very
    challenging overall economic environment, hence the moderation. Many
    initiatives may stall at signing as companies wait for the situation to
    improve, while others will not hesitate.
  5. Predictive merchandising becomes
    ubiquitous, and the crowd begins to separate.
    “Predictive merchandising” is
    also referred to as “automated merchandising” or “personalized product
    recommendations”. Whatever term you like (or are marketing) we will see this
    area are the “product reviews of 2007”, where we go from stepped up interest
    and demand to a default feature. The incumbent concerns and cultural hesitations
    of merchants and marketers will be replaced with an enthusiasm for the improved
    customer experience and ROI. Many retailers (and the vendors) will be picking
    off low-hanging fruit and seeing some good results even from the lesser
    solutions (to start). Meanwhile the crowd of solutions will begin to separate
    as the vendors with traction and profits outlast, out-market, and out-invest
    the start-ups. For more on personalization see Sucharita Mulpuru’s great
    research
    on this from December 2007.
  6. Multichannel features and services pick up
    momentum.
    This is an interesting area. Will the challenges faced by
    retailers
    lead to further multichannel integration or are the costs and challenges too
    high? Many retailers will simplify this down to key features and services that
    really meet the customers’ needs – in-store pick-up and ship-to store. Upcoming
    research in January will explore the customer trends and opportunities for
    retailers to make this easier to accomplish.
  7. Google Analytics picks up share, and the
    incumbents fight to retain customers.
    As we covered in July, nearly everyone is dissatisfied with their analytics package. Google
    Analytics has two advantages key to this theme, 1) it is simple and 2) it
    is free. As budgets come under pressure, and online retailers evaluate what is
    working and where they are spending their money it will be hard to justify the
    spend on analytics even if Google Analytics is limited in eCommerce-oriented
    capabilities.
  8. We finally begin to learn what Omniture is
    up to, but continue to puzzle over Amazon's enterprise solution offering.
    Speaking of analytics, why did Omniture buy Visual Sciences (including Atomz Search) and Mercado? Is there a “platform” in there
    somewhere? Maybe next year the answers begin to emerge. As for Amazon, no word
    on what kind of enterprise eCommerce platform offerings will re-emerge, except
    we know it will include “services”. The assets are too great at Amazon not to
    seek to monetize them in an enterprise-services context, but the garage door is
    down and the mechanics are busy.
  9. Oracle, SAP, and  Sterling begin to figure out what to do with
    this eCommerce-platform -thing.
    Demand from the vast Oracle, SAP, and
    Sterling Commerce install-base for eCommerce solutions is growing from a small
    crowd to an Obama-sized rally. The time to offer a well formed response is now,
    or be clear there is no product aimed at addressing the B2C online merchants
    and marketers’ needs. B2B solutions are more attainable and make more sense
    with the tight ERP and order management requirements, but the customer
    experience and business facing merchandising, content management, and marketing tools
    still lack maturity. Acquisitions would make sense here, maybe in 2009.
  10. The walled gardens begin to break-down. We
    will talk less about platforms and more about “eCommerce technology environments’.
    Keyword: begin. More on this in 2009.

 

Happy New Year everyone and I look forward to more of those
conversations in 2009.

 

Cheers, Brian

Comments

re: Ten Themes for 2009: eCommerce Technology

About number 5... the latest Internet Retailer survey (http://www.internetretailer.com/article.asp?id=28884) finds that 40% of merchants will update their e-commerce sites with personalized product recommendations.I agree there are many companies trying to solve the same problem. Among other things, recommendation engine companies will need to be financially very strong. Venture Beat had its view on a “recommendation engine” consolidation: http://venturebeat.com/2008/07/22/baynote-strands-richrelevance-will-the...

re: Ten Themes for 2009: eCommerce Technology

Great post Brian. It would seem that one theme through points #2, 5, & 6 is how in 2009 online retailers will focus on improving the shopping experience (predictive merchandising, social-shopping, multi-channel) -- likely to improve conversion, as it's still hovering in the low single-digits. We agree that improving the shopping experience is the #1 thing retailers can do to survive and thrive in today's economy: http://richrelevance.com/forum/