Consumers are buying the way they want to buy, and retailers need to adapt to this, Avangate tells TechWeek Europe
The way people shop online is gradually changing as consumers become used to proscribing their methods over that of retailers, according to a leading ecommerce firm.
The line between payments and commerce is becoming increasingly blurred as more and more companies look to develop a digital strategy which provides a seamless engagement between themselves and the consumer, cloud ecommerce provider Avangate has said.
The company is seeing a shift towards a service-based economy, as consumers are provided with the chance to build a relationship with businesses they trust which goes merely beyond just buying products.
“The value has now shifted to services,” Avangate CMO Michael Ni told TechWeek Europe, “Products are dead…they’re just an excuse to sell services, and services are now being productised.”
This is especially true of the PC market, which is traditionally a low margin industry, but one where manufacturers now use their products to sell the services provide on top, such as servers and storage, to really make money. Hardware is increasingly becoming a means to sell software, Ni says, as manufacturers look to take advantage of a subscription-based model which can provide more immediate returns.
This trend will only continue with the growth of the Internet of Things, Avangate believes, as this shift will open up a huge range of possible monetisation points. The sheer amount of data being captured by IoT products and services will prove to be a major money-spinner, believes Avangate senior director Ed Chuang, as companies begin to move significantly into the space within the next twelve months, making it a much more ‘real’ proposition for business.
Back in the modern day, Avangate has also seen consumer shopping habits shift dramatically as people become more tech-savvy, with many of us preferring to shop around before making a purchase to find the best deals.
A research report recently commissioned by the company found that 45 percent of consumers prefer to compare 3-4 different online channels before making a purchase decision.
“People are now buying the way they want to buy,” Ni said, adding that mobile has become “a key plane of engagement” and one that all retailers need to embrace.
And these habits are also being seen in the B2B space, as companies shop around for the best prices from suppliers before committing to a deal. Avangate works with more B2C than B2B companies, Ni said, with the latter now often buying a lot more like its consumer-facing equivalent in an attempt to get to market faster.
Overall, Ni believes that the issue is one of ‘digital value’. Consumers are looking to establish relationships with brands and companies they trust, which is especially important in the payments space, which involves people’s hard-earned money. Those companies that can provide a seamless or frictionless experience for the customer will earn that loyalty, and once they have that, they can really look to build a relationship with the consumer which will benefit both parties.
All checked up on mobile payments? Try our quiz!