Making Commerce Better – Recapping a talk by Shopify’s Satish Kanwar at AndroidTO

I meant to start writing this post earlier today when I found myself browsing Facebook instead. It happens… But my Facebook feed pointed  me right back to the topic by presenting me with a funny image that made me think of Satish Kanwar’s talk at AndroidTO.

The caption read, “Best Buy: Try it out before buying it on Amazon.” Funny but true, though “Amazon: Read about it before buying it at Best Buy” would be just as true. 

There’s a reason Kanwar didn’t use the terms “e-commerce” or “online shopping” in his title. One of his core points was that it’s all just commerce and shopping. If you research the product in store then purchase online, is that online shopping?

If you research it online then buy in store, is that bricks and mortar or just self-service 1-hour delivery?

Kanwar made the case for moving past the ideas of online and offline commerce to just “commerce”. He showed how online transactions are just a fraction of the pie, and how online shopping  influences offline purchasing.  Buyers don’t align their behaviour to the constructs of “online” vs. “offline”, they mix and match their shopping related activities according to their preferences. And millennials, he pointed out, expect a seamless experience across mediums. Gone are the days when it was accepted that the online and bricks & mortar versions of a store would be very different.

An interesting study he referenced said that if a retailer’s store is closed when customers want to shop there,  36% will buy it online from that retailer’s website and 22% will shop online for the best price. That 22% represents a great opportunity for small businesses.

The opportunity for small retail businesses was another theme of Kanwar’s talk. Opening large or numerous retail stores is a very costly proposition, and in the past, online buying was generally considered risky. So small businesses had a limited market to work with. Now that online shopping is more prevalent, small businesses – especially those with a solid mobile experience – can expand their market without a huge investment.

Kanwar listed 5 ways online businesses are democratizing the value chain, one of which not surprisingly his own company enables:

1. Get an idea (e.g. Google)
2. Build a prototype (e.g. Makerbot)
3. Raise funds (e.g. Kickstarter)
4. Sell orders (e.g. Shopify)
5. Ship products (e.g. Shipwire)

To demonstrate, he talked about an experiment he conducted, quickly creating and promoting (Twitter, Facebook) an online sock business. With the store up and running (via Shopify, of course) they sold $500 of socks in 24 hours. That experiment provides another lesson, too. There are lots of online and offline stores selling socks already but there was still clearly room for another. If your value proposition is unique or the market is big enough, there is opportunity.

His final premise was a bit less convincing, for me. He talked about the death of the department store. His premise was that department stores optimize for distribution and not necessarily for value or experience. With distribution becoming a commodity (home delivery options), he hypothesizes that department stores will die out in favour of online and experiential stores. (Experiences like the Apple store where customers get hands on with experts, or Lulu Lemon where customers might come in for a yoga class.)

He might be right, but I’m not quite convinced department stores will die. There’s a lot to be said for knowing the item you want is likely in stock and you can see and touch it before ordering. Innovative online retailers like Frank & Oak with home try-on and return options for clothing are definitely taking a bite out of traditional retailers but I have a feeling there will always be a place for shopping in store. Only time will tell.

Meanwhile what is clear is that the blending of mobile, online and in store shopping presents an opportunity for small businesses who can deliver value to customers. Kanwar referenced Andy Dunn’s “E-Commerce is a Bear” essay, summarizing four ways a retail business can differentiate:

1) Proprietary pricing (e.g. scarcity, time limited)

2) Proprietary selection (e.g. curated, narrow & deep for an audience)

3) Proprietary experience (e.g. subscription)

4) Proprietary merchandise (unique product)

Enabled by technology, small businesses can differentiate on any of these.

Lots of food for thought for anyone considering a retail business.

So where does Android fit into all of this? Android, Kanwar pointed out, is the fastest growing mobile platform so businesses wanting to take advantage of this new world of commerce need to make sure they have a solid Android experience.  And yes, he assured us, Shopify is on top of that.

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About Sandi_Jones
Technical marketer, product developer, geek, unconventional entrepreneur. I fell in love with technology in the mid-90's, found my inner geek, and never looked back.

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