Industry

Once Again, Amazon is Disrupting The Evolving Ecommerce Sector

Posted by Pixafy Team | Monday, July 10, 2017

The ecommerce industry is amid a period of rapid change. Research from Business Insider found that 48 percent of U.S. shoppers made purchases with a smartphone in the past year. This represented a 4 percent year-over-year increase.

Furthermore, globalization is taking hold in the sector as 47 percent of shoppers involved in the study purchased from foreign retailers last year – another 4 percent year-over-year expansion. New shipping methods are gaining momentum – 37 percent of respondents went so far as to say they prefer using alternative delivery locations instead of their homes. People are also using online marketplaces to research before going to brand-specific sites and, all told, the ecommerce industry is transitioning around an increasingly digital society.

Now, it looks like all of these changes are rapidly accelerating into the grocery sector. It feels like just yesterday that Amazon was launching a retail store initiative centered around selling some grocery items in an AI-powered location that blended online and in-person shopping experiences – the pilot project was actually announced in December 2016. Now, the ecommerce giant is purchasing leading organic grocery retailer Whole Foods, a move that is expected to thoroughly disrupt the e-grocery sector.

“eCommerce industry changes are rapidly accelerating into the grocery sector.”

Amazon up to its usual disrupting moves – What does it mean?

The purchase of Whole Foods just happened, so there aren’t many details. However, industry experts expect the move to have a dramatic impact on the sector. In an interview with Packaging Digest, Dan Wilkinson, chief commercial officer for 1WorldSync, explained that Amazon’s work to purchase Whole Foods may come down to accelerating its ability to gain trust in the e-grocery marketplace.

“Trust has been one of the biggest barriers for the grocery industry in the shift online,” Wilkinson told the news source. “Historically, consumers have been adamant in their desire to touch and feel a perishable food item before purchasing it, and only in the last couple of years have organizations been able to slowly gain consumer trust to purchase perishables online. Whole Foods has built its brand on a reputation of trust, using its organic-only products and detailed product content approach to drive loyalty with its customers. With this acquisition, Amazon absorbs that reputation of trust and gains access to Whole Foods’ loyal customer base.”

According to Wilkinson, this emphasis on trust has long been a sticking point in the e-grocery industry, and Amazon may be working to transform long-held notions about what works well for online purchasing.

In the same Packaging Digest report, Stephen Kaufman, chief product officer for BLUE Software, posited that Amazon’s move is about building relationships with customers. The ecommerce giant has built a reputation for constantly deepening its ability to meet consumer demands, and this move provides a new network of fulfillment centers to establish a stronger relationship with customers.

There is a common theme in these two conclusions – ecommerce companies have an opportunity to innovate in such a way that the experiences they offer create a strong tie between the brand and the customer. In the case of Amazon’s purchase of Whole Foods, this is coming out in the form of creating trust and flexible shopping experiences. But most ecommerce brands can’t go out and purchase industry leaders to expand their reach. How can most ecommerce companies learn from Amazon by creating stronger customer relationships?

Building trust

Key site functions such as credit card processing for ecommerce play a critical role in building trust. At the point of sale, customers must know their data will be safe and handled appropriately. This covers the end point of the customer journey, but there are other ways to create stronger relationships. Integrating enterprise resource planning (ERP) systems with the web platform can allow for more transparency between the website and users, particularly when it comes to stock levels and shipping expectations, adding a layer of trust to transactions. Design and content creation can build a brand identity that gets relationships off on the right start.

All of these design elements come together in building a site with the customer journey in mind. At Pixafy, we take a comprehensive approach to web development and design. With our internal expertise and extensive partner network, we can help ecommerce companies of any size build trust and, at least to some degree, follow Amazon’s lead in strengthening customer relationships.

The ecommerce industry is changing at a breakneck pace. You may not be able to keep up with Amazon, but that doesn’t mean you can’t disrupt the industry in your own way. Let’s create a plan for your business!

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