Interview: buySAFE Founder On The Future Of Shopping Carts
There are hosted shopping carts, licensed shopping carts and custom carts. Every ecommerce merchant uses a cart, and we’ve asked Steve Woda, chairman and founder of buySAFE, a firm that offers insurance for the safety and reliability of ecommerce transactions, for his views on the look of a future shopping cart. Since its inception buySAFE has guaranteed over 13,000,000 ecommerce transactions.
PeC: Shopping carts have evolved quickly. Many of them include multiple features that would have cost a significant amount of money a few years ago. Five years from now, what will a shopping cart look like?
WODA: While you do see a myriad of shopping cart offerings out there, you also see a lot of legacy shopping cart platforms that were built by online retailers. This is understandable since early on in ecommerce, off-the-shelf shopping carts were often too basic to meet the various online retailer needs.
Going forward, I predict large retailers will increasingly migrate to third-party shopping carts of some kind. There really is something for everyone out there now, from carts catering to the mid-sized retailers like MIVA and ShopSite, to ecommerce platforms designed for large retailers like GSI Commerce and Divex. There are even soup-to-nuts solutions like Infopia for large merchants that need to support multichannel ecommerce businesses.
This is obviously good for ecommerce because it allows online merchants to focus on generating traffic, sourcing products, pricing, merchandising, customer experience and customer service. In fact, I would argue that retailers should focus their businesses on these core competencies and leave the shopping cart technologies to the folks that are 100 percent dedicated to developing better, flexible, feature-rich, stable ecommerce platforms.
PeC: Practical eCommerce counts over 300 hosted and licensed shopping carts. Will this fragmentation continue?
WODA: There are a lot of shopping carts these days. To some degree, this competition has clearly helped the industry innovate and drive down pricing. On the other hand, the fragmentation has created new problems. There is a huge variance in the customer shopping experiences of these many platforms. I doubt that is helpful with shoppers as a whole.
In the future, it certainly makes sense that some level of industry consolidation will occur as the leading shopping cart platforms begin to deliver core feature sets in a truly differentiated way. That said, you’ll always find new, innovative shopping carts out there, so I suspect you will continue to see meaningful fragmentation for some time to come.
PeC: What shopping cart features do you see gaining in prominence? What new features do you foresee?
WODA: I believe the most important new features will revolve around optimizing the monetization of each shopping visitor — both new and previous customers. Merchants can spend a lot of time and money driving qualified traffic to their websites, but if that traffic is abandoning shopping carts, or worse yet failing to start carts in the first place, then the merchant’s business will suffer.
Features that help to derive revenue from each and every visitor, like cross-sell, upsell, and coupon features, will be very important for shopping carts. These features can help grow order sizes while the customer is in the shopping mode.
Additionally, if you haven’t thought about the trust and safety features on your ecommerce site, you should. Since 2002, it has become clear that about 50 percent of the Internet’s users simply aren’t buying online. This is obviously a huge, untapped market of potential buyers, and these shoppers are going to push merchants to eliminate all of the perceived risks of buying online. Clearly, addressing this huge opportunity is critical to optimizing your conversion rates and therefore, your profits.
Merchants will increasingly leverage third-party solutions that instill confidence in their shopping visitors. Confident shoppers buy online. Nervous shoppers don’t buy online. It is really that simple. As an example, my company, buySAFE, is now an integrated feature in over 20 shopping cart platforms, and we’re adding new platforms each month.
One last note, cross-functional integration will be a requirement for the best shopping carts of the future. If your shopping cart cannot integrate with your inventory system, then you’re likely missing out on a huge revenue opportunity.