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Nonstop change is a certainty for ecommerce

The internet continues to disrupt the selling of products and services.

The traditional ecommerce strategy of creating a single site and trying to market to the entire internet from that site is a shrinking option. Most small businesses do not have the budget to compete with ecommerce giants, and thus their market share is diminishing.

Increasingly, ecommerce works better with a layered approach. At one end there is the consumer. At the other end is the business, and in the middle is a third-party platform. Amazon and eBay are classic platforms. They say to the consumers, more or less, “Whatever you want to buy you can find it here. It is good value and safe to purchase.”

Retailers have to simply list their products and Amazon, and eBay will do the hard work of getting visitors. It means that retailers can do what they are good at — selling — and leave the marketing and all the other non-retail tasks to the platforms.

There has been much talk about how internet sales are killing off traditional brick-and-mortar shops. Certainly the market is always evolving, and any retailer who does not keep up is in danger of losing everything. Here in the U.K., there have been a few major retailers go under and a few more barely surviving.

Services, too

But ecommerce is much more than selling products. Take Uber and Airbnb, for instance. These platforms allow individuals to promote their services. For example, by putting a listing on Airbnb it is easy to get bookings to rent your spare room or holiday cabin. There is no need for your own website. The platforms do all the process. They provide the booking service, take the money, qualify the customers, and manage the risk of non-payment. All you do is provide the actual service.

The service industry is starting to notice internet competition too. Instead of embracing the changes and evolving how they operate, traditional providers have instead relied on political lobbying to stifle, by legislation, internet competition.

Uber has been banned from some cities. Airbnb is being restricted and regulated. The political pressure comes from established businesses trying to hold back change. I suspect that their attempts will eventually fail.

Instead, the businesses should look at the gaps in the market that the new platforms are filling. It should be easy for an established, reputable taxi service to beat Uber. The primary advantage Uber has is its mobile app and the way in which a car can pick up a customer. Taxi services rely on the old-fashioned call to a receptionist, with manual booking. Replacing this with an app on a smartphone would go a long way to competing with Uber.

Change or die?

The internet is developing and traditional businesses must change to survive. It is not always obvious which companies will be affected by these changes, however. It is easy to assume that the main potential victims are retailers, hotels, and taxi companies. In fact, the real losers could be those who offer internet services to those companies — website builders, designers, and search engine optimizers.

As more ecommerce is done via third-party platforms, the need for individual websites will diminish. If there are fewer individual websites, there is less need for search engine optimization. So it could be SEO and other service providers that need to change what they do and whom they market to.

As more and more searches are done on the platforms instead of Google, any optimization needs will be done on the listings on the various platforms. For listings on eBay and Airbnb, such services could include improving copy, getting better pictures, suggesting better titles, advising how to best promote the listing, and so on. These are services can add value.

In short, the internet continues to change how consumers purchase products and services. To survive, businesses need to accept change, and evolve.

Richard Stubbings
Richard Stubbings
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