Strategy Centre

Ecommerce – The End of the Era of Luck

12 March 2015

Ecommerce — The End of the Era of Luck

Ecommerce at the SME and mid-market level is still in many ways an amateur sport.

In my view, up to now it has often been luck — and not strategy — that has been the decisive factor in sales.

But by the end of 2015 I think things will have changed. The sun will finally set on this era.

The future is increasingly for professionals, not amateurs.

Ecommerce qualifications back then

In 1998, when I first started programming in ecommerce, the internet industry was so new that I needed no IT qualifications to get into a job.

I had an interview, said that I knew some of the languages involved and was given an immediate offer. A week later I was programming commerce websites.

Six months later I had moved to working in a FTSE 100 company, programming their intranet site. By 2001 I was working in an internet bank in one of the largest IT projects in Europe, surrounded by hundreds of developers.

It never struck me as an issue that I had no qualifications in IT.

Ecommerce qualifications now

Things have moved on a little bit. While web and ecommerce developers now need degrees and generally come from an IT background, it is the digital marketers and ecommerce managers that often do not. And they also work in this extremely complex environment.

When I think about our industry, I realise that this is unusual. Ecommerce at its best, and the mathematics and technology behind it, are as complex as any area of science, engineering or finance. Yet few meaningful qualifications exist.

How can this be?

Surely no mission-critical industry could operate in the way that the ecommerce industry does — or else the world would operate as smoothly as a banana republic.

Why, after all these years, in an area as complex as ecommerce, does it remain the case that few qualifications are required? Why are there no substantial barriers to becoming “an expert” and carving out a career in digital commerce?

The answer lies in the fact that there is no real requirement for ecommerce to be either efficient or organised.

After all, it’s not a matter of life and death. In this expanding market, the only thing you need to do is to operate slightly more efficiently than your competitor and your sales will grow.

To be “an expert” in social, search, UX or ecommerce, unlike most professions you can declare that you are.

In such a fast-moving industry, there is no requirement to have any qualifications or degree. Therefore few qualifications with any credibility exist.

The end of the frontier era in ecommerce

Because of the complexity of the elements in ecommerce and the speed that the industry has moved at, luck has often played a big part in success for the last 20 years.

Companies could not fully understand where the sales came from, so they often assigned their success to the wrong element.

Technical people and programmers often made the conclusive decisions on sales. People with no qualifications ran digital marketing operations. Traditional measurements and approaches went out the window.

In 2015 I sense the end is coming for this first “frontier era” of ecommerce.

The new era of big data in ecommerce

The reason for this is that we have entered the era of ‘big data’.

Finally, businesses are realising that the goal of all the complexity in ecommerce is the same goal as any other sales channel: SALES and PROFIT.

The goal is not technology, social proof, search, SEO, UX or getting ‘likes’. The goal is sales. Sales are the one thing that can be measured with a very high level of certainty.

Now that big data is piecing together the value of parts of the ecommerce chain, the light is beginning to break through.

Results driven ecommerce

The beginning of this era of “results driven ecommerce” is a welcome era for me personally.

In ten years of selling within the SME and mid-market sector, never once was I asked “Can your approach and technology give us the most sales and profits?”.

And when I reached a critical moment to close a deal, I could often see the question forming in a client’s mind, “How good is the IRP platform’s SEO — can we be first in Google?”

My instant answer should have been “Yes” — rather than the honest answer I generally gave: “Ecommerce is not about Google, it is about sales”.

This shift to “results driven ecommerce” is reflected in our own research and development work in IRP Insights. Machine learning and statistical analysis now form the major part of our R&D efforts and will continue to do so from now on.

Ecommerce is entering the era of qualification by results. Big data, mathematics, statistics and insights will be the dominant forces in ecommerce going forward.


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