Part 2: Investing in eCommerce: Implementing Your Digital Strategy

Part 2: Investing in eCommerce: Implementing Your Digital Strategy

My previous post on Investing in eCommerce discussed why developing a digital strategy before you invest in an eCommerce platform and related tools is important. This post discusses how what should be included in your digital strategy and how leverage the outputs of that process to choose an eCommerce platform and related technologies.

Starting Point

The first thing any manufacturer, distributor, and retailer should do is partner with a team of digital experts who can help them develop a Digital Strategy. Very few companies have internal resources with the skills or time to manage that type of program. Digital agencies with technical expertise or system integrators with strategy expertise are usually the best partners.

Once you select a partner, they will employ a methodology to gain knowledge around your organization’s business goals and fundamentals, customers, culture, and competitive environment. From there, actionable recommendations on your digital path forward will be made.

Here are some common outputs and deliverables from a digital strategy.

  • Clear Ownership – The creation of a Digital Team within the organization that includes stakeholders across the organization that will oversee all digital initiatives including eCommerce. A clear owner of the eCommerce initiative will be determined.
  • Vision – what is your high level vision for digital and eCommerce over a 2-3 year period. Examples may be that you will to be the digital leader in your industry, or you will use eCommerce as an entry point into new global markets.
  • Strategies – to achieve your vision. Strategies might be creating a new business unit with P&L. Another strategy might be to test a direct consumer site with a limited number of products to gain experience, then add B2B capabilities later. Another strategy might be to gain digital experience and engagement with existing customers first, then focus on revenue growth through new customer acquisition.
  • Roadmap – a 2-3 year road map for technology, people, and processes. Your first year road map should be detailed – the 3rd year more of a notion because it’s hard to plan out that far in any level of detail.
  • Objectives – Specific business objectives and KPIs to measure success.
  • Detailed plan – for first 12 months including timelines, budgets, and action plan. Clearly define the roles of the Digital Team, key stakeholders, and project leadership.
  • Business case – detailing the required investment, potential ROI, risks, and resources required to gain buy-in from executive management and the ownership or board of the company.
  • Technology Recommendations – In some cases, a study will be done to define requirements and make technology recommendations as part of the digital strategy to support the business case. In other cases this will be a secondary project.
  • Fit and Gap Analysis – a report to close the gaps in your plan and mitigate risk.

Once you have those things in place, you are prepared to take a deeper look at what types of technologies are needed to support your road map. Digital implementation partners will be in a much better position to help you select and implement an eCommerce platform to achieve your objectives. In most cases, that will be your next step.

Choosing Technology – Requirements 

Here are key steps to defining requirements for your eCommerce technologies.

  • Assess key business processes – Which processes need to be supported by your eCommerce platform to achieve your objective? This includes existing processes as well as new ones. Processes that support your customers/consumer must be considered along with support for internal one.
  • Identify key personas – Who will be your online buyers and influencers? Also assess internal users – sales or customer support personal for the online store and merchandisers and marketers who will be responsible for maintaining the online store itself. A profile must be developed for each persona which should include the key capabilities required to ensure the customer experience they are looking for.
  • Investigate required integration points- to back office systems and other technologies. For B2B, this is a critical step as know integration points need to be mapped in detail. Design decision about how to architect a solution that will meet both technical and end user requirements is sometimes the most difficult part of an implementation. All platforms are not created equal here.
  • Human resource assessment – what skills are in house or accessible to support various technologies? Are you a JAVA shop or .NET?  Do you have developers, HTML, CSS resources? Do you have content creators/editors, SMEs with the required knowledge of your products? Are key stakeholders and doers available for the project? What can you outsource to cover your gaps? This assessment feeds your selection process and impacts your implementation project and scope.
  • Create functional and technical requirements lists – gather known requirements from all functional areas. Prioritize the lists into must have requirements and future enhancements. You will likely pare this down even further as the process goes on. Keep a focus on supporting your business objectives so that the list of requirements does not creep into the range of having list of everything that stakeholders can think of.
  • Identify key use cases- Ensure functional requirements are identified to support your business objectives. This is frequently done through customer journey mapping to review the entire customer experience. Keep it focused on current objectives. Defer requirements that are not in the current plan to future phase. Though it may impact your platform decisions, keep your focus on the current set of objectives as requirements and platform capabilities may change dramatically over time. Planning for something that might happen in 2-3 years is a poor decision.
  • Assess your product content – what do you have today, what format is it available in, what needs to be created or enhanced? How will acquire and migrate content and into an eCommerce solution? What capabilities does the eCommerce system need to have?
  • Create a plan for making a platform selection. Who will participate? What criteria will be used to select? How many vendors and implementation partners will be included?

Choosing Technology – The eCommerce Platform Selection

Now that you have requirements and a plan of action, it’s time to seriously evaluate alternative platforms. I am not a believer in a shotgun approach of approaching every potential vendor you find. I also don’t believe cold RFPs are optimal to make decisions. Based on the information above, your selection team should be able to quickly narrow down eCommerce platform selections to three or four choices in almost all cases. By this stage, you may already have done that with initial research. Alternatively, you can select a platform agnostic digital agency or system integrator to assist you with a platform selection.

Many natural filters come into play to narrow down platform alternatives:

  • Are you B2B or B2C? There are many more potential platforms for B2C than B2B because of the complex business processes, customers and pricing, and integrations required in B2B. The more digitally mature you are in B2B, the more you will need to focus on the user experience and integration with other digital marketing tools. In many cases, that will require an enterprise level platform.
  • Licensing model preferences – Are you looking for a perpetual, term or subscription, or SAAS licensing model? Are you willing to do revenue sharing or interested more of a pay as you go model?  Is a CAPX or OPX expenditure important to you?
  • What is your projected online revenue and visitor traffic? Scalability is a huge issue that will quickly narrow the playing field.
  • Size of you organization – This relates to overall budget capacity. Most companies spend between .75% and 5% of their overall revenue on digital commerce today depending on their digital maturity. Obviously, a $10 Million organization has a different budget than a $1 Billion company. There are platforms available at all price points, but the capabilities and scalability may be vastly different.
  • Future growth – if you are in acquisition mode and will acquire other brands or companies, this may impact your platform selection and system architecture. Companies in acquisition mode frequently implement a middleware layer for integration to accelerate future integrations. If the complexities are isolated from your eCommerce solution, you may be able to invest in a less expensive platform. The same is true for many other adjacent applications like PIM, marketing automation, customer experience management etc.
  • What is your digital maturity? This is where a road map is really important. A first time platformer has very different goals and requirements than a re-platformer – think of the personalization capabilities mentioned previously. Many smaller organizations will take years to need the capabilities of some high end solutions. Likewise, implementing an enterprise solution with no experience is cause for concern.
  • Do you have a technology bias? – Do you have .NET or JAVA developers or both? Are you an Oracle or an SAP shop? You need to do this assessment up front and be very aligned here – many times so called religious wars start when marketing uses one technology stack and IT prefers another.
  • Integration requirements – How many back office or 3rd party solutions require integrations and how complex are those? Be clear on your single source of truth for content and data. Make sure you stay focused on your key business processes. This is really where integrations become important in B2B.
  • Globalization – Will you be launching many stores worldwide or more focused on a single market? If so, you will need to ensure global capabilities beyond just multi-lingual support.
  • Omni-channel Requirements – Will you need a solution that ties together physical and online stores? Do you need to support multiple sales channels (direct, distribution, retailers, online). Is digital retail in your future? These requirements will quickly narrow your field of choices.
  • Product complexity – the complexity of your products and product families will impact platform choices. If you sell product families or configurable products, be sure to map out those use cases. Most eCommerce solutions handle things like variants well, but complex, configurable products present a challenge to many platforms and solution providers.
  • Types of customers – do you have many customer different with different catalogs, buying profiles, or spending levels? Do they have many different buyer roles with different levels of authority? Are some likely to be buying mostly on mobile devices?
  • Complexity of your pricing models – do you have pricing tiers and/or customer specific pricing? Can sales reps quote prices that differ from standard pricing? Pricing is usually controlled in the ERP and your eCommerce solution must be able to expose the pricing and may need to do so when the ERP is not available or without real time access.
  • Urgency – If time to market is crucial, be wary of platforms with a history of 12-18 month deployments. There are many disruptive platforms in the market today with “good enough” capabilities to quickly bring a site to life with a faster time to business value. In many cases, those technologies will grow with your experience level to meet future needs.
  • Do reference checks – Ask existing customers about the reliability, support, and performance of the platform. What is the cadence of future releases and do they have a history of delivering on time? What is the upgrade path as future software features are release. Is your site impacted by software enhancements? Did implementation estimates match the real costs? If not, was it because of platform deficiencies or other causes?

I won’t list the various platforms and where they fit here, there are simply too many platforms and way too many variables. Suffice it to say your platform choices will quickly narrow as you evaluate your technical and functional requirements and these other variables.

If you choose to or are required to do an RFP, then make sure you incorporate all the outputs of your digital strategy and the considerations listed above. It is much easier for a solution provider or platform vendor to respond if they understand your business objectives, use cases, functional and technical requirements, and deep background on your buyer personas, products, and so forth. The resulting responses will be more accurate and relevant and choosing a platform and partner will be easier for your team.

Selecting Solution Providers

Every eCommerce platform has a list of solution providers. They are usually digital agencies and/or system integrators with varying levels of experience and skills. Both types of companies today provide digital strategy, platform selection and implementation services. But, not all are good at all those things.

Digital agencies are frequently strong at strategy, customer experience, and marketing services, but weak at technology implementations. System integrators are frequently good at technology implementations but lacking when it comes to digital strategy and customer experience. I’ve seen many system integrators struggle with eCommerce in recent years because they lack the customer experience capabilities that are required by today’s more sophisticated buyers. Since your strategy may already be in place, choose a partner that can ensure you have the best customer experience possible.

If in doubt about the best type of solution provider for you, go back to your digital maturity and business objectives. The more mature you are and the more revenue growth is an objective, the more a digital agency with a deep technology background is a better fit. Many also offer managed services at the application level. Some also offer digital marketing programs to outsource or supplement your team on more advanced digital initiatives.

I suggest talking with implementation partners to get insight and advise as you engage the platform providers. Certified solution partners should be the ones developing your architecture and solution, not platform vendors. Of course the platform vendors will be involved, but they should NOT be the only ones doing an RFP response or providing you with an implementation estimate. That’s not their core business and you will likely receive low ball estimates or very, very broad ranges. An implementation partner(s) should be included in the response if possible.

Summary

The first investment you should make in developing an online channel it to develop a digital strategy. Use those learnings to develop requirements and guide the platform and partner selection process. You will be making an informed decision with much less risk than starting from a list of “stock” requirements.

Digital Strategy should also encompass people and processes. But, that will have to wait for another blog post.

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This article was written by

Dale is the Director of eCommerce Enablement for Agency Oasis. He's been in eCommerce as a practitioner and thought leader for since 2002. He thrives on helping businesses leverage technology to meet and exceed their goals. In his spare time he enjoys family, food, golf and music.