The worldwide eCommerce industry is headed towards a $781 billion valuation by 2024. That figure, released earlier this month by Transparency Market Research, is driven by the increasing adoption of international eCommerce capabilities by sellers.
In its analysis, Transparency Market Research said this growth will bring new business to a host of service providers.
“The whole pie is expanding in every direction, and there may be enough to serve everyone, from the traditional logistics giants, to the emerging regional names, to the Ubers of the world — and even Amazon (whatever it’s planning),” the report concluded.
Among the tech industries looking to grab their share of profits from eCommerce’s expansion is the Internet of Things and omnichannel FinTech firms. One of them is NCR, and with its new Innovation Lab, the company is looking at how omnichannel eCommerce and payments can make transacting simplified.
Andy Brown, NCR’s marketing director of payments, says IoT and other emerging technologies are critical to this initiative, especially in B2B commerce and payments. But, Brown tells PYMNTS, nailing down corporate eCommerce habits can be particularly challenging.
The Role Of Data
One of the residual effects of eCommerce’s explosion is the accessibility to troves of data on consumer shopping habits. Today, any shopper on Amazon can make a purchase and then automatically be recommended similar products they might enjoy, thanks to data analytics technology. Data will be key in taking this a step further, explained Brown, to not only recommend similar products but to analyze historical shopping habits and make predictive offers for what online shoppers might want and need.
That kind of technology is possible for corporate shoppers — sort of.
“SMEs are very similar to consumers, so absolutely, this can apply to the SME market and what they’re buying,” Brown explained, noting that a small business owner shopping for a business online is often a similar process to consumer online shopping. But outside the SME realm, he added, assessing purchasing habits can become more difficult.
Corporations tend to make higher-value purchases, and with the use of purchase orders and other paper documents, the data is less accessible. There are often multiple people making purchases for the firm, too, Brown said, meaning buying habits are less predictable than they are for a single purchaser.
Here’s one area where innovations in data aggregation and the Internet of Things can really make a mark, Brown noted.
For instance, IoT-connected devices around the company can offer suggestions and predictions as to what a company needs to procure.
“There are a lot of different places where you can imbed sensors to generate data, and then, you could recommend a service offering and provide that to a particular organization,” the executive said. “It’s about using data to effectively understand what the set of services the organization really needs.”
B2B eCommerce’s B2B Payments Impact
The B2B eCommerce segment is slated for its own impressive growth rate, headed for a $1.13 trillion valuation by the end of the decade. With higher-value transactions than typical consumers, business spend makes for an attractive area for service providers, like omnichannel firms, to make their mark.
Some analysis concludes that B2B eCommerce is becoming more like B2C eCommerce, too, with higher demands for more personalized shopping experiences.
But Brown explained that not every B2B vertical is tapping into online and omnichannel procurement.
“Different markets, different trends,” he stated — eProcurement and eCommerce adoption varies by geographic and industry markets. Generally, though, he said he sees businesses of all sizes landing on digital platforms to make purchases. That means more data for service providers to analyze, and it means a step towards predictive and customized buyer habit analysis.
Brown said that should also be promoting more frictionless B2B payment solutions.
“A process where a payment just happens — that’s where we ought to be at, and I don’t think we’re at that,” he said. Paper invoices and purchase orders make it more difficult for corporate payments to become streamlined, he said, as do more challenging sales cycles.
Today, ERP and eProcurement platforms are working to integrate the payments process seamlessly into the purchasing process for corporations, Brown said, and looking to do so across platforms. The biggest challenge, he added, may be ensuring that the adequate controls are within these systems, ensuring the correct authorization for purchases made via mobile device, desktop or otherwise.
“With B2B payments, you’ve got several levels of authorization,” Brown noted. “But as long as those controls are in place, I don’t see any reason you shouldn’t make [the payment] in an electronic format.”
The challenges of streamlining corporate purchasing and payment procedures can be far more complex than doing so for consumer behaviors. Not all corporations make their purchases online, nor do they all make their payments electronically. But Brown said, as adoption of digital, omnichannel tools for eProcurement and payments rises, the role that data and IoT technologies play for corporate buying increases, too.
These challenges are part of the motivation behind the creation of the NCR Innovation Lab, the company said in its announcement of the venture last week.
“Omnichannel has evolved. It is now a strategic, end-to-end solution with a horizontal opportunity across all industries, in every geography and for all tiers of customers,” stated Eli Rosner, chief technology officer and senior vice president of software solutions at NCR, in a statement.
According to Brown, while the challenges in providing omnichannel and other smart solutions to the corporate buying game are numerous, the time is now to take on those hurdles.
“There is a huge link in what’s happening across collecting data about what you’re doing, how you’re doing it and using it to make that payment process more frictionless, and I think that’s really great,” Brown said. “I think, over the next five years, we’ll see some big changes, and things like faster payments and real-time payment services will change things a lot. It’s quite an exciting time to be in the payments business.”