How to Transition from Traditional Commerce to eCommerce
The transition from a traditional commerce model to eCommerce can be a complex process that requires time, resources, and adaptation. But it's essential to understand the market's needs, be willing to adjust and evolve constantly to succeed in the world of eCommerce.
In the past, the conventional way of shopping involved visiting malls or physical stores to search and select products from the available variety. Consumers would examine and evaluate their quality, price, and convenience, and then choose the products that best suited their needs and budget.
This approach to shopping in physical stores offered consumers the chance to interact directly with the products and receive personalized assistance from the store. However, this process was also limited by the operating hours of the stores and geographical restrictions, meaning that consumers had to adjust their schedules to shop and had access only to the products available in those specific locations.
The arrival of eCommerce began to gain ground over traditional commerce because it allows consumers to make purchases at any time and from anywhere, freeing them from the schedules of physical stores and providing access to a wide range of products with just a few clicks.
Moreover, for merchants, eCommerce can be more cost-effective in terms of operational costs compared to setting up and maintaining a physical store.
Online competition has also led to a wide variety of products and services, resulting in more competitive prices and a greater diversity of choices for consumers. The ability to easily compare prices, features, and product reviews online has empowered consumers to make informed purchasing decisions.
What is Traditional Commerce?
Traditional commerce refers to the practice of buying and selling products or services through physical means, such as brick-and-mortar stores, markets, fairs, etc., without the use of digital platforms or online technology to carry out these transactions.
Moreover, in traditional commerce, customers can interact directly with the products, touch them, try them out, and receive face-to-face advice from salespeople. Payment methods include cash, debit/credit cards, or checks, without the intervention of digital platforms.
These businesses usually have a limited geographical reach and primarily serve local or regional customers. Physical stores generally operate at specific times and may have availability restrictions based on business hours.
Traditional commerce has been the predominant model for many years, but with technological advancements and the expansion of internet use, electronic commerce has gained significant ground, offering new opportunities and challenges for businesses around the world.
What is eCommerce?
eCommerce, refers to the buying and selling of goods or services over the internet. In this model, commercial transactions are conducted electronically, using online platforms and digital technologies.
This type of commerce allows consumers and businesses to carry out commercial activities without the need to be physically present at a location.
eCommerce has experienced significant growth due to the convenience it offers consumers, the ability to reach a global audience, and the flexibility to make purchases at any time and place.
This form of commerce continues to evolve with the development of new technologies, such as artificial intelligence, augmented reality, voice shopping, among others, which seek to improve the user experience and the efficiency of online transactions.
7 Differences Between Traditional Commerce and eCommerce
The main differences between traditional commerce and eCommerce include the following:
1. Physical Location vs. Online Presence:
Traditional: Conducted in physical establishments such as stores, local markets, etc.
eCommerce: Operates online through websites, mobile apps, marketplace platforms, without the need for a physical location for transactions.
2. Hours and Availability:
Traditional: Follows opening and closing hours, which limits the time available for shopping.
eCommerce: Offers 24/7 availability, allowing customers to shop at any time and from anywhere with an internet connection.
3. Shopping Experience:
Traditional: Offers a complete sensory experience and the possibility of receiving direct advice.
eCommerce: Provides convenience and comfort but may lack the tactile and personalized experience found in a physical environment.
4. Customer Interaction:
Traditional: Offers direct interaction between the seller and customer, with the ability to touch, try, and physically experience the products.
eCommerce: Interaction is primarily virtual, through product descriptions, images, customer reviews, and sometimes videos, without the possibility of physically interacting with the product before purchase.
5. Payment Methods:
Traditional: Typically uses cash or debit/credit card payment methods.
eCommerce: Offers a variety of online payment methods, such as credit cards, bank transfers, electronic wallets, and cryptocurrencies.
6. Geographic Reach:
Traditional: Generally has a local or regional reach.
eCommerce: Can reach a global audience, allowing customers to make purchases from different parts of the world.
7. Logistics and Shipping:
Traditional: Customers usually take the products immediately after purchase.
eCommerce: Requires logistics processes for the shipping and delivery of products, with delivery times varying depending on the selected method.
Both models have their advantages and disadvantages, and many businesses opt to combine strategies from both to offer a more comprehensive omnichannel experience to their customers. The choice between traditional commerce and eCommerce will depend on the products/services you offer, your target audience, and the commercial objectives of your business.
Advantages of Transitioning from Traditional Commerce to eCommerce
The shift from traditional commerce to eCommerce brings several significant advantages for businesses. Among them are:
Global Reach and New Audiences
eCommerce offers the opportunity to reach a broader and more global market. It breaks down geographical barriers, allowing local businesses to access consumers from different regions and countries without the need for an additional physical location.
Convenience for the Customer
Customers can make purchases at any time and from anywhere with internet access. This increases convenience and flexibility, eliminating the time constraints often present in traditional commerce.
eCommerce can involve lower operational costs compared to traditional commerce. There's no need to rent or maintain expensive physical space, which can lead to significant savings in expenses such as rent, maintenance, utilities, staff, among others.
Greater Analysis and Personalization
eCommerce allows for more precise and detailed data collection on customer behavior. This enables a better understanding of their preferences and purchasing habits, which in turn allows for more effectively personalized offers and marketing strategies for each customer.
Increased Scalability and Flexibility
An eCommerce platform allows for scaling the business more agilely and with fewer restrictions than in traditional commerce. It's possible to test new products, marketing strategies, and expansions to new markets with relative ease.
Lower Barrier to Entry
Compared to opening a physical establishment, starting an eCommerce business can have a lower entry barrier. With a relatively smaller investment, it's possible to start selling online and expand gradually as the business grows.
Improved Tracking and Analysis of Results
eCommerce platforms offer tools for detailed tracking of business performance. This includes sales metrics, web traffic analysis, conversion rates, among others, allowing for more informed and faster data-driven decision-making.
Transitioning from traditional commerce to eCommerce not only offers these advantages but also allows businesses to adapt to current digital trends and meet the changing needs of consumers, thereby improving their competitiveness in the market.
Transition from Traditional Commerce to eCommerce
The shift from being a traditional commerce establishment to an eCommerce model brings significant challenges as well as unique opportunities. Traditional businesses, accustomed to their direct and personal sales dynamics, will have to consider that customer interaction will now be digital.
Making this change requires learning to manage tools and platforms while understanding and meeting the expectations of digital customers.
One of the main challenges is to create an attractive and functional online presence, capable of competing in a globalized market. It's not just about having a website but having a digital marketing strategy that includes SEO, social media, and online advertising. This transition brings the opportunity to operate 24/7, reducing fixed costs in relation to store rent and utility payments.
Thorough preparation is the foundation for success in e-commerce. This involves understanding the market, setting clear objectives, choosing the right tools, planning effective marketing strategies, and being ready to adapt and continually improve.
How to Prepare for eCommerce
Transforming your physical store to online is straightforward, as long as you use the right strategies for success and are accompanied by experts in the field.
Preparing to venture into eCommerce involves a series of key steps that range from creating an online presence to identifying effective marketing strategies.
1. Establish an Online Presence
Create a website or online store: Design and develop an attractive, functional, and user-friendly website to display your products/services, contact information, shipping policies, and everything necessary.
Domain registration and hosting: Select and register a relevant and reliable domain name for your business. Also, choose a reliable web hosting service for your site.
2. Select an eCommerce Platform
Set up the platform: Customize the selected platform to reflect your brand identity and ensure an optimal user experience.
3. Identify Marketing and Advertising Channels
Develop a digital marketing strategy: Define the marketing channels to use, such as social media, email marketing, SEO (search engine optimization), PPC (pay per click), quality content, or influencer marketing.
Create relevant and attractive content: Generate valuable content that attracts your audience, including high-quality product images, detailed descriptions, informative blogs, or videos.
Implement SEO strategies: Optimize the content and structure of your website to improve its visibility in search engines and attract organic traffic.
In addition to these points, it is crucial to establish clear policies for customer service, inventory management, and logistics to ensure a smooth experience for consumers. Also, constantly monitoring and analyzing the performance of your website and marketing strategies will allow you to adjust and continuously improve your eCommerce efforts.
Preparation for eCommerce is a continuous process that involves adapting to market trends, testing new strategies, and staying updated with the latest technologies and business practices to achieve online success.
Successful eCommerce Examples
There are several examples of companies that have had notable success in the world of eCommerce, among them are:
Amazon's success is largely due to the ability of its engines to operate almost autonomously. It generates specific buyer profiles and offers a wide variety of products to its customers.
Amazon has designed, launched, promoted, and sustained its own digital platform for eCommerce, giving it greater control over information, availability, and tracking of each product shipment, maintaining high control over each element of its platform.
This platform related to the fashion industry has reached one of the widest audiences from different parts of the world, thanks to its efficient shopping methods.
This brand does not have physical sales spaces and has opted for the virtual format.
Represents the success of digital commerce, as it turned a basic need into an innovative format through mobile applications, providing a solution to the mobility problem in cities. It also includes the food delivery service with Uber Eats.
eCommerce and traditional commerce have certain differences and cater to different customer needs and preferences, with these models not being mutually exclusive. A company can choose to operate as a traditional model, an eCommerce model, or opt for both, i.e., be a mixed business.