Commerce is everywhere, including social media, with “Buy Now” buttons and social shopping networks. These days, if you see something on Facebook that you like, all you need to do is tap your finger a couple of times and those reflective camo Chucks that caught your eye are on the way to your front door.
With internet-enabled payment options, you don’t even need your credit card at hand anymore. And now that “chat bots” have hit the scene, you don’t need to sift through a brand’s web site to find what you’re looking for.
The possibilities for commerce are truly limitless when combined with big data, machine learning and the Internet of Things. These technologies help consumers connect with the exact products they want and need through a nearly infinite number of channels.
But when the amount of product data being generated is just as infinite, retailers’ ability to innovate suffers, and buyers and sellers can become siloed. Here is a look at how commerce has evolved, and how retailers are handling the change.
The earliest form of commerce we know of is the barter system, where people exchanged goods as their means of doing business. Bartering has existed for thousands of years and in those early days neither the buyer nor the seller had a lot of market power. Used in Mesopotamia and adopted by the Phoenicians and later the Babylonians, bartering saw goods exchanged for food, weapons and spices. Interestingly enough, salt was a major currency as it was a rare commodity.
With bartering, products and product information were limited to the senses of what the consumer could touch, see, taste or smell. Vendors may have used word of mouth marketing to differentiate themselves, but overall they were quite limited in how they could convey information about their products.
Fast-forward several thousand years to when the growth of society and urban centers enabled an easier exchange of goods and services, leading to the emergence of public markets. These markets significantly improved the commerce experience for both buyer and seller. Through consolidating products available for purchase into one space in urban areas, sellers were able to more easily sell their wares. And buyers had many more options — they could much more readily compare products, prices and quality.
These public markets made it possible for consumers to do most of their shopping in one location and at one time. Much like with the barter system, documented product information was inconsistent, and the consumer was left to determine the best product for their needs based on their own knowledge. But these markets made it easier for consumers and vendors to more readily exchange informal information on products, as well as on vendor quality and reputation. Additionally, formal currency became the way people purchased goods and services, which was more precise and more universal than doing an exchange.
Even with the advent of such revolutionary technology as the printing press, electricity and telephones, commerce did not significantly evolve again until the 1990s. Before that time, people still had to go to the market (or to the store) to get what they needed. But then came the Internet, revolutionizing our society and also raising the bar for commerce. Using this new medium, Amazon and other e-commerce platforms transformed the shopping experience by enabling consumers to make all of their purchases from the comfort of their own home.
Thanks to the Internet, commerce shifted into a higher gear and omnichannel was born. Consumers could browse and buy from home or the store. Soon, the lines between these two methods of shopping merged and consumers began “showrooming” and “webrooming” — comparing prices either online or in store to find the best deal. Because of this new option, the number of products you could buy and the range of product information available was massive.
The one irksome problem with having this massive quantity of products available was that the quality of information about them was widely varied. It was sometimes unclear whether the products online were the same as the ones you saw in the store. The product information was diverse and inconsistent between online and physical stores.
The Infinite Channel
After only two decades of living in an omnichannel world, we have already entered a new phase of commerce: pervasive commerce. Advanced technologies like machine learning, mobile devices, virtual reality and drones are creating yet another revolution in how we interact not only with one another but also with products.
By adding in structured product information, which would bring a necessary uniform organization to product data, we can create a reality where people can actually get the right product, when they want it, at the right price and the right location. The Internet of Things is changing the game for marketing by connecting us to products in more ways than we could even have imagined.
Pervasive commerce will connect brands and consumers through highly personalized purchasing experiences. To be successful, it will need to involve a universal product information language that machines and search engines will be able to understand and use in decision-making.
The current lack of a comprehensive language for product information is stunting innovation and impacting commerce’s ability to bring buyers and sellers together. The current state of product data is clouding the future of commerce and, until the playing field is leveled, the digital commerce experience will be unable to attain its full potential.
Sanjay Parthasarathy is founder and chief executive officer of Indix.