ElasticPath Digital Commerce 2012

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  • 1. Digital Commerce The Future of e-commerce for Digital Goods and Content March 14th 2012 Sal Visca Chief Technology Officer Elastic Path Software Digital London London, UK
  • 2. Elastic Path • eCommerce software and solution vendor • Focused on Digital Commerce • Enterprise digital customers who are very successful in their space, long term o Time, Google, RIM, Symantec, etc. all on 3rd + projects o Very high customer satisfaction (NPS >50) • 175+ staff; 200+ customers • Offices in Vancouver, London • Profitable every year since founding • Thought leadership includes #1 ecommerce blog in the world (>15,000 subscribers)
  • 3. Digital London March 14th 2012 Bold Statement Traditional approaches to ecommerce are  inadequate,  irrelevant  unsuitable for companies selling digital content
  • 4. Digital London March 14th 2012 This isn’t your father’s shopping cart
  • 5. Digital London March 14th 2012 A traditional hard goods model doesn’t work
  • 6. Digital London March 14th 2012 What does digital commerce look like?
  • 7. Digital London March 14th 2012 It’s all about the experience
  • 8. Digital London March 14th 2012 Elastic Commerce | Frictionless, Social, Everywhere Elastic Path’s vision is “Elastic Commerce” – ecommerce that turns new ideas into profitable systems, and is adaptable to diverse, dynamic needs Everywhere • Products come from anywhere • Sellers come from anywhere • Transactions can occur anywhere • The primary source of consumer information about products is other consumers • Consumers drive how, when, and where they buy SocialFrictionless • Transactions are accomplished in the context of life • Buyers are presented with more relevant offers
  • 9. Digital London March 14th 2012 Selling digital content is different • Digital content providers are in a perpetual interactive relationship with customers • Continuous Engagement with the Consumer • It is all about the experience not the one- time sales transaction; Customer Lifetime Value (CLV)
  • 10. Digital London March 14th 2012 SKUs vs Digital Entitlements  SKU (stock keeping unit) concept is very limiting  Product variations could easily produce an unmanageable number of unique SKUs  Manage entitlements - objects with rich and extensible sets of attributes  Need to rethink catalog, merchandising, discovery, search, selection
  • 11. Digital London March 14th 2012 To meet the demand of consumers, businesses must be disruptive to survive
  • 12. Digital London March 14th 2012 According to Forrester Research “Digital disruption is relatively new; only a handful of industries have felt it to date. The most obvious example is the music business, which thanks to digital disruption went from shipping $14 billion in recorded music in 1990 to $6.8 billion (including digital) in 2010. Digital disruption has similarly upended other media. Every business—no matter how analog—is susceptible to the same digital overhaul on all fronts; it's not a matter of if but when—and by whom.” The Disruptor’s Handbook (October 27, 2011)
  • 13. Digital London March 14th 2012 Physical Digital Digital Disruption Peter Sheldon | Senior Analyst, Forrester Research Business models are changing quickly
  • 14. Digital London March 14th 2012 New Business Models  Freemium  Subscriptions  “Pay as you Go”  “Pay by the drink”  Metered Content  Quality of Service  Trial, “Try before you buy”; time or functionality limited  “All you can eat” – Netflix, Spotify, 24symbols  App and Content store ecosystems
  • 15. Digital London March 14th 2012 New Business Models Resistance to £40 - £50 price point for downloadable games In-game purchases Free games boost gaming industry revenue
  • 16. Digital London March 14th 2012 “When companies adopt technology, they do old things in new ways; when companies internalize technology, they create entirely new product experiences.” James L. McQuivey, Ph.D. | VP, Principal Analyst, Forrester Research Digital disruptors need to own this in house
  • 17. Digital London March 14th 2012 New York Times online? Paywall ? “It turns out people will pay for things even when payment is not required. Motivations such as convenience, duty or appreciation are more compelling than coercion” “Digital news is different. It is an intangible good. My access to it does not inhibit your access to it. It has a cost to produce, as a whole, but the cost of extending it to one more person is insignificant. There is no natural scarcity, so we don’t have to impose an upfront price.” http://www.poynter.org/latest-news/top-stories/142936/why-would-anyone-pay-to-read-the-new-york-times-online/ by Jeff Sonderman Published Aug. 16, 2011
  • 18. Digital London March 14th 2012 APIs – No longer an option  Internet of things – explosion of devices; new points of consumption  Purchase in context  Functionality and service must be exposed in a way to enable efficient and innovative creation of user experiences  Work within an ecosystem  Integration with other applications and content is key  Elastic Path Digital Commerce API (DCAPI)
  • 19. Digital London March 14th 2012 Digital Commerce software example
  • 20. Digital London March 14th 2012 Digital Commerce Service example
  • 21. Digital London March 14th 2012 Digital Commerce publisher example
  • 22. Digital London March 14th 2012 Digital Commerce media example
  • 23. The Power of App Stores A free application downloaded with not-so-free subsequent transactions…
  • 24. When frictionless goes too far…
  • 25. Digital London March 14th 2012 Summary  Digital Commerce requires flexible architectures to support rapidly evolving new business models  Build compelling digital product experiences; focus on Customer Lifetime Value  Enable commerce in the “context of life”
  • 26. #1 subscribed ecommerce blog www.getelastic.com
  • 27. Digital London March 14th 2012 www.elasticpath.com