How to make online shopping universally accessible

Over the last 20 years we have gone through a transformation in our shopping experience and of the contract between the consumer and the shop. The majority of this transformation has come from e-commerce, it is the definition of a disruptive movement. This 20 year battle in shopping has seen a select number of companies come out of the sea and establish themselves as the biggest companies in the world. This has caused those bricks and motor companies that were once in that top position to start running scared. I would say their reaction has come too late, their ‘innovation’ or ‘digitilization’ comes at a time when they have already been beaten. But all this would assume that e-commerce has completed its evolution. Though that is what I wish to highlight in this article, that there is a population left behind and not only that but the initial contract between customers and the e-commerce companies forged in the 90s and early 2000s has fundamentally changed.

For me and many of my peers the likes of Amazon is the perfect option for shopping. With their same or next day delivery and their near infinite product choice make them great options. Their services have resulted in increasing the laziness of shoppers, because it is now easier to buy your toilet paper online than it is to go to a supermarket. This drive towards convenience shopping is not new, you can go back 20 years and when we talked about the death of the high street we were talking about the big supermarket chains who were doing the decimation. They came along with their all under one roof shopping experiences, in mega-stores that led to the expulsion of local green grocers, milk men and butchers. All that has happened now is it is the likes of Amazon who are now putting the pressure on those same supermarkets by offering more convenience.

Returning the point that although the convenience of Amazon converted me into an early customer, I am not a representative node of the general populous. Even further than that, my cohort of 20–30 year old university educated professionals living in the worlds biggest cities are not representative. I am the type of person who has become normalized to pay subscriptions, from my Prime account, netflix, spotify or icloud services. Amazon provides a great service to Prime members. But in reality the fact is the facility of next day shipping comes at a cost of over over 120 dollars a year. That starts to sound pretty expensive if I just wanted to buy a 20 dollar kettle to begin with.

It is expensive, it is a luxury and actually for many people it makes the transparency of shopping much more complicated. And it means even today there are large groups of people who do not access the level of online service provided by Prime. Be this through disposable income or age. It means there is a huge opportunity to improve e-commerce and grow other companies in this space, due to the lack of good comparable alternatives.

A change of philosophy — my last 10 years with Ecommerce

I will talk predominantly about Amazon as in Europe they are the gold standard in terms of both users and service in e-commerce. There are a myriad of other companies and very large ones but I will concentrate on where I have the most knowledge.

When I was a teenager I remember first using Amazon to buy books for school online. The prices were impressive and the selection quite incredible. At that time there were many suppliers on their platform. There was a combination of old and new items, at different prices and with different delivery times. My reason to shop on Amazon at the start was price and selection. This was an important element to what allowed them to grow and monopolize the market. I used to go online to get the best price, I used to go online because the traditional shops just didn’t compete on the same level, and I was prepared to wait 5–10 days for my cheaper price.

However, over the years the contract between Amazon and myself has changed. Now you will find the vast majority of high street shops willing to match online shops. Look at Best Buy who now even tell you if there is a cheaper price online and give you a discount at the till if there is. In part this is because they have lost so much trade to online that they have to change their model, but this is also a reflection on the fact that online has become and is becoming more expensive. The reason before to go on Amazon was its price, because at the time it was still more convenient to go to a store than to buy something online and wait 5 days to get your package. But today we go to Amazon and the Amazon app, because of convenience. They have mastered efficient shopping. I can now think of something, see something in a shop window or advert and in less than 60s I have opened the app, found the exact product, bought it, and have it delivered by the time I get back from work tonight - or even sitting in a locker on the walk back to my house. It is quite an incredible level of efficiency.

But what has subtly changed is that I have probably paid more for that item than I would in the shop. Those items are now no longer cheapest on Amazon, but the majority of prime users don’t care or aren’t aware. They are now willing to pay more and pay more for the service that Amazon can provide. Amazon is in the game of the lifetime value of a customer, and they are great at optimizing it. They captured you at the start with cheap prices, they optimized the service to what we now have and they now benefit from my addiction to this level of service. Also, now I am hooked and now they are an effective monopoly they can also progressively increase their margins to see what sort of premiums people will continue to pay for the service and the products. This means progressively, we will suffer the consequences of increasing Prime fees and increasing product prices. This is a long way from my initial days of using Amazon. Back then I would have baulked at the fact of paying 120 dollars a year for the luxury of buying the product at the same price as in a shop, just so I could have it delivered on the same day. I mean surely I could have just walked to a shop and bought it.

So what I try to conclude through this, is that although Amazon prime is a great level of service it is now a fairly expensive shopping experience. Although, I am sold on it and willing to pay more for it, not everyone will. More than this, Amazon now occupy a different place on the market, they used to be the cheapest place to shop, now it is they are the most convenient and efficient place to shop.

The Flip side — the unserviced clients

What we have to recognise is that there are whole parts of the populous who are not on Amazon prime, for various reason some cannot justify it or just don’t understand why they need it in their life.

So nowadays where do you go for the cheapest prices online? You will have to go to a bunch of other marketplaces like wish or aliexpress or any other of a myriad of other online shops. Here you get the cheap prices, the prices of manufacturers or distributors from China accessing external markets to sell their products. These existed before, maybe not as big or as organised as today. But I remember 15 years ago ordering on Ebay and getting my usb 15 days later with a nice little Chinese export sticker on it. These platforms now occupy the space for the low prices.

The problem is that they are generally fractured organisations, as Amazon was before, essentially they provide a technical front for several hundred or thousand suppliers (a marketplace). They all provide different levels of service quality and the supply chains are disorganised and disconnected. Whereas Amazon now handle the logistics process for many of the most popular products. These cheaper marketplaces only provide the shop front, and it is the supplier who handles the shipping. What that means is that for your price, for your discount you now have to make the enormous sacrifice to the quality of service which is provided. What we have is a gulf between the same day delivery provided by Amazon and the 15–28 days delivery for these other marketplaces.

This means those who want to access the best prices and do not want to pay or cannot pay for the benefit of Prime, have to accept a grossly inferior service.

The proposition

Today there exists a gulf between the e-commerce companies on the cheap end and the established ones like Amazon. The cheap side of the market is for me a regression to the past with just a more sexy front page or app. I believe there is a medium ground a compromise between price and service, where the speed of delivery can return to 3–5 days and the cost is better than Amazon. Where shopping can return to being more transparent and service driven. Where there is not a subscription. If you want to buy just a kettle you can. But at the same time you shouldn’t be asked to sacrifice the service, to deal with various suppliers in various jurisdictions, with various rules for return.

So this is an intro to a project I have been consulting on for a number of months from a company based out in Paris. Hopefully you will soon be hearing a lot more about this company.