Blog Post

April 24, 2018

A Guide to Choosing the Most Profitable E-Commerce Automation Projects

By Tara Matamoros Carter


Professionals in every field are swimming in a sea of invisible automation. Temperatures in the workplace adjust themselves around an optimal value, lights fade up and down in response to motion, and backups launch themselves periodically to protect the company’s most valuable customer data. The hallmark of the most useful automation deployments is that nobody notices them. Things just happen on cue.

Intelligent automation is even more critical for e-commerce, though. The strength of an online store lies in its ability to take advantage of a global, mobile customer base. The potential size of the customer base also enormously amplifies the volatility of customer demand cycles. Successful e-commerce firms must find a way to scale up and down instantly. The market favors companies that respond in microseconds and standardize their processes to minimize human error.

That’s why the future is unquestionably a place where AI, robotics and IoT will take on more responsibilities, allowing humans to do what they do best. That future has already arrived for many of the leaders in the e-commerce space.

What Automation Does for E-Commerce

There are plenty of ways to operate more efficiently and grow the company without getting bogged down in long-term capital investments.

The top four ways automation deployments can help an e-commerce company is by:

  • Collapsing the effort required to complete repetitive, time-intensive tasks
  • Integrating conflicting software platforms that require manual adjustments
  • Digitizing analog systems that slow down the revenue recognition cycle
  • Providing a virtual space for business model experimentation and A/B testing

Technology is advancing rapidly in both the intelligence of automation agents and the ease of use by non-technical managers. There are many more tasks eligible for digitization and automation than ever before. Many business owners put off a deeper investigation because there are just too many options. Here are some simple, practical questions to get started in a way that can help automation projects pay for themselves.

How to Decide What to Automate

The primary goal here is determining which tasks to automate in order to see what makes the biggest initial impacts on profitability and productivity, which can then uncover more hidden inefficiencies:

  • Which recurring management tasks soak up the greatest amount of time on a daily/weekly basis? Don’t worry about whether it’s possible to automate them yet. Just select the top five time sinks for now.
  • Which actions have brought back the biggest returns in terms of customer satisfaction? The goal of automation projects should be to provide more time for these tasks.
  • List tasks that are necessary but extremely unpopular for managers and staff. Automation in these areas may not bring immediate quantifiable gains, but they can greatly improve motivation and productivity.
  • Where are the biggest blind spots in the business? Where there is no data about the state of the company? Normally, this involves categories such as inventory, receivables, field service and so on. Automation in these areas gives leaders better visibility into the state of the business, offering them greater market agility and the ability to make smarter course corrections.
  • How does the company stay in contact with customers after the sale? Referrals, up-selling/cross-selling and recommendation engines are propelling e-commerce sites to record profits. Investigate methods that help e-commerce sites scale up personalization.

Best Applications of Automation in E-Commerce

Consider variations on the following implementations of automated routines:

  • Pre-scheduling promotions – Manually changing prices for online inventory can be extremely time-consuming. Look at rolling dates that modify the price point on specified categories of items and services.
  • Cross-channel deployment – Everyone should have access to new offerings at the same time. An API or similar development project can push new updates to the online store at the same time it sends messages to social media, apps and other channels.
  • Segment communications – Following the 80/20 rule, paying special attention to the best customers can deliver outsized revenue impact. Keep them onboard and engaged by integrating lifetime customer value data with customized email automation for tighter retention numbers.
  • Shipping customization – For customers buying online, shipping is not an afterthought. When and how their order is delivered can make all the difference in who wins the sale. Automation can apply personalized shipping rules based on customer preferences and order size.

Job Functions That Can Benefit Most From Automation

Every e-commerce company must follow its own path to automation, but these three functional areas are the ones that most frequently bring back rapid ROI.

Reducing cart abandonment must be one of the central tenets of any successful e-commerce strategy. In 2017, global cart abandonment rates sat at 75.6 percent. That’s an average across industries, with fashion sites enjoying lower rates (68.3 percent) and finance sites enduring a much higher one (83.6 percent). Recapturing the interest of customers who were committed enough to fill up a cart can make a huge impact on revenues quickly. Automation can track trends in abandonment, suggest reasons for it and schedule communications to reconnect with customers with relevant messages.

Customer Service
Chatbots made enormous strides during 2018. Research indicates that more than 10,000 companies are in the process of adding chatbots to their customer service arsenal. The financial feasibility is already evident and, by 2022, chatbots are on track to reduce business expenses $8 billion per year overall. There’s a cultural aspect to this as well, in that the top four messaging apps now support more monthly active users than the top four social networks. E-commerce leaders have already moved to providing more customer service options through chatbots and more purchasing options in messenger apps.

The critical problem of establishing trust in anonymous transactions has proven crippling for too many e-commerce companies. Too little protection leads to fraud and customer data loss. Too much protection drives away customers who can find an easier path to purchase at a competitor’s site in a click or a swipe. A study by the Association of Certified Fraud Examiners found that half of all small businesses fall victim to fraud at some point in their business lifecycle, which costs business owners $114,000 per occurrence on average. Automation has proven to be a powerful tool in preventing fraud as well as assuring customer data security in compliance with PCI standards.

The On-Demand Engine

The 21st century has been characterized by a cultural shift from push to pull technologies across all industries. E-commerce giants have upended their verticals by allowing customers to drive the interaction and giving them more freedom to make choices. As a study by Deloitte recently pointed out, “Consumer willingness to embrace digital commerce is being further amplified by the rapid pace of technological change.” There’s no doubt that self-serve transactions are the heart of e-commerce. Advances in intelligent automation will be the key to providing more choices to more people in less time.

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 E-Commerce, Automation

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