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Elastic Path's presentation at JUMP 2011.
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Digital “Elastic” Commerce
Right Here, Right Now New Business Models for the instant access revolution
Oct 12th 2011
Sal Visca Chief Technology Officer
Elastic Path Software
JUMP Conference London, UK Oct 12, 2011
JUMP Conference London, UK Oct 12th 2011
Elastic Path Software provides software and services to help the world’s most innovative digital companies transact and interact online
Software • Consumer • Enterprise • Security
Telecommunications • Handset Manufacturers • Operators / ISP’s • Cable Companies
Media & Publishing • Magazines • Online Content • Entertainment
Online Services • Subscription Content • Digital Marketplace • Digital Retailers
Key Customer Verticals
Elastic Path | Technology and Expertise for the Digital Content Ecosystem
JUMP Conference London, UK Oct 12th 2011
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
Social Frictionless
• Transactions are accomplished in the context of life
• Buyers are presented with more relevant offers
JUMP Conference London, UK Oct 12th 2011
Bold Statement
Traditional approaches to ecommerce are
inadequate,
irrelevant
unsuitable
for companies selling digital content
JUMP Conference London, UK Oct 12th 2011
This isn’t your father’s shopping cart
JUMP Conference London, UK Oct 12th 2011
New rules for selling digital content
Its different than physical product
Its all about the ongoing relationship
Entitlements vs SKUs
People want to buy in the context of life
New business models are needed
APIs are no longer an option
JUMP Conference London, UK Oct 12th 2011
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
JUMP Conference London, UK Oct 12th 2011
Skus vs entitlements
SKU (stock keeping unit) is completely unsuitable
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, selection, etc
Sale not over when first transaction complete
JUMP Conference London, UK Oct 12th 2011
New Business Models
Freemium
Subscriptions
“All you can eat” plans – Netflix, Spotify, 24symbols
Metered Content
Trials
App store – content from anywhere
JUMP Conference London, UK Oct 12th 2011
JUMP Conference London, UK Oct 12th 2011
New Business Models
Resistance to £40 - £50 price point for downloadable games
In-game purchases
Free games boost gaming industry revenue
JUMP Conference London, UK Oct 12th 2011
APIs – No longer an option
Internet of things – explosion of devices
Purchase in context
Functionality and service must be exposed in a way to enable efficient and innovative creation of user experiences
You need an ecosystem – always a mashup
Integration is key
JUMP Conference London, UK Oct 12th 2011
General Online Store
Shoppers
Ecommerce
Store Operator
JUMP Conference London, UK Oct 12th 2011
Marketplace
e-commerce
Marketplace
Multi-Vendor Store Operator
… App Developers, Publishers (books, videos, music, games)
Single-Vendor Store Operator Shoppers
JUMP Conference London, UK Oct 12th 2011
Marketplace : AppStore, SuperStore ….
• Create marketplaces for 3rd party vendors • Sell add-on apps or services for your products • Create new online revenue streams
Vendor Portal
Online Channel
Approvals
Market Place
JUMP Conference London, UK Oct 12th 2011
Marketplace | Capabilities
Vendor Portal
Store Front
Marketplace Manager
Market Place
Vendor Mgmt Vendor approvals Application feedback Review vendor profile
Reporting Financial Revenue
Profile Mgmt Vendor registration Application process Vendor profile Manage users (accounts) Vendor agreement Payment types
Product Mgmt Product creation Product information Pricing Markets Offer opt in Approval workflow (state) Remove / suspend products
Order Mgmt Outstanding orders Completed orders
Community Read product reviews Comment on reviews Knowledge base / forums
Vendor Portal Configuration Vendor registration fields Approvals process Branding & URL Terms & conditions Permitted payment types Commission rates
Catalog Mgmt New product approvals Completed orders
Reporting Vendor performance Commission payments Taxes
Standard Storefront Functionality Search Browse Faceted Navigation Shopping Cart Checkout Payment Self Service Customer Reviews etc
JUMP Conference London, UK Oct 12th 2011
Digital Marketplaces
Application Stores (“AppStores”)
Software Stores
Online Music Stores
Online Video Stores
Online eBook Stores
Online Game Stores
(e) Commerce-as-a-Service
JUMP Conference London, UK Oct 12th 2011
Application Store
Marketplace
e-commerce
Multi-Vendor Store Operator
… App Developers, Publishers (books, videos, music, games)
Single-Vendor Store Operator Shoppers
3. App approved and uploaded
4. Purchase
Developer
1. New App Submitted
5. Revenue (70-80%)
2. App Reviewed
App Store
The Power of App Stores A free application downloaded with not-so-free subsequent transactions…
When frictionless goes too far…
JUMP Conference London, UK Oct 12th 2011
Summary
Digital Goods require a Digital Commerce platform
Selling online now requires Digital Relationship Management
Digital single-vendor e-commerce stores can be expanded into Marketplaces / AppStores
Marketplaces provide a venue for digital publishers (vendors) of all sizes to market and sell their digital wares
Questions
For more on-demand digital commerce resources
www.elasticpath.com/resources
1.800.942.5282 (toll-free in North America)
www.elasticpath.com