You may not be familiar with the term digital commerce—also known as dCommerce—but you've probably already engaged with it. DCommerce is a type of eCommerce where the products are digital, and no human intervention is required.
It may sound like something out of the future, but dCommerce is everywhere.
Major players in this space include Netflix and Zoom, who offer subscriptions to digital services, Salesforce with their Software as a Service (SaaS) product, and Bored Ape Yacht Club, who sell digital arty in the form of NFTs.
But dCommerce is more than just digital products. New technology has made it possible to create high-quality, fast, and convenient customer experiences that are completely automated.
DCommerce offers businesses the chance to scale like never before. If you're looking for the next trend in eCommerce, this is it.
What's the difference between dCommerce and eCommerce?
Before you read any further, let's make sure you understand the difference between eCommerce and dCommerce.
ECommerce is the process of selling or buying products on any online platform. DCommerce is a form of eCommerce, although the two now refer to different things.
Traditional eCommerce refers to the buying and selling of physical products or human services. You may be able to book your massage online, but you'll still need to see a massage therapist in real life.
ECommerce is already a highly automated system that leverages technological innovation. It requires digital marketing, online transaction processing, a website, and other digital tools.
But no matter how many apps you use on your Shopify storefront, if you sell a physical product, the process will always require manual intervention.
Though not always labour intensive—for instance, a drop-shipping store can be completely hands-off—it still takes a ton of time and resources to produce, sell, and distribute physical products when customers purchase them. As a business owner, you may not need to package and ship your goods, but you'll still need to track shipments and ensure the supply chain runs smoothly.
DCommerce, on the other hand, can be completely automated to near guarantee a flawless experience for customer and business owner alike.
The goal is to allow consumers can access goods around the clock with a click of a button or tap on their phone screen. They want immediate access to their purchase, and you want to provide it.
How does dCommerce work?
Many similar tools are used to launch a dCommerce business, including popular eCommerce stores like Shopify.
A store is set up in the same way as any other online business, only the digital goods are stored on servers instead of in warehouses and can be accessed immediately upon purchase.
These products can be anything from digital artwork to online courses to subscriptions.
To run an effective dCommerce store, you'll also need automated marketing and customer relationship management tools. Applications can store customer data that's used to target customers in social media or search engine advertising. It can offer tailored promotions to improve the overall conversion of your efforts.
Analytics allows you to learn more about your customers and their behaviours so these automated marketing efforts can be refined. You may even be able to identify trends in customer data that allows you to target new potential customers in the same way.
Other applications focus on customer retention through abandoned cart offers and loyalty rewards.
As your marketing brings customers to your store, the shop allows for effortless payments and automated deposits to your account on a regular basis.
There are pros and cons to this type of automated system, and it's important to understand them before moving your business from e- to dCommerce.
Requires less resources
The main advantage of dCommerce is that it requires less resources across the board. There's less capital needed to start your business since you don't need to buy inventory or pay to store or ship items. The digital products themselves don't require any physical resources to be created.
DCommerce will also require a smaller staff since there's no need to manufacture or ship products and the buying and marketing process can be entirely automated. This not only frees up time to work on more important things but can eliminate duplicate work efforts. All these advantages result in lower overhead expenses in the world of dCommerce.
Avoids supply chain issues
The world is still reeling from the supply chain issues faced during COVID. It's still hard to get items delivered on time to customers. With digital commerce, the products are created, stored, and delivered online. There's no need for warehouse, inventory, and shipping management. All you need is an eCommerce platform that will help you create your own online store, manage orders and payments seamlessly, while also providing you with advanced marketing tools to reach out to your customers effectively!
Simplifies returns
With dCommerce tools, it's possible to automate refunds, cancellations, or even customer retention. When a customer selects their reason for the return or cancellation, you can trigger a set series of actions.
For instance, if cost is the issue, you can offer on-the-spot discounts. If the issue is customer satisfaction, it can trigger a full refund that also promises continued access to the product or platform for a set time.
What's more is that digital products are not affected by things like wear and tear. You'll never have to worry about shipping something defective again. Even if the product is not working as expected, a remote fix to the digital product can address the issue immediately for all impacted customers.
Offers a better customer experience
Nearly every potential consumer journey is mapped out in advance and supported by specific content. In many ways, digital commerce is marketing automation at its best, as it can predict a consumer’s next logical need and answer that need to lead customers to purchase.
This process significantly reduces buying time, particularly in the B2C space where most purchases are considered impulsive.
Consumers expect a personalized experience that digital commerce can deliver. Because every process is optimized to lead to a satisfying consumer experience, consumers keep coming back for more, leading to increased revenue.
Makes scaling easier
The fact that DCommerce doesn't require storage space or shipping services means that it's much easier to scale up your business. DCommerce allows you to launch a business with a limited amount of capital on hand.
Beyond that, the automated systems make scaling quick and easy. If you have the right tools, your store can grow exponentially without intervention. For instance, a Shopify Plus store can process over 10,000 transactions per minute so your initial set up can pay off long-term.
Automation also allows you to use data analytics to inform strategic decisions about pricing, merchandising, promotions and more so that you can optimize every aspect of your business from top-to-bottom without having to spend time manually analyzing data from various sources across your organization.
Challenges of dCommerce
The biggest challenge when launching a dCommerce business is the initial set-up of these complex processes. To ensure your store operates on its own, you'll need to get those systems and tools in place. It can be a major lift on your own, so consider working with industry experts.
Digital products to start investing in now
Many people have already made a fortune selling digital products on sites like Udemy, Teachable and Skillshare. But if you're tempted to start investing in dCommerce, consider investing in Web 3.0 products.
An NFT, for instance, is a digital product that doesn't involve ongoing maintenance. This means even less staff, lower business expenses, and a lower risk of product issues or returns.
NFTs are a hot topic right now—and they're only going to get hotter as more people realize how easy it is to create them and sell them on the Web. So, if you're looking to get ahead of the popular interest, this is your chance.
Key Takeaways
The future of digital commerce is bright. It presents a great opportunity for new businesses to scale and for existing brands to adapt to better serve their customer’s needs.
The best brands understand this and are already prepared for the digital future. Take Microsoft, who launched their Office Suite as a software you needed to buy in a physical store. That evolved to a one-time purchase that could be made online and more recently to a subscription service that requires ongoing payments in exchange for ongoing product updates.
If tech giants are already harnessing the power of dCommerce, then it's time for you to leverage these tools, too.
Digital commerce is about using data to understand your customers’ preferences and behaviours, then tailoring your approach to suit them. It is about creating a customer-centric strategy that is personalized and seamless—all while being automated and easy for you. Here's to hoping that the future of digital commerce will hold more merchants who are proactive in taking advantage of this technology.
