Ecommerce Reconsidered: Why You Might Need a Shopping Cart After All
Educational publishers that serve markets at the primary, secondary, or higher education level must conform to established high-touch adoption sales processes, typically with a direct sales force.
While the specifics may vary from market segment to market segment, publishers concluded that online storefronts would not yield significant additional revenue. Worse, online sales might disrupt existing distribution relationships through channel conflicts, threatening existing revenue.
The Money Pit
The second fundamental reason publishers have questioned whether to create their own storefronts is cost. Businesses have been creating ecommerce sites in earnest for around fifteen years. In the early years of ecommerce, creating an ecommerce site represented a significant capital technology investment. A high level of technology integration was required, if not outright software development, to create the desired shopping experience for the customer and fulfillment processes. Ecommerce initiatives in the early days were risky, complex, and became a career Waterloo for many executives for whom the initiative got out of control. Without a clear projection of the new revenue ecommerce channel would generate, it was difficult for publishers to justify the investment of an ecommerce site.
A Need for Reassessment
The time has come for many of those publishers who earlier decided not to develop or acquire ecommerce capability to reassess their decisions. Many will find that after five to ten years, previous assumptions about ecommerce are no longer true.
The cost and complexity of implementing online transaction capability have been lowered substantially for publishers over the past ten years, driven by a number of factors:
- Vendor-Hosted Ecom: A wide-range of ecommerce software-as-a-service (SaaS) providers can now offer a hosted ecommerce capability to publishers efficiently and economically. SaaS providers enable a publisher to have its own branded storefront without building it themselves.
- Existing Infrastructure: Compared to ten years ago, today publishers have generally put in place the other systems that ecommerce requires, such as a marketing website, CRM systems, and electronic catalogs. Ten years ago, publishers did not always have these components in place, which significantly increased the cost of an ecommerce project.
- Easier Payments: To provide complete transaction capabilities, ecommerce sites connect to a payment gateway that allows the publisher to connect to the banking system to complete the sale. Payment gateway providers, such as authorize.net, have significantly expanded the services they provide, such as securely managing customers credit card information and supporting recurring payment plans. This means there is less functionality that publishers need to implement to provide a full-featured ecommerce site. The payment gateway providers do a lot of the heavy lifting.
Evolving Consumer Behavior Equals Greater Revenue Potential
For many customers, publishers are in fact the preferred point of sale, and ecommerce a preferred method of transaction. Many trade publishers have developed brand equity that has led to customer engagement and loyalty. Based on the brand relationship, customers often wish to engage directly with publishers to buy. Publishers such as Scholastic and Harlequin have shown that a strong brand and an editorial focus enable publishers to engage with and sell to their customers directly, and the customers prefer doing so.