Learnings from Managing Ecommerce

This is the final required post for the Managing Ecommerce course. However, I liked 

writing a blog so I’ll continue. I don’t consider myself tech savvy or having that natural 

tendency to keep up-to-date with technology, but I’m conscious of its increasingly huge 

importance and that was the main reason for taking this course. 


Doing research for this blog, allowed me to catch up on current trends such as Apple 

Pay, Shopify and Alibaba, and share it with that anonymous audience of 179 people 

that Internet allowed me to reach. After all, technology is not something you learn 

once; you need the curiosity to keep learning by yourself as it evolves. I 

developed that curiosity attending the classes and writing these posts.


Even though as future managers and entrepreneurs we will probably rely on experts to 

take care of the IT aspect of the business, it is extremely necessary to know the tools 

that are available and the basic functioning of them. This allows you–at the very 

least—to know what questions to ask. (I’ll put in italics some of the most important 

concepts I learned and if you’re still not familiar with them, you should definitely 

Google). 


Knowing the basics behind the “magic” of the Internet (client-server model, HTTP, 

TCP/IP, gateways); the use of some IT business tools (CRM, ERP, Open source 

software, Cloud computing, BI); and how to protect yourself against the risks involved 

with the dependence on technology (firewalls, BCP and DRP), gave me the high-level 

understanding on how to take better decisions about which tool to use.

Apple Pay: Your wallet. Without the wallet.

Apple Pay, Apple’s contactless payment technology launched one month ago—on October 20^th—allows iPhone 6, 6 Plus, and Apple Watch owners make payments using their devices’ NFC.[i] NFC is a short-range wireless communication that uses a smaller antenna than the wavelength of the carrier signal.[ii]

To pay, Apple Pay users just hold their iPhone near the contactless reader at the POS while placing their finger on Touch ID and a vibration and beep will confirm that the payment was successfully sent. To set up Apple Pay, users store their credit or debit cards on Passbook. They can add the card from the iTunes account by entering the security code, and additional cards by taking a picture or typing the number.

The main benefits Apple Pay offers are convenience and security, since you don’t have to expose your card and personal information and it won’t even be stored by the store nor by Apple. If the phone is lost, the user can deactivate it online.

Apple has partnered with Visa, MasterCard, and American Express and has signed deals with major banks such as Bank of America, Chase, Citi, and Wells Fargo, which are responsible for 83% of all credit card volume.[iii]  Because Apple Pay is based on already existing NFC technology it works in more than 220,000 locations that accept contactless payments.

The question arises: How long will it be until Apple’s competitors copy this system? Will this achieve a really high penetration, making the use of physical credit cards obsolete any time in the future?

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[i] https://www.apple.com/iphone-6/apple-pay/

[ii] http://en.wikipedia.org/wiki/Near_field_communication

[iii] http://www.macrumors.com/roundup/apple-pay/

Shopify: Making ecommerce accessible for everyone

Shopify is a computer software provider that powers both online stores and retail point-of-sale systems. It is based in Ottawa and was founded in 2006 after the owners, Tobias Lütke, Daniel Weinand and Scott Lake developed the ecommerce platform for their own store and realized the market need for a user-friendly ecommerce platform. They provide their services to more than 120,000 store owners including General Electric, Amnesty International, CrossFit, Tesla Motors, and others. The company has received $122 million in Series A, B and C funding from well recognized venture capital firms.

Shopify is a good option for companies that want to start selling online but do not have the infrastructure needed to set up their own ecommerce website. They offer very convenient features to make the website creation process easy. This includes a collection of over 100 free ecommerce website templates with themes created by world-renown designers. Shopify’s Liquid templating language, as opposed to HTML, makes it easy to customize every aspect of the online store.

Store owners can start receiving orders from day one. They only need to choose a template and add their products. The company handles payments directly from Visa, Master Card, American Express and Paypal. Shipping rates can be set up in a number of different ways, including fixed-price, tiered, weight-based and location-based rates. Another very useful feature is Shopify Reports, which allows store owners get a better understanding of the month-to-month sales performance. Shopify makes ecommerce even more accessible for everyone, lowering entry barriers.

Staples.com is much bigger than what I thought!

It may look counterintuitive that Staples –an office supplies retailer- is the third largest online retailer with $10.4 billion online sales in 2013 (45% of total revenue)[i]. After all, office supplies doesn’t sound as the first thing to be bought online nor are the most expensive items. However, it was only last year that this retailer lost the second place among the biggest online retailers, being surpassed by the giant Apple. Staples’ products also include computers, cellphones, electronics, furniture and many others, which I thought could explain the outstanding company’s online revenue. However, office and school supplies account for the biggest percentage of total sales (45%).[ii]

In 2013 Staples announced a new type of smaller stores that engage visitors with interactive kiosks aimed at driving more sales to Staples.com. An important role in online sales is also played by Staples Rewards program, which offers customers 5% back in online/offline purchases as well as free shipping.[iii]

While the rise of ecommerce has been seen as a threat for many retailers, Staples seems like it has managed to successfully use this trend in its favor. Nevertheless, everything has a price (especially for store employees). In 2013, the company had 40 net store closures in North America and 40 downsizes and relocations. It also initiated a plan to close up to 225 stores by the end of 2015.[iv] This demonstrates a progressive migration from a brick and mortars business model to online. Will that be the fate of all the retail giants?

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[i] http://marketingland.com/apple-takes-2-position-internet-retailers-list-e-commerce-sales-leaders-82991

[ii] http://netonomy.net/2013/10/04/selling-office-supplies-online-an-ecommerce-market-report/

[iii] selling-office-supplies-online-an-ecommerce-market-report

[iv] http://www.marketwatch.com/story/fitch-withdraws-ratings-on-certain-utica-ny-municipal-bond-maturities-2013-03-06