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Biztech Aug 6, 2012

Cloud Can Help eCommerce Float Higher

By Sunil Senan

In the age of instant and individualised gratification, digital customers are asking for more: personalised products, high quality, greater responsiveness and convenience. Online businesses need to be agile, scalable and flexible to cater to these consumer demands, while keeping their operating costs to a minimum to take on wafer-thin margins.

eCommerce transactions are expected to increase 13.5 percent annually for the next four years and reach an estimated $1.4 trillion in 2015. A high-growth industry riddled with cost and infrastructural challenges, eCommerce companies are looking at new-age technology solutions that offer them greater scalability, increased flexibility, improved dexterity, better delivery speeds – all at nominal costs. What seems to be a tough call is achievable when the business is ready to float in the cloud.

The cloud is not a new environment for eCommerce businesses. Online shopping websites and portals have been early adopters of the SaaS, PaaS and IaaS models. Moving up to the cloud is only natural progression. On the cloud, eCommerce is a simple matter of ‘plug and sell’ – your business plugs into a pre-designed system that takes care of your infrastructure, middleware and software needs, your data storage and retrieval requirements, your upgradation needs and your scalability demands and you start the online selling of your products and services, right away. That’s why businesses are gearing up to get their eCommerce up and running on the cloud.

As consumers embrace social media and social technologies, they expect their shopping to be integrated with their social lives. Such participative shopping, where your customers can engage with and get opinions from their social circle, is a fulfilling experience that can motivate them to move from ‘buzz’ to ‘buy’.

eCommerce companies are integrating social commerce to satisfy customers, create advocates and generate sales. The cloud enables businesses to get on the social bandwagon and drive up traffic, while keeping costs to the minimum and efficiently handling technology-related hiccups. Apart from a very significant difference in operating costs, companies get to gain a lot when their eCommerce business is performing optimally on the cloud.

Let us take a look at some benefits of taking your eCommerce business to the cloud.

eCommerce On The Cloud Advantages

Flexible response to needs: In a recent survey on cloud, 53 percent of respondents cited flexibility as their main driver for moving to the cloud. Not only does the cloud allow the deployment of new applications (such as a ‘quick buy’ application), the implementation of custom applications (such as a customised try-it-on feature) but also continual technological upgradation. With businesses needing to respond to the increasingly social customer, an eCommerce business can easily add a social media dimension to the platform and enable social interaction through the cloud.

Cater to fluctuating demand: Online businesses must continuously contend with fluctuating footfalls. The sudden peaks in seasonal traffic followed by periods of lull heavily tax companies. They struggle to cater to consumers when traffic is heavy and must cut costs to sustain business when traffic is low. The cloud provides elasticity to scale up and down according to varying market demands. Resources can be manipulated according to traffic which, in turn, ensures uninterrupted service to consumers. A recent survey found out that 71 percent of CIOs stated scalability as the most popular reason for adopting cloud computing.

Keep pace with a fast-changing market: Social commerce space is a very fluid arena with new technologies and ideas – for consumer engagement, marketing and customer support – flooding the market every day. The cloud provides eCommerce businesses with the agility to keep pace with this ever-changing social commerce landscape. Businesses not only get the best-in-breed technology today but also enjoy up-to-date versions in the future.

Exceed customer expectations: Traditionally, companies take one cautious step after another while building their online business because the entire process is very cost-intensive. With the cloud’s ‘plug and sell’ model, companies have the incentive to invest in the consumer concepts, usability and multimedia aspects of the eStore solution in one shot. With all these capabilities and functionalities in place, a fully equipped eStore opens up on day one. So, consumers experience best-in-class features and service from the word go. A superior consumer experience translates into effective word-of-mouth through social media, which, in turn, drives traffic to the online business.

Business Platform Model Advantages

Lower TCO, maximise gains: The biggest advantage of a cloud-enabled eCommerce solution is gained on the financial front. Seasonal fluctuations in traffic (such as traffic peaks around Thanksgiving and Christmas and lulls thereafter) are a major roadblock to online businesses. Under the traditional business model, eCommerce businesses need to invest heavily in IT infrastructure that can support peak volumes. With the cloud, companies can scale up their IT usage during the high traffic season and scale it down thereafter and only pay for as much as they use. They no longer need to invest in infrastructure and grapple with maintenance costs. Moreover, they can redirect resources toward their core business, brand engagement, and innovation.

Align investments to outcomes: Traditionally, costs pertaining to investment in infrastructure are incurred prior to eCommerce launch – well before outcomes are seen and realised by the business. In the cloud, costs are aligned with the outcome since businesses pay based on the traffic and orders. A study found that saving in hardware was the number one reason cited for adopting cloud computing (68 percent), faster deployment of infrastructure (66 percent) and to reduce systems management burden (57 percent) were also top reasons for cloud adoption. The cloud does not involve huge infrastructural investments, which is a boon to businesses in this cash-trapped, volatile global marketplace.

Improve time to launch: Organisations can quickly configure, customise and launch products leveraging the business-ready applications in the cloud. There is zero IT setup time (hardware buying, software buying, systems integration etc.) and the cloud-based eCommerce site is up and running in no time at all.

Taking an eCommerce business to the cloud offers endless possibilities to improve service and save costs. Businesses gain the unique opportunity to fully run their eCommerce activities on the cloud without worries about huge infrastructural investments, fluctuating data storage needs, expensive upgrades, and speed of business. The cloud also allows organisations to focus on their core business without getting into the technical hassles of running an online business. The cloud is transforming eCommerce by making it more flexible, scalable and in tune with changing consumer needs.

The author is Associate Vice President and Head, CommerceEdge and SocialEdge Platforms, Infosys.

by Sunil Senan

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