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July 3, 2020 | 3 Mins Read

The State of Digital Commerce Benefits from a Service Mindset

July 3, 2020 | 3 Mins Read

The State of Digital Commerce Benefits from a Service Mindset


By Tom Paquin

Forrester, in partnership with Bloomreach, recently published a report on the state of commerce experience for, in which they take a look at how both B2B and B2C sellers have realigned their channel strategies in direct response to COVID-19. There’s a lot of illuminating material in the report, especially on how the rate of adoption of digital channels has picked up dramatically in the face of necessity (unsurprisingly), but what is particularly interesting is that among businesses who sell online, 46% of them are seeing business growth over the last few months.

Another interesting piece, as noted in the report, is that half of the customers accounting for this increase in online commerce are shopping for things that they had never purchased online previously. We’ve discussed this in detail recently, of course, but it bears repeating, especially since we now have empirical data to further support these assertions.

Naturally, the market is following suit. When evaluating their planned commerce spending, 19% have decided to decrease spend on in-person commerce interactions, compared with only 2% before COVID.

These numbers are very compelling for of course all the reasons you’d expect, but evaluating them through the lens of service is an important consideration for both servitized business as well as those that are strictly product-oriented.

Forrester’s research, as it has for the last decade (and full disclosure: I worked there until 2016), centers on the role that technology plays in customer centricity, and the remainder of the report considers things like smart search, and the relationship between direct ecommerce and third-party retailers.

These are all inherently important, and I am fully entrenched in my belief that customer obsession begins by contextualizing technology through the lens of the customer, but there naturally surfaces a challenge in defining a face of a brand when that face has been taken away, and that is where service fits.

We obviously play in the sandbox of field service here, but humanizing your company through service can take many forms. Through smart customer engagement technology, for instance, organizations can not only take some of the operational lift of service off their workers, but also make their workers front-and-center to the conversation of their customers’ challenges. This is a little thing that goes a long way, especially in a world where, as the data shows, purchases are just a click away, and so are your competitor’s sites.

Servitization is of course the other major way that businesses can humanize their brands, and also retain customers through service agreements that have reasonably low overhead and help customers remain within a specific product ecosystem. By building service contracts with the customer in mind to accentuate the capabilities of your ecommerce system, you’re getting the best of both worlds: point-of-sales easiness right alongside an opening into a face-to-face relationship with the customer. The best companies combine that commerce and service data into a single practice that supports business growth.

We know this works. In a study IFS commissioned with IDC, we see that highly-mature servitized companies in the manufacturing space are 8X more likely to see a visible increase in profits directly tied to digital transformation and 5X more likely to grow revenue faster than 5% annually.

There are obviously limitations to the pervasiveness of this theory, though I’d argue fewer than you’d think. I had intended to use clothing as an example, but the existence of my StitchFix stylist (shout out to Kristina) reminds me that businesses are finding new ways to servitize everything. I’d say disposable goods like cleaning supplies are likely to be mired by pay-per-use indefinitely but I am certain that someone smarter than me is working on a way to servitize such industries as we speak.

COVID restrictions will (thankfully!) not be forever, but changing consumer sentiment will have permanent consequences for the sale and distribution of goods. It has mostly accelerated the changes that have permeated all businesses over the last half-decade or so. Service could be the key to championing that change, and making it your own.