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Discussion – 


Discussion – 


WTH is Frictionless Commerce?

Frictionless Commerce

Every step between a customer and their intended purchase is “friction,” and conventional wisdom dictates that less friction means customers will complete more purchases (overall). This is the idea behind frictionless commerce, which aims to eliminate as many of those steps to purchase as possible.

Frictionless commerce isn’t a new idea, but it’s getting a whole lot of new attention. Our CLIKK Notes on eMarketer’s Frictionless Commerce 2020 report:

Businesses have invested new attention in customer convenience because of… you guessed it. Under recent circumstances, we’re likely to think of options like curbside pickup as “public health safeties” instead of “conveniences,” but those two labels aren’t exclusive (and times are weird partly because they overlap nowadays).

Remember that Convenience isn’t just a cherry on top; it’s one of three dimensions across which retailers compete for your business, the other two being Price and Selection. The latter two factors give e-commerce its natural advantage over brick-and-mortar; e-commerce can compete on price because its overhead costs are way lower, and it can compete on selection for much the same reason (a warehouse is way cheaper to run than a department store).

It’s been harder for e-commerce to pierce that third dimension of Convenience. The internet, for all of its instant gratifications, often can’t transport physical stuff to you nearly as fast as you can go get it yourself. With social-distance orders in place, we’ve needed more options between the two extremes of Order Then Wait vs. Find The Item In The Store.

What forms do “frictionless experiences” take recently? There are three big ones to notice:

🔪 Streamlined digital transactions. In other words, honing and slimming down the online-shopping processes you know already, especially the ones closest to checkout. Shave those steps!

🚙 Click-and-collect pickup. You’re still driving to the store, but only to collect your purchases and not to pick them out. This one has been big because it can apply to everything from groceries to flat-screen TVs.

🛎 Cashierless checkout. Also known as “the U-Scan machine where you don’t have to stand face-to-face with someone who’s stood face-to-face with all the sick people” (no offense to cashiers, y’all are brave souls).

One illuminating case study. All things considered: if you’re Best Buy and you manage to generate 81% of last year’s sales without a single customer entering your stores, you’re doing something right. They’ve been able to weather this pandemic well precisely because of their recent investments in frictionless commerce—which enabled their quick pivot to curbside pickup, which then enabled them to continue selling all of the different kinds of consumer electronics people need right now.

Just how big is COVID’s effect on frictionless commerce? Well, eMarketer’s original (pre-pandemic) forecast was that click-and-collect ALONE would account for 7.6% of U.S. e-commerce sales in 2020, and they’ve since revised it to 8.2%. Considering that this is just one form of frictionless commerce and it’s jumping that much across the board, this pandemic is likely to create permanent shifts in the ways that online retail works—and it’ll be that much more important going forward to make it easy for customers to buy.

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