The Next Evolution of Commerce – Contextual Commerce

As long as there has been the human idea of trade, there has been someone willing to sell you somethingBuying in the moment you need or want in exchange for something you have. At one point, it was grain for cattle, or cotton for tobacco.

Permanent settlements led to brick and mortar stores, who held their own for hundreds of years. But once the internet arrived, all bets were off. We’ve rapidly advanced in the last 15 or so years from brick and mortar, to eCommerce, to mobile commerce, to omnichannel, each providing consumers with increasingly convenient shopping experiences.

The next evolution of commerce is upon us, and it’s important for both brick and mortar stores and eCommerce companies to take notice of. That evolution is contextual commerce, and it takes the idea of convenience to a whole new place.

What is Contextual Commerce?

Contextual commerce is really the holy grail of commerce. It’s being there when your customers are when they need a product you offer. Put another way, it’s in-the-moment shopping. No lists, no trying to remember anything. It’s purchasing what you need, or what you want, the moment you realize you need it.

This isn’t a new concept for retailers. Walk through the parking lot on the way into a baseball game, and there are trailers set up selling jerseys. At concerts, you can buy copies of albums and band t-shirts. Walk down a street on a hot day, and a young entrepreneur has set up a lemonade stand. In the moment you are thirsty, you want to support your team, you’re excited about the band, there is a retailer there, providing what you wanted.

Technology, however, has enabled contextual commerce at a whole new level. Instead of betting that someone will want a jersey, you can suggest one to someone who is near a ballpark, thanks to GPS. With IoT devices, you can re-order laundry soap while you’re standing at the washing machine.

For eCommerce, contextual commerce comes on the back of what Google calls “micro-moments”. As the search giant describes itMicromoments occur when people reflexively turn to a device—increasingly a smartphone—to act on a need to learn something, do something, discover something, watch something, or buy something. They are intent-rich moments when decisions are made and preferences shaped.”

Contextual Commerce is Already Out There

Given that contextual commerce isn’t a new concept, it’s no surprise that there are already a lot of examples of it in use. The current players in the space are no surprise, either.

Pinterest is a clear choice for purchases in the moment. The social media sharing site is all about pinning pictures of projects, images, and yes, products, that their users find interesting or want to remember later. And previously, a Pinterest user who saw a pin of something they wanted to buy would have to click on the item, go to the eCommerce site, add it to their cart, enter their payment information, and check out. But Pinterest is now leveraging technology from Braintree that allows the entire commerce experience to happen within the site. Pinterest doesn’t lose you to another site, the merchant still gets the sale, and the user gets a more seamless buying experience.

WeChat, the Facebook of China, is another example. As the most advanced and largest contextual commerce platform out there, it’s the prototype for several social media platforms that are playing catch up, including the aforementioned Facebook. WeChat goes beyond simply offering the ability to purchase something through their interface, but takes contextual commerce to the next level, allowing it’s 900 million users to call a taxi and execute peer-to-peer payments.

A little closer to home, Amazon has fully embraced the idea, leveraging context purchases in a number of ways. The Amazon Dash buttons are the ultimate in convenience. Place the Dash near where you use a particular item. When you’re running low, simply push the button on the IoT device. It places an order for that items and uses your chosen preferred payment method to process it.

Owners of the Amazon Echo can say “Alexa, what are today’s deals?” and get a list of the current featured items from the site on any given day. Taking it one step further, you can then use your voice and the Echo to purchase one of those items.

And it’s not just about purchasing from Amazon. Hungry and have an Echo. Enabling the Pizza Hut skill lets you use your voice to place your usual order. You don’t have to get off the couch, or even pull out your cell phone.

Business Systems Needed to Support Contextual Commerce

Contextual commerce doesn’t just happen. And it doesn’t just exist on someone’s phone or watch or other IoT device. It must be backed by business systems robust enough to handle the automated ordering from anywhere at any time.

A frictionless payment experience requires not only a payment service that can handle storage and processing of various payment types. It must also be secure, as the checks between selecting an item and purchasing it are removed in an effort to streamline the process.

For those that have not yet integrated their logistics and fulfillment systems with their eCommerce or ERP, contextual commerce may provide more of a headache than a revenue boon. Manually processes between these systems would only increase with a contextual shopping experience, leading to customer frustration and a poor experience.

The same is true for your customer service, returns, and issue tracking systems. A purchase experience that is seamless, followed by a cumbersome and difficult returns process leaves the impression that you’re happy to take the customer’s money, but loathe to give it back when appropriate.

After hundreds of years of few if any changes to commerce, the last 15 years have catapulted the industry in new and not unexpected ways. Like those who delayed in adopting eCommerce for their brick and mortar stores, hesitating to join in on the contextual commerce evolution may leave you playing catch up in just a few years. But having the right systems and integrations in place is critical to having a satisfying commerce experience.