E-commerce Cloud: Why startups must innovate online storefronts to woo shoppers
Many companies are still using traditional dedicated server hosting and networking solutions for the scale, security and management of their websites, and web applications.
The global e-commerce segment is exploding. In 2018, the market size is set to cross $2.2 trillion, and that number is expected to double by 2020. While retail giants like Amazon, FlipKart and Alibaba account for a large portion of that number, 63 percent of those revenues are being driven by the mid-market globally, smaller businesses with niche products and brand loyal customers.
It’s an attractive market focus for startups, but what are the most important things an e-commerce business owner can do to take advantage of the opportunity? After all, there are many distractions when building a business - finding the right product for the right audience, devising great marketing campaigns, SEO, social media impact, advertising, branding, inventory management, and much more.
Perhaps the most important thing is to make sure your online storefront delivers an incredible customer experience. Research shows that 79 percent of customers disappointed with an online shopping experience are less likely to return, and that could be disastrous for a new business. The performance of your online storefront plays a major role in this experience, yet remarkably, it is often where the first mistakes are made.
Ever wondered why we still hear about websites crashing when too many people try to get in? Stories were rife during the recent 2016 Diwali here in India, or Black Friday and Cyber Monday events in the US, where big brands like Old Navy, Macy’s and Walmart, all experienced availability issues due to surge traffic, even though these businesses are mature and have the budget and qualified teams to support their systems. A large part of the problem is a dated infrastructure strategy.
In fact, they should be considering using the cloud for its infinite capacity and utility consumption model. The other part of the problem is a lack of expertise in bringing all the disparate pieces of the solution together.
Startups have the opportunity to learn from these mistakes, and pursue a different path with regards to the underlying infrastructure of their online storefronts. Traditional, on-premise server deployments are expensive, time consuming and challenging to manage, but if the critical functions are deployed as a Software as a Service (SaaS)-based utility in the public cloud, everything changes.
The deployment becomes a service, managed by a software vendor instead of the company who is reliant on its features, eliminating the need to constantly buy and upgrade capacity. Scaling out in the event of a surge in traffic is automated, instant and cost effective, versus installing more physical servers, which may then sit dormant for a large percentage of time when not running at peak because the demand ebbs in low season.
Can old dogs learn new tricks?
Traditional vendors in this space, such as F5, Radware and Citrix are moving to embrace the cloud and stay relevant, but their entire business model has yet to pivot from the approach of deploying appliances – hardware, software or virtualised. And their sales and go-to market models are not suited for the new world. While these companies may feel like a safe bet, and their cloud vision may seem compelling and logical, their solution still requires an “installation”, advanced expertise and the customer still needs to support it through a 24/7 strategy.
It is no secret that the cloud offers infinite scalability, but in addition to the Infrastructure-as-a-Service (IaaS) from a cloud provider, using an advanced performance, security and reliability focused solution known as an application delivery controller (ADC), offers much more.
Traditional solutions are missing out on content optimisation and the ability to offer analytics for customer insights. A machine-learning stack, delivered as a utility-type service, truly built for the cloud, can detect changing requirements and respond to those requirements – thereby monitoring a customer’s web traffic and infrastructure and resolving issues before they cause disruption. This can be anything from improved page load times to a full scale-out because of a sudden surge in traffic. In addition, these options include security, round the clock support, developer services for help at the application level, as well as included cloud-agnostic hosting services if required. This is the new wave of success – the E-commerce Cloud and it’s a one stop shop for an e-commerce startup’s infrastructure needs.
Despite this trend, startups and existing online businesses still aren’t being swayed to adopt the cloud or services that make the cloud more efficient, even when in today’s always-on world, any business can be subject to a sudden traffic overload that traditional hosting solutions can’t keep up with. With so many other priorities, e-commerce start-ups especially need to be asking themselves the following question: Is it better to worry about and maintain our own systems or instead use that time and money to focus on growing the business? Are we understanding the entire cost structure or are we confusing server costs with online success?
The answer should always be to favor whatever route facilitates laser-focus on one’s business and leave everything else to service-based utilities designed to manage this on their behalf.
(The author is CEO, Webscale Networks)
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