Thought Leaders in E-Commerce: Mark Lavelle, CEO of Magento Commerce (Part 2)

Sramana Mitra: Clearly, there has been a massive explosion of niche e-commerce. Platforms like Magento as well as a few others that we have covered extensively have played a big role in enabling these companies and built very substantial e-commerce companies. One of my observations is that the bar is going up in terms of the user experience of e-commerce. When we started, it was just being able to buy from a website. Now people are differentiating with a lot more personalization, recommendation, and user experience that is vastly more complex to deliver from a platform point of view. That’s one the trends that I see. How do you see where we are today and what the needs of the market are?

Mark Lavelle: Remember the days when e-commerce had just started and the discussion was, “It’s only 1% of all retail. Why should we bother?” Suddenly, it’s 3%. Now it’s 10%. It influences over 50%. We’re seeing some of that trend with the web experience itself. You build this great website and now you have this problem of where are my buyers. You get over 90% of your e-commerce business from your website, but the trend is a lot of companies are getting a lot of their digital transaction business from marketplaces like eBay, Alibaba, and Amazon. You’re going to start to see social media platforms become important in presenting and closing sales of items and services for customers. That percentage will grow up. The line between an in-store and online transaction is changing because all that’s happening on a digital device.

The whole concept that we grew up in that last decade of building a website is mature. What businesses need to think about is what are the elements of engaging and transacting with the customer in this day and age. You have to engage them. You have to have a product at a price point. The photo has to be right. Then you have to have an order management capacity. You have to know what’s available to offer to that customer and how you’re going to get it to them. It becomes more sophisticated. These are things that cloud-based platforms are very flexible at. That’s the key to the future. The businesses that are excelling are adopting this digital-first strategy towards their customer experience.

Sramana Mitra: You went through the growth in retail percentage, and you mentioned that we’re at 10% right now. Is this accelerating? Does that mean that we are going to grow to 20% in the next five years or 30% in the next five years?

Mark Lavelle: It has to. Retail is probably net negative to flat, yet e-commerce is still growing. You compound that over an another decade and you can see where it’s going. We’re past that debate. I don’t sit with any C-level executives who are debating the impact of digital experiences on their businesses. There’s a fear mode that everybody is getting over keeping up with this, but there’s this still some optimism. If you embrace and understand it, then you can take advantage of it. It’s a good time to be in the market of providing the tools by which businesses are viewing this opportunity.

This segment is part 2 in the series : Thought Leaders in E-Commerce: Mark Lavelle, CEO of Magento Commerce
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