Michael Ross : Interview with V3.co.uk

V3.co.uk: Tell us a little bit about your latest venture - what does eCommera do?
Michael Ross: We position ourselves as an e-commerce business - we'd like to think we've got competitors but the truth is we're really doing something slightly different to most players. ATG, IBM and the others sell technology components, and Conchango and others are systems integrators, but we are different. We take best-of-breed components to offer end-to-end e-commerce solutions for medium to large retailers. We also supply consulting services and core tracking services. We take e-commerce data and turn it into insight and with that insight then try to turn it into action, and answer the question of the retailer: what should we do now?

What major trends are you seeing in the e-commerce software space?
It's only a matter of time before all e-commerce solutions are offered as software-as-a-service (SaaS) - we're within sight of it now when you see that John Lewis has 85 developers whereas House of Fraser has just one in-house because it's all managed with us. It's an interesting inflection point. The top 1,000 e-commerce sites all had to bolt together a set of different components: product data management tools, image management tools, email management systems, web shops, web analytics and so on. Today every individual component is available as SaaS somewhere, but it takes people like us to sit on the top of it all and bring it together as a solution.

So how far away are we from a Salesforce.com of e-commerce?
We're probably five years away from one vendor with one platform that can deliver everything - a Salesforce.com style hub that allows lots of widgets to plug into it. Demandware is probably the leading contender for such a SaaS e-commerce hub.

What is your advice for retailers trying to maximise their online presence?
They should take a holistic approach to e-commerce because so many things can go wrong. Technology is never a reason for success but often a reason for failure. In the physical world it's all about location but online retailers have to rethink their proposition and a lot of them go wrong because they take the physical store proposition and try to shove it online. Others go wrong because they are over or under ambitious - they want to be the largest store online but don't invest enough. The smarter retailers really want to understand what's going on to ascertain whether they should invest in more people, a new platform or just a bit of marketing spend. They'll think about what sort of data they need - web analytics is great but it only tells you what's going on on the web site, not what's going on with the customer experience, profitability or other important factors. Profit per order is the best KPI [key performance indicator] - it's a fundamental metric.

Is delivery still a major problem for e-retailers?
Yes. But again it's about getting the metrics right; it's about delivering when you promised - when that order was placed online, when did the customer think they were going to receive it and when did they actually receive it. The Royal Mail is merrily committing suicide. Most retailers now have alternatives to them, there are enough good second-tier carriers around - ultimately it may cost the customers a bit more but they will be prepared to pay a bit more to get their goods on time. How the delivery problem will get fixed is unclear. If high street rents keep going down and retailers keep going out of business we could see 24x7 collection points springing up in the high street. Maybe the privatisation of the Royal Mail will finally provide the catalyst for reinventing delivery.