The latest digital products proliferating e-commerce are bringing new opportunities and challenges to retailers.
It’s time to stop thinking about digital products as just downloadable music, movies, or books. Technology advances in recent years have blurred the line between our physical and digital worlds. We fly with electronic tickets, read on e-readers, use software applications online, and receive alerts from Groupon to get the best local deals instead of cutting coupons from a newspaper.
Digital products now come in many different shapes and forms:
- Annual maintenance and support contracts sold by equipment manufacturers
- Access to shared cars and apartments, currently offered by peer-to-peer lodging rentals Airbnb, or car sharing service ZIPcar
- Mobile applications that you can download to control home devices like smart thermostats
- Valuable data available through published APIs like those licensed by Hoovers, which offers customers access to its vast database of industry information
- Virtual goods in online games
In many cases, a digital product is an ingredient that allows personalization of a physical object.
3D printing and personalization: The future of engagement is taking shape now
We are already used to customizable text on T-shirts or to selecting a digital image on the Web to be printed, framed, and delivered to your home.
3-D printing moves this kind of personalized manufacturing to the next level. At Shapeways.com, a consumer can select existing designs for various objects or upload her own. Shapeways prints ordered goods with its 3-D printers and ships them direct. The possibilities of the service are endless; for instance, a child’s favorite drawing can be transformed into a piece of sculpture for your desk.
Here are a few reasons why retailers should be paying attention to digital products:
- Digital products offer unlimited opportunities to customize your offerings and leapfrog competition
- Digital products are “alive” and provide new ways to understand and market to your customers
- Many digital products are sold using subscriptions, which ensures a reliable cash flow
Adding digital products to your e-commerce site brings new challenges. Retailers may need to modify or upgrade their systems in order to:
- Develop product personalization and integrate it with internal systems
- Support order orchestration with different delivery paths for digital and physical products
- Implement digital rights management
- Support subscription products, which also requires modifications in pricing that range from defining subscription terms and prices, to implementing a recurring billing system
There may be countless other ways for companies to creatively enhance their offerings with digital goods. Get your systems ready and brainstorm ideas for digital products that can benefit your business!
