Research Publication Date: 3 August 2010 ID Number: G00205840 Hype Cycle for E-Commerce, 2010 Gene Alvarez E-commerce continues to rivet the attention of enterprises struggling to return to growth. This Hype Cycle will help enterprises evaluate the suitability of an exploding number of e-commerce technological capabilities, long-established and emerging, and to understand their business value. © 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Reproduction and distribution of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Although Gartner's research may discuss legal issues related to the information technology business, Gartner does not provide legal advice or services and its research should not be construed or used as such. 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TABLE OF CONTENTS Analysis ....................................................................................................................................... 5 What You Need to Know .................................................................................................. 5 Customer Experience .......................................................................................... 5 Social .................................................................................................................. 5 Globalization ....................................................................................................... 5 Mobile ................................................................................................................. 5 Software as a Service.......................................................................................... 5 The Hype Cycle ............................................................................................................... 6 Using the Hype Cycle .......................................................................................... 7 E-Commerce Foundational Components ............................................................. 7 Web Customer Experience .................................................................................. 8 Marketing ............................................................................................................ 8 Sales ................................................................................................................... 9 Service ................................................................................................................ 9 Mobile ................................................................................................................. 9 Social CRM ....................................................................................................... 10 New to the Hype Cycle ...................................................................................... 10 Mobile................................................................................................... 10 Social ................................................................................................... 11 Web Customer Experience ................................................................... 11 The Priority Matrix .......................................................................................................... 13 Off the Hype Cycle ......................................................................................................... 15 On the Rise ................................................................................................................... 16 Mobile Fraud Detection ..................................................................................... 16 Social-Shopping Sites ....................................................................................... 18 Context Delivery Architecture ............................................................................ 19 Persona Management ....................................................................................... 20 Rich Information Visualization............................................................................ 22 Customer-Centric Web Strategies ..................................................................... 23 Transactional Ad Units ...................................................................................... 24 E-Services......................................................................................................... 25 Online Advertising Data Exchanges ................................................................... 26 Social Commerce .............................................................................................. 28 Context-Enriched Services ................................................................................ 29 Open-Source E-Commerce Software................................................................. 31 Campaign Management SaaS ........................................................................... 32 Web Content Product Recommendation Engine ................................................ 33 Customer Interaction Hub .................................................................................. 33 E-Invoicing ........................................................................................................ 34 Mobile Web Applications ................................................................................... 38 Social CRM for Sales ........................................................................................ 40 Social CRM: Community Marketing ................................................................... 41 At the Peak .................................................................................................................... 42 Mobile Coupons ................................................................................................ 42 Campaign Optimization ..................................................................................... 43 Mobile Consumer Application Platforms............................................................. 44 Loyalty Marketing .............................................................................................. 45 Web 3.0 ............................................................................................................ 46 Cloud/Web Platforms......................................................................................... 47 Enterprise Feedback Management .................................................................... 49 Publication Date: 3 August 2010/ID Number: G00205840 Page 2 of 107 © 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Multichannel Campaign Management ................................................................ 49 Multicommerce MDM......................................................................................... 50 Consumer Web Mashups .................................................................................. 52 Predictive Campaign Analytics .......................................................................... 53 Sliding Into the Trough ................................................................................................... 54 E-Commerce on Demand .................................................................................. 54 Mobile Social Networks ..................................................................................... 55 Event-Triggered Marketing ................................................................................ 56 Content Analytics .............................................................................................. 57 Fraud Detection................................................................................................. 59 MDM of Product Data ........................................................................................ 61 MDM of Customer Data ..................................................................................... 63 Microblogging .................................................................................................... 65 Mobile Advertising ............................................................................................. 67 Customer Profitability Management ................................................................... 69 Distributed Order Management .......................................................................... 70 Virtual Environments for Consumer Sales .......................................................... 71 Online Video ..................................................................................................... 72 Virtual Assistants ............................................................................................... 74 Consumer-Generated Media ............................................................................. 75 Campaign Segmentation ................................................................................... 76 E-Mail Marketing ............................................................................................... 76 Preference-Driven Personalization .................................................................... 77 Climbing the Slope ......................................................................................................... 78 Consumer Digital Rights Management ............................................................... 78 Content Delivery Networks ................................................................................ 80 E-Commerce Web 2.0 Sales Tools .................................................................... 82 Mobile Search ................................................................................................... 84 Social Search .................................................................................................... 85 Web-to-Print Applications .................................................................................. 86 Integration as a Service ..................................................................................... 87 Knowledge Management for Customer Self-Service .......................................... 91 Wikis ................................................................................................................. 91 Web Analytics ................................................................................................... 93 Web and Application Hosting ............................................................................. 95 Sales Order Management.................................................................................. 96 Entering the Plateau ...................................................................................................... 97 Enterprise Portals .............................................................................................. 97 Podcasting ........................................................................................................ 98 Sales Configuration ........................................................................................... 99 Blogs ............................................................................................................... 100 Consumer Content Creation Tools ................................................................... 101 Appendixes .................................................................................................................. 103 Hype Cycle Phases, Benefit Ratings and Maturity Levels ................................ 105 Recommended Reading ........................................................................................................... 106 LIST OF TABLES Table 1. Hype Cycle Phases..................................................................................................... 105 Table 2. Benefit Ratings ........................................................................................................... 105 Publication Date: 3 August 2010/ID Number: G00205840 Page 3 of 107 © 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Table 3. Maturity Levels ........................................................................................................... 106 LIST OF FIGURES Figure 1. Hype Cycle for E-Commerce, 2010 .............................................................................. 12 Figure 2. Priority Matrix for E-Commerce, 2010 .......................................................................... 15 Figure 3. Hype Cycle for E-Commerce, 2009 ............................................................................ 103 Publication Date: 3 August 2010/ID Number: G00205840 Page 4 of 107 © 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved. ANALYSIS What You Need to Know The weak economy and five key trends are driving new investment and upgrades in e-commerce capabilities. Client interest in e-commerce has been increasing since the last release of this report; however, prudence and a focus on improving sales and customer experience is guiding all investment activities. Customer Experience Organizations want to improve their websites with rich online customer experiences. Driven by consumerization, organizations are improving their site user interfaces with rich Internet application (RIA) capabilities for all types of commerce — business to business (B2B) and business to consumer (B2C) — as websites are no longer compared with direct competitors, but are compared with leading consumer website customer experiences. Social Organizations are also adding social capabilities. Here, organizations are seeking to take advantage of many forms of social CRM capabilities. These range from building a following of "friends" in public communities, such as Facebook and Twitter, to enabling user-generated content to contribute to the organization's website and other activities that involve leveraging the "wisdom of the crowd." Globalization Organizations are going global for new customers; therefore, there is significant interest in enabling e-commerce in new countries and regions. This is driving requirements for localization capabilities, such as translation, localized currencies and payment processes, local implementation services at local rates, and other key international capabilities. Mobile Organizations want to implement mobile e-commerce capabilities to take advantage of the growing populations, using Internet-enabled smartphones and tablets for Web browsing and context-aware applications. Advancements in mobile technologies and devices and demand from consumers for mobile applications and Web browser access are also gaining more hype as devices, such as the Apple iPhone 4, iPad and other mobile devices, enable consumers and business partners to access an organization's website for product/service investigation and to possibly make a purchase directly through the device. Software as a Service The increasing number of providers and developments in e-commerce software as a service (SaaS), which is also referred to as e-commerce on demand, have opened e-commerce capabilities to a much broader audience of organizations than ever before, and the hype surrounding SaaS offerings is increasingly due to current economic and market forces. Organizations that want to develop their e-commerce capabilities into next-generation customer experiences and to increase sales and customer retention should use this Hype Cycle to understand the hype, technology maturity and business impacts of leading e-commerce technologies. Because of the amount of technology available, organizations without this Publication Date: 3 August 2010/ID Number: G00205840 Page 5 of 107 © 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved. understanding risk investing in technologies that may not provide returns, may hurt customer relationships and may negatively affect their already-complicated e-commerce capabilities. The Hype Cycle E-commerce trends and technologies are transforming the way enterprises interact with markets, including prospects, customers and partners. Research from the "Magic Quadrant for E- Commerce" uncovered how interest in e-commerce has expanded to industries outside traditional retail. The new industries investing in e-commerce capabilities are discrete manufacturing, distribution, telecommunication and publishing (see "Findings: CEOs Are Placing New Bets on E- Commerce as Part of Their Return-to-Growth Strategy"). B2C organizations still lead in innovation, however, tapping into communities of consumers via social-network software (such as Facebook, MySpace and Twitter) as a way to engage with customers and improve the overall online shopping experience. Moreover, B2C organizations are capitalizing on the increasing number of smartphones and Web-capable phones. Therefore, many are making sure that they have a mobile website that is easy to use via a mobile Web browser, and many are creating mobile applications for devices such as iPhone4 and iPad (see "How Mobile E-Commerce Should be Using Context, but Isn't" and "Top Eight Ways Context Will Make Your M-Commerce Applications Stickier"). Consumerization continues to put pressure on organizations to offer rich customer experiences as customers of all types continue to compare site capabilities with other popular sites, such as Google, YouTube, Yahoo, Amazon and eBay, regardless of the industry. Often, business partners will expect the capabilities of consumer sites for their purchasing requirements to be coupled with more-advanced B2B sales capabilities, such as sales configuration, customer- specific catalogs and links to electronic data interchange (EDI) capabilities. As organizations look to capitalize on these trends, they are also challenging IT organizations and business owners to lower operating costs and provide reliable, highly scalable, available and stable 24/7 environments. The 2010 Hype Cycle for E-Commerce illustrates the varying hype and maturity levels of e- commerce technologies, as well as their business dynamics and complexities. The sheer number of technologies being hyped in the e-commerce market demonstrates the complexity of an organization's e-commerce technology portfolio and strategy. E-commerce is often associated or confused with other synonyms, such as e-business, e-retailing or individual technologies (such as EDI). Therefore, we have provided a definition to use with this Hype Cycle: "E-commerce is a compilation of business models, processes and technologies that enable online sales, service and marketing for B2B and B2C commerce. It facilitates transactions over the Web, and supports the creation and continuing development of online relationships." E-commerce technologies are critical to key initiatives, such as CRM, partner relationship management, process improvements, sales growth, reduction of sales costs, brand building, and delivering value to consumers and business partners. This is accomplished by enabling an enjoyable customer experience that exceeds sales and service expectations. Organizations are unable to purchase a single e-commerce solution that is a complete match with all their unique business requirements as they exist, or that is agile enough to support changing requirements. Most organizations' e-commerce initiatives can have as many as 15 to 20 primary or core integration points to complete a business process, such as campaign to cash, and as many as five to 10 vendors to provide the complete operational site. Additionally, some B2B organizations find themselves managing multiple types of e-commerce beyond partner-direct (B2B), because of the varying IT capabilities of their partner networks. Publication Date: 3 August 2010/ID Number: G00205840 Page 6 of 107 © 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Using the Hype Cycle Use this Hype Cycle to investigate, evaluate and prioritize individual technologies that will enable you to create a unique Internet experience and address current and future e-commerce trends. The Hype Cycle for E-Commerce addresses 65 of the most-relevant and topical e-commerce technologies, and groups them into seven key areas: E-commerce foundational components Customer Web experience Marketing Sales Service Mobile Social CRM These groupings will enable you to align these technologies with your individual online strategies, tactical initiatives, and B2B or B2C objectives. E-Commerce Foundational Components These components enable B2B and B2C organizations to process orders; manage many types of content and product information; locate products, exchange data, services and suppliers, as well as analytics; and manage overall performance. Technologies in the group enable organization to conduct any type of commerce and are necessary to core functionality and business processes supported by e-commerce website. Technologies in this group include: Cloud/Web platforms Consumer digital rights management (DRM) Content analytics Content delivery networks Context delivery architecture Context-enriched services Customer interaction hub (CIH) Customer profitability management Distributed order management E-invoicing Fraud detection Enterprise portals Integration as a service (IaaS) Multicommerce master data management (MDM)* Publication Date: 3 August 2010/ID Number: G00205840 Page 7 of 107 © 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved. MDM of customer data MDM of product data Online video Rich information visualization Web analytics Web and application hosting Web-to-print applications *Technology that became obsolete before it reached the Plateau of Productivity (see Hype Cycle figure) Web Customer Experience These technologies enable organizations to provide an enjoyable Web experience at any point during the customer interaction life cycle. This customer life cycle will include marketing, sales or service activities delivered over the Web. The focus of these technologies is providing an enjoyable online experience that is intuitive and easy-to-use for all types of customers. Technologies in this group include: Consumer content creation tools Consumer Web mashups Consumer-generated media Customer-centric Web strategies Persona management Podcasting Preference-driven personalization Web 3.0* Web content product recommendation engines *Technology that became obsolete before it reached the Plateau of Productivity (see Hype Cycle figure) Marketing These technologies enable organizations to create customer demand and leads via the Web channel. The technologies in this section enable organizations to use online marketing techniques to acquire new customers, expand the number of product being offered to a customer and to win customers that may have left the organization. Technologies in this area include: Campaign management SaaS Campaign optimization Campaign segmentation Publication Date: 3 August 2010/ID Number: G00205840 Page 8 of 107 © 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved. E-mail marketing Event-triggered marketing Loyalty marketing Multichannel campaign management Online advertising data exchanges Predictive campaign analytics Transactional advertising units Sales These technologies enable organizations to select products and services and to process transactions over the Web channel. The technologies in this section enable organizations to improve their sales by offering full Web stores as a service, improvements to the user interface to increase conversion, to configure products and services without the aid of a human and other sales capabilities. Technologies in this area include: E-commerce on demand E-commerce Web 2.0 sales tools Open-source e-commerce software Sales configuration Sales order management Virtual environments for consumer sales Service These technologies enable organizations to service customers before, during or after a sale, and to resolve customer issues. These technologies also offer the ability to collect feedback from customers and enable online self-service. Technologies in this area include: Enterprise feedback management (EFM) E-service Knowledge management for customer self-service Virtual assistants Mobile These technologies enable organizations to provide mobile-based e-commerce (m-commerce) and can complement all phases of the customer life cycle. Particularly in the m-commerce space, many enterprises are beginning to develop context-enriched applications for the purpose of increasing customer loyalty and improving sales. Since it is the early days of context-enriched commerce, many different approaches are being taken, such as leveraging customer location and sending Short Message Service (SMS) messages. These technologies include: Mobile advertising Publication Date: 3 August 2010/ID Number: G00205840 Page 9 of 107 © 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Mobile consumer application platforms Mobile coupons Mobile fraud detection Mobile search Mobile social networks Mobile Web applications Social CRM These technologies enable organizations to use social techniques within their Web stores or to take part in larger external (both public or privately created) communities of customers. Social CRM applications encourage many-to-many participation among internal users, as well as customers, partners, affiliates, fans, constituents, donors, members and other external parties, to support sales, customer service and marketing processes. Social CRM works in each of these domains, for example, to provide a social enterprise feedback mechanism in the service domain, as well as social monitoring or product development in the marketing domain: Blogs Microblogging Social commerce Social CRM: community marketing Social CRM: for sales Social search Social shopping Wikis New to the Hype Cycle The 2010 E-Commerce Hype Cycle covers 65 technologies. To respond to the market trends listed above and to assist organizations looking to capitalize on these trends, the following technologies have been added to the 2010 E-Commerce Hype Cycle: Mobile Mobile advertising Mobile coupons Mobile fraud detection Mobile search Mobile social networks Mobile Web applications Publication Date: 3 August 2010/ID Number: G00205840 Page 10 of 107 © 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.