Miva Merchant President Discusses eBay, Facebook
Ecommerce executives handle their own businesses. But they're also experienced observers of online retailing generally. It is in the latter capacity that we spoke with Rick Wilson. He is president of Miva Merchant, the hosted shopping cart. He is also a 12-year veteran of ecommerce. We asked him about the condition of ecommerce, including the recent topics of eBay's recent acquisitions, mobile commerce and -- what else? -- Facebook.
PEC: For our conversation today, we're talking with you personally as an observer of this ecommerce scene. To begin, what's the condition of ecommerce?
Rick Wilson
Wilson:"The state of ecommerce really is thriving and -- as somebody who's been involved in ecommerce for 12 going on 13 years now -- it is wonderful to be the pretty girl at the dance again, if you will. I arrived to Miva in 1999 and immediately after I did, I was attracted to this notion of allowing business for entrepreneurs online and it's become a wonderful career for me . It's been a terrific ride at Miva Merchant.
"Nowwe see a good deal of changes and part of it's social. I mean some of the stuff I'm sure we will discuss, part of it's social, some of it's mobile. However, for whatever reason, there's now a enormous attention back in the ecommerce area I haven't seen since 1999."
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PEC: Since 1999, what are the biggest changes you have seen in the company? Social media and mobile trade, maybe?
Wilson:"In fact, there are additional changes that I believe a lot more significant to the main point of most of our merchants than social and mobile. The stuff that is really amazing for me is that the use of data [for predictive analysis].
"What we see with analytics today are a lot more intriguing, the ability to examine how somebody's behaving in your website and predict if they are going to get, if you would like to alter the offer you are likely to create them, if you would like to alter the products that you're going to show them. There's an unbelievable number of data available today in lots of businesses. I believe we are at the tip of the iceberg exploiting that info. Sure, Amazon's been doing some of the stuff for possibly a decade. But we are really seeing these things we brought down to the level of somebody doing $50,000, $100,000 to $1 million annually in income and having the ability to afford it."
PEC: Anything sinister about the usage of that data?
Wilson:"I will surely imagine some things. However, most of it [the information ] isn't personally identifiable. Thus, it is a fine line there, which is they do not know that you are coming to a site, but what they do know is that you're a however-old male, living wherever you reside, which you happen to be on a clothes site and that the previous 30 days, you have been to lots of clothing websites and you have not bought once. Or, in the previous 30 days you have been to four clothing websites and you've purchased at each of them. Certainly, using the data to a merchant's advantage -- not necessarily a customer's -- I think we will see a few changes legally and differently about how that information gets used and accumulated. But in the end of the day, I am not sure you can put the genie back in the bottle."
PEC: Let us ask your views on some current ecommerce topics. eBay has been active on the acquisition front. It bought GSI Commerce, a platform for bigger retailers, and more recently Magento, the open source platform. What is eBay up to?
Wilson:"Let's begin with what they are saying publicly. They're trying to create an ecommerce platform for the future, and I believe that they're seeing GSI Commerce as a platform for really large merchants, really about fulfillment customer support. I mean GSI Commerce was a merchant-of-record version, where they might do fulfillment, answering the telephone. They might do everything for Sears -- I do not really think Sears is a customer -- but it is all on Sears.com. Magento I think they see as more of a genuine platform, where GSI Commerce was usually custom integration. They have also purchased RedLaser, the [mobile] app for scanning barcodes for comparison shopping, and they have been buying lots of things. I believe their aim is to create this comprehensive omnibus platform of the future that unites all the hot-button products. So, everything you would have to do an ecommerce company including local search, online to offline, possibly mobile and societal. That is what I think their objective is."
PEC: Where does this leave ProStores, eBay's hosted platform?
Wilson:"My best guess is they are going to do one of 2 things with ProStores. One is they are just going to let it sit until it is dead, and that's what I really guess. That is my gut feeling. Their other choice is to attempt and migrate those customers to, say, Magento from the SaaS platform. That I think would be no different than the results of the initial one: They'd both end up dead. I believe that the results of that would be quite painful. There would be a good deal of resources placed into that. Migrating ecommerce clients, en masse from one platform to another, is something akin to torture. So I am not sure they need to go down that route; but we will see. In any event, ProStores isn't where they are gambling in their future."
PEC: Let's switch gears. What is the prognosis for Facebook? The Economist magazine recently surmised that Facebook's growth has peaked.
Wilson:"It is interesting. There is no such thing as indefinite expansion and there is no such thing as infinite expansion. What do they have, 600 or 700 million users around the world? That's a large number however you slice it. So, the prognosis for Facebook online is that I think they have sufficient use base and they have the social chart information. I forget where I read this, but someone not too long ago compared their hands of the social chart to Microsoft's control of the desktop. I generally agree with this in a high level, in that I think Facebook is not going anywhere. I think that they're the social graph keeper of document. I really don't see Google shifting that unless Facebook does something bizarre like let people download everything and somebody else can go mimic their societal chart and literally take control from their hands. I do not foresee that happening.
"When it comes to ecommerce, I believe that it's a whole lot different. A couple of years back through the ascension of Facebook, you'd hear people talk about how there is not going to be a demand for websites anymore. Everything will go through Facebook. My take is that is silly. Facebook is a supplemental platform. Let us consider what Facebook is. Facebook is the world's biggest photo-sharing platform. Facebook is also a location for status updates like Twitter. Finally it is a place to play games such as Zynga. And if you consider how you use it I use it, I'd say that is about perfect.
"There are a few chances of using Facebook as an internet merchant to actually decrease your advertising cost and do a little audience sourcing and leverage your neighborhood in ways which are absolutely brilliant. I do not foresee a day however if your site is just, as an instance, Facebook.com/mycompany and individuals are now transacting through Facebook right as a principal way of transaction. Among the reasons for this is Facebook's model with the electronic publishers such as Zynga is to take 30 percent. In the physical products world, that just does not work. There is no 30 percent to take. So, I do not expect that. I think The Economist is likely right in that I believe in some senses, their ascension has leveled. If you leverage Facebook correctly, it is a terrific tool. However, I do not foresee a day when it is going to really gobble up the whole web."
Listen to the complete audio interview with Rick Wilson.
PEC: Let us proceed to mobile. Up to now, there hasn't been lots of physical goods being really transacted on small smartphone displays and, additionally, the conversion rate on these little displays is extremely low, at best. What should you tell Miva Merchant's clients about mobile?
Wilson: "I see mobile as fundamentally different than Facebook. And the reason I compare them is because the two became these popular things at precisely the exact same time. Mobile is something which has to be addressed. It isn't something that's going to go away, because ultimately you are going to have more people interacting in a connected manner via mobile phones. So, what we inform customers is,'Here is what you can do now.' We tell the majority of our customers the mobile web is their attention as opposed to mobile app. The cause of that is our clients generally are not Coca Cola. Sure, if you are Coca Cola, you can get millions of people to download your app. You can offer a free incentive and only become enormous app downloads. If you are a more conventional [smaller] merchant, mobile is another strategy for you.
"Going back to eBay, I said RedLaser earlier, which is another company eBay bought. With RedLaser I will take my iPhone and that I will go scan a barcode and I will see every place that product is available online, and also to some extent offline. When I scan a product or have a photo of a product from my iPhone, and RedLaser brings up search results for me, and I clicked through. Not lots of merchants necessarily know they are even within this search result. By way of instance, if your data feed gets to TheFind.com [the comparison product site], that provider pushes stuff into RedLaser. Thus, you might not understand that your data feed is getting into a mobile search apparatus, but it is and if someone clicks through that information feed onto a mobile device and they receive a full-sized webpage, with checkouts not optimized for mobile, the probability of the conversion happening at the moment are extremely small. Perhaps they email themselves the connection. Maybe they simply store it and type it in their browser, or probably more likely they are not going to do anything. They will go find one that's mobile-optimized.
"When I consider how I use mobile commerce -- that has been so far restricted to eBay and Amazon -- it is very straightforward. For eBay, it is to bid on things; it is not to be tied to my computer at the end of an auction. I believe that's a fundamentally distinctive model for eBay. Most products we purchase online do not have a time problem. The eBay app in my iPhone makes great sense. I don't need to think about where I will be if I wish to be sure I bid five minutes before the auction ends.
"Amazon is kind of similar in what I normally order from Amazon, since I'm an Amazon Prime member, are commodity items. I am outside and I remember I need some shampoo or I want anything, and as opposed to having to run to a salon or some other shop and take time to do it, if it is commodity that I am not desperately needing, I could just hit my phone, search for the product name and two days afterwards, it is at my door at no cost. So, those two versions are really unique in mobile.
"They are very successful for their respective businesses, but they do not really apply to our clients. Our customers will need to look at it as making sure that the person who finds their shops through search results or location-based apps, if they are looking from a tiny screen and they are getting instructions to that client if they want their client to stay. Therefore, for the most part, we inform our clients if you're taking a look at your analytics reports and you are seeing plenty of mobile traffic, adjust your plan from there."
PEC: Can Miva Merchant have plans for a mobile offering?
Wilson:"We've got a mobile offering out now. It has been out for about four months. Presently, it is an add-on. It is something we charge for, but we also instructed how to do it in our conference at no cost. Thus, it's something that if somebody is capable, they do not want us to do. But if a merchant isn't a web developer and they simply need to hand it over and do it, it is something we sell for a couple of hundred bucks. In the long run though, we'll build it into the core product as something that is just automatically included in each shop.
"The reason we did it that way was we have a professional services team that I prefer to call our kitchen. We'd quite big customers coming to us needed mobile, so we built it for us and we looked at that and said,'You knowthis is the correct way for us to perform mobile. Let us let the early adopters get it today and see how they use it and let that run for a month or two and then return.'"
PEC: You have published a new update to Miva Merchant. Tell us about that briefly.
Wilson:"We launched what we call Miva Merchant 5.5 PR8 about two weeks ago and it is the next generation of our platform. It is a streaming upgrade for all our current customers so it is not the sort of thing that needs a new store build. In actuality, it doesn't violate their shop; they go right up to it. There's a whole lot of new features. They create order management behind the scenes easier. But the big tent pole attributes are reporting: quite advanced sales reporting, and a reporting API, not just the reports we built, but an API to make it effortless to create the reports yourself.
"Then another major feature we added was a really robust multiple image system. This is on the design side of your website. We have always supported multiple images since you've got complete control of the templates and the design. But now we have taken that and made it much easier for the layman so that they can literally drag and drop their pictures into our admin and you can add an unlimited number of images per product and the goods are tied to features, to swatches, so if I have a visual picture of a product choice, I could click it and it'll update all the multiple pictures."
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