Conversational commerce meets the connected economy

If you think the past two years have been intense, your perspective should be reset soon.

As the pandemic becomes rampant and just another thing to watch, the digital shift it sparked won’t stop. Tectonic technological movements like the connected economy cannot be extinguished per se.

Instead, the number and quality of connections will likely increase and drive new forms of commerce, shopping and spending that will be as impactful as the mobile Internet. This is the opinion of Mariano Gomide de Fariafounder and co-CEO of VTEXthe enterprise digital commerce platform that rose to fame in 2008 as an overlooked Brazilian tech company that landed Walmart Brazil’s digital account.

VTEX grew from there to serve 38 countries, and along the way it also gained a reputation for speed to market and understanding local market dynamics. As Gomide de Faria told PYMNTS in an interview, the pandemic was a wake-up call for CEOs who viewed digital as a secondary channel – until it suddenly became their only channel.

When the Colombian government asked VTEX to bring the country’s largest pharmacy online to dispense COVID-19 medicine, “everything was convenient,” he said. The site went online in three weeks.

“What we see now is that [digital] is no longer a side business,” he said. “It’s the main business of how to explore these multi-channel opportunities that have arisen with COVID. The other side is that the population has learned to buy online.

“This change in perspective or mentality creates a new future,” he added.

This new future is the connected economy forming in real time, and Gomide de Faria said he believes the changes it will bring will be disruptive at most, but with benefits to match.

“How to build a brand in a connected economy is a challenge,” he said. “Yesterday you created a brand by buying ads. Tomorrow you will create brands by having amazing customer service.

See also: VTEX partners with Stripe to bring digital payment options to e-commerce retailers

Marketplaces, room for great apps

It’s a little hard to imagine given the current state of things, but Gomide de Faria said he doesn’t see the physical store continuing in its current form – and more surprisingly he sees the online marketplaces of the same way.

“Companies have to face the stark fact that the market is not a new channel,” he said. “The Marketplace is a basic feature. Conversational commerce, live commerce, messaging commerce, business app chat commerce is a reality. It is already more than 50% in Asia. It’s going to hit the United States like a tsunami, and businesses aren’t ready for it.

He said that Facebook and Google are “not affordable as the backbone of growing a business” and that “no retailer, no brand can afford to pay 20% to 25% as some kind of cost. . We saw the market wave take over with Google and Facebook, and the market started at 10%. »

But even marketplaces have their limits. For their seemingly endless variety of products, marketplaces lack the customization and connection they were simply not designed for.

This has left the United States open to a super app or two to bring the connected economy to a new, comfortable cruising altitude above the still disjointed fray of products and payments.

“What happened in Asia is now happening in Europe and Latin America and will eventually happen in the United States,” he said. “Why the United States is the latest country to ride the wave of conversational commerce is because [the] The United States does not have a super popular chat app. If you go to Latin America, 94% of the population is connected to WhatsApp. In China, it’s WeChat.

Gomide de Faria said US taxation has long favored online marketplaces and platforms.

“It will change and change quickly, and one or two apps will take over and the business will adapt quickly,” he said. “It’s no longer, ‘Choose what to buy and hope for what to sell.’ It’s different. Today you have to ask your customers [beforehand] What [they] want to buy, and I will pursue it in the market for [them]. The best brand, the best product and the best price and delivery conditions.

“Retailers are no longer curators of products. They are a guest concierge.

This involves a few simultaneous changes. There’s the shift to online shopping habits, the shift in IT infrastructure to create and sustain a connected economy, and there’s the new retail that’s growing.

“Business is no longer based on the product you buy,” he said. “It’s entirely based on the groups of customers you control, those who identify with you and who you feel comfortable with. This is the big change. It happens everywhere. A new category of providers will emerge – solution-as-a-service providers, SaaS companies with a connected ecosystem.

Read more: E-commerce software platform VTEX plans potential IPO

More Instacart than Amazon

Not shy about calling out the likely winners, Gomide de Faria said it’s possible an Amazon or a Meta would buy a hot super app and absorb it into their existing ecosystem.

“I believe Facebook and Apple are the two companies accepted by US security policies that will ride the wave of conversational commerce,” he said. “Apple has Apple Business Chat. It’s a powerful platform that’s already better in the US. And Facebook has, in my opinion, the most advanced chat platform in the world. Those two, in my opinion , will be the ones who will take control of the American market.”

But a great app alone doesn’t get us to the Connected Economy 2.0 – it’s a task enabled by technology but ultimately done by people in a new shopping paradigm closer to Instacart than Amazon .

“Instacart is a great example,” he said. “You say what you want. I send you a photo. I say yes, no, yes, no. I don’t care about the price. The company has more money than time. You don’t need to choose your cucumber or your rice. You have more money than that. You delegate an agent.

Stating that most sales will be through social channels in the next few years, Gomide de Faria told PYMNTS: “You won’t go to a store to look for a product anymore. You’re going to have maybe three or four janitors who used to be called salespeople. You’re going to say, ‘For the next three months, I’d like this dress, this bracelet, this handbag, and could you find it and bring it to me?’ This is the new purchase context.

Related: VTEX expects more companies to go the Nike route and develop D2C

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NEW PYMNTS DATA: ACCOUNT OPENING AND LOAN SERVICE IN THE DIGITAL ENVIRONMENT

On: Forty-two percent of US consumers are more likely to open accounts with financial institutions that facilitate automatic sharing of their bank details upon sign-up. The PYMNTS study Account opening and loan management in the digital environmentsurveyed 2,300 consumers to explore how FIs can leverage open banking to engage customers and create a better account opening experience.

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