How data can define a new era of opportunities for e-commerce

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After several years of blazing growth for “quick commerce” or q-commerce, a cursory glance at the headlines in the tech sector will tell you that the industry faces serious obstacles. This is due to a combination of a difficult macroeconomic outlook for businesses and the impact that the cost of living crisis and impending recession are having on people’s wallets.

But far from being a cause for panic, this should be seen as a reason for opportunity in the q-commerce sector. With a few q-commerce players losing steam in the delivery sector race, what is needed is the adaptation and diversification of its offer, that is, multi-category.

Food will always be here and in demand, and recently, we have seen more delivery players enter the grocery sector to meet the demand of a changing customer base. But why should we stop there?

Whether it’s flowers or pharmaceuticals, what’s next for e-commerce could certainly make a huge difference to the survival and success of businesses in what could aptly be called “The Hunger Games.” It could also change the landscape of e-commerce as we know it.

To make sure we stay close to customer demand and stay relevant, we need to focus on that hidden gem that separates our industry from the high street: data.

Why data is important for q-commerce

Part of the challenges of e-commerce comes down to the many demands on business owners for attention. Glovo, for example, has a four-sided marketplace of customers, partners, brands, and couriers. Add speed to the equation and the stakes are even higher.

97% of US data executives say data science is crucial to maintaining profitability, while 82% say their company leaders should be concerned about what poor data models could mean for the future of the company.

This second statistic should be of particular interest to q-commerce. The decline in demand shows how much the sector needs to reconnect with the consumer and their needs.

As web design and marketing specialist Atul Jindal recently wrote on VentureBeat: “Data is no longer an option…Accessing it, interpreting it, and using it effectively has become the difference between life and death for the modern online retail.

The data strategy’s ability to turn, as Atul puts it, “raw, meaningless data into valuable, meaningful information… [guiding] business processes, from decision making to strategy building”, which is why we have invested in such a strong proprietary strategy and it operates on a data mesh model.

Prior to this, it was a challenge for our data setup to scale with business growth and ultimately not help business performance.

With the data grid, we have a decentralized approach that is vital to managing data at scale, and if we want to keep pace, both in our operations and in our delivery, we need a data strategy worth its weight in gold. This could be the same for any business, but for q-commerce it is an integral part of their survival.

With this in mind, I look at some of the issues facing e-commerce and how data can help not only keep the industry ahead, but also diversify its offerings to help ensure its relevance and long-term future.

Stock and product

A whopping 75% of all supply chain management professionals want to improve their inventory management practices. The high-wire act of having too much and too little stock has lost its safety net with recent global tensions over inflation and the supply chain.

When it comes to q-commerce, by leaning on data, players can streamline inventory management and ensure they stock the products the consumer wants, an even more important consideration given kitchen halls and micro-fulfillment centers ( MFC) that it typically relies on to offer. Short delivery windows.

But without a detailed understanding of consumer appetites, these stores are playing potluck and may not be able to stock what is most in demand. Not ideal when McKinsey reports that 30% of consumers expect products to arrive the same day.

However, it’s not just about convenience. Through improper inventory management, some q-commerce players could be spending twice as much as they earn per delivery moving heaven and earth to meet customer needs.

Some e-commerce companies have tried to absorb this cost by offering their capabilities as a service. But this will only be a short-term solution. Instead, what is required is for q-commerce to apply the right data to forge a path to profitability. And, as mentioned above, expand into areas beyond retail and grocery, like pharmacy and more, and diversify your inventory for the long haul.

After all, in the world of e-commerce, there is still a lot to be explored.

Better customer understanding

Part of changing your stock and inventory is, of course, understanding the customer better. Customer data is the holy grail in the service industry and is the trump card of e-commerce compared to in-person retail.

But as e-commerce demand declines, we need to make sure we’re connected to exactly what the customer wants beyond the item itself.

More than half (59%) of consumers say that personalization influences their overall purchasing decisions. If eCommerce is to remain an in-demand service, it needs these kinds of metrics and position itself as a service defined not only by speed, but also by personalization.

As we have already explored, customers have changed a lot since the rise of q-commerce two years ago. Now we need a reboot. Does fast delivery now still constitute what it did 24 months ago? Could it even be related to a certain transaction? If we don’t ask these questions, we may be guilty of promising a specific service before the need has been truly defined.

That also does not mean that it will be one size fits all. The form q-commerce takes is also highly dependent on geography. Local nuances are key to staying relevant, even for a global company. For example, our experience in Nairobi tells us that due to heavy traffic that can delay deliveries in the city, and that as demand for groceries outstrips takeout, deliveries are still possible because there is no risk that the hot food cool down.

Q-commerce needs to leverage person-to-person, country-to-country customer data to ensure it’s a relevant service, and if it’s not, ask what it can do to reform it.

Maintain positive work environments.

In the rush to deliver at speed, one of the risks e-commerce businesses face is neglecting those behind the desk or on the road making deliveries.

But companies cannot afford to compromise on their commitment to providing a supportive work environment because of their customer promises to go above and beyond. Particularly at a time when layoffs in the tech sector are becoming common.

Data, therefore, has a role to play, looking inward. Implementing a robust data strategy inevitably means less work for the worker because their productivity increases while decision making is refined. And, when it comes specifically to couriers, the routes are optimized to help them avoid repeating their steps.

But data goes further and can also benefit your culture. Due to our own hyper-growth, we were very keen on maintaining a positive work environment and making sure we didn’t lose our identity or voices get lost in the noise.

That’s why we conducted an internal survey to provide crucial data on how employees feel about factors like compensation, career development, and diversity, equality, and inclusion. Like all data, this needs to be used; converted into knowledge used to inform not only the status quo, but also the direction in which we are headed. In this way, we can ensure that business success does not come at the expense of employee well-being.

Knowing what data eCommerce businesses need to survive the “Hunger Games” is only half the job. Any successful data strategy must also address the four concerns of data users: lack of reliable data, quality and availability issues, discoverability, and bottlenecks.

Only then can we build a platform that enables data-driven decision-making and ensure that e-commerce is not relegated to the dustbin of the big tech that it has been.

Whether it’s orders, customers or colleagues, data has a lot to tell us. Developing a strategy you can hear is key to making better business decisions with faster insights. And with this, despite the headlines, the future could be very bright for q-commerce.

Daniel Alonso Moreno is the VP of QCommerce at Glovo.


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