Application Leaders Should Closely Watch Visual Configuration, Digital Wallets, Customer IAM and Virtual Customer Assistants
Over the next two years, visual configuration, digital wallets, customer identity and access management (CIAM) and virtual customer assistants (VCAs) will have high impact on digital commerce as mainstream adoption of these technologies increases, according to the 2021 Gartner, Inc. Hype Cycle for Digital Commerce.
“Digital commerce is a fast-changing market where competitive pressures and the need to innovate means new technologies emerge frequently,” said Sandy Shen, research vice president at Gartner. “Application leaders can use the hype cycle to differentiate between technologies that are fads that will disappear over time, and those that are expected to have a significant business impact. By understanding the capabilities and challenges of each technology, they can make informed decisions regarding resources at hand.”
CIAM, digital wallets, visual configuration and VCAs entered the slope of enlightenment in the Hype Cycle in 2021 (see Figure 1). In this phase, examples of how the technology can benefit the enterprise start to crystallize and become more widely understood.
CIAM tools manage identity, authentication and authorization for external identity use cases. Privacy regulations and increased dependence on remote interactions have intensified the importance of CIAM to businesses and their customers.
“CIAM also leads to improved user experience (UX) within B2C and B2B commerce, gig economy and government to citizen (G2C) interactions,” said Shen. “By the end of 2021, 86% of organizations will compete based on UX. In industries with very little competitive differentiation between products and services, the online experience becomes the differentiation.”
Digital wallets establish credentials to enable users to make remote or face-to-face transactions from connected devices. This technology has demonstrated wide benefits, such as reduced customer effort and increased revenues, as has been demonstrated successfully in industries, such as parking, transportation, retail and digital commerce. Lack of digital wallet support could impact conversion rates and be viewed as a competitive disadvantage.
A VCA is an application that engages, delivers information and/or acts on behalf of an organization’s customer. The COVID-19 pandemic has accelerated adoption of VCAs, pushing some use cases into the mainstream adoption phase, but new use cases in healthcare or brand marketing are also emerging.
As VCAs are now the first point of contact to support multiple customer interactions via digital engagement channels, they can be used to deliver proactive advice and engagement to build loyalty and customer satisfaction.
Visual configuration enables sales representatives and end customers to see a visual representation of products they want to order with the options and features they have selected. It is more relevant for B2B transactions where it can enable customers to purchase complex manufactured goods via digital commerce with no training. Organizations that are among the first to adopt it in their industries see substantial competitive advantage and cost savings.
Recent improvements in technology, such as improved photorealism, are leading to rapid growth and wider adoption of visual configuration among digital commerce businesses.