Programmatic Commerce: Productivity Breakthrough or Presumptuous Intrusion?

Having technology remember you can be a huge convenience. But as your smartphone's auto spell check feature never ceases to remind you, having an algorithm presume to know what you want - and, by extension, to assume that you will always want the same thing based on your history - can be annoying and will probably be expensive. Not for them. For you. 

We may become conditioned to accept the insistent guidance of devices - resistance is futile, earthlings - but that would be an ironic counterpoint to the ostensible freedom the internet promises. And a likely source of frustration. JL
 
Rachel Arthur reports in Forbes:

Programmatic commerce: a world where mundane repeat purchases and those easily solved by data insights, are automatically done for you.
Imagine this: you wake up in the morning and your coffee machine, as it pours you your first cup, tells you it’s almost out of your favourite blend. Rather than making a mental note to yourself to remember to buy some more on your next store visit, your machine instantly does the ordering for you – adding it to your shopping basket, along with the detergent that needs replacing, the toothpaste you’re running low on, and the mascara that is just about to dry out.
When you leave for work, you get an update that the order will be delivered to the trunk of your car that afternoon. You then get a notification that it’s your friend’s birthday, and based on social media data that your digital assistant has pulled, you are recommended an ideal present to buy. You automatically add that to the checkout also.
Welcome to the age of programmatic commerce: a world where mundane repeat purchases and those easily solved by data insights, are automatically done for you.
The phrase – though used in other spots across the internet – has been coined by global commerce service provider, Salmon, as: “Where consumers and businesses allow technology to make purchase decisions on their behalf based on pre-programmed parameters and learned preferences.”

As CEO Neil Stewart says: “At the moment we make a choice every time we make a purchase; in the future, based on a set of parameters, we think people will be willing to pass that over to machines.”
The Internet of Things is a big factor. Today, there are more than five billion devices connected to the internet – by 2020, Gartner IT -0.36% predicts this will reach 20.7 billion. The growth of intelligent data alongside, and consumers being more comfortable with their data being shared (especially millennials), all add to the reasons programmatic commerce will become commonplace in the future, he adds.

Such a suggestion also comes at a time when conversations about “omnichannel retail” are becoming increasingly tired. Retailers know they are working towards unifying their channels, focusing heavily on seamless shopping experiences whether online or off, and importantly on the role of mobile, it’s just a matter of actually getting there, Stewart explained. Programmatic, meanwhile, feels both new and exciting to talk about, as well as something that has the potential to really shift the industry forward.
Taking the trouble out of repeat purchases is a huge opportunity first and foremost for the consumer goods and grocery markets. “Anything that makes it easier for the consumer works, because inherently they’re lazy,” Stewart explains. That, combined with price reductions, is the exact reason we push the button to call an Uber, for instance. It’s all about ease.
When shopping online today, you can already spot certain retailers (like Amazon) moving in this direction – recommending discounts if you subscribe to a certain product. Do so with Wunderbrow eyebrow make-up, for instance, and you can choose how often you receive the item (in monthly intervals) for a 5% discount. Sign-up to five different subscriptions in a month and you can save up to 15%.

Consumers can subscribe to the Wunderbrow product on Amazon

It wouldn’t be hard to imagine those sorts of repeat purchases being very quickly continuously updated for you, once you’ve set the initial parameters. Apply that to milk, eggs, yoghurt, diapers, shampoo, and it’s even more straightforward.
Suddenly consideration is replaced by software automation. Data-driven marketing to enable personalisation is already well underway; this just takes it one step further, thanks largely to the IOT. “A huge benefit for the consumer in auto replacement as opposed to choice, is that they get their time back. Why go to the store to pick things up that you already know you need, or spend the time browsing to buy them, when you can just get them shipped automatically – it’s about convenience,” Stewart adds.
The role of artificial intelligence, or our digital assistants, will become increasingly relevant in this space too – the facilitator for delegating our decision-making. The key here is that consumers will become more willing to hand over their personal data, through the “personal relationship” they build with their assistant. In doing so, buying choices become filtered to suit tastes, which in the long run changes the role of online search too.

The connected fridge of the future will enable programmatic commerce. Image via Salmon

“This exceptional access to personal data is incredibly powerful, and it will eventually make SEO and PPC far less dominant in search. Personal assistants will query more diverse sources of information, and will have the ability to comb through more resources, some of which are not visible in search,” reads the accompanying report from Salmon on this subject. As can be seen in the nature of many online grocers, and indeed Amazon again, already – search flips then from request to recommendation.
All of this is likely to have a big impact on marketers too. With the IOT and personal data meaning demand can be anticipated, marketing will play a smaller role in driving decisions. But even more significantly, with repeat purchases enabled through machines, the consumer will become “locked in” to one brand too. “This really changes shopper marketing,” says Stewart. “When you’re locked-out, the ability to get that customer back becomes increasingly costly and difficult.”
Where at the moment, much of advertising is pushed around emotion, for instance, the future could well be geared more to utility and, of course, to price. While consumers will undoubtedly still look for variety in their lives, the whole conversation really changes what loyalty looks like in terms of basic everyday goods.
Automation doesn’t seem sexy, and sold to the consumer, it still feels a long way off from true AI and IOT integration. But, as always, and in the words of William Gibson: “The future is already here — it’s just not very evenly distributed.” Time for businesses to really start thinking about it.