What are the Benefits of Digital Commerce?

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Digital commerce, defined as the buying and selling of goods and services online, has completely transformed the retail landscape. Digital Commerce offers companies of all sizes the ability to reach customers around the world, operate leaner and smarter, and reimagine the shopping experience. For both established retailers and small startups, embracing digital commerce provides compelling benefits compared to traditional brick-and-mortar business models.


  • Global Reach & Market Expansion: Digital commerce eliminates geographical boundaries, enabling businesses to tap into international markets and reach a broader audience.
  • Cost Reduction & Profit Maximization: Transitioning to online sales reduces substantial overhead costs associated with physical stores, such as rent, utilities, and in-store personnel.
  • Sales & Revenue Enhancement: A digital presence can increase sales by attracting new customers and facilitating impulse purchases with features like personalized recommendations and one-click checkouts.
  • Customer Experience Optimization: Digital platforms offer a personalized, convenient shopping experience with 24/7 access, detailed product information, and customer reviews.
  • Omnichannel Strategies & Customer Insights: Integrating digital and physical sales channels offers a seamless customer experience, while digital analytics provide valuable insights for targeted marketing and inventory management.

Top 9 Benefits of Digital Commerce

Embrace the future of retail with digital commerce: a gateway to global markets, lean operations, and tailored shopping experiences that are setting the new standard for business success. From expansive market reach to enhanced customer experiences, here are the benefits propelling businesses into a prosperous digital future.

Top 10 Benefits of Digital Commerce

Wider Market Reach Opens Up New Horizons

One of the most transformative aspects of digital commerce is the ability to sell to a global consumer base rather than just a local customer population. Location no longer limits who can access products and services. An online storefront allows a business to reach audiences across countries, time zones, and continents. The global digital commerce market size is expected to reach USD 19.43 trillion by 2032, growing at a CAGR of 15.8%.

Selling online breaks down geographic barriers that hinder physical stores. Now, companies can expand into entirely new  markets at a fraction of the cost of building new retail outlets. Tapping into fresh demographics and consumer bases is as easy as optimizing a website for multilingual and multi-currency transactions.

Digital Commerce Market Size

Just as important, digital commerce enables businesses to stay open 24/7. Whereas customers living in different time zones had limited options before, digital commerce retailers can now fulfill orders at any hour of the day or night. The always-on nature of an online storefront aligns perfectly with the on-demand mindset of today’s consumers.

Lower Overhead Costs Boost Profit Margins

For retailers weighed down by the costs of operating brick-and-mortar locations, embracing digital commerce presents a lucrative opportunity to reduce overhead expenses and maximize profits. The cost savings stem from no longer needing to rent, staff, stock, and maintain physical storefronts.

Brick-and-Mortar CostDigital Commerce Savings
RentNo physical stores mean no rent or property taxes
PayrollAutomation reduces staffing costs
UtilitiesNo more electric, water, and HVAC expenses
InventoryLess physical space needed with online fulfillment

Without in-person retail spaces, companies avoid paying rent, utility bills, property taxes, liability insurance, and other associated costs. Transitioning to digital commerce enables businesses to close underperforming locations as web sales grow to pick up the slack.

Ecommerce automation also leads to lower payroll expenses. Online retailers require fewer staff dedicated to roles like cashiers, stockers, and sales associates. Customer self-service replaces the high-touch model of traditional retail stores.

For small businesses, escaping the overhead costs of a physical retail presence provides instant relief. As projections indicate that a staggering 22% of worldwide retail sales will be conducted online by 2023, the imperative for small enterprises to embrace the digital marketplace has never been more pressing.

Digital commerce startups can get off the ground without taking on the financial risks of opening a storefront. For larger retailers, optimizing the digital and physical footprints through an omni-channel strategy balances out costs.

More Sales Volume and Revenue Growth

For incumbent retailers, adding digital commerce capabilities does not necessarily cannibalize existing store sales. Instead, an online presence boosts overall sales volume by offering existing customers more choice in terms of where and how they shop, while also attracting new buyers.

E-commerce makes it easier for retailers to capitalize on impulse purchases. If a product catches a customer’s eye, they can purchase it immediately rather than having to travel to a physical store. Smart digital merchandising, personalized recommendations, and one-click checkout all facilitate higher conversion rates.

Since 2022, online transactions have claimed 21% of global retail sales, underscoring the rapid shift toward e-commerce. Furthermore, projections by Statista indicate that online shopping in the United States is set to surpass a staggering 1.7 trillion dollars by 2027.

Revenue of the e-commerce industry in the U.S. 2017-2027

Email marketing via segmented subscriber lists enables personalized recommendations and promotions based on purchase history. Automated post-checkout and cart abandonment email drives re-engagement for additional sales.

Ad retargeting gets the most value from site visitors after they leave by displaying relevant ads across their other internet browsing. Retailers remind and nudge prospects to return and complete purchases.

Far beyond static newspaper circulars, digital promos can be highly customized. Online offers dynamically update based on user identity and activity. Dynamic pricing alters product costs based on demand signals like inventory and competition.

Improving the Customer Experience From End to End

Creating a seamless, personalized shopping experience is critical for digital commerce success. Fortunately, digital commerce provides retailers with advantages over physical stores when it comes to understanding customers and optimizing touchpoints.

Online shopping aligns with the convenience expectations of modern consumers. They can browse products, conduct research, and complete purchases whenever they want, from the comfort of home or on the go via mobile devices. No more coordinating store hours or driving to crowded malls.

Product research is streamlined online as all the relevant details on features, specs, reviews, FAQs, and manuals exist in one place. Customers gain the confidence to purchase without having to interact with sales staff. If personal assistance is needed, many digital commerce retailers provide 24/7 live chat support.

User-generated ratings and reviews further establish trust in the buying process by highlighting the pros/cons of fellow customers. Detailed product photos allow online shoppers to inspect items closely without having to handle display models. Augmented reality mobile apps take digital try-before-you-buy even further.

On the transaction side, digitally native shoppers now expect one-click checkout and secure payment processing. Digital commerce platforms provide turnkey integration with leading payment gateways and fraud protection. Customers enjoy checkout speeds not possible through manual cashiers or card readers.

For delivery, consumers increasingly demand fast, low-cost, or free expedited shipping. Digital commerce retailers invest heavily in supply chain capabilities to get online orders to doorsteps quickly through services like Amazon Prime. Innovative ship-to-store and curbside pickup options also improve convenience.

Omnichannel Experiences Bridge Online and Offline

Rather than go all-in on digital, many mature retailers pursue an omnichannel strategy that tightly integrates digital commerce with their existing physical stores. This provides customers with a consistent, seamless shopping experience across channels.

Buy-online, pickup-in-store (BOPIS) enables customers to order products online but retrieve them from a nearby brick-and-mortar location. This appeals to those who value convenience but still want their items quickly. Store inventory can fulfill online orders as efficiently as warehouses.

Conversely, capabilities like endless aisle let customers browse additional inventory or product details right in a physical store. Staff can place orders on customers’ behalf for items not currently on the shelves. This combines the immediacy of in-store retail with the selection of digital commerce.

Omnichannel CapabilityCustomer Benefit
BOPISBuy online, pick up in store for quick fulfillment
Endless aislesBrowse additional inventory in-store
Unified inventoryEnsure product availability across channels
Flexible fulfillmentOptimize shipping method per item

For omnichannel execution, inventory management integration between digital and physical is critical. This provides visibility into real-time stock levels across the network to prevent mismatched customer expectations. Order management and fulfillment can be optimized based on item availability at nearby stores.

When digital commerce and brick-and-mortar work together, customers benefit from flexibility and choice. Brands see increased sales and loyalty. Even major discount chains like Walmart and Target now offer BOPIS and other omnichannel convenience.

Achieving True Omnichannel Commerce

Given all the operational advantages outlined, omnichannel commerce delivering consistent experiences across physical and digital channels clearly represents the future of retail. Stores will remain important as service showrooms, marketing displays, fulfillment hubs, and return centers.

    • Unified Retail Experience: Omnichannel commerce blends digital convenience with the tangible benefits of physical stores, forming a consistent retail ecosystem.
    • Strategic Role of Physical Stores: Beyond sales, stores serve as interactive displays, fulfillment centers, and service hubs, essential in the omnichannel mix.
    • Seamless Integration: Retailers must fuse online and offline data, offering customers a smooth transition across shopping channels with modern POS systems.
    • Flexible Fulfillment Options: Adapting to consumer preferences for convenience, retailers are implementing BOPIS, curbside pickup, and ship-to-store services.
    • Consumer-Driven Commerce: The demand for a flexible, anywhere-commerce approach is pushing retailers to perfect omnichannel strategies to enhance customer loyalty and capitalize on digital transformation.

Digital Analytics Provide Better Customer Intelligence

In contrast to limited point-of-sale data from physical stores, digital commerce generates a tremendous amount of detailed analytics and shopper insights. With an abundance of customer intelligence, retailers can make smart, data-driven decisions.

Analytics DataBusiness Impact
Site trafficIdentify popular products and optimize site navigation
Shopper demographicsRefine buyer personas and marketing targeting
Geo-locationSupport appropriate languages, currencies, shipping
A/B testingContinually refine site experience for higher conversion

Clickstream tracking tools supply a wealth of real-time behavioral data on how visitors navigate a website. Retailers can identify which product pages attract traffic, where shoppers exit, average time on site, and related trends. These usage metrics pinpoint areas for improving site conversion.

Online analytics also reveal demographic and geographic data to help segment audiences. Insights on the ideal buyer persona for different products allow marketers to fine-tune messaging and offers. Location data determines which languages and currencies to support.

Analytics empower A/B and multivariate experiments that optimize site experience. Testing aspects like page layouts, product descriptions, pricing, promotions, and more identifies the best combinations for higher conversion. The top-performing variations can continually be refined.

All this data and testing is impossible for an offline store. Digital commerce grants new visibility into customer behavior that simply browsing in aisles cannot provide. Data also improves supply chain visibility and inventory management tied to actual sales trends.

Heightened Security and Fraud Protection

Securing sensitive customer information is paramount for retailers. Security emerges as the primary concern for 44% of consumers when selecting an online payment method, highlighting the importance of trustworthy transactions in the digital economy.

Digital commerce offers several key security advantages over physical stores when implemented properly.

  • Encryption protects payment data and scrambles information in transit
  • Multi-factor authentication adds layers of verification for purchases
  • Trust seals and customer reviews validate legitimacy
  • Less physical product theft and shrinkage

Ecommerce platforms utilize encryption and tokenization to protect payment data. This means customer credit card numbers are never directly processed or stored. Encryption scrambles data in transit between browsers and servers. According to Paysafe, debit cards, credit cards, and digital wallets are the leading online payment methods, with usage rates of 59%, 51%, and 33% respectively. The report indicates a notable rise in the use of debit cards, particularly for smaller transactions, whereas credit cards continue to be the preferred choice for more expensive purchases.

Compared to traditional card-present payments, digital commerce transactions can incorporate additional verification steps with solutions like 3D Secure. Customers confirm purchases using one-time codes sent to their phone or biometrics.

Since online shoppers cannot physically inspect the products, third-party trust seals like McAfee SECURE and Norton Verified provide reassurance that sites are legitimate. Customer reviews also help validate product quality and seller reputation.

From a loss prevention standpoint, the digital nature of online retail reduces theft, damage, and other shrinkage risks associated with physical products. Customers cannot shoplift virtual items. Inventory stored in warehouses faces fewer security threats.

While fraud remains a concern, overall enhanced security protocols and lack of physical access to purchases help minimize risks for retailers and shoppers alike. Cybersecurity best practices like SSL certificates, data encryption, firewalls, and penetration testing are strongly recommended.

Lean Operations and Simple Scalability

Particularly for small startups, digital commerce provides a lean launchpad without cumbersome retail infrastructure. Digital merchants can add or modify products instantly without forecasting inventory demand well in advance.

Online catalogs are not constrained by physical shelf space. Retailers can offer greater product variety and long-tail items. Niche brands that may struggle for distribution in crowded store aisles can instead thrive on the virtual shelves of marketplaces like Amazon.

Digital platforms easily handle sudden spikes in traffic and order volumes. Inventory is immaterial since items don’t need to be physically shipped until purchased. Digital commerce systems scale seamlessly using cloud infrastructure that adds capacity automatically during peak seasons.

Legacy brick-and-mortar retailers must carefully plan new store openings years in advance. However, their online stores can expand domestically or internationally at the click of a button. Geographic rollouts become simplified without on-the-ground buildouts.

For small merchants, third-party marketplace listings provide turnkey access to millions of buyers without managing the entire digital commerce technology stack. Marketplaces like Etsy, eBay, and Amazon minimize the business operations needed to reach a global audience.

Enhanced Marketing and Promotional Abilities

Unlike physical retailers that rely heavily on local advertising, digital commerce merchants can precisely target and track digital marketing. Online ads display dynamically based on audience demographics, interests, keywords, and browsing history.

Social media now plays an influential role in driving brand awareness and traffic for online merchants. Creative organic and paid campaigns build customer engagement on platforms like YouTube, Facebook, Instagram, and TikTok. User-generated content also boosts credibility.

YouTube reigns as the top video marketing platform with 90% of marketers leveraging its extensive reach, while Facebook closely follows at 86%, and both Instagram and LinkedIn share a substantial usage rate of 79%.

Email marketing via segmented subscriber lists enables personalized recommendations and promotions based on purchase history. Automated post-checkout and cart abandonment email drives re-engagement for additional sales.

Ad retargeting gets the most value from site visitors after they leave by displaying relevant ads across their other internet browsing. Retailers remind and nudge prospects to return and complete purchases.

Far beyond static newspaper circulars, digital promos can be highly customized. Online offers dynamically update based on user identity and activity. Dynamic pricing alters product costs based on demand signals like inventory and competition.

In summary, embracing digital commerce presents an enormous opportunity for retailers to drive efficiency, reach, and growth. While physical stores still play an important role, legacy models must evolve omnichannel strategies to align with the new reality of online consumer behavior and expectations.

Compared to brick-and-mortar, digital retail also provides more effective cross-selling opportunities. Recommendation engines dynamically suggest complementary or higher-end products based on browsing behavior and past purchases. Retailers can readily upsell customers once they are on the site to increase average order value.

For customers, the breadth of inventory available online far surpasses physical shelf space. Retailers can list hundreds of product variations or long-tail items impractical to stock in stores. This benefits businesses as the expanded selection converts more visitors into buyers.


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