Commentary: Envisioning a brave new world of e-commerce

NEW YORK -- With all the exciting advancements in consumer technology, why is it that innovation in e-commerce is stagnant?

The status quo of the digital shopping experience has not changed since the dawn of the Internet. Today's consumer experience still consists of a two-dimensional, unimaginative website. Yet, when you look at consumer technology, there is an exciting world of wearable's, "smart" technology, and even virtual augmentation.

Why the disconnect?

With all the capabilities we have today -- power of big data and the proliferation of communication platforms and technologies -- the digital shopping experience has the potential to be exciting. Yet, it makes up only 7% of U.S. retail sales, according to Forrester Research, and conversion rates hover around 1% to 2% -- virtually unchanged since 1995. Additionally, up to 70% of traffic driven from search bounces off the first page of a website, never making it past one click.

Search is the main culprit. Companies, namely Google, emerged early on to provide consumers a better way to navigate content. Simultaneously, it began to shape the rules of e-commerce that we know today. Brands now have to play by certain rules to be "searchable," focusing on SEO content and keywords versus the consumer experience itself.

Marketers seeing fewer returns on search spend and also getting less data, leaving consumers increasingly dissatisfied.

It's hard to believe we have some industry leaders bold enough to predict "The end of the Internet" by crowning the app era. But, with consumers spending more time on their mobile phones versus their PCs and laptops, according to Nielsen, it's apparent mobile commerce does not face the same challenges of e-commerce.

That said, it is the mobile movement that is going to transform communication. Consumers today are choosing to connect via mobile messaging platforms over email, voice, or SMS. In less than three years, more than 1.5 billion consumers around the world are using these mobile platforms.

While cost may have initially driven adoption for regions outside the US where SMS is costly, the reasons these apps boast high rates of engagement is because it enables consumers to have rich, real-time, one to one interactions, wherever they are.

The 1.5 billion consumers using platforms today are the digital shoppers of tomorrow, and they'll expect the same experience from their favorite brands. This will be the new standard.

While challenging Google's model seems like a daunting task, many brands are already looking to challenge it.

One example is eBay, who commissioned a survey challenging the effectiveness of paid search. It found if it shut down keywords, in which it spends $51 million annually, it would lose less than 3% of its traffic. Its findings suggest "the efficacy of SEM is weak, a conclusion that is likely to apply to other large brands that together spend billions of dollars a year on Internet marketing."

So, why should brands continue to invest in paid traffic, which is arguably becoming less and less qualified, rather than putting dollars towards delivering an exciting, one-on-one experience to its consumers?

Companies need to invest in a strategy that lets them build powerful, one-to-one relationships with their customers across all digital touch points, so that search eventually becomes an unnecessary step between consumer and brand. An e-commerce experience should be more like a high-end boutique versus a vending machine.

Wherever your consumers are connecting with you, they should feel excited about engaging with your brand directly and eager to spend time and money with you.

With all of the technology, connectivity and multi-channel functionality at our disposal, we have the power to create a brave new world of e-commerce: an emotional experience that truly creates lifetime relationships.

Robert LoCascio is founder and CEO of digital-engagement company LivePerson.