I have been laying some miniscule bets with my fellow Digeratis on how long will it be before the global eCommerce community has its own version of the UK PPI fiasco?  For those of you foreign to these shores, this was the supposedly industry scale mis-selling of payment protection insurance to consumers who took out loans or wanted to protect their credit card repayments when they were sick or unemployed.  So far this episode has cost the UK banking industry £12 billion ($19.1 billion)!  

Now, I used to be responsible for teams writing some of the marketing messages for PPI for retail clients when I worked at GE Capital some years ago and I can tell you that we were closely regulated about what we could say and had to hand out copious pieces of approved in-store literature (and online text) to potential customers before they took the product. Many people bought PPI willingly for peace of mind and, of course, you only used it if you fell upon hard times. In any case, today, almost everyone who was sold PPI gets a refund of total premiums paid in compensation for mis-selling. Incredible!

So what message does this sorry tale send to the eCommerce community worldwide? Simple - you have to plan for Stupid. Particularly if you operate in the US (think Elizabeth Warren!) and the EU.   

As a community of implementers we have already been doing this is some areas. How we allow Users to create passwords comes to mind.  Here, eCommerce practitioners have been trying in vain to help Users to create more secure passwords with limited success.  Studies continue to show that the same simple, insecure, passwords are created time and time again by Users, despite warnings to the contrary. Here’s a list of the most commonly used passwords, as revealed by Trustwave’s survey of business enterprises:

1. Password1
2. welcome
3. password
4. Welcome1
5. welcome1
6. Password2
7. 123456
8. Password01
10. Password3

What is interesting about this list is that even those sites which seek to regulate password creation, by for example demanding that a CAPITAL letter and/or a number be included in a password to enhance security, are undermined by User Stupidity. Changing "password" to "Password1" still gives us two of the top three most commonly used passwords!

I often wonder whether it is the ease of use and accessibility of digital channels that make sensible people more stupid. The recent Lord McAlpine Twitter Libel circus is a case in point (if only those who libelled the Peer had followed the Theory of Balls Rule 6).  Apparently, those being chased for damages include a Barrister who would not have dreamed of getting on a soapbox in the street and shouting a libel in the offline world. 

On the other hand, the recent government eCommerce campaign for the election process of Police and Crime Commissioners (PCCs) in England shows that in some cases the public simply use 'Stupid' as an excuse. Of the reasons for a low turnout (15-20%)  in these elections the one which states that no infomation was available to voters as to who was standing or what the process was all about seems to be the most lame.  In fact, online channels excelled in explaining candidates policies and profiles in the geographic regions where candidates stood.  Basic web searches brought up simple to use sites that provided information that beat anything that would have been delivered through peoples' doors via snail mail.

So, evidence suggests that eCommerce implementors are left with three types of Stupid.  First, when Users have been clearly told about product features and sign up to them, yet they still claim not to get it (PPI). Second, no matter how much it is self- evidently in Users' best interests to either do something (passwords) or not do something (twitter libel) a substantial minority will act against themselves. Third, if Users don't really care about something they will act stupid as an excuse as to why they did not participate.

The bottom line is, Stupid is as Stupid does, and eCommerce implementers can't plan for, or prevent, Stupid. They can however, make sure they have a large contingency budget!

Check Out Gary's Current Status and Expertise HERE.

If you have been following the evolution of eCommerce recently you will have identified two key issues that all giant companies trying to dominate the space (Google, Amazon, Apple and Facebook) are grappling with. First, the increasing role that governments want to play in online business, particularly the imposition of taxes and regulation of online trades by local and national authorities. Second, the potential (or not) of local advertising driven eCommerce.  

Both of these issues can lead to dramatic changes to end users perceptions of the benefits of buying and selling online.  In the first instance, governments are starting to play the clown as they try to trap the eCommerce companies into playing by the same rules they have long imposed on bricks and mortar businesses in their respective jurisdictions. In the case of local advertising, eCommerce strategists could easily be seen by both investors and end users alike as acting like buffoons if they roll out platforms that are too intrusive and kill off the potential for this area of growth for eCommerce at its start.

The increasing role that governments want to play in this space may turn out to be the more serious threat to the future of 'free enterprise eCommerce' (where buyers and sellers meet unhindered in cyberspace). Following on from the recent battles over Network Neutrality (which are not over but on hold pending the outcome of the US elections), two specific fiscal initiatives by governments are worth noting here. First, it is rumoured that Google has been on the receiving end of a tax demand from the French Government for 1 billion Euros on the advertising revenue that it supposedly gets for sending users to French media websites. Second, Amazon has capitulated to levying states' sales tax in the US. Now eCommerce companies cannot pass onto end users ALL the savings from having efficient warehousing and shipping operations out of state.  

On the potential for local advertising on mobile devices, some pundits see this as the next ‘big frontier in eCommerce’. Here the argument is that helping smart device users purchase close to them and shifting local advertising spend online (presumably to the detriment of local papers) is a huge opportunity which global online retailers, like Amazon, can’t ignore.  The suggestion is that Amazon, for example, should take over Groupon (which even Google tried to buy before the Groupon IPO) and make a killer APP for Amazon Smartphone devices (a ‘Kindle smartphone’?).  

To me this low-price driven strategy is fraught with danger.  Anyone who has a Kindle supported by advertising knows that Amazon’s 'push' ads do not interfere with the purpose of the device's reading or book ordering experience.  Since users are settled and ready and receptive to read the odd Advert, this is not too bothersome on existing Kindle devices. However, can you imagine how irritating it is to have ads popping up just as you are about to make a call prompting you with an offer 100 meters away? Limited screen size is a real problem for this service and even if you are interested in such content as an end user it is a distraction that you can likely live without.  The sheer number of ads that need to be pushed locally to make this profitable is also challenge. To even have a chance of permission based regular use they need to be in the 'interest sweet spots’ of end users close to 100% of the time (the assumption is you can turn them off, but can you on a low-priced smartphone subsidised by the ‘Kindle ecosystem’?). Even the the most ferocious proponents of the advantageous of 'Big Data' can't promise this. ‘Digital Local marketing’ maybe the next big thing from the point of view of creative agencies but it is without doubt one tough nut to crack from the point of view of end-user experience as its perceived benefits may not always exceed its perceived cost in terms of time and intrusion. 

What is clear is that both of these developments will impact how eCommerce is practiced globally in the months and years to come. Some serious thinking about the future of global eCommerce is afoot...