The Coming of Inbox Commerce

Published April 26-30, 2023

Why Now

The past few months have been all about Generative AI and the promise that it holds for transforming our lives. Whether as copilot or autopilot, Generative AI will improve productivity and outcomes. But in all the excitement about it, there is one important trend that has been missed out. Our inboxes are becoming two-way and commerce friendly. This shift from being just a communication tool to enabling conversation and commerce will be very important for sellers because it removes the friction that forces buyers to click through to websites and apps for doing transactions. Think of this as a shift from “far” commerce to “near” commerce – search, browse, and buy comes right into our inboxes. The easier those transactions become, the less that brands will have to spend on wasteful new customer acquisition, and therefore the higher will be their profitability.

The coming rise of inbox commerce is being driven by a number of changes in our inboxes:

AMP in Email eliminates redirects and can be used to create mini-apps inside email.
SMS is becoming two-way. (A stupid regulation in India still keeps it one-way.)
WhatsApp has, over the past year, opened its platform for brand conversations. As WhatsApp Pay proliferates, buying inside the app will become simpler.
RCS (think of it as an SMS upgrade) can also bring commerce closer to consumers.
AI-enriched product catalogs can improve relevance and power recommendations across channels.
Chatbots can simplify the creation of search and browse workflows.
While not an “inbox”, ChatGPT has shown how a search bar can become a window to almost anything.

Taken together, all these innovations will change the “where” of commerce. For long, it has been assumed that brands must bring their buyers to their websites and apps for completing transactions. This has been a point of friction since unidirectional push messages (like emails and SMSes) had to persuade consumers to click and change context to the brand properties. Now, the interactivity that is coming in the push channels can ensure that commerce can be done right inside the inbox. Netcore’s early customers for AMP in Email have seen an increase of 5-15 times (500-1500%) in actions being performed inside the email when the option is provided to consumers. While engagement has been the primary use case so far, the next obvious step is to enable shopping. Once the payment layer gets streamlined and embedded inside the messages, frictionless commerce will be here – right inside the inbox where all of us spend so much time each day. It is what WeChat has been doing in China for many years; the rest of us are now going to see the same seamlessness of marketing and transacting in our inboxes. This will herald one of the biggest leaps in ecommerce in years, if not the past couple decades.

Overview – 1

When I did a search for “inbox commerce” and “inbox ecommerce”, I got less than 15,000 results combined, and almost all of them were not relevant to the topic we are discussing. Inbox and ecommerce have not been discussed in the same breath! That is about to change. I asked ChatGPT for an overview of inbox commerce:

Inbox commerce refers to the practice of conducting business transactions, promoting products or services, and engaging with customers within messaging platforms or email inboxes. The idea is to streamline the customer experience and make it more convenient by allowing users to interact with businesses and make purchases directly within the messaging apps or emails, without leaving the platform.

In the context of messaging apps like WhatsApp, RCS (Rich Communication Services), 2-way SMS, and AMP (Accelerated Mobile Pages) in email, inbox commerce can take various forms:

Conversational commerce: Businesses use chatbots or live agents to engage with customers, answer queries, and help them make purchases through messaging apps. This can include personalized product recommendations, support, and payment processing.
Promotional messages: Companies can send promotional messages or offers to customers via these messaging platforms, encouraging them to make a purchase or learn more about the products or services offered.
Transactional messages: Businesses can send transactional messages like order confirmations, shipping updates, and payment receipts to customers via messaging apps, creating a more unified and convenient customer experience.
Interactive content: AMP for email allows businesses to create dynamic and interactive email content, which can include product carousels, forms, and other interactive elements that enable users to engage with the content and make purchases without leaving the email.

Inbox commerce is becoming increasingly popular due to its ability to create a seamless and personalized customer experience, as well as its potential to increase engagement, conversion rates, and customer retention.

[Rajesh] I asked about why inbox commerce is so important for marketers and brands:

Inbox commerce is important for marketers and brands for several reasons, as it offers a unique and convenient way to engage with customers, drive sales, and build lasting relationships. Some key benefits of inbox commerce for marketers and brands include:

Convenience: Inbox commerce allows customers to interact with businesses, browse products, and make purchases without leaving their messaging apps or email inboxes. This convenience can lead to increased customer satisfaction and higher conversion rates.
Personalization: Messaging platforms and emails enable businesses to deliver personalized content based on user preferences, behavior, and past interactions. This targeted approach can lead to improved engagement and higher sales.
Enhanced customer support: Inbox commerce allows businesses to provide real-time customer support through chatbots or live agents, resulting in faster resolution of issues and improved customer satisfaction.
Better open and engagement rates: Compared to traditional marketing channels, messaging apps and emails often have higher open and engagement rates. This means that marketing messages delivered via inbox commerce are more likely to be seen and acted upon by customers.
Increased customer retention: By offering a seamless and convenient shopping experience through inbox commerce, businesses can foster long-term relationships with their customers and encourage repeat purchases.
Integration with other marketing channels: Inbox commerce can be integrated with other marketing channels such as social media, websites, and apps to create a cohesive and consistent customer journey, reinforcing brand messaging and driving sales.
Data-driven insights: Businesses can gather valuable data on customer behavior and preferences through interactions on messaging platforms and emails, which can inform future marketing strategies and help optimize campaigns for better results.

[Rajesh] In summary, inbox commerce is important for marketers and brands because it allows them to create a more convenient, personalized, and engaging shopping experience for customers, ultimately leading to higher conversion rates, increased customer loyalty, and better overall business performance.

Overview – 2

I asked ChatGPT to suggest alternate phrases for “inbox commerce”:

Messaging-based commerce
Conversational commerce
In-app purchasing
Direct inbox transactions
Chat-based commerce
Messaging-enabled commerce
Inbox-driven sales
Integrated messaging commerce
Message-centric commerce
Communication platform commerce

[Rajesh] I then asked which platforms offer inbox commerce:

WeChat: A popular Chinese messaging app that allows users to shop, make payments, and interact with businesses directly within the app through WeChat Pay, WeChat Stores, Mini Programs, and Official Accounts.
WhatsApp: With WhatsApp Business, companies can create business profiles, showcase products, send promotional messages, and provide customer support through the popular messaging platform.
Facebook Messenger: Businesses can use Messenger to engage with customers, provide support, and facilitate transactions using chatbots or live agents.
Instagram: Instagram’s shopping features allow businesses to tag products in their posts and stories, enabling users to make purchases directly within the app.
RCS (Rich Communication Services): As an upgrade to traditional SMS, RCS enables businesses to send rich media messages, promote products or services, and facilitate transactions through interactive content.
Email platforms with AMP (Accelerated Mobile Pages): Platforms like Gmail and Outlook support AMP, allowing businesses to create dynamic and interactive email content that enables users to browse products, fill out forms, and make purchases without leaving the email.
Apple Business Chat: Apple’s messaging platform for businesses allows companies to engage with customers, provide support, and facilitate transactions within the Messages app on iOS devices.

[Rajesh] I inquired about WeChat and inbox commerce:

WeChat is a good example of inbox commerce. WeChat is a Chinese multi-purpose messaging, social media, and mobile payment app developed by Tencent. It offers a wide range of features, including instant messaging, voice and video calls, social networking, and mobile payments.

WeChat has integrated various commerce-related functionalities into its platform, allowing users to engage with businesses, make purchases, and perform transactions without leaving the app. Some of the features that make WeChat a good example of inbox commerce are:

WeChat Pay: Users can make mobile payments directly within the app for both online and offline transactions.
WeChat Stores: Businesses can set up their online stores within the WeChat platform, allowing users to browse products, make purchases, and track orders seamlessly.
Mini Programs: WeChat allows developers to create small apps within its ecosystem, offering various services like e-commerce, ride-hailing, and food delivery.
Official Accounts: Businesses can create official accounts to engage with customers, share promotional content, and provide customer support through WeChat’s messaging system.
WeChat Advertising: Companies can run targeted advertisements on WeChat, promoting their products or services to users based on their interests and browsing habits.

[Rajesh] So, there we are. A few questions and we have an overview of what the state-of-the-art looks like for inbox commerce. Next, we will look into the future promise of inbox commerce.

(As an aside: the previous two posts where I quoted ChatGPT answers took barely 5 minutes to write; had I thought, researched, and written them, it would have taken me over an hour. And I probably would not have been as comprehensive. This is the power of ChatGPT as copilot. Once I came up with the idea of “inbox commerce”, I could use it to help me with the writing.)

Trade Show Wow

I had written in a previous essay on my recent US visit about my attending two ecommerce trade shows (eTail West and Shoptalk): “The focus for us [at Netcore and Unbxd] was on two innovations: AMP in Email (what we termed as All-in-Email) and AI-enriched catalog (which is the key to getting product discovery and personalisation right).” This needs some elaboration.

At eTail, Netcore was sponsoring roundtables – each was a 20 minute conversation with 7-8 marketers. Initially, we discussed personalisation and the friction points being faced, and then mentioned how Netcore could solve the problem because of its ability to use AI to enrich the product catalog (going beyond human input) and combine it with unified customer data to do significantly better personalisation than competition. While this was exciting, it did not elicit the excitement that we were looking for to drive traffic to our booth and leads for future conversations. We then decided to change our approach. In the last few roundtables, we started by showing how the Gmail inbox could become a shopping channel – starting with a product catalog, being able to add items to the cart, then selecting a shipping address, and finally making a payment – all right inside the email inbox. The marketers were blown away by what they saw! It was one of those “wow” moments where they realised this could be the future of their business. Interest in our offerings spiked and we had a complete turnaround in inbound interest at our booth! As I told one of my colleagues in Hindi, “Paisa vasool.” (I guess the closest English translation would be – great RoI!)

Shoptalk was very similar. In fact, at a 1:1 meeting with the founder of a D2C company I had started by explaining about Netcore and what we did. After a couple minutes of listening, the founder cut me short and said, “What you are describing is what 50 other companies at this show are talking about. What is different about you?” Realising that I was a few seconds away from losing the prospect, I opened my iPad and showed “inbox commerce” – exactly what had wowed the audience at eTail West. I could sense the awe in the founder as he saw the transaction being completed right inside Gmail. He then said, “Why didn’t you start with this? These 30 seconds are all you need to sell me to talk more to your company.”

The experience of my colleagues was very similar. It was then that I realised that we were on to something big, perhaps even a new category. In the US, email is one of the most important channels marketers use for their communications with consumers. (SMS is now rising rapidly but has many limitations which RCS promises to fix.) Actions inside email had so far been restricted to simply clicking through to a landing page. What we were showing was extraordinary – the ability to do “all-in-email” – search, browse, add to wishlist, add to cart, pay, and a lot more – right inside the email. This was something no one had ever seen or experienced. And that is when I knew we were on to something big. A colleague expanded “All-in-Email” to “inbox commerce” since it could also apply to other channels. This could become one of the biggest innovations in ecommerce offering a big win-win for both buyers and sellers.

All-in-Email

I wrote about All-in-Email in the context of hotlines in my essay on ProfitXL:

For the past decade or so, almost nothing has changed in the push channels. And now, almost suddenly, a triad of innovations is creating excitement: emails can become interactive thanks to a technology called AMP, WhatsApp (popular in many countries) has allowed for brands to interact with customers, and Atomic Rewards can offer gamified micro-incentives to encourage attention and the sharing of personal information (also called zero-party data). AMP, WhatsApp and Atomic Rewards can thus drive inbox engagement and action funnels closer to consumers. AMP and WhatsApp can even replace apps – and combined with the advantage of ‘push’ give marketers control to initiate conversations which can lead to conversions.

AMP, because of its underlying email base, costs a fraction of that of WhatsApp (which is controlled by Meta). While still in its infancy in terms of use cases being deployed, AMP will enable what I call “All-in-Mails”. From filling forms to lead generation, from spinning wheels for offers to using calculators for answers, from getting additional product information to acting on abandoned shopping carts, from searching to paying – AMP is the future of email. Think of it as Email 2.0 – email without the need for clickthroughs and landing pages, a world without redirects.

… AMP in email, WhatsApp and Atomic Rewards convert the unidirectional push channels into two-way rich interactive hotlines, thus finally enabling marketers to bridge the chasm between new customer acquisition and attracting traffic to their properties. Hotlines are thus the gateways to building deep and lasting relationships, a win-win for both brands and customers.

The premise and promise of inbox commerce lies in the fact that it brings the conversion funnel closer to customers. Every friction point that is removed can lead to a magnitude increase in actions. What’s exciting is that almost all the push channels are now moving to becoming two-way, evolving from simply being communication channels to powering conversation and commerce. Generative AI in its ChatGPT avatar can make conversation better, making chatbots and even search bars as funnels for commerce.

Consider the promise of conversational search in ecommerce. Today, the search ends with a list of products shown. Now imagine being able to continue to refine the product list with the search – much as one would talk to a salesperson in a store. “I like the first item, but can you show it to me in a lighter shade of blue?” The basic idea is the same as inbox commerce: reduce the steps, clicks and friction to enable a transaction.

As Lenin said, “There are decades where nothing happens; and there are weeks where decades happen.” This is what we are now living through. Even as the macro environment screams slowdown and recession, the pace of innovation across sectors is amazing. Entrepreneurs are working to solve problems – as they always do, but the speed at which new solutions can be brought to the market is accelerating. Inbox commerce is one such innovation which promises to transform the way we transact with brands. I will end this series with the 2-pager flyer we distributed at eTail and Shoptalk giving a glimpse of tomorrow’s world – which is here today!

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