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Energising eCommerce: QNET’s Digital Transformation
Energising eCommerce: QNET’s Digital Transformation Written by Jennifer Johnson Produced by Kiron Chavda
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The eCommerce sector is expanding rapidly, and so are customers’ expectations of eStore functionality. QNET’s CIO and CTO have devised a plan to conquer the industry — and it is about to go live 4
Malcolm Chiu, Chief Information Officer
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Changing a global platform is not a small initiative,” says Malcolm Chiu, the Chief Information Officer of Hong Kong-based direct selling titan QNET. In the rapidly-expanding world of eCommerce, user experience is a crucial factor in turning casual browsers into buyers. Chiu, and the firm’s Chief Technology Officer, Ivan Woo, have long understood the role of personalisation and agility in creating a dynamic eStore. Four Annual years ago, they also realised that QNET’s existing legacy platform could not accommodate many of the features that customers were coming to expect from an online shop. In 2012, QNET set about the mammoth task of creating an entirely new Next Generation Platform (NGP) — which is due to launch this year. “This is the largest IT project in the company’s history,” Chiu explains. “We had our entire platform built in-house about 10 years ago and we grew that platform to serve hundreds
of countries and many languages.” However, as time went on, there proved to be some legacy issues with the firm’s original platform. “It was really imperative that we transform or migrate the platform to a much more modern and robust solution,” Chiu says. QNET’s unique sales model and wide global reach requires a highly personalised web platform capable of producing detailed analytics. The company Revenue relies on teams of independent representatives (IRs) to sell its products to consumers in their communities. The IRs are then compensated based on the sales volume of their referrals and the revenue of the other IRs in their teams. Retail customers can only purchase QNET products if they are given access to a representative’s referrer ID. “We sell many different kinds of products,” says Chiu. “From vacations all the way to cosmetics. And we have many networks — they build
QNET
$430 million
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Bert Van Genechten
Timothy Steleman
COO Delaware Digital Greater China
SVP Digital & Collaboration – Delaware Digital US
Bert has a background of more than 16 years in helping customers to create end-to-end solutions and processes to serve their markets, from the ERP backbone and logistics to the digital touchpoints they create customer moments on.
In his role as SVP of Technology and Digital/collaboration practice lead for Delaware|Digital North America, Timothy focusses on emerging trends in digital (web and workplace) and eCommerce technologies. With a strong technical as well as consulting background, Timothy strives to deliver maximum value when implementing projects for Delaware|Digital customers around the globe.
digital.delawareconsulting.com
Laurence Vandelanotte Sr Digital Strategist Laurence has more than 15 years’ experience in digital marketing and strategy. She sees it as her mission to assist organizations and brands to identify business objectives and user needs and to consolidate them into pragmatic and performing digital solutions.
Digital Transformation Is Not A Big Bang Theory Entering the 21st Century One Step At A Time As a lifestyle business in the 21st century doing 100% of its business transactions online, QNET’s goals to provide higher-quality services and better customer support are tightly connected with its digital development. When you are aiming for such all-inclusive advancement, choosing the right partners is crucial. Delaware|Digital is proud to be selected as a prime partner of QNET in this process, co-creating the Next Step for Sitecore (NS4S) programme. While moving forward in the digital growth and transformation, a couple of learnings occurred, which may be useful to any other companies planning such transformations. Delaware|Digital has introduced their Digital Growth Map which makes it clear that it is crucial to work on three axes, in order to be successful in digital transformation: - Channels - Data - Governance Companies don’t have to necessarily move at the same pace along each of the three axes, but significant steps need to be made when you want to start changing the company from within, like QNET did. 1. Reach your channel objectives by building a solid foundation Digital transformation is an ongoing process that keeps improving, changing and disrupting business operations. When developing a digital ecosystem, it is important that the setup of the core system and technical architecture is designed for the future – for instance, in order to provide customers with personalised advice, which is one of our core objectives. This is the reason why QNET started by selecting the Sitecore-Commerce system as a future-proof solution to develop its digital channels. Essentially, it is the foundation of its overall optimisation and prosperity. 2. Single source of truth Understanding your customers and their preferences is crucial in order to create relevance for your digital channels. Collecting this data is not really an issue anymore. The challenge, however, is bringing the data together in order to create context and generate actionable insights. Data is
often scattered in silos, which prevents managers from using it efficiently. This is the reason why you need to work towards a single source of truth for all your data: where do you store your customer information, your product information, your pricing information, … what systems need access to which parts of the data? A good definition of actionable data is, good prioritisation of sources of information and confident decisions on how to use it, which are all crucial in a successful digital transformation. 3. Move from silos towards integrated collaboration The development of a sustainable digital ecosystem requires the support of every department within the company. That is why a general mindset shift is so important in reaching digital maturity. We see a strong correlation between a customercentric organisation, overall digital maturity and ultimately, revenue. This is an ongoing project where the left and right part of the brain need to work together, where IT departments and marketing specialists together have to focus on customer satisfaction. Within QNET, this is tackled by appointing two drivers in the digital core team, Ivan Woo as IT driver and Lordever Digan as Business driver. Customer Advocacy to tie everything together When you look at the picture on the left, you can see that even a hundred years ago, sales was not about pushing a product, but about creating an immediate connection with the customer. What does she want, what experience is she looking for? This is still true today. By creating relevant and personal “moments” for a customer throughout his/ her journey with your company, you make him / her feel closer to the brand. A single customer that recommends a brand to his family and friends is worth more than any ad you can pay for. When your business is ready to rise up to the challenges of the 21st Century, use the above points as guiding principles to help you take the steps in digital. QNET is the perfect example of a company that shows impressive results.
their business and target customers on different segments — so they have many different needs when they go back to the shop.” Woo explains that QNET’s legacy platform hasn’t evolved as quickly as customer needs and expectations. “Our platform was created ten years ago, so at that time there was not as much social media and not much analytic information,” he says. “Basically, we built a platform that was highly customisable, but heavily dependent on IT. So down to a single price change or a single banner change, everything has to be done by IT.” According to Woo, IT risked becoming a “bottleneck” for business growth at the organisation. One of the primary reasons for the creation of the NGP was to free QNET’s
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Physio Radiance
tech professionals from dayto-day web maintenance tasks and afford them more time to focus on development. The firm has partnered with web content management provider Sitecore for the creation of its new platform — which has more recently become known as Next Step for Sitecore (NS4S). “Our second objective is to bring agility and scalability to a more modern eCommerce platform,” Woo explains. “With Sitecore technology this is very much achievable. They are one of the best in analytics and with their structure and mechanics we can easily scale up.” With NS4S, QNET will also be
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CIMIER QNETCity Automatic Watch able to more actively engage with the world of social media. At present, the firm makes use of platforms like Facebook and Instagram purely for social purposes and has not been able to convert these platforms to sales portals, but there are plans to expand promotion to a wider range of digital networks. “We want to catch up,” Woo affirms. “All the things we talk about: digital transformation, social media engagement, mobile-friendliness, are features that our legacy platform lacked. With Sitecore solutions this is something that we can achieve.” Chiu summarises the anticipated benefits of the NS4S platform
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Every industry has a digital disruptor. Let’s make it you.
HITACHI is a trademark or registered trademark of Hitachi, Ltd.
Like most industries, yours is under pressure to transform due to new competition from digital disruptors. The only way to get the benefits of digital transformation is with the right data strategy.
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No one knows data like Hitachi Data Systems. How can we help you accelerate your digital transformation?
Hitachi’s end-to-end solution, from server and storage to backup, has fundamentally transformed our customer service platform, enabling us to increase customer loyalty with new levels of efficiency, responsiveness and reliability. We are confident that this improved customer experience will help create even more business opportunities and drive new revenue growth in the future. Malcolm Chiu, CIO, QNET
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using “three As” — attractive, agile and analytical. The company worked alongside a team of web designers to ensure that its new, customer-facing site is as visually enticing as possible. Secondly, QNET marketeers will be able to carry out a number of initiatives themselves, including promotions and product updates, with minimal reliance on IT intervention. The third expected advantage comes as the result of big data analytics. “The platform will allow us to collect valuable information about how customers engage with our sites,” the CIO says. “We will be able to get a lot of insights to help us determine what actions we need to engage customers more effectively.” Development of the platform is expected to be completed in late October, with the help of Delaware|Digital, one of the most experienced partners on Sitecore technology. Pilot sites will launch in Sri Lanka and the United Arab Emirates in November. The two countries were selected because they are among the top performers in QNET’s two respective business models and what they refer to as world and local plans. The former involves transacting in US dollars, whereas the latter allows sellers to trade in local currency and be subject to local taxation. Business in Sri Lanka is conducted under the local plan model, and the island’s triple-language requirements make it an ideal place to gauge just how effective
“Our second objective is to bring agility and scalability to a more modern eCommerce platform”
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the new Sitecore capability translates. “These are key markets for us,” Chiu says. “In the direct selling world, our hybrid distributor-consumers are also earning income and we have a high level of income-earning distributors in the UAE. And we have a very cohesive team in Sri Lanka. We can have more input in these two countries as we launch.” QNET’s digital transformation isn’t solely
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limited to the new platform, either. It is a holistic revamp of the way the firm presents itself across multiple digital landscapes. Earlier in the project timeline, Woo supervised a significant data centre merge, which saw a 10-year-old data centre integrated with a more modern one at Hong Kong’s CyberPort site. In the process, some of the company’s ageing data equipment was replaced. Woo is also currently exploring the best ways to utilise cloud technology within the business.
“The programme has multiple facets,” Ultimately, Woo and Chiu hope the explains Chiu. “We have the main project will enhance how customers eCommerce website and perceive and interact with then we have the mobile QNET — but the duo has site. We also run a a larger goal in mind: commission engine “We believe we will where we distribute become a digital commissions leader in this industry,” to millions of Chiu says. Malcolm distributors around Chiu has since the world on a been promoted to was founded weekly basis. There COO, a position from are a lot of elements to which he will continue to this digital transformation drive digital transformation that we’re embarking on.” into other areas of operations.
1998 The year that
QNET
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QNET Units G-L, 21/F, MG Tower 133 Hoi Bun Road, Kwun Tong, Kowloon East, Hong Kong . Tel. +852 2263 9000 Fax. +852 2827 1833 www.qnet.net