While this is a topic that deserves a lot more than a few bullets in some blog, I wanted to summarize what I see as the divergent viewpoints that are driving a significant investment cycle in eCommerce technology.  Whatever your preferred source of industry data, it is widely agreed that retailers are investing heavily in a technology refresh to support B2C commerce.  Varying industry estimates put this re-fresh rate at anywhere from 50-70% of retailers investing in significantly upgrading or replacing their core eCommerce systems over the next three years.  

There are several key reasons retailers are doing this.  Some include:

• Scalability
• For many retailers their core eCommerce systems are first or second generation.  They were developed when eCommerce was viewed as additive to the business and not a core component of overall strategy. 
• Since the deployment of these systems many retailers have seen huge growth in online commerce.  Many retailers are seeing 30% YOY revenue growth on the Web which makes the Web their fastest growing store.  First and second generation systems were not built for that kind of scale.
• Growth
• As retailers have had tremendous success on the Web and eCommerce/multi-channel strategy has moved into the boardroom, it has also become a key component of the growth strategy.  As such, new systems need to be in place to support significant growth metrics.
• Agility 
• Multi-channel/eCommerce is an evolving space.  As such retailers need a vast amount of flexibility or they risk creating a technology environment like they have today.  This will be costly not just from a technology infrastructure standpoint but also from an opportunity cost perspective.  If they cannot iterate as fast as their competition they will be in trouble. 
• Example:  look at how Circuit City resurrected their brand with buy online, pick up in store before any of their competitors.  Their 24-minute guarantee was ahead of its time.  The competition has caught up however.  So now we will have to see what type of agility Circuit City built into their systems.
• Business enablement
• In most retail organizations, business constituencies are now reaching out for tools and processes to be able to run multi-channel strategy execution.  The days of the change request sent to IT for a site change or a new marketing campaign are over.  Business groups need tools to be able to run channel strategies and interact with customers independently from IT.
• As evidence of this, look at the retail organizations that now run ownership of eCommerce/multi-channel up through the Marketing organization and not IT!!
• Customer Centricity
• A renewed focus on customer centricity as a model for brand loyalty and growth in the industry (as opposed to supply chain efficiency, assortment, price competition, etc) alone has driven most retailers to adopt multi-channel retailing as a strategy for success.  The multi-channel retailer views all channels as opportunities to interact with customers and build loyalty.  Web, store, call center, advertising, mobile devices, etc, etc all represent ways to drive customer centricity.  As such retailers are looking at their eCommerce investments in a more holistic light.  eCommerce investments should be "multi-channel investments".  In other words, how can I invest in technology in a way that does not build channel silos but rather can enable consistent interactions with customers across channels.
• Industry Advances
• Back when most retailers built their first or second generation eCommerce solutions the packaged offerings from most technology providers were weak.  What came "in the box" was not significant enough to justify a buy vs. build approach.  For the solutions that were more feature rich, many of them were attached to very small companies whose financial staying power was a real question.
• Faced with this reality many retailers went it alone and built their own sites, most (50%+) choosing ASP/ASP.NET as a standard. 
• With multiple revolutions since the Dot com boom and bust, vendors now have very credible solution offerings that truly offer accelerated deployments and flexibility.  On the platform side, vendors like Microsoft and IBM have stayed in the market and continued to deliver supportable and credible offerings.  Even several niche application vendors have survived as well.

   So with that background, here is how retailers are investing (more on this topic later...):

• eCommerce as an application market
• This is about delivering a ton of features to the business today
• eCommerce as a channel in a broader multi-channel strategy
• Providing an infrastructure for a broad multi-channel strategy that enables integration and tooling across a variety of channels

Can you tell which one I subscribe to?  More in a future post...