In On-Demand Commerce, time is the most valuable asset.

Mariano Gomide de Faria
11 min readMay 6, 2021

Two powerful voices of the tech and financial market sectors, Bill Gates and Warren Buffett, once famously discussed that the only thing we cannot buy is time.

We live our lives in pursuit of satisfaction, happiness, achievement, obligatory responsibilities, and above all, how we spend our time contributes to these precedents. In line with these philosophical musings, the concept of time, harnessing it, and making it work for us is the driving force of On-Demand Commerce.

The Urge of On-Demand Commerce.

Before we step into how this paradigm shifts businesses’ realities, I invite you to look at the old economic concept regarding supply and demand.

In the traditional scope, economists have presented a process in which the supply and demand curve adjusts itself by price mechanisms, as do production and consumption levels.

However, I encourage you to move your sights to new horizons. Time is another major resource playing an active role in orchestrating our lives, businesses, and decisions.

The new economic system is structured on two pillars: technology and commercial transactions. This has led humans to delve into a new way of trading called “On-Demand Commerce”: a new economic dynamic in which consumers place convenience, agility, and simplicity as the fundamental requirements above price and everything else to perform a commercial transaction.

In this way of doing commerce, people buy time by ensuring they are paying to have peace of mind. A frictionless and simple shopping experience in which customers pay more for not worrying about anything, just receiving their product or service.

Following the On-Demand Commerce logic, the majority of people with money in their hands will choose to pay more for a service or product that values their time.

COVID-19 accelerated this shift towards time efficiency, but this isn’t a new phenomenon. In reality, this has been a central theme since we started trading using the internet and technology.

Consumers have become addicted to the feeling that their time is being used in the most efficient way possible. It’s up to the brand manufacturers and retailers to unlock how they can promote instant gratification while providing everything for everyone, everywhere. All the while, they must make sure the end customer understands that the available amount of time in their schedules is considered.

Time is the ultimate resource every person and company is pursuing. How can we build future-proof companies that will push this paradigm forward?

Adding up value means time efficiency.

On-Demand Commerce means ensuring your customer’s time is being valued most of all. The majority of retailers worldwide are conducting mainstream strategies that follow the most obvious and logical ways to accomplish time efficiency: reviewing supply chain and shopping experiences, focusing on reducing the time a customer spends on it.

Simply negotiating better delivery times and modifying freight tables are mainstream examples of achieving this goal. The On-Demand Commerce strategy, though, conceives the idea that investing in a time-efficient experience for the customer requires viewing logistics and customer service as primary marketing instruments.

As an example, let’s look at Argos, one of the world’s omnichannel leaders. They use the number of seconds a customer spends to receive their products after scanning to do the pick-up as a KPI. While NPS has numerous biases due to the limited sampling, controlling time is an agnostic approach as it reflects the piece that most aggregates to customer satisfaction.

On a personal level, I recall a story from my colleague, Fabio Schimidt who lives in NY. He once purchased an iPhone from Apple’s online store. The iPhone was delivered directly from China and the experience left us mystified.

Have you ever thought about delivering an order in any country in the world, while shipping from China? This trend brings a new reality: simplicity sells more time than fast delivery. Assortment sells more time than fast delivery. On-Demand Commerce means asking the client to wait for seven more days to deliver but ensuring that their time is valued above all else, with the right assortments and overall simplicity.

Asian countries are located close to the largest distribution centers globally, and most brand manufacturers have operations there. This privileged location allows for easy and fast iterations with brand manufacturers and distribution centers.

A well-managed company smartly distributes its inventory throughout the world. Not for nothing did Apple, a 1.7 trillion valuation company, choose to ship DTC from China. The On-Demand Commerce concept implies consolidating inventory and distributing it via DTC. On-Demand Commerce companies do not assume risks in distributing merchandise via B2B or distributors.

Although logistics helps in making the On-Demand Commerce magic happen, the main key is adding value to the customer experience.

The customer’s lack of time and the On-Demand Commerce phenomenon moves the company’s role from the seller to the listener. Retailers were previously called sellers, however, they now inaugurate a new buzz word in which they are called buyers.

When the company actively listens to the customer’s demands, retailers must tailor the whole experience to bring in value while ensuring it all happens in an efficient timeframe. One important factor is not being the owner of inventory or product but capturing the customers’ demand.

This way, while promoting brand loyalty and lowering your customer acquisition costs, you thrive from being a competitor. Again, people will choose to pay for a custom experience that makes them feel that their time is valued.

There is no fixed assortment in On-Demand Commerce; retailers always seek the right products in the market to fulfill their customers’ needs. Sales order control is less critical than demand control; companies must only control what the customer wants to buy. Customer clusters are much more important than product distribution.

In On-Demand Commerce, you are a customer brand, not a product brand.

Perfect matches go beyond Tinder: On-Demand meets retail in the precise alignment between supply and demand.

The On-Demand phenomenon ignited a run of Tinderization in every aspect of our lives, including a new way to buy products. Back then, we shopped what was available for us in the stores, and now we declare what our needs are, and the retailer’s responsibility is in fulfilling our desires. In some interpretations, this is the soul of how a marketplace works.

Tinder, the popular dating app, provides an endless menu of people who could potentially be your (next) true love. If you swipe right for a person who has already swiped for you, it’s known as a match. Otherwise, numerous dating opportunities will continue to appear on the screen until a better and perfectly fit prospect comes up. Tinder basically found a way to align the demand and supply curve of lovers using technology.

Likewise, Tinder products are now sold following the On-Demand Commerce logic. Following the supply and demand economics logic, the most prominent players in retail aggregate the available products in the market to fulfill the customers’ needs according to the current demand.

On-Demand Commerce places convenience as a major priority, and all parties involved are motivated by factors that promise enhanced efficiency. In a certain way, the marketplace economy is the first step towards an On-Demand Commerce cycle, placing the retailers as buyers, not sellers.

In real life, how can businesses shift to On-Demand Commerce? Joining this Tinderization reality means promoting the perfect alignment between demand and supply. In order to promote the perfect match between consumers’ demand and supply — yes the order is right: demand comes first, then supply — the company must build the correct incentives internally.

Organizing the company based on product categories and the current supply chain is old logic. If you don’t face this as a brutal fact, you will test out the famous Darwinian theory. The solution is to organize the organizational structure according to each customer cluster — or some might say brand personas — and invest in digital talents.

The nirvana of On-Demand Commerce organizations involves changing the current organizational chart. Substitute the obsolete retail and industry logic by creating a decentralized structure with teams that represent each customer cluster. Each business unit works like a concise retail structure having its own logistics, marketing, operations, and technology teams.

Furthermore, to achieve this decentralized business model, it is essential to eliminate bureaucracy and other traditional and inefficient decision-making processes. Companies save money, resources, drive innovation, and ultimately, time, by simply cutting these layers of bureaucracy.

On-Demand Commerce companies are always seeking to save time. Companies that save time invest in scaling up processes by reducing the number of conversations needed to achieve the one goal of exploring the best product assortment for each customer cluster while looking for other sellers in the market to fulfill the customer’s demand.

Ego-less-environment organizations are necessary to create an internal culture that inherently promotes a genuine desire to deliver the best time-efficiency experience to the customer.

It is a matter of redesigning organizations to enable a Darwinian environment for good ideas. Some may fail. However, the strongest are more likely to succeed, and the ones that survive can change the entire organization for the better. Time, again, is the main consequence of having an agile and flexible structure that enables businesses to deliver a valuable shopping experience for consumers. If your mission is to sell time to your customers, ultimately, you will also need to eliminate processes and bureaucracy.

Composability: the secret behind time to revenue.

On-Demand Commerce shifts perspectives on how we can deliver a valuable and time-efficient experience by redesigning organizations and the entire shopping experience. One of the ingredients of this magic recipe is missing: technology, the one thing that will leverage businesses in this journey towards On-Demand Commerce.

Retailers and brand manufacturers need the composability infrastructure to promote On-Demand Commerce.

In periods in which customers face time scarcity, there’s a need to combine agility and flexibility. The composability of SaaS allows companies to search and combine pieces of commerce, like Legos, that can be used to build up a unique, valuable experience for the end customer. Using this powerful engine, companies focus their efforts on listening to customers and delivering endless possibilities to fulfill their needs.

The key to success relies on focusing on what we do best. Delivering all the non-core functions of the company to someone in the market that can perform faster, cheaper, and, ultimately, better, promotes the nirvana for every business out there: time to revenue.

In the commerce context, leveraging composable commerce enhances the shopping experience and accelerates digital transformation inside the company. Imagine if you could have a company that automatically promotes a better experience for customers simply by having them interact with it. In terms of time efficiency, delivering valuable experiences that drive customer satisfaction long-term allows customers to benefit from not having their time wasted, while capitalizing on having their needs met while shopping.

Customers are pursuing the ultimate simplicity when shopping.

Composable businesses have a native network effect: the more customers use them, the better they get. Only now have customers experienced the network effect in tech companies.

In On-Demand Commerce, retailers and brand manufacturers see this effect inside their organizations while adopting the modern commerce cycle. This is the art of composability: customers play an active role in developing new features inside the structure that already exists. It improves the product to all within the ecosystem.

Also, composable companies can negotiate large-scale with third parties and have the bargaining power to bring it to the table for their customers. For example, Shippo offers better shipping costs than FedEx, Stripe vs. credit card companies on fees, and the list goes on.

Again, retailers must fulfill customers’ demands in the most efficient timeframe, as buyers, not sellers.

The composable technology enables the company to have an infinite combination of solutions, services, and data to ensure time efficiency. The best part? By having an unlimited capacity for testing new ways to engage the end consumer, retailers and brand manufacturers reach the plenitude of On-Demand Commerce.

Key Takeaways of On-Demand Commerce

Time doesn’t mean just delivery. In On-Demand Commerce, time means:

  • Having unlimited possibilities of assortments to fulfill your customers’ demands.
  • Simplicity and exemplary customer service are the marketing expression of your brand.
  • Having multi-layer integration among the product inventory, not only integrating your distribution center but the production capability — your retailer’s stock or anywhere that your product is available requires integration.
  • Having an organization chart that embraces time-wasting killers.
  • Having a composable technology stack. Headless is not good enough; you should be able to test without paying for it.

Time is everything. In commerce and otherwise, our time is our most valuable resource, and we all want it maximized. When it comes to shopping, if retailers and businesses want to truly capitalize on delivering a satisfying experience that drives long-term relationships and customer loyalty, time efficiency is non-negotiable. On-Demand Commerce thrives on time management, and ensuring time is not wasted at any level is a must.

Here are the three most important takeaways from this article:

  1. Customers have more money than time. They are willing to spend more money on a product or service that saves time. They aim for efficiency, and your business can prove itself as even more valuable by delivering on their needs while not wasting their time. Logistics and customer service are the primary marketing instruments.
  2. Efficiency and convenience in On-Demand Commerce ultimately benefit both ends: the company and the customer. Companies seek out players who offer specific products while developing an internal business culture that exists to meet customers’ demands.
  3. A valuable customer experience is time well-spent; efficient use of the customer’s time results in better long-term loyalty. Conversational commerce is a much more efficient use of time consumption pertaining to interaction than browser or mobile experience. Be ready for this new revolution.

Covid-19 made us all realize that time is the real currency, across the world, across businesses, across all industries. With lockdowns, mandatory quarantines, and less access to purchase at our previous levels of leisure, On-Demand Commerce was put into overdrive to meet the needs of customers who sought instant gratification.

If you are not the one selling time to your customer, you are not the one who will rely on loyalty. In On-Demand Commerce, competition is fierce. However, one way to ensure your business is staying ahead of this competition is by understanding that time is the most fleeting resource.

We invite you to schedule a meeting in your organization with the topic: “Do we sell time to our customers? How?” and share the results of this brainstorming session with the authors. We are open to collaborate with you and document your findings.

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Mariano Gomide de Faria

Professor and Programme Director @EICOM — The European Institute of Commerce Management. Founder and Co-CEO @VTEX.