Barcode Scanning: What Every Ecommerce Store Needs to Know

By Nick Maglosky, CEO, Ecomdash

Part of the beauty of ecommerce is trading in the old ways for newer, more efficient ones. That makes it somewhat surprising, then, that barcode scanners of the past have found a new life in the today’s world. 

Developed in the late 1960s, barcode scanning was not universally adopted until the 80s, once its usefulness was proven and the conspiracy theorists quieted down. But with early ecommerce, barcodes didn’t seem to fit in — customers no longer handed products to cashier, and expediting checkout lines was no longer a concern. Finally, the rise of smartphones allowed for a new and more convenient method of scanning, and barcodes earned their place in ecommerce alongside their sister technology, QR codes.

But the real question is, can QR and barcode scanning help your ecommerce business? The short answer is “yes,” but below we go into details on how scanning technology can improve any online store, including yours.

What Is Barcode Scanning?

Technically speaking, a barcode is a compressed representation of data, particularly the item and its price. Specialized optics-based machines can “read” the data in an instant, saving time on inventory management and in-store checkouts.

After barcode scanner technology showed promising results — raising sales by an average of 10-12% circa the 1970s — it became widely adopted. It wasn’t until the 1990s that the technology was improved upon, when Japanese company Denso Wave found a way to store even more data in a limited space: the QR code.

In terms of data types, barcodes are one-dimensional and are read linearly, whereas QR codes are two-dimensional and can be read horizontally and vertically. This provides exponentially more space for data; barcodes can contain at most 20 characters of data, while QR codes can store up to 7,100 characters of data.

Regardless of whether you use barcodes or QR codes, the core principle is the same. Scannable codes allow for the instantaneous transfer of data, making organization and record-keeping that much more efficient.

That’s how it started out, but scanning tech is still evolving even today. Once smartphone technology passed a certain point, it allowed virtually everyone to have a scan reader right in their pockets. (The new iOS 11 even has a native QR reader built in.) This most recent advancement has lead to more ways for barcodes to improve businesses, including more creative marketing strategies.

What Can Scanning Do for Ecommerce?

Sure, ecommerce doesn’t need to worry about rapidly processing a checkout line full of people. But the capability to transfer data instantly still has plenty of other uses. Here is a list of just a few ways to use barcodes. (Continued on next page)

Inventory Management

One of the backbones of scanning technology is how much easier it makes managing your inventory. Everything is automated, aside from physically holding the scanner up to the printed barcode. This is a huge help for brick-and-mortar stores, but is even more useful for online stores. For starters, ecommerce companies deal heavily with warehouses and shipping centers, which can get confusing when consolidating information across multiple locations. Scannable codes ensure your inventory always gets replenished before running out. But more than that, scanning tech can help update inventory levels online. No customer likes being told their product is out of stock after they order it, so any lag time for updating online stock levels is a risk. Enabling a scannable system helps track what’s available and what’s not, so your customers know when a product is unavailable before they get their hopes up.

Order Fulfillment

Barcodes and QR codes make for faster and more accurate package tracking, an essential for ecommerce. As online shopping matures, customers place more emphasis on tracking their package to check if the delivery is on schedule. Barcodes and QR codes make this easier for retailers like you to prevent lost packages and slow delivery times. USPS now offer Shipment Confirmation Acceptance Notice (SCAN) forms which consolidates all shipping and tracking information into one master barcode. This speeds the scanning process for USPS workers and eliminates the chances of missed packages.

It doesn’t matter how good you are at math; a computer is always better. That’s the thinking in automating processes like shipping: remove human error for more efficiency. In addition to being faster, scanning is also more accurate, greatly reducing the chances of delivery mistakes.

Redirecting In-store Shoppers to Online Stores

One of the more interesting byproducts of smartphones is how they changed in-store shopping. A 2015 SessionM study examined the shopping habits of 12,000 Americans for some surprising revelations:

• 90% of shoppers use their smartphones while shopping in brick-and-mortar stores.
• 54% use smartphones for price comparisons.
• 42% check reviews online.
• 48% look up additional product information.

This holds a lot of hope for ecommerce stores, who receive an extra opportunity to win over shoppers before they reach the cashier. With scannable codes, the chances are even higher, especially if you manufacture the product yourself and can add your own code to the package. The SessionM study also showed that the most relevant use for scannable codes is coupons/deals. While not applicable to every ecommerce company, if you have some of your products on shelves, a scannable code could be a powerful marketing technique, and may even attract some business for your online store.

Marketing Efforts

Scannable codes can be used for creative, outside-the-box marketing campaigns (QR codes more than barcodes). While QR codes’ heyday of the early 2010s is over, in the right hands this practical technology can still be put to good use. Here are a few key pointers to keep in mind:

1.  Be Subtle

Oversaturation caused QR codes to fall out of vogue the first time, so it’s best to not make the same mistake twice. Nowadays, QR code marketing should be done conservatively and in moderation. That means you should limit the number of places you put a QR code, and when it does appear it should be small and discreet. Think of it as an option for those who want it, without forcing its use on those who don’t.

2. Try Social Media

Social media and QR codes go hand-in-hand, and some sources even credit Snapchat for reviving the tech, or at least saving it from extinction. Above we mentioned how successful scannable codes are with coupons and sales deals, an area at which social media also inherently excels. Combining the two just makes sense.

3. Monitor progress

Monitor the analytics to see how many scans your QR code is getting — after all, immediate data is one of the perks of code scanning. If performance fails to meet projections, rework your strategy for the next iteration.

Conclusion: Old Tech Given New Life

The ability to transfer data quickly will always be useful, regardless of whether you’re shopping online or in a store. The real question is whether you’re using the best, most up-to-date methods. Recent advancements with barcode scanning has led to many cutting edge ecommerce technologies that make our lives easier, from multichannel inventory syncing to streamlined shipping management; but there will always be plenty of room left over for that beeping red light of our childhood.

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About the Author

Nick Maglosky is CEO of Ecomdash, a leading full-cycle inventory management platform designed and built to empower e-commerce entrepreneurs looking to expand their business to multiple channels and beyond. Nick is passionate about small to mid-sized businesses and all things e-commerce, and hopes one day the Cleveland Browns will win a championship.

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