If you're the biggest and best in your sector today you won't be for long, the internet has allowed millions of people around the world to take what today might be a small micro bite out of your very large macro cake.
And if enough of them do this consistently and better than you then it's inevitable this aggregated change in behaviour will quickly dilute what you think is a dominant position, the reality is the digital Pandora box is open, and it isn't closing anytime soon.
During this crisis have you noticed how much additional time you and the family are spending on social media?
Can you recall the last 3 digital adverts you saw today and did something about them?
If the answer to the 2nd question is no, why do you assume others will behave any different than you?
People today don't have to go to your website. In fact it's probably one of the last places to go to.
They also don't have to be interrupted with your intrusive adverts that you now can't really afford anyway.
They can block out your digital intrusions across multiple devices. Thanks to GDPR today's socially savvy consumer has greater control over how/if you can use personal data,.....as a result inertia is very much with them, not you!.
We find that retailers are often swayed by new technologies that sound promising, but too often don’t deliver.
Many also have a murky understanding of how omnichannel creates value.
Some fashion brands, for instance, have been slow to push e-commerce, given the high cost of shipping and returns, and the fear that online channels cannibalise in-store sales.
Others fund ad hoc investments that yield only marginal improvements in the overall shopping experience.
I have taken this extract from a recent McKinsey report that has some extremely telling home truths for retail. (link below)
We see these three common issues:
- Unclear understanding of what parts of omnichannel to prioritise. Too few retailers have established alignment across their organization on the omnichannel agenda, including the long-term vision and the current status. Without strategic alignment, organizations often end up investing in a scattershot fashion, funding divergent priorities in e-commerce, store operations, supply chain, marketing, and technology.
- Focus on tech rather than on customer value. Many retailers have leaped to embrace tech-enabled, flashy innovations like smart mirrors, Bluetooth beacons, and in-store kiosks to create differentiation. But without a proper grounding in customer needs or determining how these investments will create and sustain value at scale, retailers sometimes end up with what amount to shiny objects that drain capital expenditures.
- Failure to sequence investments in line with strategy. Many retailers race to advance omnichannel initiatives without doing the critical thinking to identify the starting point and the specific capabilities needed to succeed at each step. Pressure to keep pace with competitors or eagerness to put a compelling idea into action can prompt some companies to plunge in headfirst. But without clearly sequencing the “crawl, walk, run” approach and investing in the right fundamentals, retailers often end up with fragmented investments that destroy value.
Not too many years ago the biggest threat in any sector was to come from your nearest and perceived biggest competitor, this was a time when businesses were locked in a 'macro' mindset. They were sure that smaller businesses, or start-ups would take a long time to have any real impact on what they did, regardless of where in the world they did it. And of course they had nowhere near the financial and resource access that big business had.
Fast forward to today and not only is the macro player under pressure with a competitors website, there's a new aggregated 'micro' threat that's using stealth and free to access and free to use social media platforms to come along and screw up your safe haven.
At no time in history has it been easier and cheaper to set up a business. This crisis has seen furlough paid kitchen sink entrepreneurs get going on that idea they've been mulling over but not really had the time.
If I understand the social digital medium better than you I already know I don't need a website or a database.
I don't need to spend huge amounts of my budget and resource on advertising, If needed I can do 'drop ship', and I can gain access to your incumbent and future customers.
All this can be done via social media platforms, but you have to be obsessed with consumer behaviour and learn to 'listen'.
Omnichannel excellence requires a laser-like focus on value creation. Leaders in the field take a hard look at their strategic and customer priorities and decide who they want to be from an omnichannel perspective. And they develop an equally clear-eyed understanding of what it will take to achieve that ambition. By embedding these principles into their retail strategies, leaders can use the momentum—and urgency—of the present moment to create decisive advantage.
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