The old but very much valid maxim 'retail is detail' seems to be losing its credibility and lustre for many based on the experiences by today's consumer.
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.
As retailers of all sectors have scrambled to leverage technology in the main to reduce cost, especially in the use of chatbots how often is the 'experience' they expect consumers to go through also 'experienced' by leadership teams?.
Someone reminded me "We are all customers of someone else's business" - which if you think about is very true but unfortunately we don't seem to spend as much time 'experiencing' our own business in the same way we expect our customers to do.
I have taken this extract from a recent McKinsey report that has some extremely telling a few home truths for retail.
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.
When you hear the word 'strategy' what comes to mind, does it sound like something that can take time to deliver a return?
When you think about the word 'tactics' do you think about a short term gain?
The question is rhetorical because reality is they are both symbiotic but often business gets drawn into a tactic driven approach whilst losing sight of the strategic 'Why' people should choose to spend their cash with you over a competitor.
The key issue I often come up against is that 'business transformation' is still perceived as a tactical technology driven initiative, when it's actually a people and process mindset thing.
Sure the tech can act as an enabler of of efficiency, and sometimes even have huge impact on improving the bottom line, in particular where it streamlines outdated cost and certain manual processes.
When was the last time you used your 'chatbot' to solve a problem that might not be sat in the AI script?
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.
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