24 Jul 2018, 17:31 — 9 min read
Summary: With the number of retail players going up dramatically, the business of retail has become very competitive. To further complicate matters, the consumer expectations have changed because of the Internet. Navigating these new waters will determine how successful companies are in today's economy.
Like it has done to all businesses, the Internet has practically disrupted the retail industry — in India and across the world. Thanks to the internet:
1. E-commerce as a business has taken on a near-vertical, north bound trajectory. E-commerce has redefined the business of retail most often rewriting all the old rules of business.
2. New technologies sprouted at the speed of thought – across domains and complexity levels (IoT, AI, ML).
3. New business models took birth (Uber, Aribnb, Facebook, Alibaba – to name a few).
4. Most importantly, consumers truly became empowered. Online channels & devices, and the rise of social media and prevelance of smartphones, ushered in an era of ‘always connected’ consumers who are more informed, instinctive and influential than ever before.
The Internet and the deluge of associated technology innovation essentially meant that, to survive, an existing enterprise had to undergo digital transformation at multiple levels. Now, the concept of digital transformation is often the elephant in the room, leading to either huge exercises or the other extreme—a thought paralysis that kills the business. Simply put, digital transformation is the process by which an enterprise:
1. Understands, acknowledges and measures the impact of digital forces acting on it — both on the demand side as well as the supply side
2. Builds a customer-centric business roadmap to fundamentally embrace the new dynamics
3. Revalidates and rejigs its technology infrastructure so that it can engage with customers in a seamless manner, enabling the reimagined business roadmap.
While this may appear intimidating, it really isn’t so. Besides, there isn’t really an alternative! Before one embarks on such a fortune-altering exercise, a retailer needs to remember a few things:
Once ready to embark on a digital transformation journey, there are essentially these 6 steps to go through (I believe an exercise like this is like going in for a heart valve/ replacement surgery – I will draw parallels at appropriate places):
1. Brainstorm and reformulate your view of your customers. Who are they? What clusters do they belong to? What behaviours do they exhibit– across the entire purchase journey? Build those three or four distinct customer personas that define your segments.
(Understand the condition of your body – the impact of the changing environment; of age; Of lifestyle. Baseline your health condition.)
2. Map the entire customer journey — from awareness/ research (identify need) to engagement (the evaluation process) to transactions (acquiring the product or service) to customer success/ service (onboarding, service & support) to advocacy (loyalty) for each of the personas. (Go through a battery of tests to map out your body’s and heart’s capabilities.)
3. At each of these touch points, identify the enterprise department that will be involved to make it a positive engagement. (Understand and isolate the parts that need correction – maybe the heart valve is not functioning properly.)
4. Next, identify the technology components/infrastructure needed at each of these touchpoints that will contribute to rendering the engagement seamless and positive.
(Deliberate with your cardiac surgeon and decide on the way forward – maybe the best option is to do the valve replacement.)
5. The most important part comes after you have drawn up the list of technology interventions. I have seen successful enterprises adopt the following approach thereafter:
a. Redraft the Big Picture – both from a technology perspective as well from a manning perspective. (Build the full plan. For pre-surgery, the surgery itself and post-surgery.)
b. Looking at the big picture and the technology interventions needed, develop a phased deployment/adoption approach. Tier the technology adoption on the basis of need (urgent or can be taken up in six months or oh-we-can-wait-ayear- or-more). This is important to stagger investment as well as to be structurally ready (many enterprises underestimate this part) to execute on the technology led transformation plan.
A comprehensive approach across multiple technologies and across multiple disciplines in an enterprise puts unprecedented pressure on the multi-hinged enterprise. (Maybe both valves need to be replaced – though one is at a significantly higher risk than the other one. The relatively better-off one can do with conservative management for the time being, while the rogue valve can be replaced. The body can handle this better.)
c. If you have a legacy infrastructure in place, figure out what you need to retain and what can be done without. Thence, always keep an eye on the part you retained to make sure the ‘new technologies’ you adopt sits in fair and square into the existing piece — unless of course the new technology is so crucial that you don’t mind even if it sticks out like a sore thumb. In most cases, the legacy infrastructure inventory will get displaced and shaken around rudely to accommodate the newer technologies.
The key is in identifying the impact and creating a plan to mitigate the risk of disruption. (The heart valve, being a foreign body, will take time to adjust to the rest of the body. It will need anti-coagulants to ensure blood does not clot on contact. Many other medications could also be needed. Decide on the dosage and the frequency of these medications.)
6. Last but not the least, put in place an internal governance programme that keeps a hawk’s eye on the interventions effected and the big picture. This is important to correct course if necessary. Also, be forever ready to alter the course to manage newer realities as they come up. (Regular checkups and diagnostic tests are mandatory to ensure the heart valve is accepted by the body well and to identify issues & further interventions, if any.)
We live, as experts contend, in the #AgeOfTheCustomer today. Thanks to a fast-changing technology landscape augmented by the growth of devices, retail is perennially disrupted. In such a scenario, retail enterprises need to get SMART to leverage technology and thus, ride these waves of disruption. And for me, SMART stands for Selecting Modern, Adaptive & Relevant Technology that helps a business achieve its strategic goals by perfectly aligning brand promise to consumer expectations. So get SMART and be successful!
The author, Siju Narayan is a veteran of consumer & retail sales and marketing in India. He wrote this article for STOrai Magazine
Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views, official policy or position of GlobalLinker.