Confusing necessary with sufficient

We’re told we have to embrace all things omni-channel, yet Macy’s and Nordstrom, two of the acknowledged leaders in this arena, have yet to move the dial much on market share and profitability.

We’re told we have to digitally enable most dimensions of our business, yet Sears, which has been a pioneer in many aspects of e-commerce and digital innovation for more than a decade, looks to be in the midst of the world’s slowest liquidation sale.

The excellent and provocative work by L2 on companies “digital IQ” frequently ranks brands on the top end of the scale that are laggards on many key performance metrics.

Some will tell you that this proves that embracing a digital first strategy is over-rated or that investing heavily in omni-channel is a mistake.  They are mostly wrong.

The error comes in confusing necessary with sufficient.

There are few brands, especially in retail, that can ignore an aggressive move into frictionless commerce. The customer experience must become more unified.

More and more, mass marketing strategies are dying and it’s becoming extraordinarily difficult to break through the clutter. Letting go of one-size-fits-all strategies in favor of creating more personalized programs is becoming increasingly important.

And we can’t keep interrupting customers with largely irrelevant messages at the wrong time and out of context. Deeper customer insight, coupled with an understanding that smartphones and tablets allow the customer to be untethered and addressable at the moment of need, puts a premium on marketing that is localized.

We are entering an era where a high level of competence in the above three principles is necessary just to stay in the game, to be even marginally relevant, to have a crack at the customer’s consideration.

You can be leading edge on all of these dimensions and it’s still not enough.

What we offer the customer needs to be amplified–that is, it must be truly unique, intensely relevant and remarkable in the purest sense of the word. This is where Sears falls incredibly short and where Macy’s struggles to break out from the sea of sameness that characterizes much of the department store world.

Unfortunately too many companies vaguely embrace all things digital and start gulping down the omni-channel Kool-Aid while ignoring this last critical piece.

At the end of the day, if the dust ever settles, they’ll have spent a ton of time and money on merely keeping pace and not enough on the things that ultimately matter.


3 thoughts on “Confusing necessary with sufficient

  1. Love identifying this question of “necessary”… One of the serious problems in all digital marketing has been the rapid spread of digital marketing options – a spread which fragments the potential audience. The end result has been marketers who tend to spread their resources into more and more fragmentary parts – each of which delivers less market impact than the last.

    In fact, within the digital world I believe it’s extraordinarily tough to find the ways to consolidate power to drive mass market action (and here I speak as an advertising guy moving product at retail). I recently moderated a panel with VistaPrint and Both had to shift to traditional mass advertising (esp. TV) because their growth was extraordinarily limited within an all digital world.

    Can’t say exactly what the equivalent is for the traditional retailer. But there has seemed to develop a limit where the digital portion of their sales will grow only slowly from (perhaps) a 10% total today…

    Which leaves us all to debate: Omnichannel is critical. Yet in allocating resources among the far too many options, how do we make the best choices for where we put our efforts? Where are those placed with the highest return – especially given digital’s inherent tendency to fragment markets rather than deliver consolidated power?

  2. The challenge that Macy’s and Nordstrom have is having to respond to a public market every quarter, which is fine if the world was not changing. Wall street itself is still trying to catch up with how fast the world they knew is changing in front of their eyes and companies – public and private should really focus on a long term vision of where they will be in 10-20 years from now. You have to understand your customers and focus 100% to make their lives easier, one click and tap saved at a time.

    Sears’ problem is not technology, it’s the brand, product selection, store design, the entire story of why people shopped at Sears is gone and they have not created a new story and no amount of tech is going to help them on that.

    A large number of retailers (specially local) think that technology or a mobile app is going to save their business, which can not be farther from truth – this is only one leg of the stool and you need to pay attention to all legs at the same time. The world of retail is both extremely tough and exciting at the same time and it’s the responsibility of vendors to help retailers build and run more successful operations rather than fragmented, piece-meal solutions. When retailers suffer, the vendors suffer with them.

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