Digital · Frictionless commerce · Mobile · Retail · Share of attention · Winning on Experience

Retail’s new front door

In a “brick & mortar first” world, retailer’s embraced the old adage: location, location, location.

Once the site was determined, a lot of time and money went into the design of the store–with a particular emphasis on making it as strong a magnet for consumer traffic as budget and inspiration would allow. Then the visual and marketing teams went to work, creating attractive window displays and generating eye-catching promotional signage, all with the goal of capturing the customer’s attention as she walked or drove by. If these marketing strategies worked, they would lure her across the threshold and the retailer would have a chance at a sale.

Today, it’s rapidly becoming a “digital first” retail world. More retailers are reporting that the majority of customers start their consumer decision journey online. More and more brands are discovering that a very high (and growing) percentage of new customer acquisition is occurring through a digital channel, not a physical one. And when we say “digital”, it’s increasingly likely we mean some sort of smart mobile device. The power of the traditional store front is waning.

In the vast majority of categories, brick & mortar is not going away. As I like to say, physical retail will be different, not dead. In many cases, stores will remain critical to generating sales, but their role in acquiring a new customer, generating repeat business or building on-going customer engagement and loyalty is diminishing–and, in many cases, quite rapidly.

Right now, for many brands, for many consumers, for many shopping occasions, retail’s new front door is a smart mobile device.

So if your brand’s mobile experience isn’t compelling, the odds of capturing a new customer aren’t that great. If the mobile experience doesn’t help reduce friction for an existing customer (in or out of a store), good luck getting that repeat business. If the mobile experience doesn’t position your brand well in those key decision points that my friends at Google call “micro-moments”,  there’s a pretty good chance you aren’t making that sale.

Embracing the notion that mobile is becoming your brand’s new front door can be profound.

It forces process redesign and budget re-allocation. It requires breaking down the silos that exist in the channel-centric thinking, organization and metrics that persist in so many retailers. It causes us to admit that if we don’t win in a digital channel it barely matters where our stores are located, how good they look, what products we carry or whether we’ve got great salespeople. Heresy, some might say.

It’s apparent that there are quite a few retailers that get this new reality and are acting accordingly–and often boldly. For them, the precise end-game is anything but clear, the path is hardly smooth, but they are in the arena, taking risks, investing where they need to be.

Yet far too many others are merely treading water or paying lip service to this new world order. Sadly they are crippled by legacy thinking and systems, burdened by a store-first culture, unwilling to let go of the past, even when it’s obvious it’s not working. Unless they pivot soon and decisively it’s fairly certain that this will end badly.

 

 

Frictionless commerce · Mobile · Multi-channel · Omni-channel

As the channels evaporate . . .

By now, it should be readily apparent that a very large–and growing–percentage of customers bounce back and forth between digital and physical channels when shopping.

By now, it’s obvious that the exploding usage of mobile devices is blurring the distinction between e-commerce and bricks & mortar.

By now, we should understand that, in fact, it’s only retailers that talk about channels. You never hear customers speak in that way.

And yet…

And yet, we obsess over same-same stores sales, rather than same-market or same-customer segment performance.

We close under-performing stores in a quest to boost profitability, only to discover that we’ve often made matters worse.

We organize our teams, metrics and incentives around sales channels instead of customers, and wonder why we struggle with consumer relevance and engagement.

As the channels evaporate in the minds of our customers, the only two questions for us are: do we accept this reality and are we ready to act accordingly?

Oh, and one more: just what the heck are we waiting for?

 

 

Innovation · Mobile · Omni-channel

Innovating to parity

Let’s face it, most traditional retailers aren’t very good at innovation. There is no such thing as an R&D budget at most of them. Many barely even have any real process or tangible goals centered on bringing new things to market. Labeling your typical large retailer “reactive” when it comes to innovation is being generous and polite.  Not surprisingly, most of the useful disruption in the retail space has come from outsiders and start-ups.

Recently we have seen a number of sleeping giants begin to awaken to the need to raise their game and pick up the pace. The digital transformation that has swept through retail, and the resulting blurring of the channels, makes it impossible for even the most conservative of brands to sit idle.

Yet, here’s the problem. Most of these retailers are merely focused on closing the gap between them and the obvious or emerging leaders. Once some new technology or marketing technique or experiential dimension begins to prove itself out, then these companies kick into action. Apple starts doing untethered checkout, a couple of  years later mobile POS starts springing up nearly everywhere. A few brands have success with order online, pick up in store, and soon that is on everyone’s list of 2015 projects.

There’s nothing inherently wrong with being mindful of which new strategies are gaining consumer and economic traction and positioning yourself to be a fast follower. And to be sure, if a company finds itself in trouble, it is completely sensible to find the areas of innovation that can quickly deliver the greatest near-term leverage.

But most of these brands are really just innovating to parity. By the time their innovation efforts get to scale, the next big thing is beginning to emerge and once again they themselves behind. It’s the proverbial difference between skating to where the puck is, rather than skating to where it’s going to be.

It’s great that more companies are embracing innovation. But it’s not enough to merely step on the innovation treadmill.

Winning in today’s environment requires a commitment to anticipate, to leap, to experiment, to fail, to refine and get up and try again.

Leading from behind has never worked.

And hoping to lead from parity probably won’t cut it either.

 

 

 

 

Customer Growth Strategy · Mobile · Multi-channel · Omni-channel

Merge ahead

More and more, your web presence is the front-door to your brand, not just a sales channel.

More and more, mobile, and all things digital, blur the lines between e-commerce and brick-and-mortar.

More and more, your channel-centric thinking–and organization, metrics, incentives and budgeting–are becoming barriers to meeting the customer where she is.

More and more, your mission, if you choose to accept it, is embrace the world of channel hop and focus on delivering a frictionless customer experience.

Merge ahead.

Or risk being side-swiped.

 

 

Customer-centric · Innovation · Mobile · Omni-channel · Personalization · Share of attention

The shopper genome project

No doubt you’ve heard of The Human Genome Project–the effort to decode our species by identifying and mapping all of our genes. Ultimately it’s an effort to better understand what makes us tick, from both a functional and physical standpoint.

As a business or brand leader you have a similar challenge when it comes to decoding your current and potential consumers’ attitudes, needs and behaviors.

In a world of vast and growing choices, the pressure is only increasing to develop deep, actionable insight into your customer base.

In a world where most segments are growing slowly, your only chance for out-sized growth is to gain market share. And that requires understanding which levers to pull that are compelling enough to win new clients or grow share of wallet with existing ones.

In a world where most competitors are either engaged in a race to the bottom or stuck in tired old mass marketing techniques, you have the chance to win big by embracing a “treat different customers differently” strategy. But you need to understand how to meaningfully segment your customer base and exactly which value propositions to deliver to which segments. And you need to get into action.

In a world where smart devices are growing like crazy and (finally!) offer the promise of the right offer to the right customer at the right time, you had better be able to follow consumers as they channel hop and to deliver permission-based, highly relevant and personalized communications.

More than a decade ago Don Peppers and Martha Rodgers opined that the only true lasting competitive advantage is to know more about your customers than the competition–and to be willing to act on that insight.

That’s never been more true than right now.