In his now viral “4 Horsemen” video, Professor of Clinical Marketing at NYU Stern Scott Galloway boldly proclaims that pureplay retail of any kind – online-only or brick and mortar only – is dead. We agree.
Not many will argue that retailers need to combine online and offline experiences and deliver an integrated, personalized experience to shoppers. In fact, according to EKN’s annual Future of Stores industry benchmark, 97% of brick and mortar retailers believe they can leverage stores as their strongest differentiator against online-only retailers; yet, 82% rate themselves as being significantly behind, in terms of offering consumers flexibility and speed of order fulfillment.
When it comes to delivering a seamless, “phygital” customer experience, why is no longer the question. How retailers transform, and what specific capabilities they need to prioritize are less clear.
Towards this end we’re excited about upcoming global research we’ve partnered with IBM on. Together, we’re exploring the definition and business value of “agility” from a retailer and consumer product manufacturer’s standpoint.
We’re attempting to build greater industry specificity around an otherwise esoteric concept, specifically focusing on agility as it relates to:
- Quickly adapting organizational culture, structure and processes to changing market trends. Market leaders across categories are being challenged by dynamic new business models that will force them to quickly evolve or lose market-share and customer stickiness.
- Securely integrating new technologies into the enterprise IT architecture. The increased use of consumer devices and services in the enterprise, the imminent rise in the number of connected devices, lack of standardization of technology platforms across the web and mobility spectrum, and the increased adoption of cloud-based solutions and software-as-a-service are all conspiring to make the job of a CIO or CTO ever more challenging.
- Leveraging data in near real-time to power personalization across the customer experience. Though personalization is often looked at through the lens of marketing and promotions, consumer expectations cut deeper. From burgers to shoes, they want to design or customize their own. For both retailers and manufacturers the top two personalization related challenges remain the lack of a master customer data model and the inability to deliver contextual insights to the right person at the right time.
- Creating a flexible and profitable supply chain strategy that maximizes demand fulfillment. Some of the largest retailers are betting big on pick-up and delivery speed and flexibility as the new battleground for customer acquisition and retention.
To help retailers prioritize their investments, the research will help establish:
- Specific business processes that are critical to business agility
- Related KPIs retailers and consumer product manufacturers must focus on to measure agility and what the industry benchmarks for leaders are
- The business value of greater business agility
Developments last week relating to the launch of a club savings online retailer and its imminent multi-billion dollar valuation are a microcosm of the larger force at play in retail – each wave of disruption arrives faster than the last, and no one is safe. Deeper insights into how retailers and consumer product manufacturers can be more agile will be timely and valuable in today’s environment.