In today’s world of growing digital empowerment, consumer oriented businesses have to adapt to new technologies in a flash, always aiming for a more meaningful and valuable relationships with customers. Richer communication channels and a wealth of customer data facilitate a new connectedness that globalizes business models. Not to mention that a digitized, increasingly customer-connected value chain provides companies with significant competitive advantages in the form of scale, speed to market, agility and closeness to the customer.
Nowadays businesses literally have to rethink what customers value most and create operating models that take advantage of what’s newly possible for competitive differentiation.
How fast and how far to go with digital transformations?
Self-determined and self-confident, informed at any time, in any place, in favor of convenience and time savings, thanks to continuous availability of information through various channels. In a nutshell, that describes the new standard for consumers in the digital age.
At the same time, the transparency of the markets increases, with the next provider just a mouse click away which has a huge impact on the dealer-customer relationship, of course.
Still, many companies have difficulties to adjust to modern customers' needs, as a consistent examination of a strategic realignment of their business models is necessary, if not imperative.
Businesses trying to gain this advantage will need to clearly define how they will innovate, implement, manage and monitor the application of digital solutions throughout their organization. First, they should take a step back and understand what their current digital portfolio looks like when matched against their strategy and expertise. Only then it is possible to take an objective look at all business processes and decide which of them can benefit from digitization.
Numerous studies show, for instance, that today’s customers commonly use different channels for their research on products and prices and that self-determined users generally expect an intelligent cross-media network that ensures an optimal customer service. Therefore, it’s high time for online retailers to examine their existing business models, as the right one, used properly, can open up enormous opportunities across new markets, segments and customer groups.
Service is reigning supreme
Producers, brand owners and retailers just have to adapt their offers and services as closely as possible to the individual customer needs and put them in the conscious perception of the customer and their habitat. Best practices, such as the QR-code-shopping with posters á la Tesco, show that the intelligent linking of e-commerce and local on-site business can be successful by setting customer journey touch-points.
Giving an example from the fashion industry could be e.g. that unavailable items can be reordered from the online store at the point of sale (POS), or matching pants to the previously online ordered blazer can be picked from the inventory on-site. Of course, order and payment are possible via a mobile device in the same process, too.
Integrated cross-channel strategies are the way to go
Isolated from existing sales processes, many e-commerce projects often don’t make really full use of their online potential, as the decision makers are more focused on a simple adaptation of an original pure player concept. Unfortunately, this frequently leads to a dead end, since in such cases the high customer expectations of attractive buying process, fast delivery, flexible payment methods and established services are not met. Thus, the relevance of detailed knowledge of the customer, the use of customer journey touch-points and automated marketing processes, is more important than ever.
In the long term, it is needed to think not only in single distribution channels in favor of networked, integrated cross-channel strategies, but unique features and market advantages have to be worked out to integrate cross-channel strategies intelligently in your business model
Where are we heading?
Business models need to evolve their network capabilities constantly and co-operate actively, intelligently and be flexible, in order to differentiate themselves in future-oriented markets. The selection of the best digital distribution channel is important, including planning, purchasing, logistics, marketing or controlling, as all departments need to align the way they work with the long-term strategy.
Still, dealers seldom manage to succeed in transforming their business models easily, although their future success will depend more and more on how quickly and effectively new innovations can be implemented, or how the company understands the potential of digitization, adapts it to its own business and puts it to practical use.
Be aware that no matter what business you’re in, managing multiple platforms, negotiating with numerous software vendors and dealing with compatibility issues will consume time, money and energy. Hence, those companies that effectively embed digitization into their business model and enable the fast deployment of solutions at scale will have a key competitive advantage. Thus, continuously keep an eye on the framework of your business model and adapt it appropriately if you wish to stay at the forefront of the digital revolution.
By Daniela La Marca