Change will do you good

Change is good

Many marketers see Continuous Commerce™ as the love child of technology and changing customer expectations. The ways in which it allows businesses to integrate across multiple touchpoints—creating seamless brand experiences focused on customer utility—is opening new horizons and challenging old retail models. These are exciting times.

Yet for most companies, delivering on the seductive promises of Continuous Commerce™ is more than a matter of simply turbocharging your IT, marketing and digital skills. More and more brands are embracing Continuous Commerce™ only to find that the benefits don’t quite meet the potential. Why is this? Are there hidden barriers beyond technology, new digital channels, and changes to how we communicate with customers?

First of all, unlike other routes to market-channel advances, Continuous Commerce™ requires you to coordinate your organization in ways that aren’t obvious at first. While marketing might lead the charge, that department can no longer be isolated as the messaging arm. Logistics, supply chain, customer service, HR, finance, legal, operations and sales all need to come together for Continuous Commerce™ to deliver on its potential. And if marketers are to play the coordinating role, they’ll probably require a change in skill sets, ambition, role definition, and supplier support.

Take the Australian market as an example. Consumer brands going direct to consumers have to think more broadly than digital and brand excellence—they also need to overcome the geographic challenges of a relatively small population concentrated in a few cities separated by vast distances. Last-mile logistics are far more problematic in this region than optimizing online conversion.

Yet traditional marketing advisors are out there, preaching that you have to empower consumer by reaching them directly, and get frustrated when their clients “don’t get it” or move too slowly. In our opinion, inaction is mostly a function of organizational misalignment. Marketing probably knows the world has changed and that an eCommerce offering might make sense, but finance will push back when the cost of delivery is three times the margin on the sale of a pair of socks.

I once witnessed a fascinating argument between marketing and finance at a large brand house. The GM of marketing, armed with colorful slides and infographics, was trying to persuade her CFO that a direct-to-consumer offering was strategically savvy, despite potential retailer backlash. She argued that putting customers first could never be a bad thing and that her research showed that customers wanted to purchase single SKUs online.

The CFO was sold on a direct offering, but they argued over single SKUs versus bundled. The CFO lost his cool at one point, shouting, “Putting customers first is a bad thing if it drives us broke.”

The good news is this company now runs a hugely successful Continuous Commerce™ operation (integrated across their multiple digital and physical channels), but bundles small-value SKUs to avoid losses, even when customers have expressed a desire to buy individual items.

The point of this story is to highlight how the marketing department and its agency advisors were fighting the wrong battle. The wider organization wasn’t questioning the fundamental drivers of Continuous Commerce™. But the marketers lacked the institutional knowledge to overcome the real objections around the financial modeling. Worse, their agency partners were providing case studies of Zappos and Tesco rather than rolling up their sleeves and working through SKU-optimization modeling, or network logistics options.

This is just one example, but we’ve seen variations of this too many times to count. Brands need to face these questions: Where does Continuous Commerce™ report within the organizational structure? How will we pull it off given current capabilities? What are the implications for our call-center staff? What business rules do we place around stock availability?

Even within the marketing function, what changes will Continuous Commerce™ drive through asset and production management? Photographic needs for catalogs don’t always align with a fast-moving Continuous Commerce™ environment, and just managing this one changing requirement may draw more on operational or manufacturing-process-optimization type skills than traditional marketing ones.

Continuous Commerce™ when done right is a game changer, so it’s all about embracing the complexities. Having helped many brands on this journey, I’ve learned that a key ingredient to success is the breadth of the marketing team and its ability to coordinate across multiple functions. To do this, marketing also needs to speak various other functional languages. Smart agencies wanting to help their marketing clients will quickly realize that they need to skill up on broader commercial and organizational skills to help overcome the real impediments to this promising trend.

Marketing needs to lead. To do so, marketers and their advisors need to change. The excitement is only just beginning.

There are no comments

Add yours