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2016


There are many outside factors that will influence your consumer chain, from seasonal changes, to customer demands, to technology, to regulatory.  There are even more outside influences that must be taken into account for large national and international retailers.  All of these influences can affect your consumer chain in many different ways and throughout all of these your consumer chain can and must provide a transition through the influence and even evolve to support the permanent influences.  The two greatest influences on your consumer chain are probably consumer demands and then technology.  Both of these influences will drive evolutionary changes in your consumer chain and if the influences from these areas are not addressed they will also cause your consumer chain to lose effectiveness.

 

Technology is closely related to consumer demands and in many cases will drive the consumer demands on your community resulting in demands on your consumer chain.  Technology capabilities are quickening and consumers have already embraced the capabilities and the promise of the technology capabilities driving demands on your consumer chain that must be recognized and accounted for.  Recognizing and embracing these demands is required in order to continue to realize value from your consumer chain.  Key consumers, these are the consumers that return over and over and drive your continued sales and growth, demand fresh community opportunities in an increasing velocity and you must engage with these demands in order to continue and grow the relationships and the resulting value of these relationships. 

 

Consumers demand additional return on their participation and engagement as well, it is not good enough for the retailer to simply provide a portal for sales.  The consumer demands engagement and interaction from the retailer, and ideally other consumers that are also engaged with the retailer to develop a community.  The results of this engagement of both consumers and retailer is a community that provides a reason for the consumer to return over and over again.  As I have said, the consumer demands fresh content and two way engagement from the community to provide a reason to return.  The consumer demands not only fresh content, the consumer also demands the opportunity to develop and provide content for the community.  This provides the reason for consumers to return over and over again; the ability to create content and then interact with other consumers and even the retailer based on the reaction to the content.

 

The key influence on the consumer chain is the consumer demands and interactions with the community and the chain.  The consumer demands are driven by additional factors like seasonal changes and cultural practices.  All of these additional influences however are realized through the demands of the consumer.  The key to success is the focus on the consumer demands and the patience to build the community.

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?


The consumer chain influences across the retail organization, the sales channels, the internal and external partners will grow from insignificance to a major influencing factor.  This growth prospect require some vision and patience on the part of the retail senior leadership along with a great deal of imagination and persistence from the partners.  The consumer chain provides an opportunity to collect and analyze an immense amount of data, especially from the eCommerce sales channel and the consumer community.  The consumer community and the eCommerce sales channel provide a sandbox environment to experiment and measure results of those experiments to then influence decisions across the chain.

 

Supply chain partnerships from the raw materials to the retail distribution have been in place for a long time and the addition of the consumer partnership to create a consumer chain is in its infancy.  As with all new opportunities there is a great deal of potential and there is a great deal of risk to achieving the potential.  The potential though is worth the effort to realize and as I have previously stated, I believe this will become a cost of doing business in a short period of time.  The consumer has always influenced the retail marketplace based on purchasing trends and surveys.  These tools are cumbersome and more importantly not very accurate predictors of the future purchasing patterns of the consumer.  Over the years there have been improvements in accuracy of these predictions and there have also been a lot of inaccuracies.

 

The data that can be captured and provided by a robust consumer collaborative community can provide the information that will dramatically improve the accuracy of the forecasts.  This data and the analysis of the data will provide the information to influence not only product selection and sales forecasts but also presentation, sales and discount presentation.  The data can influence the decision to mark down product and in addition to what to mark down but also when to mark it down and how to present the markdowns for maximum reaction with minimum impact to other products.

 

It is important to be influenced by facts rather than by assumptions and the consumer collaboration community provides an opportunity to collect facts from a new outlet to use for more accurate and robust analysis.  This data from the consumer community can all but replace the majority of surveys and focus groups by providing real life examples of consumer reactions by tracking their flow and activities through the consumer community and the eCommerce sales site.  As the consumer participation grows the value of the data will grow as well.

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?


The success of the consumer chain does not come overnight, even if it looks that way from the outside.  The success starts with the commitment from the retailer senior management to the goal and objective of developing a robust consumer chain.  I say this starts with the commitment from the retailer senior management because the bulk of the effort and investment, especially in time, will come from the retailer.  This is only fair because it is the retailer that will be realizing the greatest level of return.  After the retailer, the greatest benefits are derived by the consumer, and then it is probably a tie between the manufacturers and the transportation partners within the consumer chain.

 

Because of the nature,and the time horizon involved in the steady value returned to the retailer the commitment level must be great.  In order to maintain the level of commitment required the consumer chain development and build up must be structured and delivered in a manner that provides a series of benefits to provide and example and validation of the benefits that can be achieved as the consumer chain grows and gains momentum.  The consumer chain will gain momentum based on two objectives and benefits;

  1. The retention of the consumer on the site.  This is achieved through the encouragement and consumer value returned as a result of the consumer chain.  The retention of the consumer on the community must be the first objective because all value is derived from the retention and resulting increased sales achieved from the robust community.
  2. The growth and value derived from the data resulting in the retention of the consumer on the site. This is another important growth factor that will provide the basis to prove assumptions and the data to support analysis of product selection and purchasing patterns along with the analysis of consumer shopping patterns.

Both of these objectives require an investment in both labor and capital to support.  Fortunately, the capital investments can be done in increments when you utilize cloud technology for the architecture.  This strategy allows you to invest over time to support the growth and expansion of the architecture and not invest in architecture that will not be fully utilized for an undetermined period.

 

The cloud technology that supports the investment in technology based on usage is an important feature to the acceptance and commitment of your retail organization leadership.  The investment is based on the actual usage and growth rather than investment on a forecast that may not materialize in the forecasted time period.  This is not to say that I do not believe in the benefits and opportunities of the consumer chain, it is just the acceptance that the initial growth and acceptance period from the consumer can be hard to judge and initially requires a high level of labor to support and encourage the participation of the consumers in the community. 

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

 

The consumer chain should, and will, become a key business driver in the long term success of the retailer.  While this may not currently be the case, many retailers are just beginning to experiment with the consumer chain that includes engaging the consumers in the retailer’s community.  The beginnings of these types of engagement will quickly lead to the retailer realization of the value of the community.  This realization will then encourage the retailer to expand their engagement in the community to experiment with the types of consumer engagement that can drive new product, sales and marketing opportunities.  These types of experimentation and expanded engagement with the consumer will quickly become a major business driver in the success of the retailer.

 

This consumer engagement and participation does not just happen, it requires support and nurturing which requires a significant investment of time and effort from the retailer.  This investment must be realized and supported by the retailer leadership before any return and the retailer must realize that the return my take quite a bit of time and experimentation before any return will be realized.  The retailer must focus on building the community and showing the consumer the value of participation before the retailer will gain any benefits.  This is in fact a common theme in all social networking interaction with the consumer such and Facebook or Twitter. 

 

I think that we will see a quickening of acceptance and participation by the consumer in the consumer chain.  This is only natural with the expanding acceptance and growth of the social tools and services utilized by consumers.  As an example of the type of growth and interaction you can expect from consumers I look at the acceptance and growth of Pinterest.  If you have ever explored Pinterest you can see the creativity of people and also the explosion of growth and engagement of the consumer in posting and following others.  Just a quick look around Pinterest and you find pins for everything from fashion, to cleaning, to home furnishings to vacations; people have embraced this social network for the opportunity to engage and share ideas at an astonishing rate. 

 

The example of Pinterest provides a direct example of the commitment and types of engagement that can be expected from consumers with just a little encouragement.  This commitment does not just happen though, it requires the early and long term commitment from the retailer to nurture and grow this community interaction.  This interaction though is exactly what is required by the retailer in order to grow and succeed in the future.  Consumers are demanding and searching for this type of engagement and the sooner a retailer provides the community for participation, the sooner the retailer will reap the benefits of the community. 



And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?


The consumer chain is all about collaboration and as I have described earlier the framework and architecture is designed to support collaboration.  I think though that there is a great deal of space between a framework that is designed to support collaboration and the actual collaboration across all of the internal and external partners.  First collaboration means different things to different people and especially groups so it is important to start with a definition or objective for the collaborative relationship.  I think it is best to define the objective because there can be many different ways to meet the objective.  The objective can and should be defined for each partner in the consumer chain collaboration network so the relationships and the contributors across the chain can be identified.

 

As I have said above, it is important to start with an objective because this solidifies the direction and understanding across all of the involved partners.  Starting with a definition of the collaborative consumer chain leaves the results open to interpretation by each of the partners which can and will result in partners going in different directions and increasing the risk of failure.  An objective however is clear as it identifies and defines the end result allowing each partner to determine the requirements and best method to meet the objective.  Starting with the objective encourages the partners to define how they will collaborate to meet the objective, simply defining the collaborative consumer chain provides no direction or goal and so the partners have no reason to build the collaborative relationships.

 

There should be objectives defined for all partners so they everyone has a stake in the relationship. The objectives can and should change depending on the type of relationship.  What I mean by this is that a raw material supplier will have different objectives than a carrier.  The connecting relationship at the center of all of these relationships though in this example is the retailer.  The retailer is the hub that truly brings the value to all of the partners and without the retailer there would be no reason for the collaborative network.  This means that the responsibility for success of the network lies with the retailer.

 

This is a great responsibility for the retailer, however, the retailer also gains the benefit of survival and growth of the business.  I do not think this is a choice for the retailer, this is a requirement for the retailer and a cost of doing business.  In order to survive the retailer must act as the hub between the demands of the consumer and the participants that are trying to meet those demands.  The options and demands of the consumer can be met by a variety of many retailers and you must give the consumer a compelling reason to shop and purchase with your outlets.

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?


Measuring the value that is derived from your consumer chain is difficult due to the nature of the network and the collaboration.  This does not mean that you cannot or should not measure the value derived, in fact you must be able to measure the value of any business initiative to justify the investment.  Your consumer chain collaborative network is no different than any other business initiative, the challenge though is in determining how to measure the value.  Much of the value returned by the consumer chain starts with soft values, such as the customer spending more time on the site.  These soft values though should lead to a measurable value such as increased sales.

 

This exercise starts with the question, what should you measure?  On the surface the question has an easy answer because there are generally two meaningful measurements in the retail business;

  1. Increased sales - this simply measures the overall change in the sales over a period of time, either positive or negative.  Every retailer maintains a history of their sales for measurement and comparison.
  2. Decreased costs - this too is easy to measure and is the overall change in expense over a period of time, again positive or negative.  Again every retailer maintains a history of their expenses for measurement and comparison.  The cost analysis though must also take into account the sales volume and measured as a percentage to sales in order to perform an accurate analysis.

This is not a discussion on measuring sales or expenses though so I will leave it at the simple definitions. 

 

The difficulty in measurement comes into play from trying to define the type of impact the function and capabilities provided in your consumer chain will generate.  As a comparison; I would say that an increase in time the consumer spends in the store or on the web site would translate into an increase in sales.  The online portion of the equation is easy to measure because of the data capture every step of the way where the in store activities are much more difficult.  I would also say that consumer reaction to online product display and offerings will lead to improved demand forecasting which in turn will lead to reduced cost of inventory and reduced overstock.  This is a little more difficult to measure and understand but again, the online tracking can provide the data to support the measurements.

 

The online portion of the consumer chain and especially the extended consumer interaction generated by the consumer community can be used to provide a wealth of data to analyze and measure performance and value relationships.  This online analysis and the resulting findings and improvements can then be extended into the physical store environment to improve the customer experience which should translate into increased sales and reduced costs.  It is time to use the online experiences to measure and experiment with changes and improvements that can be extended through both physical and electronic sales channels.

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

tbrouill

Consumer Chain Data

Posted by tbrouill Feb 16, 2016


The greatest potential value proposition that will result from implementing a consumer chain and the technology integration architecture and framework is the potential of big data combined from across the consumer chain.  The big data potential though requires preparation, planning and expertise that may not be currently available to you.  There are specialized skills and experience required to implement a robust big data architecture and more importantly it is essential to develop the big data architecture and framework that will support the near future needs of your consumer chain.  The initial design should be supported with a high quality design from experts to build the flexible and robust framework to support the big data needs.

 

The skills required to design a robust and flexible big data architecture to support your needs are not common and cannot be effectively provided by your database management team.  Big data expertise and experience are specialized and you will gain the greatest value from investing in specialists to work with you to perform the analysis and design of the architecture.  Starting with a stable platform is important to the success of this initiative and skimping on the investment will end up costing you much more in costs to rework and lost opportunities for analysis.  This is very much like the old commercial ‘pay me now or pay me later’, if you skimp on the initial investment you will end up paying much more in the long run.

 

From a data collection and analysis perspective there are three areas producing the greatest volume of data and the greatest volume analysis requirements;

  1. The online consumer community site supporting the interaction and retention of consumers.  This site provides a wealth of data related to the consumer interaction and participation in the community to identify product likes and dislikes and also potential combinations of products for cross selling opportunities.
  2. The eCommerce site supporting the shopping and sales demands of the consumers.  This provides the finalization of the consumer shopping experience from the search and shopping patterns to the final sales to support analysis of site logistics, product offerings and combinations.
  3. The supplier data supporting the procurement and supply of new and continuing products.  This is really a two way street and a point of value for your suppliers.  The retailer provides the early forecasts and sales statistics for the products while the supplier provides the procurement through shipment of the products to the retailer.  This is especially important to efficiently managing the inventory life cycle and especially managing the overstock inventory. 

 

The data repository and the data analysis are extremely important to the ability of the partners to derive value and inefficient data storage and analysis or missing data can have a dramatic impact on this value.  This is why it is important to invest in the early development to provide a solid and robust framework to build.  Remember, you can pay for it now or pay a much greater price later to develop this architecture and framework and it is better to pay up front because of the long term savings and value realized.     

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?


In order to succeed in your consumer chain development and growth you must perform an honest and thoughtful analysis of the challenges to the success of the consumer chain.  This analysis should be performed on a regular basis to ensure that your focus remains on current challenges.  This is important because of the rate of change you must absorb and support.  Due to the nature and demands of the consumer chain your opportunities and challenges will also continuously change and grow.  It is important to focus on the current and near term challenges and drop the challenges that are no longer important.  This is a classic risk analysis process that must continuously be reviewed and updated.

 

I suggest scheduling a recurring session to review your challenges and opportunities to ensure that it happens.  In my experience you must schedule these sessions in advance and define a regular agenda for the review or the reviews just will not happen in the manner necessary to ensure the challenges are monitored and addressed.  Your challenge analysis should focus on the key areas of the consumer chain:

  • The consumer interaction, attraction and retention.  This focus is on the actions of the consumer while interacting with the consumer community site established to determine
    • First what areas attract the most activity
    • Second the types of activities performed by the consumer on the sites
    • Third track and monitor the retention of consumer on the site and their return to the site
  • The external partner interaction and support. This should focus on the growth and value delivered to and by the consumer chain external partners such as suppliers and carriers.  These areas of focus are similar to the consumer focus; interaction, attraction and retention.  Your external partners are an important aspect of the consumer chain and must be nurtured and supported in order to maintain the value added relationship.
  • The technical architecture and framework supporting the consumer chain.  This review is especially important from three aspects;
    • The consumer viewpoint to analyze the nature and volume of the data collected to support the analysis and growth of the consumer interaction requirements. 
    • The external partner viewpoint to support the demands and opportunities from your partrners to build value and grow the partnerships.
    • The technology viewpoint to analyze utilization, including plans for growth, to ensure the technology framework will support the demands of the consumer chain.  This technology review is especially important to support the seasonal demands on the consumer chain.

 

These challenges can seem to sneak up on you if you do not regularly review for new challenges and opportunities.  Implementation of this regular review cycle will help you to maintain a robust and flexible consumer chain that is prepared to support the changing demand of the consumer chain.

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?


The consumer chain concept and more importantly the robust spoke and hub framework provides many opportunities for the entire chain to benefit. Most importantly, though, it provides the retailer at the hub a vast amount of data along with the connectivity to utilize that data to strengthen collaborative relationships, analyze shopping patterns and product selections, enhance retention of customers and provides a means to support the discontinuous change that is increasingly the norm of the retail business environment.  Obviously though, this will require investment in labor, time and technology to fully realize the opportunities and the curiosity to explore the opportunities that develop over time.   

 

The hub of this framework is the critical factor in the future success of the consumer chain and requires a thoughtful analysis and definition to start with a basis that is both flexible to allow for growth and change and then it must be robust enough to support the stress and storage of activities from many different directions with the data repository that supports big data techniques and technology.  This can seem like an overwhelming task at first look.  You must take on this task though with the understanding and the plan that the hub will change and grow as the business requirements solidify, then change and then grow continuously as the consumer chain changes and grows.  The important requirement of the hub is that it should be built on a platform that can easily grow and change with the demands of the consumer chain.  This is why I would lean towards cloud technologies to support the hub platform.

 

As your eCommerce channel grows, your opportunities and demands of the consumer chain will grow in both volume and importance.  These demands can only be supported through a robust and flexible platform to support the great amounts of data that can be collected.  These demands will increase in a continuous manner as the growth and demand grows in a continuous manner.  Cloud tools and technology will provide the methods and capabilities to support these ever growing demands in a manner that does not demand a large investment in either technology, or the labor to support the technology.  These software as a service and platform as a service capabilities are beginning to increase in capabilities and acceptance.  These capabilities and acceptance will only increase as more organizations realize the value of subscription services to support the spurts in growth on an almost immediate basis.

 

You must focus on the capabilities and services that make your offerings special, this requires focus on the consumer chain relationships and services.  Cloud tools and technology allow you to focus on the differentiating services by providing a platform as a service.  In order to maintain your success you should make the shift to focus on the services that differentiate your offerings and subscribe to the foundational services based on volume and usage.  This method allows you to take advantage of the latest tools and platforms without heavy investment, allowing you to focus investment on the success of your business.

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?


In order for the consumer chain to succeed there must be a framework in place that stores the data and provides translation and forwarding capabilities to communicate and share the data as necessary across the entire consumer chain.  This data is focused on an individual retailer, or retail group, and as such it is logical that the retailer be responsible for the maintenance and support of the framework.  The framework provides the means to easily add new partners to the chain without impacting others and more importantly it allows the data flow to be focused on the individual partner requirements.  Most importantly this framework must be flexible and robust to support the changing requirements of the consumer chain.

 

This data and communication framework should be architected in a hub and spoke model to provide the greatest flexibility that incorporates a robust big data model to support the data mining needs of the consumer chain.  As with most big data initiatives the value of the architecture increases time goes by and the data grows.  The framework though will support the push and pull data demands of the entire consumer chain, from the suppliers to the end customer and as the data available grows, the value to the consumer chain will also grow in kind. 

 

This will require an investment in technology, however, the hardware costs are reasonable to start and with cloud based tools and technology it can grow as the need grows without significant investments.  This will also require an investment in knowledge and research capabilities, in other words people, to perform the type of analysis that brings value along with adding new partners and maintaining and expanding the communications along with sharing data with existing partners.  This can start simple with sharing of sales and forecasting information and then this forecasting and planning information will grow in accuracy and value as the data builds from the consumer interaction. 

 

This translation and forwarding hub and spoke framework will provide the basis for the consumer chain to grow and change as the demands of the consumer change.  It can and will provide an invaluable store of information that can be mined to understand shopping and product demands to be able to focus and support the positive aspects of retaining customers and also a steady growth of business.  This framework provides the means to increase the value of the partnerships across the entire consumer chain and this will provide a return to all of the partners in the consumer chain.   

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing


I view the consumer chain as a series of hub and spoke mechanisms that are connected by a chain of collaboration across the partners.  Each participant, or member in this consumer chain is collaborating with other members in providing and receiving value to the other members in the relationship while in most cases managing a collaborative chain internal to their own organization.  In other words, each supplier or customer in the particular retailer’s consumer chain can also be a supplier or customer in many other consumer chains and can even be controlling a consumer chain of their own.  This makes for a complicated relationship that is best managed and controlled by the organization that has defined their consumer chain, in the case of this discussion this would be a specific retailer. 

 

The retailer is in the position to identify and coordinate the needs while encouraging and supporting the collaborative efforts to support those needs.  The retailer becomes the hub in their consumer chain to develop and coordinate the execution of the collaborative initiatives while maintain the data resulting from the consumer chain activities.  This consumer chain hub and spoke concept provides the framework for the network to achieve the greatest value for all members.  In this framework the retailer, as the hub, becomes the translator and traffic cop that coordinates and encourages and maintains the flow of information and the collaborative efforts.  There must be a participant in the consumer chain that in effect owns the collaboration and the participant that will obtain the greatest value is the retailer, so it is a logical conclusion that the retailer should own these responsibilities.

 

This role of translator and traffic cop is very important to the success of the consumer chain and will require a great deal of effort to develop the framework.  This is because the retailer must first develop the consumer collaborative community that will generate a great deal of the feedback to the consumer chain.  Sales data provide a single dimension of information to the consumer chain where the consumer community will fill in the missing information and provide the color that will enhance the sales data into an increasing stream of data to the other members of the consumer chain to increase performance and accuracy of demand evaluations. 

 

The sales numbers provide the ‘what’ part of the retail channel and the objective of the consumer collaboration community must be to provide the ‘why’ part of the retail channel.  The ‘why’ part of the equation is the information that will help the retailer to maintain and grow the sales through a balanced equation rather than the hit or miss method of retail sales. 

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

tbrouill

Consumer Chain

Posted by tbrouill Feb 7, 2016


The consumer collaboration community is the first step in creating a consumer chain that will link the retail supply chain from the manufacturer to the end consumer through a collaborative technology network.  The consumer chain will provide value to each member partner from one end of the chain to another by linking the the partners to support the objectives of everyone.  This consumer chain extends the linkage out to the consumer to engage and retain their participation in the community and provides the critical data from both shopping and purchasing activities along with the feedback loop from their participation in the retailer’s collaboration community.  This data is invaluable to the remainder of the chain for developing products and marketing these products to the customer base.

 

This consumer chain is made up as a hub and spoke architecture from major partners rather than links attached to one another.  This hub and spoke architecture functions with the retailer at the hub and the consumer, manufacturers, carriers and the raw materials as the key spokes of the hub.  From my perspective this hub and spoke architecture better describes the actual relationships and process of the activities.  The retailer at the hub provides the means and the connection to all of the partners in the consumer chain in a manner that provides the greatest value to the partners. 

 

The retailer at the hub provides an architecture where the retailer maintains and supports the communication framework along with the big data repository and tools to analyze the data to share with the other member partners.  The retailer at the hub provides the methods to direct and forward communications as necessary to other partner members in the relationship while providing additional value to those communications by relating and adding relating or value added information from the big data store of information to enhance and clarify the communications and the value of the communications.  This is where the collection and analysis of big data will return great value back to the consumer chain. 

 

The challenge for the retailer though is to accept the challenge and invest in the big data repository, tools and effort investment necessary to realize the value.  I believe this has been the stumbling block all along and has cause the supply chain to create islands of information that are protected by the partners collecting and maintaining this information.  The issue in the past has been that there was no one putting the information together in a hub.  My suggested hub and spoke framework provides a means for the retailer to maintain and coordinate the information from all channels and partners in a manner that will allow them to combine information from all hubs in a manner that produces the greatest value.  This is the control tower concept of managing and coordinating activities in the consumer chain.

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?


When the collaborative consumer community is ‘self sustaining’ by the participation of the consumer and interaction with the retailer the community will produce a vast amount of data.  This data will be invaluable to the retailer for developing marketing plans and especially for product development and sales forecasting.  This data will provide a wealth of information from both direct consumer response and especially by tracking movement through the site.  The challenge for the retailer will be the analysis of this data utilizing big data technology and techniques.  This data will feed a great deal of analysis scenarios to help the retailer to plan and execute product and marketing strategies and reduce the trial and error guesswork.

 

This consumer community will provide a great deal of information as a result of the consumer activity and travels through the community.  This information includes the path the consumer takes through the community by tracking the clicks on the page and when, and how, they leave the page.  This type of information can be invaluable in developing and formatting a community that retains the consumer and directs the consumer deeper into the community site to participate.  This hard data of the consumer path through the links and the pages on the site provides a level of confirmation and accuracy that can never be achieved through post purchase surveys.  These actual travel paths and selection of links that are interesting to the consumer, along with the sequence in which they select and explore the links will help the retailer to increase the appeal and retention of consumers in the community.

 

In addition, the consumer community will provide the opportunity for the retailer to perform early testing of products and marketing in a supportive environment before investing large sums of money manufacturing products.  Another opportunity for value from the community is encouraging ‘pins’ of different uses and combinations of products from the consumers.  This provides two value streams;

  1. It provides suggestions to consumers for different uses for the product and different combinations of the product.  The combination, or pairing, of products provides an additional strong sales and marketing opportunity for the retailer for add-on product sales.  This is especially valuable when the suggestions are provided by other consumers.
  2. It encourages both retention and return of the consumer to the site to participate.  This increases the ‘sticky’ factor of the site providing a greater potential for sales.  The more time a consumer is on the site, the higher the likelihood of a purchase.  In addition, this feature provides a great potential for word-of-mouth marketing to encourage additional consumers to investigate the site.

 

These provide a highly valuable potential for return from the consumer community that requires an investment in both time to develop the following and tools to analyze the vast amount of data produced by the consumer activities on the community.  This provides the retailer an environment to experiment and validate actual results rather than focus groups or surveys.  I believe the results provided by consumers exploring the community provides a greater level of accuracy than either focus groups or surveys can ever achieve and this is why I so strongly believe in the consumer community.

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?


Consumer collaboration from the retailer perspective should be viewed as the next social networking wave.  What I mean by this is that consumer collaboration is the next logical step in the retailer to consumer relationship and engagement that started with social networks such as Facebook and Twitter and Yelp and then expanded with services such as Groupon and Retail Me Not.  The initial social networks and social exchange between consumer and retailer was very one-sided, sure consumers could respond through the social networks but the interaction with the consumer was in a more outward direction from the retailer to the consumer.  Consumer collaboration practices focus on reversing that direction and encouraging the consumer to actively participate and even guide the interaction between consumer and retailer.

 

I bring up this social networking aspect of consumer collaboration to highlight and reference the importance of patience and long term support for the initiative.  Social networking in the retail space requires a great deal of support from internal departments and staff in order to be successful and bring value to the retailer.  The consumer collaboration extension is no different and will also require a great deal of support from these same internal departments and additional staff in order to be successful.  The retailer must realize this is no small investment and also, even more importantly, no short term investment with a quick return on investment.  The retailer must be prepared for a long term investment in consumer collaboration in order to reap the benefits.

 

I strongly believe though that all of this effort and patience will create a stronger relationship and increased retention of the customers.  In addition, I think that there is a major difference between the consumer collaboration initiative and the earlier social networking activities in that consumer collaboration has the very strong potential to reduce the retailer labor support requirements as the community strengthens.  The main objective of the consumer collaboration community is to develop a community that will open communication and engagement between the retailer and the consumer.  This community is meant to provide a place for consumers to provide feedback and suggestions to other consumers along with the retailer.  Based on this key objective, the community can be considered a success when the consumer community members begin supporting and driving the activities themselves.

 

The most valuable benefits from the consumer community will be derived by the interaction of the consumer members with other consumers and the retailer.  This interaction of consumers will provide the retailer with a great wealth of data and suggestions on product development, and groupings along with methods and data on marketing and sales of the products.  These are the benefits that will drive value and growth for the retailer. 

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?


In this fast paced world of eCommerce and mobile technology delivering instant gratification and driving a pace of discontinuous change that is tiring,  it may not make sense to say you must be patient in this environment.  In the case of building and maintaining a collaborative relationship with your retail customer, however, this is exactly the case.  I know that is sounds like you are at odds with the technology and capabilities to say have patience, but developing this relationship requires a great deal patience because of the fast paced technology and the experiences of the consumer.  The consumer is being driven and enticed in so many directions and by so many distractions that you must have patience to wait for the consumer to take the time to engage in the collaborative relationship. 

 

You must maintain your consumer collaborative environment with new content and also new offers and methods and opportunities for interaction with the consumer exactly because you will only have an instant to draw the consumer in and explore.  You will need to provide the encouragement for an extended period of time while you are building the following of consumers.  This will require posting and advertising fresh content and offers on your site to encourage the consumers to return, until it becomes a habit and the become a regular participant in the community.  Remember you are developing a community and it will take a while before the word spreads about the value of the community.  This is exactly why I say that you must have patience when developing this community.

 

This patience requires the investment to develop new content on a continuous basis.  By continuous basis, I mean that you must invest in the internal resources to prime the pump of the community with fresh content multiple times a day.  You must experiment with the type of content and the time periods when you post the content to determine the most opportune content and time of delivery.  This requires patience and experimentation to develop and deliver the content over a long period of time while your community grows to a critical mass and begins to create content without your continuous involvement. 

 

This consumer collaboration community is a bit of a good news / bad news story.  The bad news is that you cannot define a time period for how long you will need for the exclusive preparation and delivery of content and the good news is that you will come to a time when you will realize that there is a great deal more content and direct consumer engagement in your community than you are creating yourself.  You must have the patience to get through the period of the hyper level, and cycles, of support with content and offers to encourage the consumer to return and participate.  If you look at the strength of Amazon now it is easy to forget the start-up period where the Amazon site required a great deal of effort to promote and engage the consumer.  You must be prepared for your consumer collaborative environment to require a great deal of effort over a long period of time to provide a return on your investment.  This return on your investment though will fuel your success for a long period of time.

 

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?