There has always a level of disruption in the retail marketplace and the difference over the years since the Internet boom in the late 1990’s is the speed of this disruption. The speed of the disruption has reached the velocity now of a regular occurance of market upheaval and realignment every year or two at the most. You can see with the annual year over year growth that the eCommerce channel of the marketplace combined with consumer acceptance has reached a level of escape velocity where this market has become a leading segment of the retail marketplace. While the eCommerce channel may not have become the majority market channel by sails, it has definitely attained a major market channel as measured in disruption.
The combination of tools and consumer acceptance and embrace of the eCommerce tools and capabilities has reached critical mass now and these capabilities are now driving the retail marketplace and disrupting not only the brick and mortar channel but all channels. Consumers have embraced mobile technology and mobile tools to change the way that they shop and interact on an every day basis with the retail marketplace. These tools and technology have allowed imaginative and forward thinking retailers such as Amazon to disrupt the retail marketplace at a speed that is only increasing. Retailers who previously cobled up competitors in a strategy to grow market share are not finding that they cannot adjust to the technology and consumer demands quickly enough to maintain their market share.
Amazon is the easiest example now to see the disruption at work in the marketplace. Amazon started with a focus on growing product line and sales volume at the expense of profit. They then began to add technology tools and services to these offerings to simplify the purchase process and encourage the consumer to return and stay at the site. Their focus is on consumer site retention through a broad offering of services and technology that not only simplify shopping but also simplify the consumer’s shopping process to provide the consumer with a balance while freeing time for activities the consumer enjoys. Amazon has realized early that consumers driving force is simplification and the ability to free time to spend with family and friends. This focus on free time is a direct response to the career forces that have been consuming more free time and result from the consumer drive to socialize.
This consumer drive to spend quality time with family and friends is a key factor to the speed of consumer adoption of these disruptive technologies and tools. Retailers must accept the concept that consumers are taking more control of their time and also manner in which they interact with the retailer. The speed of disruption is increasing now as a result of consumer embrace of new technology and tools and this will only increase with the millennial generation demands on the retail marketplace and their careers. The retailers that do not embrace this disruption will lose, no matter their share of the market.
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?