Where omni channel retail supports purchases across all retail channels, social commerce encourages shopping across all channels and social network capabilities to allow shoppers to support their own personal lifestyle requirements. Where omni channel purchasing requires support from the retailer, social commerce allows the consumer to construct the social capabilities across channels and technologies as required by the consumers’ changing needs at the time. Social commerce now is at the root of the changes that are confusing the retail market and driving legacy retailers to the brink of failure. The difficulties for retailers are compounded by the fact that consumers have taken control of their shopping practices and this is disrupting the purchasing methods that are the foundation of retail strategies and support practices.
Social commerce is defined and driven by consumer capabilities and imagination that enhance the consumer shopping capabilities currently supported for the most part by shopping malls. Retailers are struggling with this concept now because they have not had to take these demands into account in their support activities in the past. This level of control exerted by consumers now through social commerce is foreign to the large legacy retailers that have been accustomed to allowing shopping malls support the shopping demands of consumers. The entertainment and food choices that have always enhanced and encouraged consumers to spend time at the mall are also being overwhelmed by the consumer changes driven by social commerce. Technology now allows consumers to select their need, whether shopping or entertainment and they can compartmentalize to meet their demands to fit into their lifestyle. Movie theaters are impacted now at the same level as retailers from the expansion of technology capabilities impacting the movie experience such as streaming video. In addition, social commerce impacts the real estate market and especially as it relates to finding new uses for large malls that are left empty from the reduction in consumer interaction in the brick and mortar stores.
Social commerce impacts the entire retail supply chain, from manufacturers to the purchase, whether that purchase is online or in a brick and mortar outlet. The consumer demands are changing faster and more fluid as a result of the growth in purchasing by the millennial generation and these changes are overwhelming legacy retailers because these retailers are struggling with culture changes in collaboration along with shopping and resulting purchasing changes. The greatest struggle though for these legacy retailers is the cost to retool their legacy technology to allow them to support these fluid and continuous changes. This cost to retool is where the struggle begins for retailers because they will have no hope of keeping up with the changing shopping and purchasing patterns without significant investments in their infrastructure. This investment is where the retailers struggle with justification because heavy and early investments in technology will impact profit margins and these investments in leading edge technology also run counter to the retailer culture.
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?