Consumers, and especially the millennial generation’s, effect has turned the retail marketplace upside down and inside out leaving many major legacy retailers struggling to maintain or regain market share. Consumers have implemented their strategy to support their changing lifestyle demands through technology leaving retailers to struggle to catch up. Retailers are not accustomed to consumers developing and implementing a strategy that cannot be controlled by the retailers. This is, however, just exactly what has happened in the retail marketplace as a result of the mashup of eCommerce, social networking in combination with a much higher level of comfort and acceptance of the virtual retail marketplace.
This has been really a long time coming and when you look backwards you can see the signs years ago from the retail marketplace especially where retailers struggled to stop consumer trends that improved consumer ability to shop but hindered retailers ability to control the market. In the past retailers would have been able to control the market through their offerings and their control of the consumer availability. The Internet and now social commerce has changed all of this and now retailers require a strategy to embrace the social commerce along with the collaboration with consumers to support this strategy. I believe that an essential ingredient to this strategy is the collaboration with consumers. This collaboration requirement is a major change in the consumer to retailer relationship and this is what is causing the major challenges with legacy retailers ability to implement an effective social commerce strategy.
The large legacy retailers have been accustomed to control the market through product placement, promotion and also the brick and mortar channel span to provide sales demand and increases through market share and reach. This has all been changing over the years and you can follow the trajectory with the success and span of Amazon as an example. The Internet and now social commerce has crushed any controls the large legacy retailers have been able to use on the market. This is a major shift for these large retailers that for years and years have been able to control the market through their size. The growth of millennials has driven the final nail to kill these large retailers control of the market.
Retailers must now change their strategy from a command and control strategy of consumer buying ability to a collaborative partnership with consumers to sense and respond to the consumer demands and desires. Consumers have taken that final step into the virtual marketplace and now the large retailers must chase these trends to catch up. The only watch though to catch up and maintain this new strategic requirements is to change their culture to one of adaptive collaboration that encourages consumer partnerships. The consumer relationship will drive the success of retailers going forward and retailers must embrace this strategy in order to survive.
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?