Social commerce is a study in choices for consumers and it is also a study in control and extension of these choices. The velocity of changes made possible by technology is buffeting the retail marketplace and as a result the common standing practices of large legacy retailers in a manner that seems to be overwhelming now to many of these retailers. The results of the difficulties in response to these changes are clear; reduced sales, store closings and a frantic search for a strategy to address the waves of change. Retailers are struggling to adjust their sales and outlet strategies to adjust to the changes and having difficulty in finding the combinations that meet the consumer demands and turn the tide on sales reductions.
I have written before that these changings are not really sudden and have been building to the tipping point we seem to have reached in the last year. I have also written before that retailers must develop a flexible and robust framework that allows them to sense and respond quickly to discontinuous change. Now it seems that the discontinuous change in quickening and the waves of change are getting more powerful. This quickening is the result of consumers reaching a tipping point of a combination of technology (mobile and commerce), social networks and imagination. The ingredient that pushed this tipping point though has been the steady and constant growth of the millennial generation in the retail market. This entry in the market has added dramatically to consumer choice and allowed consumers to wrest control of their shopping and purchasing options from the retailers.
The choice effect has changed the retail market and the factors driving these choices are converging and driving more choice into the market. Consumer choice with the millennial generation leading the change allows consumers to put together options to customize their shopping and purchasing habits in a manner that supports their needs at the time they are shopping. Large legacy retailers are not accustomed to this type of activity and this is causing them to struggle in finding their direction. The challenge I believe for these large legacy retailers is accepting the social networking aspect of shopping into their strategy and framework to allow these retailers to collaborate with consumers to sense and respond to the changing demands and choices of consumers.
Retailers must provide a flexible and robust framework that allows them to support the demands of consumers and more importantly they must incorporate and embrace social networking and consumer collaboration to allow them to sense the changing demands and choices of consumers. Now it is about supporting and providing choices to consumers, in products, in sales channel and also in shopping capabilities and social networking and technology play a critical role in this capability.
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?