The prospect of remote collection lockers and click & collect points replacing London Underground ticket offices sparked a round of strikes last week, creating havoc for commuters. The second round of planned strikes was only narrowly averted this week.
Transport for London’s (TFL) proposal to close 240 underground ticket offices and replace them with automatic ticket machines will result in a proportion of job losses for station staff but present an opportunity for TFL and UK retailers alike, by:
Responding to the popularity of click and collect in the UK. Forrester’s Consumer Technographics® Retail Survey data shows that UK shoppers are responding to retailers’ omnichannel fulfillment capabilities, readily adopting click & collect services. UK grocery stores Asda, Waitrose and Tesco are not waiting for the closure of ticket offices. They are already setting up trials for click & collect services at selected stations across the London Underground network. The click and collect service will allow shoppers to order their food online before a cut-off point during the day, for collection at their local station on their way home in the evening.
In my post at this time last year I wrote of the changes we could expect in 2013 around the shift toward digital business. And indeed we did see a significant move toward digital business in 2013 - a transition that’s still very much just beginning.
But 2014 will be different. 2014 is when digital reality begins to sink in for CEOs around the world. And if your CEO doesn't figure out digital business this year, I predict 2015 will be a very challenging year for your organization, no matter what business you are in.
The Retail Conundrum
A recent Wall Street Journal article highlights the challenge of retailers very well. Store footfall is declining as consumers' lives become more digital. We are seeing a steady shift toward shopping online and shopping less often. So how can today’s retailers survive? The simple answer is that many will not. Retail will undergo a seismic shift in the next 10 years. And since retail is a major employer, it's a shift that will impact us all.
Time drives behavior. Digital tools extend the workplace into our private lives, allowing greater productivity while also creating fewer opportunities for large chunks of time to “go shopping.” We are increasingly using digital technologies to optimize how we fill our days for work and pleasure:
• Digital scheduling tools like Google Calendar help us plan our work and play time.
Two or three years ago, software buyers in the market for new and improved tools for managing website content and cross-channel digital customer experiences had a typical request: “Help me replace my legacy web content management system with a new web content management system.” It was out with the old, legacy, hard to use system, and in with a new solution that perhaps had a few new capabilities, but which still looked and felt like… a web content management system.
As we approach 2014, that WCM buyer is asking for a whole lot more. Enter the digital experience platform – an emerging software category poised for takeoff as enterprises seek to differentiate through better digital customer experiences.
Forrester has defined the digital customer experience platform and 14 specific tools and capabilities in our TechRadar report for application development and delivery pros.
We took the research further in another recent report, a Market Overview report covering digital customer experience delivery platforms. This reports describes 17 representative software vendors and their offerings as they try to tackle this robust market with a diversity of capabilities; each has a different approach. Our research has identified players with heritage in four vendor categories: web content management (e.g. Acquia and Adobe), eCommerce (e.g. Demandware, Digital River), marketing solutions (e.g. Hubspot, Razorfish), and enterprise business software providers (IBM and Oracle).
Last week, my colleague Sucharita Mulpuru published Forrester’s annual US online holiday retail forecast. In her blog, she shared that Forrester expects this year’s holiday season to generate $78.7 billion in US online sales, a 15% increase on 2012's total. This optimism is largely due to ever-increasing numbers of consumers choosing the Web over physical stores as well as the rise in mobile commerce.
To better understand consumers’ attitudes and behaviors regarding shopping during the holiday season, my team conducted a qualitative research project last year with our ConsumerVoices market research online community, starting before Thanksgiving and ending the first week of January. We found that consumers are always on the hunt for holiday deals, not just during the holiday season. Most consumers have an idea of what they are willing to spend on holiday gifts, and while most stay within their budget, they will gladly spend the extra money if it comes down to staying on budget or giving the ideal gift.
Choosing digital customer experience solutions isn’t easy for application development and delivery (AD&D) pros, or for their counterparts in the business. Tech pros used to respond to digital business needs by acquiring, say, a web content management or eCommerce system. They may have integrated other software tools to deliver extended capabilities. And it was good.
Fast forward to 2013, and the range of tools to support robust multichannel digital experience is wide and deep. Many different vendors are responding. A new Forrester report cites a number of their offerings as examples of emerging digital customer experience delivery platforms.
In our research, we discover some vendors provide more capabilities; some have fewer. Some build or buy most of their capabilities; others focus on integrating best of breed tools. All represent a range of companies attacking this market by answering a multitude of needs by IT and business customers all seeking to better address their customers through digital channels.
For this report, we identified four market segments plus representative vendors, including:
Web content management-centric platform vendors, such as Acquia, Adobe, Bridgeline Digital, Ektron, HP Autonomy, OpenText, SDL, Sitecore.
eCommerce-centric platforms, which expand upon their transactional foundations, such as Demandware, Digital River, and hybris (an SAP company).
Consumer mobility in India and China is flowing into enterprises. Recent Forrester survey data shows that nearly three in five IT execs and technology decision-makers in these countries — 58% in India and 57% in China — plan to increase their spending on mobile software (including applications and middleware) in 2014.
India has leapfrogged Australia/New Zealand and now leads the Asia Pacific region in terms of expected mobile software spending growth. China has made the biggest move over the past year, jumping from eighth place to second.
We believe that the high growth in mobile software spending in India and China is primarily due to:
Many brands and corporations today suffer from “two site” syndrome. The ‘.com’ site (often owned by brand/corporate marketing) serves to offer up a glossy magazine experience — designed to romance the customer with brand and product stories, while the ‘store.’ is owned by the eBusiness team and is designed around structured product content to optimize conversion and revenue goals. The result is often fragmented and poorly integrated digital experiences that confuse the customer, introduce unnecessary complexity, and ultimately fail to deliver on the broader digital strategy of the brand.
In the age of the customer, brands today seek a unified experience between the four stages of the customer life cycle (discover, explore, buy, and engage). For eBusiness professionals, this means tighter collaboration with their corporate marketing and brand counterparts to find ways to embed commerce (the buy phase) into the heart of the .com experience rather than building segregated eCommerce sites. However, this is easier said than done. The problem is that many brand and manufacturing organizations leverage web content management (WCM) platforms to create, manage, and measure targeted, personalized, and interactive brand experiences. However, these WCM platforms lack the robust commerce capabilities that organizations need to manage large, complex product catalogs and develop sophisticated merchandising strategies to sell online.
In-line editing? Check. Personalization? Check. Testing and optimization? Check. As the web content management market matures, functional differentiators have become tougher to find. One of the remaining functional gaps in the market is a digital customer experience platform that supports complex but unified commerce-based and marketing-based experiences. Currently, these experiences tend to be disconnected due to technical (and organizational) silos.
Count Sitecore among the vendors — such as Oracle and IBM — hoping that a hybrid commerce and content platform will make an impact on the marketplace. This week, Sitecore acquired commerceserver.net. This marks the first marriage of significant .NET content and commerce (the other commerce/content combinations available — Oracle and IBM — are built on Java).
Good move? It is significant that another vendor has taken the step towards building a digital customer experience platform that includes both commerce and content offerings. And that’s where the challenge will come in. Both IBM and Oracle have faced the challenge of integrating commerce and content products that weren’t designed and built on the same architecture. Sitecore’s challenge won’t be any different. Time will tell if the whole is greater than the sum of its parts.
On Tuesday at 8 a.m., I received a call from my mother. Instead of driving to her office, as she’s faithfully done at that time for more than a decade, my mother was caught between shelves of cashmere. Macy’s was having a pre-holiday one-day sale, and my mother was thrilled to be part of the early-bird crowd getting first dibs on cardigan colors at 50% off. I was struck — not by my mother’s rare excitement about the discount but by Macy’s success in changing her behavior. My mother traded her comfortable weekday rhythm for a detour to the mall, thanks to Macy’s timely, exclusive promotion.
This example is representative of a major potential shift in which consumers break traditional habits thanks to strategic sales and effective marketing. My mother’s impromptu spree is only a precursor to the behavior that could play out next week when Thanksgiving Thursday becomes the new Black Friday. For the first time in its history, Macy’s will open on Thanksgiving itself to compete with retailers like Target and Best Buy, which open their doors moments after the pie crumbs and coffee cups are cleared away. For Wal-Mart, Black Friday 2013 will start one full week early.