2013 is going to be a fascinating year for retail in Europe.
When I look at what’s to come this year, I can paint a picture of what Forrester predicts by looking at a tale of two brands. Both are iconic, heritage British brands that have responded to their increasingly digitally enabled consumers in two very different ways. Naturally, this has resulted in two very different levels of success.
...but I’ve spoken to a number of eBusiness executives in luxury retail companies over the last 12 months or so, and by and large they share a similar frustration. For the most part, their senior management remain resolutely defiant in the face of the opportunity that digital brings.
Which is arrogantly short-sighted, when you consider that luxury shoppers are:
Young. Shoppers who buy luxury products online in the US are almost ten years younger on average than regular online shoppers. Globally, online luxury shoppers are more likely to be tech-savvy thirty-somethings rather than brandy-swilling boardroom bumblers.
I’ve been called upon to present on agile commerce many times over the last year, and when I do I most commonly start with this quote:
"Change is the law of life. And those who look only to the past or present are certain to miss the future."
It’s from John F. Kennedy, a man that I admittedly don’t know that much about, but the sentiment in this message rings true for me. I am a passionate reader of history and taken too literally, JFK’s quote could seem to tell us not to look back for answers. But my take away from it is rather that you must learn how to build the future from lessons of the past. Don’t dwell only in tradition and “how it’s always been.” Far too many businesses have driven themselves to the wall over the last few years (Borders, Blockbuster, HMV, etc.) because they clung to the belief that what had made them successful in the past would remain their source of competitive advantage in the future.
One thing that history does tell us is that not only is change the law of life, but the pace of change is only getting faster. And that’s where the concept of agility comes in. I’ve written before about why agile commerce is more than just “multichannel done right.” Absolutely, the imperative of putting the customer at the heart of everything you do and serving them coherently and consistently across touchpoints is critical. But agile commerce builds on this by focusing on the need to achieve organizational agility.
I’ve been thinking, talking to clients, and reading a lot recently about the rise of the Chief Digital Officer.
Most of my recent research has been concerning the shift we are seeing in leading organizations in response to their increasingly digitally aware consumers. Much of this has been described in our agile commerce research, and it goes something like this...
It’s no great surprise that many retailers are reporting an increase in multi-touchpoint engagement from their shoppers this year in the run-up to Christmas. Our own Technographics® data has been showing an increase in the use of things like mobile, tablets, and click-and-collect services for some time. But as the number of touchpoints shoppers are using increases, so does the complexity faced by brands trying to manage coherent, consistent, and compelling experiences across these multiple touchpoints.
The reality we now face is that customer journeys cross touchpoints.
Forrester’s Marketing Leadership team has been championing an approach to thinking about the customer journey not as a marketing funnel but as a life cycle -- a dynamic, circular ecosystem of touchpoints that morphs over time, possibly with each customer and each journey. But even making the leap from a funel based paradigm to this approach is just the first step in working out how best to optimize each touchpoint.
One of the biggest mistakes you can make is to just assume that every touchpoint needs to replicate every other touchpoint. Customers don’t use each touchpoint in the same way. Their expectations about what they can achieve on mobile and how a mobile app might help them interact with their physical environment with, for example, a mobile store locator or a bar-code scanner is very different from what they expect to be able to achieve when they call your call centre.
Touchpoints need to be designed within the context of an overall customer journey. Not in isolation.
So either you are back, or you were with me all along. But now you are wondering “Ok, so what is the difference?” Let’s look at what the two terms really mean. Omnichannel doesn’t have a formal definition, though here’s what the oracle that is Wikipedia says…
“Omni-Channel Retailing is very similar to, and an evolution of, multi-channel retailing, but is concentrated more on a seamless approach to the consumer experience through all available shopping channels, i.e. mobile internet devices, computers, bricks-and-mortar, television, catalog, and so on.”
On the other hand, Forrester defines agile commerce as…
“An approach to commerce that enables businesses to optimize their people, processes, and technology to serve customers across all touchpoints.”
I had the pleasure of presenting an evolution of our Agile Commerce research last week at the Internet Retailing conference in London. It was an interesting event on a number of fronts, but my key take-away from the event was a very positive one.
eBusiness executives in Europe have definitely woken up to the Agile Commerce message.
We can’t claim all the credit at Forrester, but I definitely got the feeling from listening to my fellow panelists on the Customer track present their stories that they were in the same place as we are now, at least in terms of strategic intent, if not yet in execution:
Simon Smith, Head of Multichannel Experience at O2 Telefonica described how he is bringing a service design ethos to delivering both consumer and employee experiences. Telefonica aims to design service experiences that are Individual, Relevant, Thoughtful, Reassuring and Amazing (SUPER, anyone?), and what was the most interesting piece about their story was that these experiences are designed from an outside in, customer first perspective before any of the individual touchpoints are designed. By basing these experiences on common personas and a wealth of analytical data, Telefonica then overlay touchpoints as appropriate, enabling them to step out of the discussion about “should we or shouldn’t we develop this or that functionality on this or that platform?” and into the more relevant discussion about “what touchpoints and experiences most make sense for our customers?”
There are a few firms that I regularly point to as agile commerce exemplars, and one of them is Burberry.
This always makes me smile because being from the north of England and growing up in a culture dominated by shipbuilding and football (and Newcastle Brown Ale), Burberry has long been the iconic garb of the “chav.” Since many of the people who read this blog aren’t from the UK, a quick cultural diversion is probably needed here. But don’t worry - it's relevant to the Burberry story. Honest.
Mao Zedong is quoted as having said that: “A revolution is not a dinner party . . . A revolution is an insurrection, an act of violence by which one class overthrows another.”
However, history also shows us that violence is not the only way to lead transformational change in a society that is locked into a traditional way of being. Some iconic campaigners for peaceful change, such as Gandhi or Leo Tolstoy, come from relatively privileged backgrounds and were well positioned to take a front seat in leading change. However, others have risen from very humble beginnings. Martin Luther King. Sophie Scholl. Emmeline Pankhurst. All people from ordinary backgrounds who rose to prominence through their single-minded vision of a better world, their ability to communicate their passion, and the courage of their convictions in the face of overwhelming opposition to their way of thinking.
So why is this relevant to a blog that’s normally about eBusiness?
Here at Forrester, we’ve been evangelizing the concept of agile commerce for a while now, and we are working on a stream of research building on the concept and digging into exactly how leading organizations are transforming themselves to embrace the era of agile commerce. One of the questions I personally get asked is what exactly does an agile business look like? How do you recognize one?
In speaking to a number of leading practitioners in this space, I have found that there are four things that agile businesses have in common. They:
Architect the experience. Agile organizations don’t allow touchpoints to emerge randomly or operate independently from one another. They design compelling cross-touchpoint experiences that are meaningful to their customers and add value to the brand, like “Click and Collect” for a retailer or mobile-driven online check-in for an airline.
Are customer-obsessed. Agile commerce means putting the customer at the heart of every decision, bringing quantitative and qualitative customer insight to every decision, and even reorganizing around the customer life cycle to focus teams on what the customer needs, not what the channel thinks.
Enable with technology. Agility demands some key underpinning enterprise technology components, such as a commerce platform that can serve the Web, mobile, and stores. But it also requires that touchpoints are unshackled from back-end systems by a common set of commerce APIs.