Digital Disruption from EX²

In today's economy, retailers are being forced to trim margins to battle a marketplace of global competition, slow growth, increasingly demanding customers and rising costs. Many retailers have reduced their margins to a single-digit percentage, and most are struggling to find ways to reduce costs and operate more efficiently.

If there is one guiding principle for businesses, it is: Give the customers what they want. (How many ice cream shops could stay in business if the only flavor offered was plain vanilla?) What customers want today is a multi-channel experience. They have grown increasingly tech-savvy and more comfortable with using everything from desktops to kiosks in order to research products they are considering, to communicate with companies, and to make purchases. Companies that give them want they want will thrive, and those that do not will falter.

Creating a great Omni-channel customer experience, however, is far more than merely enabling access through a variety of devices. It is a cohesive plan to guide each customer throughout his or her purchase journey. Although not every enterprise needs to create an identical multi-channel experience, there are certain important characteristics that all successful Omni-channel models share.

Recently, there has been a lot of "buzz" in the IT world about the potential rewards and possible pitfalls of becoming a digital business. Companies are rushing to digitize everything they possibly can, and the effects are becoming far-reaching. However, no single aspect of business has been impacted more by digitization than that of the customer experience. Done correctly, businesses have the opportunity to engage customers on a more personal level, allow employees to be more productive, and improve profitability. Done incorrectly, digital initiatives can frustrate employees and annoy customers leading to a decline in profits or revenue.

In increasing numbers, customers are demanding a more personalized experience that connects smoothly across all channels. To help satisfy the needs of the digital customer, many successful businesses have implemented certain strategies.

It is a buyer's market these days. With a handful of exceptions, consumers know that comparable products and services can be found from a number of different sources. Because customers have gained a great deal of insight into their own power over providers of goods and services, they have begun to expect -- and even demand -- more than ever before. These newly empowered customers are also proving to be less loyal than ever before. Businesses that fail to deliver what consumers want can quickly discover that customers have abandoned them for the competition. 

First came home shopping via radio and cable television, and then came the Internet and online retailers. Modern shoppers suddenly discovered the convenience of ordering a product from the comfort of home, even at 3 a.m.

The name "Gucci" has been synonymous with high quality and luxury since the 1920s, when the company began producing classically styled leather goods. By the 1950s, movie stars and other celebrities were regularly seen in Gucci fashions or sporting Gucci accessories. Gucci items quickly became status symbols. This allowed the company to charge top prices for its goods, but catering to such an exclusive clientele meant that the company had to offer outstanding customer service while remaining on the cutting edge of fashion.

As most retailers will freely admit, one of the more difficult aspects of pleasing customers is keeping up with their constantly changing desires. Consumers can be fickle; a brand or product that sold faster than retailers could stock their shelves last week may gather dust this week. Customers who were once reluctant to make purchases online have become increasingly more comfortable with the process. Shoppers who could not imagine using a mobile phone to place an order a decade ago are now conducting research, comparing pricing and purchasing items with their mobile devices.

For more than three decades, brick-and-mortar stores have been waging a battle against online retailers. Every year, online stores gain more of the market share. In recent years, several chains that were once retail giants have been forced to declare bankruptcy, close many of their locations or sell their brand to a competitor. Although the fight has been deemed as hopeless by some, the reality is that brick-and-mortar retailers do not need to abandon ship yet. They just need to use every tool available to encourage shoppers to opt for in-store purchases.