Kevin Benedict Ponders the Future: mobile commerce

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Digital Transformation in Retail - 13 Action Steps

The behaviors and expectations of today’s consumers are rapidly evolving under the influence of digital and mobile technologies; as a result, retail growth and profits are quickly shifting to digital commerce. These changes require retail industry decision makers to acquire real-time situational awareness, new digital strategies and a digital mindset around business transformation. Retailers must recognize and act proactively when customers, competitors and markets change by deploying the appropriate digital strategies and technologies in the right sequence to maximize returns and competitive advantage.

We encourage retail executives to understand and follow these 13 actions:

Recognize the need for digital transformation extends beyond websites and mobile apps to the entire organization and across all business processes.
Understand the degree of change occurring in retail as a result of customers’ fast-changing behaviors.
Judge accurately where your organization stands on a digital technologies maturity curve.
Show the necessary leadership to change strategies, budget priorities and plans based on new data, trends and insights, and then make the required investments in digital technologies, people and skills to compete successfully.
See that traditional channel-centric strategies are no longer viable; rather, retailers must adopt precise, customer-centric strategies, enabled by digital technologies.
Don’t excuse slow adoption of digital technologies, as the data is clear and compelling and demands immediate action.
Think with a digital mindset, intimately understand the capabilities of digital technologies, understand digital’s role and importance in customer interactions, and develop new digital business models, processes and strategies for supporting today’s and tomorrow’s digital markets and consumers.
Realize that digital transformation and the industry’s adoption of digital technologies are occurring on an accelerated schedule that peaks around 2020. It waits for no retailer’s budget cycles, three-year master plan, leadership change or strategy.
Align the pace of digital transformation initiatives with the speed at which consumers are adopting digital technologies, behaviors, markets and thinking. This might mean over-investment in the near term to catch up or stay ahead of the competition.
Unify disparate digital transformation initiatives behind a single company-wide digital transformation doctrine – a guiding statement that effectively describes the reason for digital transformation, what needs to happen and what winning looks like. This doctrine must be used to direct and shape the entire company’s efforts.
Closely monitor the business impact of rapidly emerging digital technologies to ensure investments are prioritized and acted upon in the right time and place to maximize ROI and competitive advantage, while also balancing the need to innovate and embrace a fail-fast, test and learn mentality.
Understand how digital transformation will alter traditional retail roles, responsibilities and skills for all associates.
Pay close attention to how digital transformation shapes and changes consumers’ interactions and experiences, and train associates to best serve digitally enabled consumers.

The Greek philosopher Heraclitus wrote, “Change is the only constant in life.” In business, another constant exists: While some companies will adapt to market changes, others won’t. The pace of change across the industry landscape is accelerating like never before. Some retailers will choose to deny, ignore and retrench, while others will embrace, adopt and lead. The race to digital transformation is on, and there is no time for delay.

You can download the full report, "How Digital Thinking Separates Retail Leaders from Laggards" here.

Watch the 3-minute video on digital thinking in retail.

Follow Kevin Benedict on Twitter @krbenedict, or read more of his articles on digital transformation strategies here:

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Kevin Benedict

Senior Analyst, Center for the Future of Work, Cognizant

View my profile on LinkedIn

Follow me on Twitter @krbenedict

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Join the Linkedin Group Strategic Enterprise Mobility

Join the Google+ Community Mobile Enterprise Strategies

***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I am a mobility and digital transformation analyst, consultant and writer. I work with and have worked with many of the companies mentioned in my articles.

Analyzing Retail Through Digital Lenses

In 2016, total worldwide retail sales reached $22 trillion, of which digital commerce makes up $1.9 trillion, or 8.7% of the total. While the majority of retail sales still occur in brick-and-mortar stores, overall growth is predominantly driven by digital commerce, which was expected to expand rapidly worldwide at a 23.7% growth rate in 2016, and by 2020 to represent 14.6% of total retail spending of $27 trillion. Of course, digital commerce numbers vary depending on the product category. Online sales penetration for many product types – electronics, apparel, furniture, home improvement, etc. – are significantly higher than worldwide retail sales projections, while categories such as petrol, convenience and grocery have a much lower penetration.

In the U.S., sales at department stores fell almost 6% in 2016, while online retail sales rose 11%. As a result, bricks-and-mortar retailers have been forced to re-evaluate their business performance, and many, such as Sears, Macy’s, Aeropostale, Chico’s and American Eagle, have needed to close stores. Still others – especially those who have failed to digitally transform – are going out of business altogether, including The Limited and Wet Seal. In an industry with razor-thin margins and intense competition, missing out on key growth opportunities are a ticket to irrelevancy, or worse.

Given the rapid rise in digital commerce, retailers are increasingly concerned about profitability since online sales are believed to contribute to margin erosion. In fact, some retailers fear that an over-reliance on digital technologies will dilute margins. These concerns, however, are not supported by our research. Rather, retailers with strong to very strong revenue growth, which we correlate with digital leadership, also tend to realize higher profits.

Retailers have enjoyed consistent revenue growth through their digital channels for the last several years. This growth is expected to accelerate into the foreseeable future. In fact, retailers are increasingly dependent on digital commerce growth as sales soften through traditional channels. In fact, 22% of retailers in our study said they generate 30% or more of their sales from digital channels. By 2020, 79% of retailers forecast they will receive 30% or more of their sales from digital channels, a massive 259% increase.

Nearly all retailers (98%) achieve at least some of their revenue through digital channels today; most respondents anticipate much of their future growth to be driven by digital commerce. Retailers with exceptionally strong (11%-plus) revenue growth already derive a higher percentage of their sales from digital channels, according to our research. These retailers also forecast a more bullish future than lower performing retailers. You can download the full report, "How Digital Thinking Separates Retail Leaders from Laggards" here.

Watch the 3-minute video on digital thinking in retail.

Follow Kevin Benedict on Twitter @krbenedict, or read more of his articles on digital transformation strategies here:

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Kevin Benedict

Senior Analyst, Center for the Future of Work, Cognizant

View my profile on LinkedIn

Follow me on Twitter @krbenedict

Subscribe to Kevin's YouTube Channel

Join the Linkedin Group Strategic Enterprise Mobility

Join the Google+ Community Mobile Enterprise Strategies

Measuring the Pace of Change in the Fourth Industrial Revolution

Technologies help us deliver on a business strategy. Without a strategy, there is no rationale for deploying technologies. In addition, there is no rationale for digital transformation, unless there is a need for business transformation. If you believe this as we do, then strategy development will be a priority. Strategies, however, are developed under the guidance of a doctrine. The purpose of a doctrine is to create a high level understanding of what we we want to achieve with our strategy, and the concepts that must be employed to achieve it. An organization’s doctrine will guide strategy development, and the tactics needed to achieve a goal.

An example of a doctrine is, "We will be a fast follower, and excel at quickly manufacturing and delivering popular fashions." With this doctrine, the company can now develop strategies that align with the doctrine.

Many executives consider digital transformation important, but an IT issue. We, however, believe IT serves only one purpose – supporting the needs and strategies of the business. If the business doesn’t perceive a need, or have a business strategy that requires digital transformation, then there is no transformation role for IT to play. All of our research, however, concludes that organizations must be engaged in business and digital transformation or they will fail at winning in the Fourth Industrial Revolution.

Digital doctrines and strategies must come from the top, as they require an intimate understanding of the goals, doctrines and strategies of the organization, and the resources available to achieve them. Grassroots efforts to transform a company will fail, as they are too slow to compete against engaged, focused leaders.

Leaders must have an intimate understanding of how markets are changing, by how much, and the technologies that are supporting these changes. We all watched as advertising and sales expanded quickly from brick and mortar locations, to search engines, to online auctions, mobile retailer apps/websites, and now to online classified, online markets and sharing economy platforms. Do we fully understand consumers' path-to-purchase journeys in these evolving digital environments? Do we understand where traditional path-to-purchase journeys intersect with digital journeys? One thing we do know for certain, as a result of our research, is that consumers are altering their buying habits to take advantage of the convenience, market feedback and in-depth product information available in these mobile and digital markets. The need now is to measure how fast buying habits and shopping behaviors are changing, which is not easy. Many new behaviors and trends are outside of traditional measurements.

An additional challenge for leaders is measuring the pace of market change, and aligning resources and priorities to ensure we are changing, if not at the same pace, at least at a pace ahead of our competition. What units of measurement will capture the speed of change? What data sources will provide the data necessary for analysis, and how do we capture the data? Once we have a methodology in place for measuring the pace of market change, how do we then measure the pace of our own changes inside our organizations and in those of our competitors so we know how we are doing?

Download my latest report, "How Digital Thinking Separates Retail Leaders from Laggards."

Watch the 3-minute video on digital thinking in retail.

Follow Kevin Benedict on Twitter @krbenedict, or read more of his articles on digital transformation strategies here:

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Kevin Benedict

Senior Analyst, Center for the Future of Work, Cognizant

View my profile on LinkedIn

Follow me on Twitter @krbenedict

Subscribe to Kevin's YouTube Channel

Join the Linkedin Group Strategic Enterprise Mobility

Join the Google+ Community Mobile Enterprise Strategies

How Digital Thinking Separates Retail Leaders from Laggards

George Lucas, creator of Star Wars, once said, “You can’t do it unless you can imagine it.” In our latest research on the future state of work in the retail sector, we find many industry executives struggling to imagine where the future is leading them and their organizations, not to mention the role digital technologies will play along the way.

Traditional retailers are challenged by rapidly emerging new business models, such as Amazon Go and Facebook’s launch of its digital commerce platform, Marketplace. Moreover, pioneering companies in the sharing economy (i.e., Uber) are expanding from their initial markets into areas such as food delivery, while insurgent retailers, such as Sun Basket, are combining digital and social media platforms, mobile apps and massive volumes of new data to encroach on retailers’ territory. These nontraditional competitors are changing the rules of the retail game via disruptive strategies.

To better understand the strategies and technologies that digital transformation requires, Cognizant’s Center for the Future of Work, surveyed 500 executives from the retail industry across 18 countries, in partnership with renowned economist Nouriel Roubini. Sadly, our research shows a significant number of retailers making decisions and forming strategies based on outdated attitudes, fears and misunderstandings. Given all the hype around digital, and the available data on its increasing importance, it is surprising to see enormous and persistent differences in thinking between retail’s digital leaders and laggards.

Digital leaders tend to experience higher revenue growth, and their attitudes about digital technologies suggest they will keep their leadership position. Their perspective on how retail jobs and work will be transformed as a result of digital is also more evolved, as are their ideas on the vastly new and enhanced skills that will be needed to support tomorrow’s retail environment.

Digital laggards see an alternate reality. They place far less importance on digital technologies and their future role, and they show higher levels of fear and concern about digital overall. Our findings reveal a reluctance among laggards to digitally transform their thinking, IT infrastructures, doctrines and business strategies. If they remain on this track, their companies could find themselves in dire straits.

This report digs deeply into the differences in thinking between digital leaders and laggards, as well as between high- and low–revenue-growth retailers, and highlights strategies that can be employed to achieve and maintain digital leadership. We also delve into the role that “mental constructs” and personal attitudes play in separating retailing’s digital leaders from laggards. We explore how the thinking of digital leaders results in differentiated strategies, greater returns and improved results. We reveal the differences between leaders and laggards in their digital technology investments, and then analyze how leaders believe digital implementations should be sequenced between now and 2025. We also scrutinize the perceptions of frontline retail managers in terms of the mistakes they believe are being made by executives when it comes to digital transformation.

Download the full report, "How Digital Thinking Separates Retail Leaders from Laggards."

Watch the 3-minute video on digital thinking in retail.

Follow Kevin Benedict on Twitter @krbenedict, or read more of his strategies and thoughts here:

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Kevin Benedict

Senior Analyst, Center for the Future of Work, Cognizant

View my profile on LinkedIn

Follow me on Twitter @krbenedict

Subscribe to Kevin's YouTube Channel

Join the Linkedin Group Strategic Enterprise Mobility

Join the Google+ Community Mobile Enterprise Strategies

The Role of Sensors, Real-Time BI, Big Data and Personalization in Mobile Commerce: The Report and the Video

I just completed a video that accompanies my latest research on mobile consumer behaviors, and the strategies retailers must implement. If you design, develop or deploy customer facing apps, this content is relevant and important.

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Kevin Benedict

Writer, Speaker, Analyst and World Traveler

View my profile on LinkedIn

Follow me on Twitter @krbenedict

Subscribe to Kevin'sYouTube Channel

Join the Linkedin Group Strategic Enterprise Mobility

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My Best Articles on Mobile Commerce Strategies 2015

In 2015, a master strategy for mobile commerce emerged. Mobile apps need to be personalized, but that is not enough. Personalization without context, relevance, value to the customer and permission is just creepy and/or obnoxious. We recognized a new kind of partnership is required between customers and trusted vendors. One that requires a deeper level of earned trust, and one that provides mutual benefits through the sharing of data. We call this relationship a MME Data Partnership.

Parts of MME Data Partnerships can be found within many existing loyalty and rewards programs. Although the purpose is rarely understood. These programs define how the collection and use of specific data will be used to provide mutual benefits. It is an overt agreement by both parties to share and use data in return for defined rewards. Within a MME Data Partnership we found three types of data, we call 3D-Me, are needed to optimize a mobile user experience:

Digital data - online and mobile activities and behaviors
Physical data - Sensor and IoT
Personal data - MME Data Partnerships

For each of these categories purposeful strategies need to be developed and implemented to collect, analyze and utilize the data in order to provide the best experiences for customers.

Personalization, as we have learned, is not enough. Personalization needs to be combined with CROME Triggers (contextually relevant opportunities, moments and environments), which are bits of data that when collected and analyzed in real-time, identify the need for specific and relevant personalized content.

All of these strategies and more are discussed in "The Best of Mobile Commerce 2015" articles listed below:

Download the full report, "Cutting Through Chaos in the Age of Mobile Me" here: http://www.cognizant.com/InsightsWhitepapers/Cutting-Through-Chaos-in-the-Age-of-Mobile-Me-codex1579.pdf.

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Kevin Benedict

Writer, Speaker, Analyst and World Traveler

View my profile on LinkedIn

Follow me on Twitter @krbenedict

Subscribe to Kevin'sYouTube Channel

Join the Linkedin Group Strategic Enterprise Mobility

Join the Google+ Community Mobile Enterprise Strategies

Instantly Personalizing Mobile Apps - Cutting Through Chaos

Unique Consumers and Unique Profiles

Smartphones, laptops, PCs and in-store visits have made path-to-purchase journeys very complex and confusing for online retailers to recognize and support. Consumers can search and discover products and services using a smartphone on their way to work. In the evening they can pull out a tablet and engage in immersive research while laying in bed. They may decide to review some more on their desktop at work, then at lunch time stop at a brick and mortar store to look at the product in more detail. That evening, they purchase the product online using a laptop. How is a retailer or e-tailer going to cut through this chaos and recognize individual consumers and their needs along their path-to-purchase journey?

In our research at Cognizant's "Center for the Future of Work" we found online shoppers use different devices for different categories of products. In fact, 56% of online shoppers use multiple devices on many online path-to-purchase journeys. On the go search and discovery is often initiated on smartphones, immerse research on tablets, while completing transactions on laptops is a common pattern.

Some products consumers are comfortable purchasing on a smartphone, others not. We found online shoppers of different ages exhibit markedly different shopping behaviors. We found significantly different online shopping behaviors between those with different education levels, genders, ethnicity and technology preferences (laptop/desktop vs. mobile).

Our findings reveal these variables, all added up, equate to thousands, if not millions of different combinations of needs, preferences, unique activities and behaviors. These unique set of variables we call Mobile Me Profiles (MME-Ps), require different personalized content, at different times and locations, for each consumer in order to provide an optimal experience. In this age of "mobile me" where customers demand personalized and relevant user experiences, it is necessary to identify these differences, precisely and instantly.

If you are going to compete and win in mobile commerce today, you must target markets of one. It is no longer an effective strategy to treat your customers as one homogeneous market of unknown consumers. In today's world of mobile commerce, where devices are intimate extensions of unique individuals, knowing those individuals, as individuals is key.

Read more on how to deliver these strategies in my new report, "Cutting Through Chaos in the Age of Mobile Me."

Download the report here http://www.cognizant.com/InsightsWhitepapers/Cutting-Through-Chaos-in-the-Age-of-Mobile-Me-codex1579.pdf.

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Kevin Benedict

Writer, Speaker, Analyst and World Traveler

View my profile on LinkedIn

Follow me on Twitter @krbenedict

Subscribe to Kevin'sYouTube Channel

Join the Linkedin Group Strategic Enterprise Mobility

Join the Google+ Community Mobile Enterprise Strategies

Kevin Benedict Ponders the Future

Digital Transformation in Retail - 13 Action Steps

Analyzing Retail Through Digital Lenses

Measuring the Pace of Change in the Fourth Industrial Revolution

How Digital Thinking Separates Retail Leaders from Laggards

The Role of Sensors, Real-Time BI, Big Data and Personalization in Mobile Commerce: The Report and the Video

My Best Articles on Mobile Commerce Strategies 2015

Instantly Personalizing Mobile Apps - Cutting Through Chaos

Interviews with Kevin Benedict

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