Saturday, 13 August 2016
Thursday, 11 August 2016
RIP ROI: Time-To-Market is the New Indicator of Success
A great article by Jonathan Becher SAP makes a convincing but disturbing case for replacing Return On Investment with Time-To-Market, based on some concrete examples.
Essentially, Jonathan makes the point that traditionally we explored strategic options by changing some key variables and assumed that all other factors remained equal, or ‘as is’, for the purpose of the exercise…
Thinking about it, the only problem with the traditional approach in a digital economy is that things, especially markets, have accelerated in rate-of-change, to such an extent that little ‘remains equal’…
He quotes Ben Thompson, author of Stratechery in that P&G’s 2005 ROI analysis of the opportunity to take over Gillette probably assumed a few fundamentals of the razor industry were immutable: brands would be expensive to build; razor cartridges would command very high margins; in-store real estate was a competitive advantage; and high distribution and R&D costs would be a constant for all players in the industry.
And then Dollar Shave Club came along with a brand built cheaply by clever creative, with blades imported from lower-cost manufacturers, with no R&D costs, and no presence in stores whatsoever. Dollar Shave Club figured out how to undercut Gillette’s pricing model by 50-75%.
In a similar way, many years ago, an early client Clark's Shoes managed to dominate an unpredictable labour-intensive market carrying high raw material costs, by starting with invitations to buyers to view designs for the new season at local hotels, and taking - unchangeable - orders up front, resulting in highly accurate sales forecasts, minimal waste, and a solid basis for negotiating the purchase of the necessary hides of leather...
Meanwhile, we traditionalists were committed to holding back brand launches until 'everything was ready...'
In a digital economy, speed to market is really the only way to stay ahead in terms of optimising a market opportunity...
Even more is it important that traditional thinking and assumptions be re-assessed, ideally before a new entrant does it on your behalf.
If the prospect of such a radical re-think of the basis of your business model represents a step too far, why not try a realistic ‘what-if’ on the possibility of a Dollar-Shave-Club subscription model entering your category, fast?
Essentially, Jonathan makes the point that traditionally we explored strategic options by changing some key variables and assumed that all other factors remained equal, or ‘as is’, for the purpose of the exercise…
Thinking about it, the only problem with the traditional approach in a digital economy is that things, especially markets, have accelerated in rate-of-change, to such an extent that little ‘remains equal’…
He quotes Ben Thompson, author of Stratechery in that P&G’s 2005 ROI analysis of the opportunity to take over Gillette probably assumed a few fundamentals of the razor industry were immutable: brands would be expensive to build; razor cartridges would command very high margins; in-store real estate was a competitive advantage; and high distribution and R&D costs would be a constant for all players in the industry.
And then Dollar Shave Club came along with a brand built cheaply by clever creative, with blades imported from lower-cost manufacturers, with no R&D costs, and no presence in stores whatsoever. Dollar Shave Club figured out how to undercut Gillette’s pricing model by 50-75%.
In a similar way, many years ago, an early client Clark's Shoes managed to dominate an unpredictable labour-intensive market carrying high raw material costs, by starting with invitations to buyers to view designs for the new season at local hotels, and taking - unchangeable - orders up front, resulting in highly accurate sales forecasts, minimal waste, and a solid basis for negotiating the purchase of the necessary hides of leather...
Meanwhile, we traditionalists were committed to holding back brand launches until 'everything was ready...'
In a digital economy, speed to market is really the only way to stay ahead in terms of optimising a market opportunity...
Even more is it important that traditional thinking and assumptions be re-assessed, ideally before a new entrant does it on your behalf.
If the prospect of such a radical re-think of the basis of your business model represents a step too far, why not try a realistic ‘what-if’ on the possibility of a Dollar-Shave-Club subscription model entering your category, fast?
Wednesday, 10 August 2016
How GenZ represent a way back for Bricks&Mortar stores
The digital dependency of Generation Z (GenZ) could present a technological ticking ‘time-bomb’ for brands and retailers, according to new research by Vodat International, reported in NetImperative.
Apart from the potential represented by the 38% GenZ who say they will continue to make most of their purchases in-store, other research findings from the report include:
Not meeting this need, for a generation that will succeed the millennials, means GenZ’s growing digital reliance could drive a gap between shopper expectations and the reality of what the store can deliver over the next five years.
A pity, for the want of a little digital savvy, to allow GenZ to morph into GenZZZZZzzzzzz, as far as traditional stores are concerned…
Apart from the potential represented by the 38% GenZ who say they will continue to make most of their purchases in-store, other research findings from the report include:
- Top motivations for GenZ consumers to shop in-store – validation (68%), immediacy (43%) and social interaction (42%)
- Top technologies that GenZ say drive them into store now – free WiFi (48%) and self-checkouts (38%)
- Top tech that would encourage them into store in 2021 – fast-track ‘scan and shop’ apps (18%), augmented reality fitting rooms (18%) and virtual queue ticketing systems (17%)
Not meeting this need, for a generation that will succeed the millennials, means GenZ’s growing digital reliance could drive a gap between shopper expectations and the reality of what the store can deliver over the next five years.
A pity, for the want of a little digital savvy, to allow GenZ to morph into GenZZZZZzzzzzz, as far as traditional stores are concerned…
Tuesday, 9 August 2016
Walmart Jetting to No.2 Online?
Walmart's purchase of Jet.com may impose too big a payload on a 1-year start-up.
At Check-in:
- Walmart are paying $3.3bn for an online fellow-passenger that has generated sales of $1bn in its first year, but no profits, to complement their current $13.6bn digital revenue
- They gain access to a young team of digital talent that has thrived in a small company environment, now transferring to the world's biggest retailer
- They are hoping to access the cheapest way to ship online
- Walmart can offer Jet.com access to their global sourcing and buying power...and cash
- Walmart's bricks & mortar estate, too big and slowing...
- Jet.com sells in bulk to a young audience - ability to pay?
- Transactional bulk-buying in an era that is increasingly about smaller, faster, closer, more convenient, cheaper shopping? Contrast this with Dollar Shave Club, who have found a way of shipping monthly at $1/basket, on a subscription model...
But are No.1 Amazon flying so high, No.2 becomes irrelevant?
Monday, 8 August 2016
Amazon Prime Air - Taking off via its new 40 Boeing fleet
In its continuous search for pipeline cost savings, Amazon have commissioned 11 of what will be a 40 plane fleet that will complement their drones and van network, raising the distribution bar even higher in online fulfillment.
Longer term, NAMs will need to think about how far up the supply-chain Amazon will reach in their search for economies and faster response-times...
For instance, how about product design and manufacture, absorbing private label on the way?
...thereby taking us back to their ultimate mission statement incorporated into their logo, 'everything from A to Z', selling anything anyone wants anywhere, whenever and however they choose to buy, within normal legal limitations, of course...
Saturday, 6 August 2016
Thursday, 4 August 2016
Lidl - the real threat?
The discounter as change-maker:
This week, why not visit your nearest Lidl and think about the threat to the major mults? Even better, follow it with a call on a nearby Tesco to heighten the contrast…
See how long it takes for you to appreciate that the hard discounters becoming more like supermarkets is not the issue... Of course they will add to their offering, especially to cater for upmarket clients…
But suppose their real impact is in making the consumer-shopper value a simpler, more limited choice, and in the process convincing us that we cannot perceive – and don’t always need – the ‘extras’ provided by equivalent brands at 30% more…
Causing us to ponder whether we are changing the discounters, or they are changing us?
Now that’s the type of competition the mults – and their branded suppliers - don’t need…
This week, why not visit your nearest Lidl and think about the threat to the major mults? Even better, follow it with a call on a nearby Tesco to heighten the contrast…
See how long it takes for you to appreciate that the hard discounters becoming more like supermarkets is not the issue... Of course they will add to their offering, especially to cater for upmarket clients…
But suppose their real impact is in making the consumer-shopper value a simpler, more limited choice, and in the process convincing us that we cannot perceive – and don’t always need – the ‘extras’ provided by equivalent brands at 30% more…
Causing us to ponder whether we are changing the discounters, or they are changing us?
Now that’s the type of competition the mults – and their branded suppliers - don’t need…
NAM-Tales: Winning and losing in Job interviews
The above* reminds me of a pal in a NAM-job interview who was handed a Biro by the Sales Director saying 'Sell me that'.
The interviewee examined it, snapped it in half and threw it into the waste-basket...
He then said: 'John, a man in your position should not use rubbish like this, what you need is one of these', taking a Mont Blanc pen from his pocket with a flourish...
No, he did not get the job...
Perhaps a lesson therein for both parties?
* HT to Gabi Ajulah
Wednesday, 3 August 2016
Public Wi-Fi hotspots and NAMs: Busting the many legal myths
Given the NAMs' dual roles of road-warrior and adviser to the retail trade, knowing the legal implications of using public wi-fi spots can help.
Nothing beats taking the time to read the full article by Ars Technica UK, but by way of encouragement, the following key points may whet your appetite:
- "If there is no stated legitimate purpose for the processing of individual user information, the default position is that it must not be processed."
- Some hotel Wi-Fi software records the URLs accessed by each guest (Held for legislative purposes, in case there’s a copyright breach or it’s requested by law enforcement or whatever).
- Collecting and storing personal information brings responsibilities under the Data Protection Act 1998 (DPA), soon to be updated. The more data collected, and the further its purposes diverge from what’s strictly necessary to provide a service, the more responsibilities the collector incurs.
- A user "cannot be obliged to accept something that isn’t a necessary part of the service, and they especially cannot be expected to accept marketing as part of something else."
Note: The article deals specifically with the legality of public wi-fi in the UK. The rules and laws can vary wildly in other countries around the world.
NB. The article also adds much useful detail - and relevant links - for retailers setting up and managing a public wi-fi spot, a useful addition to a NAM's advisory repertoire.
Sunday, 31 July 2016
Saturday, 30 July 2016
Amazon Dash = 'never forgetting' + 1-click 100% Availability = entry-level online...
Amazon Have Introduced Dash Device For Customers Of New Grocery Delivery Service
Following on from the launch its AmazonFresh grocery delivery service in London last month, Amazon has announced the introduction of its innovative Dash device, which it launched in the US last year.
The six-inch long device allows customers to scan a product barcode or say the name of a product to add items automatically to their Amazon online shopping basket. These items are then ready for purchase the next time the customer visits the Amazon.co.uk website or mobile app. Dash will be available for AmazonFresh customers, initially at no additional charge with their second AmazonFresh order, from now until 28 August 2016.
 |
| Amazon Dash |
“We’re all used to trying to remember the contents of the fridge and kitchen cupboard and scribbling down reminders on pieces of paper,” said Ajay Kavan, Vice President of AmazonFresh. “With Dash, at any given time, customers can keep track of products when they come to mind and scan to reorder groceries and household essentials as soon as they run out. At Amazon, we’re always looking to innovate based on feedback and Dash has been designed to continually learn as customers use it.”
AmazonFresh is now available in 128 London postcodes, allowing members of its Prime scheme to order a full weekly grocery shop from a range of over 130,000 products, which include major brands, Morrisons’ own label lines and offerings from local food producers.
NAM Implications:
- Combine ‘never forgetting’, 1-click ordering and ‘100% availability’ for an appreciation of what this move represents for Amazon…
- …and other retailers…
- Are you absolutely certain that you/your company, are optimising Amazon’s full potential?
Thursday, 28 July 2016
For the NAM who is still on the way to a work-life balance...
Pic: Fiona Cooper, Comelite Architecture and Structure, Edinburgh
HT Iain Laing, Kickstand Marketing
This brought to mind a fellow-NAM driving home many years ago, noticing increasing degrees of paper rubbish blowing about the estate, becoming more pronounced the closer he got to home..
Eventually he reached his driveway and found his four filing drawers and a cabinet strewn about the garden...
Tuesday, 26 July 2016
A Drone-fleet in your street?
 |
| pic: Amazon |
Amazon Prime Air getting serious....
According to reports today in The Verge, Amazon is partnering with the British government to expand its testing of delivery drones, paving the way for commercial air deliveries for UK residents.
The expanded testing involves Amazon working with the UK Civil Aviation Authority to focus on operating drones outside of the line of site of pilots, improving sensors for obstacle detection and avoidance, and having one pilot operate a team of multiple, semi-autonomous drones in unison.
This ground-breaking work will help Amazon and the Government understand how drones can be used safely and reliably in the logistics industry. It will also help identify what operating rules and safety regulations will be needed to help move the drone industry forward.
In other words, Amazon have a vision of replicating their traditional delivery system, via drone-fleet in the air...
As you know, home delivery works in terms of covering costs via high density geographical coverage - you realise they are No.1 when Amazon-man delivers your parcel along with one for next-door i.e. why not ask about the other package, next time...
Time to seriously elevate your partnership with Amazon, rather than following the competitive fleet?
See live footage Video
More detail here
Saturday, 23 July 2016
Subscribe to:
Posts (Atom)