// Rebuilding_Creativity
Archive for
Automation in Retail – The Next Competitive Advantage?
Did you know Amazon currently has a workforce of over 350,000 robots in their warehouses? I was recently reading an article by McKinsey on the challenges that traditional retail is currently facing with declining profitability, evolving consumer preferences, and the accelerating growth of e-commerce. Currently in the face of this, most retailers have taken a softly softly approach, underinvesting in future focused capabilities such as IT, digital, and tech talent.
The research found that a surprising 52 percent of retail activities could be automated, at least partially (exhibit below). The fact that over half of retail activities could be automated really hit home to me about the size of the prize in this space as a competitive advantage to not only become more operationally efficient but at the same time deliver a better customer experience.
The below visual from the report shows a cross section of industries, the types of tasks and % of automation potential. Whilst it shows retail still has a significant human element required in the “interface with others” (read my post on a consideration of charm), it shows there are a large number of data processing and predictable tasks that have automation potential – think customer order processing, product & promo pricing, inventory order forecast & management.
So how can Automation be put into practice for retailers? The report indicated three main areas of focus.
Step 1, review and simplify core business processes. Taking a customer first approach is key here, if you approach organising the business around what the customer wants you will always be led in the right direction. They found that process-redesign efforts here can see efficiency improvements in reducing steps by 20% to 30%. As an example, complex processes such as promotion management often involved more than eight steps and more than four teams, with opportunity to streamline with workflow tools. Workflow management tools can help to also smooth decision processes and simplify validation steps – with opportunity for 50% to 70% percent reduction in steps whilst maintaining nearly 100% accuracy
Step 2, automation. Once processes are simplified, retailers can look to build automation into them, at a basic level I’ve seen this done with robotic process automation (RPA) for manual tasks such as data entry and reporting. For example exporting orders and inputting them into a daily report format for the accounts team or re ordering low stock inventory. If you take it to the extreme you have Amazon’s example of automating the order pick process in their warehouses with 350,000 robots!
Lastly, add smarts with AI. This step can particularly improve the customer experience by allowing retailers to a scalable solution to deliver a more personalised experience. Beyond automating processes, this step requires “teaching” processes to learn and derive insights. AI can be applied in areas such as dynamic product selection, promotion, and pricing, where advanced analytics algorithms are increasingly used to analyse large sets of data – think Netflix or Spotify’s recommendation algorithm or Amazon’s dynamic pricing on site adjusted to market conditions.
With over half of retail tasks an opportunity for automation, there is significant opportunity for retailers to harness it not only to be more operationally efficient but deliver a better customer experience and in my experience, thinking customer first will always lead to down the right business strategy.
Alex Leece
What is Digital Product Marketing?
Although Product Marketing is growing as a discipline across both B2B and B2C digitally driven businesses, it’s challenging to find a clear definition of what the the role entails, even when you search on Google. So what is Product Marketing? Lets take a look.
In organisations, the role sits at the intersection of product, sales and marketing, meaning the role can have a large impact on growth — but also means that the role can be hard to clearly define.
In a nutshell, Product Marketers work with Product Owners and Sales Leads to define a products proposition and take it to market, driving it’s overall success in achieving product market fit, with a deep understanding of the customer.
To do this, Product Marketers need to have a broad marketing skill set ranging from strategic to technical, and have a focus on clearly articulating the products proposition, messaging and target customer groups, before they then stimulate demand and drive acquisition of these customers.
Product Marketing Starts with Proposition & Positioning
A great product goes nowhere if it doesn’t get the attention of the people who would love it. So Product Marketers start with research into, who’s going to be the audience for the product, how (and where) are you going to reach them, and what the best way to present the product to them will be.
An NBR article a year or so ago stated research that only .0025% of new products go on to achieve product market fit within the first three to five years of their life in NZ. This leads to significant waste, a loss of economic opportunity and is materially different to other countries, positioning is a tool that can have significant impact on improving this metric.
Often the key reason for businesses initially implementing Product Marketing support is to tackle this problem of market fit through positioning. A products positioning in market can have a huge impact on a businesses success or failure, as it immediately short cuts in the head of your customers who your competitive set is. For example, if you positioned your product as a generic enterprise management system you are competing with the Salesforce’s of the world, however if you positioned it as a niche real estate lead management system instead, despite perhaps having the same product feature set, you could dramatically increase the uptake of the product by enthusiastic customers through solving their specific need.
Great examples of this would be Tinder & AirBnb who both had to relaunch to their current brand positioning before seeing success in market – Tinder was initially called MatchBox “the flirting game”.
Product Marketers Grow Brand Through Customer Focused Go-To- Market Messaging
Product Marketers then lead the development of go-to-market messaging to ensure they present the right message in the right channel to the right customer group. They create the communications framework that gives products the edge in their market to get exponential returns on marketing spend.
Building a strong brand positioning baked into your messaging is a key driver for long term business profitability, it will be the wind in your sails across all facets of business activity. Research has shown that brand affinity to be the second largest driver of purchase decision after price, as reflected in this chart from Millward Brown mapping the share performance of the BrandZ 100 top brands out performing the S&P. 500 2006 to 2008.
As well as messaging, it is also crucial that the product experience lives up to the story you tell in the market, in the digital age, brand and product are being brought closer together then ever before. The way the customers engage with your product is a crucial code in developing your brand. Not only the feature set but the engagement communications around the product and the way the product looks in terms of design, needs to reflect the positioning in market.
Product Marketers Acquire Customers Through Targeted Performance Marketing
Product Marketer’s typically leverage growth marketing techniques with targeted digitally driven advertising to customer groups. They aim to drive measurable acquisition & retention of customers to a product in the most efficient way possible as the product they are marketing is typically at start up or scale up stage where funds are tight and broadcast marketing techniques are not possible.
More then ever they are spearheading usage of AI & Data Driven marketing technology platforms to maximise the return on ad spend. This combination of brand and performance marketing brought together by Product Marketers is unique to the discipline, and incredibly powerful for gaining market share for products.
Finally, Product Marketing vs Product Ownership
An often asked question, what is the difference between Product Marketing & Product Ownership?
In a nutshell:
A Product Owner’s job is to create and develop new products and features, Product Marketing’s job is help define them and to bring them to market.
References:
https://www.nbr.co.nz/article/how-make-kiwi-smes-world-storming-fr-p-216825
// Rebuilding_Creativity 