Market Chaos or Hyper-Opportunity?

"Market dynamics, business constructs and digital operating rhythms accelerate advanced scaling of Omni-digital platforms."

(photo: Peter Weedfald delivered the opening keynote for Channel IQ 2014 in Chicago on Sept 3rd. Each attendee received a copy of Green Reign Leadership).

The need to accelerate change is especially warranted through shifting purchasing behaviors, mounting competitive pressures, digital price sensitivities: Omni-retail urgencies and the tired art of influencing consumers through push advertising. All while your most buying-productive and profitable consumers are clearly on the move. As one example, according to the end of year Millennial Media 2013 report mobile access makes up 51% (37% smartphones, 14% tablets) of the time consumers spend on retail websites or using retail related apps.

No surprise, consumers cloud-hunt for best pricing, savvy comparatives, editorial and social reviews with free, next day shipping. Juxtaposed back to the year 2010, aggressive mobile cloud engagements have grown an astounding 285%. Imagine CEO’s, CFO’s and CMO’s reviewing this critical game changing consumer centric data. Just what actions, changes, marketing direction, what investments will they newly trigger in direct competitive response to consumer purchasing behaviors? How do they best prepare for successful market penetration in 2015, 2016, 2017 and beyond. The best rallying words to describe immediate restructuring chores have to be “radical, relentless, focused.”

Unlike physical stores, the global internet instantly pushes, pulls and serenades consumers from every corner of the earth. No physical boundary blurs, no language barriers, no shortage of speed, customer service or sales determination. Instant gratification for consumers, instant measurement and profitability for merchants. The high costs of gasoline and personal time has been replaced by the low cost of cloud access. Editorial scriptural-product-influencers congener and blur with home based socially energized consumer reviews, blogs and postings. Okay, you already know this. But did you also know by the year 2018 over one third of global online sales will be cashiered through Asia. That today, on average, only 25% of Asia’s population purchases online while Europe and the USA combined currently represent 70% of e-commerce sales. This means mammoth growth opportunities for USA based companies. This also means new global cloud-retail competitors will swoop into our USA marketplace vacuuming up demand, share, revenues and profits. Retailers and manufacturers alike need long-tail local and global operating plans to protect, to advantage.

Why are these market numbers so important to consider? Because these facts auger a CMO’s must-be-focused-on the balance of e-power and e-sales for future consumer on line purchasing trends. We expect the USA will continue to lead in e-commerce even in 2018 however, Asia and India’s influence, global instant web reach and vast assimilation into our USA markets will mean and suggest a change in market conditions, a reorganization of distribution as well as a shift in physical retail power and potential growth. Radical, relentless focus and investments today will deliver sustainable and competitively advantaged merchants for tomorrow on a global scale.

And as manufacturing costs in Asia are a modicum of our USA based operational, structural, human capital, tax burdens and cost of capital the future of brand and product competitive cloud advantage in-country may be disadvantaged by pricing, supply and costs outside-of-country. Already today a majority of major product brands that retailers sell have robust and fruitful web sites designed, ready and expecting to gain consumer purchases on their own. Imagine if you will if these same brands decide to compete with USA channels directly from Asia based locations… imagine the cost advantage, the disruption: imagine their ability to launch globally, instantly.

Chaos or opportunity? The numbers suggest mammoth opportunity for those companies that quell marketing chaos and restructure for cloud growth. According to Forrester Research projections American cloud shoppers will spend $327 billion in 2016, up 45% from $226 billion this year and 62% from $202 billion in 2011. Forrester also reported 192 million American consumers will shop on line in 2016 an increase of 15% from 167 million at the end of 2012. Additionally, 192 million U.S. consumers will shop online in 2016, up 15% from 167 million in 2012. But the bigger factor in driving e-commerce growth is that each shopper will spend more on average, the report reveals. U.S. consumers in 2016 will each spend an average of $1,738 online, up 44% from $1,207 in 2012.

Time to change. In order to advantage todays and future opportunities in a dynamically changing global retail and cloud marketplace Gen One Ventures suggests investing time and capital within five key and critical operating areas:

1. CMO’s must immediately engage deeply and religiously with their IT peers to architect a highly secure and ambient SCRM (Social Customer Relationship Management) foundation designed to gather, collect, store and mine consumer data through every step of cycle engagement. Quantitative-qualitative and predictable consumer shopping and traffic behaviors flows at unimaginable speeds, hyper-complexity with colossal scalability. Harnessing formidable unions with your CMO and CTO’s asset and investment infrastructures is the pioneering map for global cloud opportunity. Big data is certainly overwhelming for the sharpest CMO. However, big and small data highly underleveraged defines chaotic risk, competitive disadvantage.
2. Capitalism has found a way to build formidable and lasting relationships between consumers, brands and products through social networking. Opportunity is now well defined as Omni-channel presence and consumer brand relationships. All built on social relevancy, preference and on-time delivery from the consumers life perspective not the brands potential profit perspective. Advanced CMO’s hunt and tend beyond segments and demographics providing near-perfect-data push and pull triggers in product offerings, services, content and reviews. Right moment, right location, right on time through advanced digital and social command of company assets.
3. Cross-channel, cross country and cross global technologies and infrastructures are a must have not a should have for CMO’s guiding and protracting company growth. Adjusting and articulating real-time offers based on consumer wants, needs, preferences and desired locations (geo-demographics, mobile versus in-store, etc) must be embraced, tested, measured and scaled cross department integrated daily (sales, service, marketing, product management, channels, etc.).
4. A CMO’s social media disciplines (SCRM), infrastructure, initiatives and measurements should be easily shared, reviewed, measured and fueled for company cloud and in-store growth initiatives. Social technology investments are critical to build a tectonic growth orientated marketing platform muscled by mature social management, social monitoring, social pulling and social commerce with near instant high speed consumer ROI centric measurements. Consumers can no longer be “pushed around” by historic styles of advertising. Social infrastructures today and tomorrow must be created and tuned to pull consumers into their brand stage and product offerings.
5. Physical stores can no longer operate as analog nodes disconnected from corporate digital hubs. In order to protect, grow and profit physical retail locations each store must become it's own digital hub of commerce and savvy social engagements. This means physical stores must be digitally connected with consumers in their local markets surrounding a 3 to 4 mile radius. This strategy and tech-deliverables should have been administered years ago across retail America to protect local markets from competitive e-commerce engines, thousands of miles away. With the obvious vista of mammoth global e-commerce ahead, time to turn local retail stores into true Omni-channel e-commerce engines before distant drones fly over stores delivering goods and services 2 blocks away.

In order to advantage newly seeded global clouds, vast global commerce and community opportunities, it is time for the CEO, CTO and CMO to congener to deliver a highly radical, relentless and focused sales and marketing charter. An investment strategy designed to over scale local and global opportunities today and certainly for many years to come.

Chaos or opportunity? The right choice is profitably clear.

Peter Weedfald is president of Gen One Ventures and author of Green Reign Leadership