24 companies are failing to “keep up” in 2018, that’s 1,895 stores or 21,191 people worrying about job security, is this a failure to adapt to newer, upcoming technology, and digitalise, or is it not keeping up with their customers’ needs and relying heavily on brand worth.
Customers these days would seem to be caring less for brand loyalty and more on how much they save. People are more than happy to wait 3 to 5 business days for a product to be shipped to them, if they know that they can save extra cash. The problem that a lot of companies are having is a that they are not adapting to the change of upcoming technology quickly enough, be it internal or external.
Internally, companies should now be focused on how they can make themselves more efficient with a wide range of software available to streamline basics processes.
These repetitive tasks should include, reception, customer relationship management, social networking, reporting, HR, leave approvals etc.
Automation is a proven to be cost effective for virtually any organisation, a great example of this would be ITESOFT “Streamline for Invoices”.
Streamline for Invoices allows you to capture, process and automate your supplier invoices, invoice management, reporting and adds a layer of fraud protection.
This means greater productivity, allowing clerks to do more important tasks. Rather than double handling supplier invoices and associated data, they could be following up late payments or chasing pending payments and bringing benefit back into the business.
Externally companies need to adapt to their customers; customers drive business to profit or decline.
Some businesses have struggled to keep up with what their customer really wants and/or haven’t been able to quickly adapt to customer needs.
The prime example…
In 1991 Blockbuster was worth $8.4 Billion and made a large amount of their profit from late feels totalling a great $800 Million worth in 2000.
A customer by the name of Reed Hastings received a $40-dollar late fee on Apollo 13 and there birthed the idea of Netflix.
In the same year as making $800 Million, blockbuster was also Offered Netflix for $50 Million but turned them down as they chose to go with Enron broadband services, by 2001 Enron filed bankruptcy amidst an accounting scandal.
By 2002 Netflix was public and blockbuster posted losses of $1.2 Billion, one year later and Netflix was posting profits of $5.8 Billion.
It wasn’t as though Blockbuster didn’t try and evolve, they even rolled out a “no late fee” campaign but it was too late. By 2010 the company was only worth $24 Million and soon folded.
The company had failed to adapt to the needs and the wants of it consumers, they had many years and large profits that should have allowed them to change, but they were too reliant on the old ways and too out of touch with upcoming technology.
Is internet shopping to blame?
In 2018 1,895 stores have or are expected to close, these stores are offering a wide range of products.
A recent study suggests that two thirds of UK consumers are buying clothes online, this comes down to a multitude of reasons, better prices, easier price comparisons, more variety, discrete purchases, car parking prices, bringing the family, can’t bring the dog…
Internet shopping is just convenient.
But some companies seem to be very slow on driving their customer to their own website and online shop, and this has caused many people to become more reliant with sites like Amazon.
Amazon is a company that understands the internet, they realised early on that internet shopping is on the rise and they decided to get big a piece of the pie.
Amazon offers a Prime membership on which you receive next day delivery, Prime Video (think Netflix), Prime Music (think Spotify) and they give you all of this at a loss!
Estimates believe that Amazon spends $1 Billion a year on just the free delivery, so why is Amazon happy to spend that much money?
Whereas normal users spend $500 a year on items, Prime members spend $1,200 a year. Any company will find it hard to compete with that offer.
Another example of how harnessing upcoming technology has massively benefited one company over many others.
So, what can other companies do to bring customers back in store?
If companies want to keep their stores open they need to create experiences.
They need to add value rather than just offer a location for a transaction. Stores need to be clean and up to date “community centres”.
Why don’t bookstores create spaces to learn, clothing stores offer free styling classes, music stores host music lessons?
How many times have you walked past a shop/restaurant/pub etc. and decided not to go in because they are empty at prime time… Sometimes “bums on seats” is more important than simple transaction volumes.
Unfortunately Toys “R” Us no longer exists because buying toys online was much cheaper. But imagine if they offered something else, not just for the kids but for whole families!
They could have offered playgrounds for families visiting the stores, Lego building centres for creativity (Lego has trialled some pop up stores of this nature with enormous success), video game hubs where kids could have met up with their friends, slime centres, competitions, Christmas parties, Easter egg hunts etc.
There were so many possibilities for them to create experiences for the whole family and to keep bringing them back and in doing so, they could have created customers for generations.
Companies must adapt to new technology and customers.
Companies are going to have to adapt to new, upcoming technology quickly and hopefully drive their own innovations.
But they are also going to have to bring back the service in customer service, listening to their customers and their competitors to find that edge.
Discover The Upcoming Technology That Is Capture-As-A-Service For Invoices!