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Agility and innovation have been buzz words in almost everyone's digital strategy in the last few years. This pandemic has changed priorities for everyone, from consumers to brands.
The initial instinct is to cut costs; nevertheless, consumer behaviors shifting online have caused companies to re-evaluate their current working ways and forced many to adapt quickly or die out.
It can be hard to see beyond the initial contingency planning, but in this blog post, we will try to convince you why to start innovating where you can in the short term over simply cost-cutting will help your business in the long term.
These are some tips that you can implement already on your eCommerce plan.
> Review your current digital strategy and pinpoint what is working and what is not
> Reexamine new customer needs
> Test new concepts that might have been on the back burner
> Build up partnerships
> Invest in external innovation if building in house does not make sense
> According to Mckinsey, in the 5 years after the recession of 2008, executives that could answer the question: “What is next on the innovation agenda?”, outperformed the market by an average of 20%. However, the majority of companies ended up reducing their pace of innovation and did not perform as well.
> Small brands and other innovators focused on creating disruptive offerings, looking beyond the immediate challenges. This is often done in response to engaging with their community to understand their expectations.
> Trying new products that they might not have previously. For example, the increase in home workout equipment in response to gyms being closed, or office equipment to help with a new work at home situation. (Futur, 2020).
> The resurgence of large brands, primarily because of their availability and built trust, has created the opportunity for a few key projects: redesign of their existing product lines, creating new products and more focus on in-house private label products for the more price sensitive consumer. (Futur, 2020).
> Nesting at home has increased digital engagement and purchasing across channels. However, this behavior is not addressed in all aspects, as 60% of consumers surveyed by Mckinsey said they needed help with identifying the right product in an otherwise overwhelming amount of choice. This includes:
Keeping these ideas in mind, we will focus on reimagining innovation by focusing on the pipeline. Most innovation pipelines would not have accounted for an event such as Covid. However, we believe events like this have created an opportunity to reevaluate your pipeline using the following strategies:
Understand your consumer and their needs or pain points, while also considering how these points have changed. For example, consumers needing more personalization in the average shopping experience to help make choices that are relevant to them.
Some innovations that made sense before the pandemic, might not be as relevant now. For example, most companies streamlined their product offering throughout the crisis, aiming to offer what is most relevant to their consumers. In response to that, expanding existing product lines (which accounted for 33% of product launches) might not make sense.
Client acquisition costs spiked before and during the pandemic, and this likely to remain. Therefore crafting a seamless client experience will help to keep them loyal customers. Ensuring that a focus on the full omnichannel experience is embraced and thought about from day one will be crucial as it forces your team to also consider what updates to existing operating models and tech stacks might be needed to match this focus. It may seem like a lot of moving pieces to accomplish on your own, and understanding what to do inhouse and where to bring in partners is also important (McKinsey, 2020).
As we have seen throughout our entire e-commerce and personalization series, both topics are highly linked, especially when it comes to how digital strategy is crafted within companies. By embracing and understanding your consumers and their behaviors, how different brands, big or small, are operating in the e-commerce space and how nesting has influenced consumers' digital behaviors, innovation pipelines can be properly ranked for development.
We want to end this series by challenging our viewers to evaluate your own innovation pipeline in light of the different trends and aspects discussed throughout our series and share with us how you will be moving forward in your innovation journey in relation to personalization.
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