“There is no question. This is not business as usual. We are in a rapidly changing landscape. If you think we are living in an evolutionary time, you are kidding yourself. We are living in a revolutionary time” Aiden Tracey, CEO of SGSCO proclaimed in his session, Winning at the Moment of Sale: Why the Rise of the Digital Shelf Changes the Consumer Path to Purchase at L2’s Clicks & Mortar conference.
If I were a retailer I would be—as many are—confounded into paralysis. The old rules of linear retail are gone. We have gone from retail-centric to consumer-centric.
“We are in an omnichannel, consumer led world. Mass marketers were once able to pound away with mass messaging on mass media into a world where mass retailers decided terms of consumer engagement” Tracey aptly put it. “Today’s world is one of consumer empowerment, the consumer will decide how brands will be built in the future.”
The smart phone, which was only introduced a little more than 10 years ago, has radically altered the retail landscape and is fast becoming the primary vehicle for purchasing. Already in Japan and the UK more transactions occur on mobile than desktop and during Black Friday more people shopped electronically (108 million) than visited physical stores (99 million). Granted, most retail analysts posit physical stores will remain important for decades, but the trend is real, fewer transactions are occurring in stores, store traffic in the aggregate continues to decrease, and growth is occurring in the digital channel—but not enough to offset the decreases most retailers are suffering in their physical locations. More disruption is on the horizon, accelerated by channel shifts and a steady stream of new VC-backed digital competition, only a fool wouldn’t be worried.
The Big Shift: From POS to MOS
Amid this exponential change of the digital revolution, to do nothing is to certainly fail. Where to start is the question. Tracey suggests we begin to think differently, that we adapt a new paradigm and shift from a POS or point of sale stance to MOS or moment of sale.
We have moved from a retailer-controlled linear world to a network world where the consumer is at the center of everything. It makes sense that the paradigm would change too! It is a retailer’s/brand’s job to figure out the logistics, systems, traditional media, social media, and the product information that will drive engagement and ultimately sales. Today the industry, especially CPG and packaged goods companies, is set up around a POS mindset with tens of billions of dollars designed to win at POS. But this isn’t working anymore. Moreover, the huge well financed brands that are the winners at POS on the physical shelf, will not, by default, win in an MOS environment. Rather, MOS allows smaller digital brands to be smarter working with omnichannel strategies and they have a greater shot at success.
Product is Content in the MOS Paradigm
The non-linear path to purchase today spans Facebook, YouTube, blogs, reading online reviews and banner ads, watching a video on mobile, viewing a print ad, shopping online or in-store, purchasing through a call center, and probably a dozen other product touchpoints. The universal link along all these different touchpoints is the product. The product is the actual content, the media that communicates its value to the shopper. Therefore the experience must be seamless and synchronized across platforms and it must be truly superior to the competition.
For this reason, Tracey urges companies to focus on your product content strategy. He says its time for brands and retailers to create a seamless synchronized experience across all touchpoints with product content. He chided the industry for not linking the physical and digital shelf better. Acknowledging it is hard work, Tracey pointed out the lack of robust product information on websites, including all product variants such as color, size, etc. as well as the ability to enlarge the visuals for better inspection and short product videos.
Reallocate Headcount Spend to MOS
To organize your business, its marketing strategy, and partnerships around MOS you need to recognize that the algorithms depend on high quality attributes and metadata attached to each piece of content you put into the system. Content must be accurate, up to date, and cohesive across all channels and MOS to deliver a seamless compelling experience and maximize conversion. Only when the consumer enters search terms and finds the right product at the right time with the right review can a rich online experience occur.
Brands and retailers need to look at their channels and optimize the content for the specific channel. For instance, what works on the physical shelf is overwhelming on a smart phone. The product content needs to be culled to the fewest data points the consumer needs to decide in a mobile environment.
Mobile First Design; Integrate Sales and Marketing for MOS
Granted, most retail sales occur at physical stores, but growth is occurring online. Tracey suggests designing for mobile first, “take the time to figure out the 4-5 elements that the consumer is looking for. Enhance the content for the platform; create it with the shopper’s experience in mind.”
Marketing and sales need to be unified in an MOS world, a radical shift from the discreet silos of the marketing and sales roles in a POS world. Econtent requires tighter integration between these functions.
Omnichannel requires tighter marketing and sales integration for your econtent. We have discreet marketing and sales departments that in a POS world, often didn’t talk to one another. In an MOS world they need to be integrated and the leader may come from another department.
MOS is a mindshift; but really, as a consumer—and aren’t we all consumers—you have already made the shift, it just needs to occur within your business model. Tracey laid out a doable path that leverages many pre-existing assets, just configured differently and employing new algorithms to communicate with consumers where they are. A roadmap for sure!
Marie Driscoll, CFA is an industry analyst focusing on apparel brands, retailers and luxury goods and providing consulting services to academia, industry, investors and non-profits through her firm, Driscoll Advisors.