Brands Must Recognize Their Burning Platform

Alberto BreaFebruary 13, 20184 min

What is your burning platform?

  • Having customers walk into your store to shop for a flat screen TV, then ordering it through their Amazon app at the store because Amazon has a better delivery service.
  • Having customers wait 15 minutes to get a service rep to help them find the right stroller, then walking out after realizing that they are better off going online for help.
  • Having customers go with their kids to a toy store to shop and play, then walking out after realizing that it is just a disorganized warehouse with toys, not a playground.

Today, every business has a burning platform; a friction point between their customers’ expectations and offerings that are disrupting their business. The longer they wait to solve it, the more likely it is to burn their entire business.

We like to think that we are living in the retail apocalypse. Amazon is killing the retail industry. The reality is that the customer is the biggest disruptor, not Amazon. Today, customer expectations are changing by the day, and are shaped by the environment. Most of the retail industry is not prepared to adapt to the needs of their ever-changing customers.

To bring the point home, let’s look at four customer expectations that are burning the retail industry today:

1. Be Personal
2. Be Connected
3. Be Mission-Driven
4. Be Experiential

Customers expect retail to be personal in the same way they get personalized movie recommendations from Netflix or their Google search results. Customers expect to have access to a community to help them make an informed decision in the same way they do it on Facebook, LinkedIn, or WhatsApp. Customers expect brands to earn their trust by having a purpose and doing what they promise. They look at brands like Patagonia that is willing to go all the way in their commitment to protecting the environment. Finally, customers expect brands to provide experiences, not just sell products. They look at stores like Target Wonderland, which is part toy store and part holiday playground, but all fun.

The challenge is that most retail experiences are impersonal, disconnected, product-centric, and lack a real mission. They want to meet the new customer expectations, but it requires a digital transformation. Moving from being a caterpillar to a digital butterfly is hard. They not only need to invest in technology, but they also have to transform the entire operation and culture of the organization. As a result, a transformation is a long-term project for the most part. In the meantime, these public companies need to deliver quarterly results to Wall Street, so they default to reduce costs (A.K.A closing stores).

Let’s take a closer look at the challenge with a couple of examples that have been in the news recently, Macy’s and Toy’s “R” Us.

Macy’s recently announced 5,000 job cuts and seven new store closures. The default line is that department stores are dead, but I don’t think that’s the full story. Yes, we have external factors that had negatively affected Macy’s, such as the reduction of the middle-class and the significant decline of foot traffic to malls. That said, Macy’s burning platform is poorly merchandised stores that are hard to shop, lack inspiration, and offer mediocre customer service. In summary, Macy’s cannot pretend to be a high-end store if their employees don’t care.

Toy’s “R” Us declared bankruptcy last year; the largest ever by a specialty retailer. What happens next will determine the future of the company’s’ 64,000 employees and nearly 1,600 stores. Many factors contributed to the Toy’s “R” Us decline, such as a leveraged buyout for about $6 billion that crippled the company. That said, the burning platform of Toys “R” Us has been dirty, old, disorganized, overwhelming, and overpriced stores.

Today, people go to a toy store for the experience, not just for the product. They want to learn about the latest games. They want to interact with the product at a whole new level – think augmented reality video games. They want to have fun in the store, even host birthday parties. They want to engage with knowledgeable employees who are passionate about games. They want frictionless experiences that bridge the online and physical world.

The challenge is that most companies respond to their burning platform with technology first, customer second. They undertake a massive investment in technology that takes years to materialize, as opposed to testing new customer experiences. That might not scale first, but it would provide a solid foundation for the future. To quote Reid Hoffman, “To scale, do things that don’t scale.”

In summary, we all have a burning platform, points of friction with our customers that are burning our business. The burning platform is not going away; it just evolves with changing customer expectations. The best thing that we can do to respond to the burning platform is to have a culture of on-going testing and learning to move at the speed of our customers.

The Blake Project Can Help: Please email us for more about how we help retail brands create bigger futures.

Branding Strategy Insider is a service of The Blake Project: A strategic brand consultancy specializing in Brand Research, Brand Strategy, Brand Licensing and Brand Education

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Alberto Brea

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