Influences Of The Consumer Chain

There are many outside factors that will influence your consumer chain, from seasonal changes, to customer demands, to technology, to regulatory.  There are even more outside influences that must be taken into account for large national and international retailers.  All of these influences can affect your consumer chain in many different ways and throughout all of these your consumer chain can and must provide a transition through the influence and even evolve to support the permanent influences.  The two greatest influences on your consumer chain are probably consumer demands and then technology.  Both of these influences will drive evolutionary changes in your consumer chain and if the influences from these areas are not addressed they will also cause your consumer chain to lose effectiveness.

Technology is closely related to consumer demands and in many cases will drive the consumer demands on your community resulting in demands on your consumer chain.  Technology capabilities are quickening and consumers have already embraced the capabilities and the promise of the technology capabilities driving demands on your consumer chain that must be recognized and accounted for.  Recognizing and embracing these demands is required in order to continue to realize value from your consumer chain.  Key consumers, these are the consumers that return over and over and drive your continued sales and growth, demand fresh community opportunities in an increasing velocity and you must engage with these demands in order to continue and grow the relationships and the resulting value of these relationships.  

Consumers demand additional return on their participation and engagement as well, it is not good enough for the retailer to simply provide a portal for sales.  The consumer demands engagement and interaction from the retailer, and ideally other consumers that are also engaged with the retailer to develop a community.  The results of this engagement of both consumers and retailer is a community that provides a reason for the consumer to return over and over again.  As I have said, the consumer demands fresh content and two way engagement from the community to provide a reason to return.  The consumer demands not only fresh content, the consumer also demands the opportunity to develop and provide content for the community.  This provides the reason for consumers to return over and over again; the ability to create content and then interact with other consumers and even the retailer based on the reaction to the content.

The key influence on the consumer chain is the consumer demands and interactions with the community and the chain.  The consumer demands are driven by additional factors like seasonal changes and cultural practices.  All of these additional influences however are realized through the demands of the consumer.  The key to success is the focus on the consumer demands and the patience to build the community.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Consumer Chain Influences

The consumer chain influences across the retail organization, the sales channels, the internal and external partners will grow from insignificance to a major influencing factor.  This growth prospect require some vision and patience on the part of the retail senior leadership along with a great deal of imagination and persistence from the partners.  The consumer chain provides an opportunity to collect and analyze an immense amount of data, especially from the eCommerce sales channel and the consumer community.  The consumer community and the eCommerce sales channel provide a sandbox environment to experiment and measure results of those experiments to then influence decisions across the chain.

Supply chain partnerships from the raw materials to the retail distribution have been in place for a long time and the addition of the consumer partnership to create a consumer chain is in its infancy.  As with all new opportunities there is a great deal of potential and there is a great deal of risk to achieving the potential.  The potential though is worth the effort to realize and as I have previously stated, I believe this will become a cost of doing business in a short period of time.  The consumer has always influenced the retail marketplace based on purchasing trends and surveys.  These tools are cumbersome and more importantly not very accurate predictors of the future purchasing patterns of the consumer.  Over the years there have been improvements in accuracy of these predictions and there have also been a lot of inaccuracies.

The data that can be captured and provided by a robust consumer collaborative community can provide the information that will dramatically improve the accuracy of the forecasts.  This data and the analysis of the data will provide the information to influence not only product selection and sales forecasts but also presentation, sales and discount presentation.  The data can influence the decision to mark down product and in addition to what to mark down but also when to mark it down and how to present the markdowns for maximum reaction with minimum impact to other products.

It is important to be influenced by facts rather than by assumptions and the consumer collaboration community provides an opportunity to collect facts from a new outlet to use for more accurate and robust analysis.  This data from the consumer community can all but replace the majority of surveys and focus groups by providing real life examples of consumer reactions by tracking their flow and activities through the consumer community and the eCommerce sales site.  As the consumer participation grows the value of the data will grow as well.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Consumer Chain Commitment

The success of the consumer chain does not come overnight, even if it looks that way from the outside.  The success starts with the commitment from the retailer senior management to the goal and objective of developing a robust consumer chain.  I say this starts with the commitment from the retailer senior management because the bulk of the effort and investment, especially in time, will come from the retailer.  This is only fair because it is the retailer that will be realizing the greatest level of return.  After the retailer, the greatest benefits are derived by the consumer, and then it is probably a tie between the manufacturers and the transportation partners within the consumer chain.

Because of the nature,and the time horizon involved in the steady value returned to the retailer the commitment level must be great.  In order to maintain the level of commitment required the consumer chain development and build up must be structured and delivered in a manner that provides a series of benefits to provide and example and validation of the benefits that can be achieved as the consumer chain grows and gains momentum.  The consumer chain will gain momentum based on two objectives and benefits;

1. The retention of the consumer on the site.  This is achieved through the encouragement and consumer value returned as a result of the consumer chain.  The retention of the consumer on the community must be the first objective because all value is derived from the retention and resulting increased sales achieved from the robust community.
2. The growth and value derived from the data resulting in the retention of the consumer on the site. This is another important growth factor that will provide the basis to prove assumptions and the data to support analysis of product selection and purchasing patterns along with the analysis of consumer shopping patterns.

Both of these objectives require an investment in both labor and capital to support.  Fortunately, the capital investments can be done in increments when you utilize cloud technology for the architecture.  This strategy allows you to invest over time to support the growth and expansion of the architecture and not invest in architecture that will not be fully utilized for an undetermined period.

The cloud technology that supports the investment in technology based on usage is an important feature to the acceptance and commitment of your retail organization leadership.  The investment is based on the actual usage and growth rather than investment on a forecast that may not materialize in the forecasted time period.  This is not to say that I do not believe in the benefits and opportunities of the consumer chain, it is just the acceptance that the initial growth and acceptance period from the consumer can be hard to judge and initially requires a high level of labor to support and encourage the participation of the consumers in the community.  

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?