Puratos Hellas operates as a B2B company serving a network of bakeries, confectionery stores and chocolatiers and recently created two online platforms, Bakers On-line & Chocolatier online, where professionals can easily create their e-shop, with the support of Puratos Hellas, to engage its customer base as part of its customer-facing fast pacing digital transformation, which has been a tremendous success, Salevourakis said. The internal transformation is more challenging, however, he noted, as it requires overcoming the inertia of business-as-usual and building capabilities in the team members about what digital tools mean for the business, the added value, and its future to obtain the necessary buy-in.
Younger organizations have had the benefit of devising their business models around the digital transformation underway across industries rather than having to pivot as traditional retail declined. Power WearHouse, a Toronto-based health, wellness and fitness company founded in 2019 that designs “weighted wearables”, built its organization on remote expertise from the outset, said Founder and CEO Shelagh Stoneham.
“Those retailers that were set up from both a technological and organizational perspective to be able to react to shifting customer perspectives have the best chance of flourishing in this environment,” Stoneham said. The atypical business climate of recent months has been challenging corporate strategies and executional excellence, she noted, and requiring high emotional quotient in addition to intelligence. “2020 has been what I view as the year of truth for legacy brands as well as new brands such as Power WearHouse,” she said.
The business plan Stoneham wrote to launch the company has become a living document she said, rewritten twice within the past 12 months. “We all need to pivot in terms of our go-to-market strategy, not just in terms of digital, but also in terms of the kinds of offerings that we present,” she said, adding, “this has been testing the kind of nimbleness of organizations to be able to react, because consumers change in terms of their short-term needs,” she noted.
Organizations that hedged their bets between online and offline are really struggling now, she said. “Now is the time for organizations to place their bets, not simply hedge them, and view the world as a retail ecosystem, and the customer as one customer, because that's the way customers shop,” she said. Consumers are drawn to brands, not to the channels they are sold through, she added. When companies segment their offering between online and offline, they jeopardize transparency and end up eroding trust among their customers, she said.
“This one customer view is not optional. It is critical for customer success, and that means organizationally, we need to be set up differently in terms of the skill sets, the structures and the attitudes,” Stoneham said.
Many global brands were slow to digitalize, said Regina Szeto, Vice President of Brand, International PR and Marketing at SECOO, China’s leading integrated upscale e-commerce platform, but by about 2015, many brands knew they had to make a move. All the big global luxury brands have accelerated their digital and social push since then, she noted, and embraced the social media platforms unique to China as the country dove headlong into e-commerce.
China already led the world in e-commerce penetration prior the seismic shift online of 2020, noted Szeto, especially when it comes to e-commerce via mobile platforms. Live streaming has become increasingly relevant as a means of reaching consumers of late, she noted, and the importance of creating content offline for consumers online has been reinforced alongside the shift towards even greater market share for e-commerce in the world’s most populous market. “Constant content consumption is very challenging for any retailer, any brand, to have to create content to engage and to convert into sales,” she noted.
Supply chain disruptions have posed a real challenge across the globe in 2020, when online consumption skyrocketed in the first half of the year, manufacturing and logistics operations in China were impacted in the early months, Szeto noted.
While it’s become convention within forward-thinking organizations for chief marketing officers and chief technology officers to be well-coordinated, chief operations officers also need to be at the table to ensure supply chain disruptions are minimized and to be able to pivot on the fly to meet the dynamic needs of consumers, said Power WearHouse CEO Shelagh Stoneham.
The complexity of interactions among different kinds of players and different kinds of raw materials has made supply chain operations particularly challenging in 2020, agreed Qroma CEO Rodrigo Mejía. “We have to adopt a lot of flexibility. For every single company in the world, consumers and customers are changing,” he said. Qroma’s been able to maintain its revenue in an incredibly challenging year, he noted, but it’s required a greater mix of products and sales channel combinations, he explained.
“We have seen an important change in consumer spending prioritization, and that is impacting the mix of what we already have,” Mejía said. “The capacity to get better forecasting predictions, faster adaptability in production systems, a very flexible supply chain, and also a very resilient and careful monitoring of free cash flow generation is critical in this period,” he added.
The biggest challenge for a consumer-oriented manufacturer like Qroma is combining more scale to keep costs competitive with greater adaptability and customization of products to satisfy more demanding consumers, Mejía said. “The way to address both bigger scale and adaptability and customization is only true automatization,” he added.
“Blockchain, IoT, everything is coming, and it’s really going to change the way we are producing and delivering our products in the coming years,” he said.
Retaining the right talent was critical for Power WearHouse to establish fast and reliable supply chain infrastructure, Stoneham said. “Customer behaviour has shifted, so we have to be able to pivot, not exactly like fast fashion, but we have to be much faster and nimbler, and understand customer needs and remain relevant to them, and that means supply chain has to be able to keep up,” she said. “It's the combination of relevant experience, but also the attitude,” Stoneham said. “I call it the what and the how.”