by Fronetics | Jul 17, 2019 | Blog, Content Marketing, Current Events, Logistics, Marketing, Supply Chain
Here are four ways the Amazon effect is shaking up supply chain trends – and why it’s a net positive for the industry.
Highlights:
- More companies will start to tap into the gig economy in the last mile, and Uber-style delivery companies will emerge.
- To meet growing customer demand, same-day delivery will become increasingly standard.
- Supply chain leaders will be increasingly evaluated according to customer experience.
Here’s the thing about adversity: it has a tendency to test our strength, and, more often than not, it brings out the best in us. There’s no doubt that the meteoric ascendency of Amazon has created plenty of adversity for the retail, transportation, and supply chain industries. But as the corporation continues to shake up supply chain trends, it’s actually giving the industry an opportunity to sharpen and refine its practices.
Amazon’s dominance has already influenced supply chain trends in big ways. Industry-wide, companies have been compelled to reflect how they do business. In many cases, it’s been a painful process: businesses have had to reinvent, in everything from what and how processes are implemented to the choice of new technologies to purchase. But despite the difficulty, the reinvention process has the potential to pay big dividends in the long term.
Experts are predicting that there are four major ways in which Amazon will continue disrupting supply chain trends going forward.
4 ways Amazon will keep disrupting supply chain trends
1) Uber-style delivery companies
If you think e-commerce sales are high, you haven’t seen anything yet. Recent data from Statista predicts that e-commerce sales will grow as much as 25% by 2022, meaning that retail delivery will undergo analogous growth. As postal service prices rise, FedEx and UPS will likely need to make more deliveries themselves. Meanwhile, Amazon’s 3PL business is booming, putting pressure on the competition.
While these retail delivery services have not yet tapped into the gig economy, largely thanks to opposition from labor unions, it’s only a matter of time according to Convey CEO Rob Taylor. Taylor predicts that a deal will be “brokered between unions and 1099 labor, following in the footsteps of Uber and the taxi and public transportation industries’ unionization efforts.”
2) Same-day delivery
Same-day delivery, once a novelty, is increasingly a subject of consumer demand. PwC’s Global Consumer Insights Survey 2019 found that 40% of online shoppers are willing to pay extra for same-day delivery. To meet the demand retailers are investing in on-demand warehousing and other solutions for increasing localized inventory.
In addition, there’s the rise of drone delivery. Back in 2017, McKinsey estimated that the value of drone activity would reach $1 billion. More recent estimates, including one from ResearchandMarkets, set the value at $11.2 billion by 2022. It’s not long before same-day delivery will be necessary for businesses to compete.
3) Customer satisfaction metrics
As supply chain trends go, the type of metrics used to evaluate personnel may not seem particularly revolutionary. In fact, this type of shift is an indicator of sweeping cultural change. Writing for Fortune, Elementum CEO Nader Mikhail predicts that “tomorrow’s CEOs will come from an unlikely place: the supply chain.”
Customer expectations have been redefined, thanks to the Amazon effect, and businesses need leaders who are skilled at transforming overarching goals into many smaller variables. Where better to find such skills than among the ranks of supply chain leaders?
As a result, in addition to more traditional supply chain key performance indicators (KPIs), Taylor predicts that “net promoter score (NPS) and customer satisfaction (CSAT), which are leading indicators of customer happiness and loyalty, will play a greater role in the supply chain scorecard.” Essentially, supply chain and marketing goals will increasingly intersect.
4) Artificial Intelligence
Artificial Intelligence (AI) is among the most widely discussed supply chain trends in recent years. AI is helping supply chain leaders collate and analyze operational data, and “automating the ability to predict customer demand, forecast product availability, optimize routes for delivery, and better target and personalize communication with customers,” according to Taylor.
Amazon has invested heavily in AI technologies including order optimization, blockchain, warehouse robotics, and the Internet of Things. To keep up, Taylor predicts that “a new generation of supply chain leaders will likely require skills in AI that empower them to translate this highly technical information into business decisions and profitability.”
Navigating the Amazon effect on supply chain trends
When it comes to managing Amazon’s disruptive effects on supply chain trends, the industry will do best to look on them as opportunities. Amazon’s success is, according to Taylor, “pushing brands to modernize and align their teams around the central goal of improving customer experience.” The bottom line is that thanks to Amazon, supply chain companies need to be primarily focused on the customer in order to compete.
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by Elizabeth Hines | Jun 25, 2018 | Blog, Content Marketing, Logistics, Marketing, Social Media, Strategy, Supply Chain
Aiming to deliver value outside the sales funnel allows your business to build long-term relationships with customers, rather than focusing on a single sale.
Congratulations! You closed the deal. You hammered out the terms and set up the billing. But, according to marketing experts Mark Bonchek and Vivek Bapat, now the real work of growing revenue begins.
Successful 21st century businesses focus on what happens after they close a sale, not the transaction itself. That’s because consumers — and B2B customers — have higher expectations than ever before. They read reviews, listen to webinars, and download white papers before they buy, and they expect a better experience after.
Purchase brands vs. usage brands
Bonchek and Bapat describe two types of brands: “purchase brands” and “usage brands.” The usage brands “focus on the moments of truth that happen after the transaction, whether in delivery, service, education or sharing.” As a result, they command greater loyalty and higher prices than competitive brands that are content to end their relationship with an invoice.
[bctt tweet=”Suppliers need to shift focus from persuading people to buy, to persuading them to become a committed advocate for their brand.” username=”Fronetics”]
What does that mean for you as a supplier? You need to shift your focus from persuading people to buy, to persuading them to become a committed advocate for your brand.
“Be” the B2B customer
B2B accounts are complicated. They have many decision makers and many points of contact. You may have a sales team with multiple reps and sales support people on one account.
With so much going on, it’s important to “be” the customer. Try to identify and understand the people who depend on your product or service to get their work done every day. Those are the people you need to impress.
“What is the likelihood that you would recommend Company X to a friend or colleague?” According to Bain & Company, this is the one question that most closely correlates to customer satisfaction. “High scores on this question correlated strongly with repurchases, referrals and other actions that contribute to a company’s growth.”
And what makes people recommend a product or service? Success while they’re using it.
Social media: An important part of the B2B relationship
Bonchek and Bapat say, “The purchase and usage mindsets are equally, or even more, relevant for B2B brands. Business solutions tend to have longer life cycles than consumer products and there is an even greater opportunity to deliver value outside the sales funnel.“
So yes, you may have to tweet. And stay present on LinkedIn. Because your customers look there to follow trends and find good information to help run their businesses. Industry forums, YouTube, and Instagram are also great places to provide value beyond the sale.
Don’t worry if you’re not a creative genius. Most of us aren’t. Do try to talk about issues that are relevant and maybe even unsettling to your industry. If your customers are having a problem, chances are other businesses have the same concerns and vice versa.
You probably have an opinion, maybe even a solution. Use social media to share it with a larger audience, your users will thank you for it.
How do you deliver value outside the sales funnel?
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by Fronetics | Apr 24, 2018 | Blog, Content Marketing, Customer Service, Logistics, Marketing, Strategy, Supply Chain
While automation technology can streamline many processes and functions, customer-service automation can sometimes backfire and lose you business.
We’ve talked a lot recently about implementing automation technology into your sales and marketing operations. It can be a great tool for saving time and money while increasing your communication and customization with prospects and leads.
But a recent Harvard Business Review article by Ryan W. Buell, Professor at Harvard Business School, reminds us that the benefits of automation “aren’t universally rosy,” particularly when it comes to customer service. Here’s why customer-service automation isn’t always the best answer.
Your brand is at stake
People like technology when it works. But they can be unforgiving when it doesn’t. Customer service is the part of your business that is most likely to cause lasting damage to your reputation when automation fails.
Any point of contact between your company and your customers is part of customer service. Outbound emails, chatbots, automatic order confirmations, and interactive voice response (call trees) are all part of the customer experience. If any one of them disappoints, you’ve given customers a reason to think twice before doing business with you again.
Solving problems is more important than saving time
People want technology to make life easier and ordinary tasks faster. That’s why digital boarding passes, on-demand ride services like Uber and Lyft, and electronic payment systems like Venmo are “good” technology. With simple interfaces and a specific purpose, they make it easier to accomplish something that would take longer to do without them. People perceive companies that offer these services as innovative, helpful, and even indispensable.
If, on the other hand, “an action would be seen as annoying when performed by a person, chances are it will be annoying when performed by technology,” according to Buell.
Call trees are the most egregious example of bad automation, especially when callers are forced to listen to product pitches or survey requests before they can talk to someone who can solve their problem. “The best uses of technology are likely to make customers and employees feel more, rather than less, valuable to your organization,” says Buell.
No one wants to talk to a machine
Humans are emotional and social beings. Buell suggests “an instantaneous connection to a gracious and well-informed human should be a short stroll, click, or tap away.”
Machines are information deliverers, not problem solvers. They can’t deal with ambiguity or non-conforming situations. As they get smarter and more connected, they can fool you into believing they’re thinking when, really, they’re just processing inputs and responding based on rules. That’s not the same as hearing, caring and reacting with empathy. And that’s why great customer service should always include easy access to a human being.
When electronic service isn’t responsive, it can make your customers’ problems worse, not better. Tasks that require creativity or are unique to individual circumstances don’t lend themselves to automation.
Don’t let technology take center stage
Technology should be invisible to as great an extent as possible. When servers and cashiers are slaves to tablets and POS systems, they’re not making eye contact and talking to customers. When callers are asked to repeat the same account information while navigating from one department to another, they get justifiably irritated, which puts your call center agents on the defensive before they’ve even said a word. Automated services that are difficult to use or don’t lead to the right outcomes are more annoying than satisfying.
Experts at TechTarget offer the following advice to keep service technology in the background where it belongs:
- Unify management of different customer service channels whenever possible to provide consistent service.
- Integrate customer data so callers don’t have to repeat the same information over and over.
- Integrate business processes across departments to create logical hand-offs and a path to solving customer problems.
- Make it easy to reach a human at any time!
- Make sure humans test and update automated services on a regular basis.
If you’re looking at customer-service automation as a way to improve productivity, don’t make the mistake of prioritizing cost savings over customer satisfaction. Never underestimate the value of human connections for both employees and customers.
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by Elizabeth Hines | Sep 11, 2014 | Blog, Strategy, Supply Chain
Strategy is not execution
Strategy and execution are fundamentally different. Strategy is about making choices. Execution is about getting down and dirty so that the choices made can produce results. Here’s how you can get from excellent strategy to strong execution.
Strategy is the pursuit of excellence. It is more than white boards, spreadsheets, taglines, slogans, and vanity metrics. Strategy is about making choices on where to play, how to play, and how to maximize value — for your company and for your customers.
Execution is about doing the work needed to produce results within the context of the aforementioned strategy.
Here is how to move from strategy to execution.
Keep it simple.
When it comes to strategy simplicity is key. Develop a few simple but big ideas or themes that will drive your organization. Live or die by these ideas. If you develop too many or they are too complicated, you will lose focus and internal buy-in. When you lose focus and internal buy-in, execution is doomed to failure.
Involve your team.
When you pick your few big ideas (see above), make sure you involve your “front line” team. These are the people who turn action into daily routines. Their insight and knowledge are invaluable.
Be obsessed with your strategy.
If you cannot articulate the “why” of your strategy in everything your organization does, it is probably the wrong strategy. Being obsessed with your strategy means that your strategy can be demonstrated in every action, every day.
Focus on the customer.
If it is not about the customer, it is not strategic. Everything you do needs to link back to the people who are paying you… your customers. If it does not help them, it does not help you and therefore cannot be strategic.
By staying focused on these business execution strategies, you’ll be able to successfully move your supply chains from idea to reality.
by Fronetics | Feb 10, 2014 | Blog, Marketing, Social Media
This article was originally published on DC Velocity.
A recent study conducted by the Corporate Executive Board’s (CEB) Marketing Leadership Council found that the average customer progresses nearly 60 percent of the way through the purchase decision-making process before engaging with a sales rep.
Where are customers looking for and finding information? Customers are turning to the internet and social media. If they are looking for your company – what are they finding? A key finding of the CEB study was: “companies that fail to ‘show up strong’ in this context are underserving potential customers and are at risk of losing mindshare and, ultimately, sales opportunities.” This is largely due to when customers tend to buy. Specifically, 80 to 90 percent of prospects who first engage with a company are not ready to buy. Forty percent of these prospects will be ready to buy within a year and 80 to 90 percent will be ready to buy within two years.
Improving your company’s visibility can be achieved by establishing a presence and by optimizing your presence. This is inclusive of launching a company blog, participating in social media, creating YouTube videos focused on your company’s products and services, and ensuring that your website is easily navigable and provides both current and potential customers with the information and services they need.
There are several tactics that can be used to increase visibility and help with measurement efforts include leveraging multiple digital platforms, regular analytics reporting, mobile optimization and content curation – a more recent trend which marketers and business owners have found as an effective method by which to establish online influence.
Both Kinaxis and SJF Material Handling Equipment have invested in becoming visible and both have seen positive results.
Kinaxis, a supply chain management company, launched an online social media campaign with the objective of doubling leads and web traffic numbers. The campaign included two online comedy series (Suitemates and The Late Late Supply Chain Show) and the launch of the company’s 21st Century Supply Chain Blog. The campaign was successful – traffic increased by 2.7 times and leads increased by 3.2 times.
SJF Material Handling Equipment the largest stocking distributor of new and used material handling equipment in the United States, has a strong presence on Facebook, Twitter, and Google+. The company reports that nearly 20 percent of their website traffic is driven by social media. Stafford Sterner, President, notes “If you’re trying to reach out to totally new markets, then you might want to do Facebook and Twitter. If you’re comfortable building that relationship with people or companies you’re close to, then it’s LinkedIn.”
Being visible is an essential part of any business strategy. Take the time to make your company visible.
