Business.com

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• Digital Transformation for SMBs: Necessity or Utopia?
• Does Your Store's Customer Experience Live Up to Your Marketing Promises?
• The Ultimate Guide to Visual Merchandising for SMB Retailers

Digital Transformation for SMBs: Necessity or Utopia? Posted: 29 Dec 2020 01:30 PM PST "Business transformation" is a generalized term for fundamental changes to the way any given company does business. When the core business is influenced by changes to processes – operational or strategic – you could safely say that the organization is in the middle of transformation. But why does a business – especially a small or midsize business that is already pressed for resources or capital – undertake this process of transformation? On the surface, there might be a variety of reasons, such as insufficient sales volume, irregular cash flow, subpar product quality, increasing customer service complaints, or poor productivity. However, the underlying cause of the decision to transform is always survival. When one or more of these problems threaten the very solvency of your business, nothing short of a transformation will do. In any given business, strategy and operations are both driven by technology. Whether it is marketing, HR, production or finance, every core function runs on software-driven processes. Therefore, business transformation has become synonymous with digital transformation. The concept of digital transformation is certainly nothing new. Business owners have been discussing this strategy for years. It has often been listed as a top priority for many companies. But the reality for many small and midsize businesses is that accomplishing this goal of digital transformation often seems impossible.  Digital transformation defined First, let's be sure of what digital transformation actually is. This concept is often broken down into four categories: business process, the business model, domain and organization. Business process: Business processes are often the main focus of digital transformation, as this involves incorporating technology to improve key aspects of common processes. This includes utilizing AI for inventory management, creating an app for mobile orders, or automating accounting processes. Model transformation: This involves incorporating technology to change or improve the industry as a whole by creating an entirely new or different business model. Oftentimes, this includes the digitalization of resources or the integration of cutting-edge technology that alters the entire industry, such as Uber and Lyft's approach to ridesharing. Domain transformation: This type of transformation is a bit more complex and not possible for every type of business. With domain transformation, one business can expand its services and offerings to create an all-encompassing type of organization. Amazon is a perfect example of this, as it has expanded from being just an online retailer into cloud computing and IoT capabilities, while also escalating to create its own delivery service. Organizational transformation: Organizational or cultural transformation is another way to approach digital adoption. This involves creating systems that improve company culture by creating innovative procedures, supporting higher productivity, and adopting agile collaboration methods. There are certainly many benefits established SMBs can gain from successful digital transformation. But can smaller organizations or startups succeed too? Let's discuss. Are SMBs struggling to make transformation a reality? Although the majority of business leaders intended to make more moves toward digital transformation in the upcoming years, the pandemic essentially forced many companies to make this happen. Business leaders reported that the massive shutdowns and necessary transition to remote working situations pushed them into digital adoption at a faster pace than they anticipated. This also led to a shift in other business priorities, such as improving operational efficiency and enhancing business processes. Unfortunately, this resulted in numerous mistakes and challenges along the way. A report from Statista found that over half of the companies surveyed faced "skill gaps," as their current employees did not have the training or knowledge to utilize new technology. Additionally, 41% of teams struggled to transition into digital workspaces, and 39% found it incredibly difficult to integrate new digital systems into the current business models. As a result of all these varied challenges (which, on closer inspection, are fundamental to business and not even related to technology), many business leaders have been quite frustrated and even started to question whether digital transformation is a long-term solution. Speed or scale? Rushing a business into digital transformation is certainly not ideal. However, companies are typically more successful when they tackle specific areas first that stand to benefit the most from digital transformation, then adopt technology at scale and expand throughout the company quickly. This helps in optimizing costs. According to IDG's 2018 report on digital business adoption, the key focus of their digital transformation was data security, IT improvements and workforce strategy. Therefore, the first projects digitally transformed companies tend to approach involve big data, mobile technology and cloud computing. The current areas of focus in organizations undergoing digital transformation typically include AI, machine learning, IoT and software-defined networking. Many companies do not have the option to integrate digital solutions one by one, as most objectives and projects require an integrated or wholesale change or approach. However, there are some benefits from a forced rush into transformation that is championed internally. For some businesses, this is the exact push they needed to make digital adoption a priority. It has helped team members to learn the importance of flexibility and innovative change. Additionally, it could open the doors for new positions and job opportunities in the future to close organizational skill and knowledge gaps. The key to successful digital transformation is speed at scale – with strategic integration. Although SMBs may be integrating digital solutions quicker than they expected, they must start with approaches that solve their most urgent challenges. Full transformation will not happen overnight – careful, calculated adoption is the way to go. A lot to gain or a lot to lose? A Forbes study found digital transformation to be a top priority for many executives in large organizations worldwide. And it goes without saying that the focus of the enterprises today is the building block of the SMB tomorrow. To make digital transformation a true success, SMBs should start with the most important elements that are poised to make the greatest impact. If a new digital tool makes processes more complicated or slows things down, then look for other solutions. Further, the impact should be not just on operations, but also take into account overall customer experience as well as company culture. Next, SMBs must closely monitor the results from all strategies and gather feedback from both employees and customers to adjust and improve along the way.  The fact of the matter is that digital transformation is happening whether businesses are ready or not – and the pandemic has certainly catapulted this movement. Businesses that fail to adapt will fall behind even quicker as their competitors advance with tech. However, it is still important to implement systems correctly rather than just quickly.  There is no reason for SMB leaders to fear digital transformation. When tech is adopted successfully, there will be vast improvements to the customer experience, internal productivity and, ultimately, the business's profitability. The trick is to focus on finding solutions rather than on the challenges that stand in the way. Good luck!

Does Your Store's Customer Experience Live Up to Your Marketing Promises? Posted: 29 Dec 2020 09:36 AM PST The best e-commerce marketing programs build excitement about your store, show customers that you have what they want or need, and promise convenience and service that makes shopping with you a pleasure. As consumers, we want to be recognized and catered to, and we can always use more convenience and positive experiences – especially during a time when there's more uncertainty than usual.  But what happens after your great marketing brings customers to your store? Do they experience the convenience you promised, or is navigation a hassle? Do they get suggestions for things they like or suggestions that show you don't know them as well as your marketing indicated? And can they actually spend money with you, or will your fraud prevention program reject them?  When your customer experience (CX) undermines the marketing messages you use to bring in shoppers, you're not only competing against your competitors, but you're also competing against yourself. And that's more common than you might expect. Is there a disconnect between CX trends and CX reality? CX mattered before 2020 as a competitive differentiator for e-commerce, and it will matter in the future. However, the way CX has affected consumers has changed this year, as more people have shifted the bulk of their purchasing to online stores for delivery and curbside pickup. While retailers have hustled to meet new demands, it appears that there's a fairly consistent mismatch between the experience retailers want to deliver and what customers get. Digital experience agency Isobar surveyed more than 1,300 chief marketing officers during 2020 to see how customer experience expectations have changed since the start of the pandemic. Some 64% said they'd changed their CX strategy "completely or moderately" to adapt, and 39% put more focus on e-commerce. Among the e-commerce features they said they're most focused on for better CX are AI, chatbots and conversational voice interfaces, all of which can make it easier for customers to find exactly what they want. However, consumers – at least in the U.S. – are now reporting decreased overall satisfaction with their experiences at many retailers, according to a monthslong COVID-19 retail CX study by the American Customer Satisfaction Index (ACSI). The survey of more than 30,000 consumers from April through September asked shoppers to rate their recent retail experiences.  It found that customer satisfaction declined in four out of five retail categories: internet, specialty stores, department stores and supermarkets. Drugstore satisfaction didn't fall, but it didn't improve. Customers say retail shopping experiences are getting worse. In particular, satisfaction with retailers' mobile apps, both the quality and the reliability, took hits this year, even as many retailers rolled out or upgraded apps to make online ordering easier. Supermarket apps, which many people have relied on during stay-at-home orders, saw the biggest declines in satisfaction, dropping by 2% for quality and 4% for reliability. Some of the poor experiences consumers have had this year are likely related to the pandemic: shortages, stockouts and rushed deployments of new features and services likely all played a role. However, as Grocery Dive notes, customer satisfaction with retail experiences fell in 2018 and 2019, too, according to previous ACSI data.  Adding AI, voice, and chatbot features to retail apps and web stores may help customers have a better experience, but it seems like there are some foundational CX problems that many merchants need to sort out first. Focus on fixing CX basics For retailers who don't have strong, consistently improving CX ratings, it may be wise to focus time and resources on refining their basic e-commerce CX before adding new features so that it supports their marketing instead of undermining it. You can start by evaluating how well your e-commerce experience really works. If your marketing promises convenience, but your store's app is poorly designed and hard to use, that's a problem. Part of the solution is to make sure your marketing doesn't pledge more than your technology can deliver. This requires clear communication with your development team, and maybe some adjustments to your messaging. The other component is to focus on what your store can do better now. One way to improve your e-commerce app function and the experience your customers have with it is to build a low-code app instead of a native app, because low-code doesn't require your developers to reinvent the wheel. Instead, low-code apps leverage your store's existing data and support to "enable a great experience." This kind of app is also faster to build and easier to test, so you can prepare, launch, and incorporate customer feedback rapidly. When you're working with one e-commerce system, instead of using a separate system for your app, you can avoid basic but common CX pitfalls like sign-in hassles, personalization misfires and outdated stock level information. But having a great app and webstore isn't the only way you can align your CX with your marketing. The ultimate test of marketing promises kept: CX at checkout Is your store's checkout easy to use? A March 2020 Sapio Research five-country consumer survey commissioned by ClearSale found that half of consumers polled abandoned purchases because the checkout process took too long or was too complicated. Thirty-four percent said they'd abandoned a cart because the merchant required them to create an account. When your customers place an order, does their experience undermine the marketing message that you recognize them and value their business? If your fraud-screening program is generating false positives and automatically rejecting those orders, that's what's happening.  Industry data and our own research show anywhere from 30 to 65% of declined orders are actually good orders. Often, fully automated programs kick these orders out because of small data mismatches that manual review would quickly resolve. False declines create short- and long-term losses. For example, if you spend $50 to acquire a customer, they put $300 worth of goods in their cart for their first transaction, and then you treat them like a fraudster, you've not only lost the profit on their order, you've lost the marketing dollars you spent bringing them to your store. Next, there's lost customer lifetime value. Once a store insults them, customers are often gone for good. Forty-two percent told Sapio they won't try again with another payment method; 39% will never shop there again. Finally, there's brand damage that can raise customer acquisition costs. Twenty-eight percent of consumers told Sapio they'd likely complain on social media after a store rejected their order.  The solution is to review flagged orders. This allows you to approve more orders from good customers, increase your average customer lifetime value and build loyalty instead of taking brand damage. Align your messaging and CX to keep customers satisfied The most effective marketing campaigns promise a convenient experience, recommend items the customer will be interested in and show that they recognize the customer across channels. However, for that marketing spend to be effective, the store's CX has to carry through with those promises.  The evidence from this challenging year suggests that despite retailers' efforts to create better e-commerce experiences quickly for their customers in 2020, there's room for improvement, especially in retail apps and false decline reduction, and it starts with the basics. Investing in making your app and web store easier to use, and manually reviewing orders to avoid false positives can help your brand live up to its marketing promises, provide a great experience, and strengthen customer loyalty.

The Ultimate Guide to Visual Merchandising for SMB Retailers Posted: 29 Dec 2020 08:48 AM PST Done well, visual merchandising is one of the most effective ways to boost in-store sales. Alluring or visually arresting displays can tempt casual passersby to enter your shop, linger once they get there and purchase items they never even knew they wanted. Memorable displays can entice them to share images of your shop and your products on their social media accounts, and keep them coming back to see what you'll show them next. Artful displays can enhance your store's brand, whether you sell rugged off-road gear, elegant stationery or anything in between. Let's take a look at what makes visual merchandising sing.  The basics aren't exciting, but they're also not optional First and foremost, effective visual merchandising is about making sure your shop is clean, organized and well stocked, because no matter how amazing your product displays are, no one will notice if the whole experience is off-putting in general. Have you ever walked into a store where chaos reigns? We all have, at some point or another. In retail, that's one of the most common missteps store owners make, and it can be a costly one. Almost two-thirds of people surveyed by ServicesChannel for its annual "The State of Brick and Mortar Retail Report" have recently (within the past six months) walked out of a store because of its physical appearance or disorganization. If you bait and switch – if an expected or showcased product isn't in stock – about 30% of consumers will either leave the store without purchasing anything or will buy the same item elsewhere. And a dirty bathroom will scare them away for good – 20% or more of shoppers won't return once they've encountered one. Giving customers what they're looking for Let's assume you have that basic blocking and tackling taken care of, and that you're stocking, cleaning, and tidying up throughout the day. What's next? Accommodating the types of shoppers that will enter your store: those who know exactly what they want (the buyer on a mission), those who want to touch and/or try things on (the experientialists) and those who just enjoy browsing. Your visual merchandising needs to accommodate all three. Even the most casual visitor is likely to leave your shop with something – Statista found that more than 40% percent of purchases made by those ages 18 to 64 were impulse buys, and it was close to half for the youngest buyers. The opportunity to showcase merchandise is limited only by your imagination. You can use a wide variety of retail displays to highlight products, cross-merchandise and prompt a last-minute purchase at checkout. Whether your store is large or small, there are retail displays that enable you to make the most of every space, from the floor to the countertops and the walls to the ceiling, with all three types of customers in mind.  How to appeal to the 3 types of shoppers The buyer on a mission Since this type of customer knows exactly what they want, give it to them easily and conveniently, but make sure they pass some other tantalizing, complementary or just flat-out-useful items on the way. If you understand the products your customers buy the most, you can take advantage of that information and use visual merchandising along the path of traffic to introduce products they may not have considered before. Tabletop displays are mobile and can be placed wherever you need them to be, using acrylic risers, display boxes, and other retail displays to vary the height of different products and organize them conveniently. Mix in signage displays to add visual interest, enhance your brand or just provide useful information. Take care not to be overly intrusive – you want to attract their attention, not force them to navigate their way down an overly crowded aisle. Remember, they're there to get what they need and go. Your job with visual merchandising is to make sure they do so with just a little something more in hand. Point-of-sale displays near checkout are also a good way to entice this type of customer into a last-minute purchase. The experientialists Much has been made of the customer experience, but in this instance, I'm talking about giving people the ability to examine the merchandise up close and personal, whether that means feeling the glaze on a set of hand-thrown dishware, leaning in to smell the roses or feeling the weight of the fabric in a pair of jeans. For this type of shopper, consider all five senses: touch, smell, sight, sound, taste (as appropriate, of course, for what is it you're selling). If you were in their shoes, how would you want to interact with the merchandise? Retail displays come in all shapes and sizes, and those made of acrylic can be customized to suit just about any need. To add cachet to any object, consider placing it on a floor pedestal that naturally sets it apart from the rest of the items in your store. Countertop trays and freestanding dump bins make items accessible while corralling them neatly. For the experientialists, the visual is just part of the merchandising, but be sure not to make it difficult to pick something up without knocking something else over. A lush or complex display can be beautiful, but forcing someone to paw through it is annoying and makes the occasional break or spill inevitable. And if it's something they'll want to try on, make sure you have the right sizes in stock and a place to do so. The browsers This can be one of the most fun types of shoppers to merchandise for. You never know what will catch their fancy, so you have carte blanche to create a visual merchandising display featuring anything you want, from the next thing in tech to silk nighties. Use it to introduce new or hot items in your store, and rotate the display often to keep these casual customers coming back for more. Browsers are experientialists' kindred spirits, so make sure they have the opportunity to fully explore what you're displaying, and give them room to linger so people aren't constantly brushing past them. Delicate or expensive items can be displayed in locking acrylic countertop boxes or wall-mounted pedestals that give them a full view of the merchandise inside at eye level. Signage displays can be used to provide product information while creating a visual barrier for contemplative evaluation. In-store shopping is still king, despite all the online hype For small business retailers, the allure of in-store shopping remains strong. The "State of Brick and Mortar Retail Report" mentioned at the outset found that 86% of people still buy half or more of their goods in stores. For Gen Z, the pull is especially strong compared to their millennial or Gen X cohorts. Research done by Kearney into retail trends found that members of Generation Z like to shop in-store, because it gives them the opportunity to disconnect from social media and the digital world they're immersed in 24/7. That's great news for SMB retailers, and it makes effective visual merchandising all the more powerful. Plus, those same Gen Zers will eventually get back online and share what they like with others. Dive in and get your visual merchandising displays popping. More in-store revenue awaits.

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