When did tech companies lose their point of view?
Through a special arrangement, what follows is a summary of an article from Retail Paradox, RSR Research’s weekly analysis on emerging issues facing retailers, presented here for discussion.
Traveling this year’s conference circuit, a phrase I’ve heard over and over from tech vendors has been: “Any way they want it.” This is in reference to their (retail) clients, and to the vendor’s willingness to bend over backwards to get their clients whatever they need.
It’s okay to emphasize flexibility when it comes to how a vendor enables a business process, or even flexibility in how a vendor deploys their solution (cloud vs. on-premise, for example). But what’s not okay — and what I too frequently hear in keynote speeches and press conferences — is to take that flexibility to mean that the vendor should not have a point of view about the future of the industry.
In fact, I would argue that a point of view is especially important right now, when the future is so uncertain. There seems to be a concerted effort to kill off the term omnichannel as if it’s done and has no value today. But how many retailers can say omnichannel is done? I’ll tell you how many: absolutely none. No one has digital transformation figured out, let alone implemented.
Why have so many tech vendors lost their way? This, I don’t understand. Everybody’s talking about the same trends. Millennials. Digital Transformation. Experiences. Price Transparency. Social Media. So many more. How hard is it to articulate what these trends mean for a specific solution area? How hard is it for a vendor to translate that impact into a vision for the future for their solution?
Apparently, it’s really hard, because instead of hearing those conversations at the events I’ve attended, I am far more likely to hear, “We’ll do whatever our clients need.” When retailers don’t know what they need next, I guess that answer roughly translates into “nothing of importance.”
Discussion Questions
DISCUSSION QUESTIONS:
Is today’s rapidly shifting environment compelling technology vendors to become more flexible when formulating solutions with retailers than in the past? Do you think a strong point of view is more or less important for tech vendors looking to serve their retail clients?
Poll
BrainTrust
Al McClain
Co-Founder, RetailWire
Bob Amster
Principal, Retail Technology Group
A point of view and some expertise regarding trends in retailing and omnichannel shopping are certainly key. Another thing is honesty. I’ll never forget walking up to a small booth at a retail tech show a few years ago and commenting that for a seemingly small company, it was amazing that they did all of the things listed on their sign. The rep’s comment was, “We don’t.” While I stood there stunned, he told me they only had three or so of the dozen capabilities listed on their sign, but that they had to put all the key capabilities and buzzwords on the sign to get attention.
So I think honesty, expertise and a point of view are all important and in somewhat short supply these days.
I commiserate with Nikki. Software developers should be the ones designing and enhancing their systems from what they perceive as trends arising either from their customers or on their own. This does not mean, however, that they should be willing to develop bespoke solutions every time another customer wants to “have it his way.”
We’ve been working in retail information systems for a long time and I remember clearly when Paul Mickelson, founder of Island Pacific, saw the potential problem of being too many things to too many people and almost echoed the words of Henry Ford: “You can have it in any color you want, as long as it’s black” and refused for a long time to make one-off changes to the software for customers.
The truth, as Nikki states, is that we are in a rapid transition period from older business models to a newer and very different one and, consequently, not many retailers can see clearly what they need, what they have to do and how they are going to do it. To allow multiple retailer customers to each dictate what they want in a software solution, and and actually build it that way, is counterproductive. That is why software developers created user groups — to first gather consensus, lay down the roadmap and THEN build the enhancements!
Well, I certainly don’t want to take the hint and share my very prejudiced perspective overtly, but perhaps I should! The company I work for has continued to develop a distinct point of view (PoV) for the retail industry. Is that PoV stagnant? No. It has to be very agile as the consumer market evolves. It is forward-looking as much as possible. Although life is changing swiftly, there are signals and forces that can be measured that help define a predictable future. This ability to derive tangible findings from hyper-local market research is critical for technology-driven companies.
Is omnichannel done? No. I totally agree with Nikki. Retailers need to investigate the industry for market insights that are relevant to their businesses. This can be done effectively and technology companies need to guide their customers (the retailers) with prescriptive intelligence.
My point of view: one of the problems with retailers “not knowing what they need next” and tech vendors saying “we’ll do anything it takes” is the fact that it is often stated, “the customer is in control.” While given lip service, has any retailer really transformed itself 180 degrees to “give the consumer anything it takes” (within reason)? Amazon comes closest, and you could argue Nordstrom has this focus as it spends $1 billion on its online strategy. But the bottom line is that all customer-facing touch points by retailers are built for transactions when the customer is standing there, not for simply asking customers if they are in browse mode and how the retailer can support their path to purchase in the future.
With ad blocking, generic email blast unsubscribe rates soaring and the continued creep-factor of following non-buyers around with re-targeting, retailers should be freaked out about even maintaining all the touch points, much less screaming BUY every time they interact. And what are they pushing to BUY? With them losing billions each year on out-of-stocks and overstocks, I’d say they aren’t doing a good job of guessing how to surprise and delight. So again, rather than trying to find a flexible tech vendor promoting the latest in predictive big data analytics, turn your attention to the remaining non-buying consumers you can reach, and just ask them how you can help.
From my personal experience, I see companies demanding a point of view from technology vendors and consultants. They value someone that has grounded conviction and not just tools. At the end of the day, the company will determine how it runs, but that shouldn’t eliminate having a rich and fruitful exchange on important business issues.
There are those that delimit the position that a technology (or any) vendor ought to take or voice, but that short changes their customers. On the flip side, those retailers that are only looking for the tool are missing out on ways to truly expand awareness and the decision horizon.
This is an important topic for tech companies to ponder. There is certainly a balance to be gained with being flexible on one end and focused on the other, but having a point of view and a strategy is not just important for the tech company, it is equally as important to a retailer, who does not have the time or expertise to really understand how to best use new tools.
There is an important caveat for all tech companies to note. Before establishing your point of view and conveying it to your prospective retailer clients, know what keeps the retailers up at night and be very specific in terms of how your technology mitigates or eliminates one or more pain points.
Also, understand how the retailer rationalizes and prioritizes investment and what other recent or pending investments in technology they are already committed to.
Many times a new technology solution is not considered viable, even though it could be, as it is deemed by the retailer to be incompatible with the current list of “vested” projects the retailer is dedicated to executing.
A technology vendor who doesn’t have a strong point of view isn’t doing their job. These guys essentially do surgery on your business. Would you want a surgeon who says “well, I can see you’ve got a problem here, I’ll get my scalpel out and follow your lead.”?
Great vendors start with an insight into the future that’s so intense they have to go into business to make it happen. Understanding the landscape is their job — and holding back doesn’t ultimately do their clients any favors.
I think tech companies need to have a point of view, but there is a difference between PoV and implementation. A strong point of view is important from a thought leadership and product strategy perspective, but implementation of technology needs to be flexible because the consumers are now heavily in charge of the channels they use to make purchases. A traditional POS vendor must be omnichannel and traditional warehouse logistics vendors have to accommodate home delivery logistics. These changes were not driven by the retailers but by consumers.
Tech vendors have the vantage point of seeing many retailers, many project ideas and many implementation results. If the vendor’s people are any good, they can become good advisers to their retail partners and have a point of view that brings real value to the retailers they talk to.
Of course retailers have to be receptive to new ideas and suspend the belief that they have all the answers as well. Humans have 2 ears and 1 mouth. That’s not a bad proportion for both the retailers and the tech vendors to exercise when listening and talking.
Nikki, you are putting music in my ears on this one. This is one of my most favorite things I do as a consultant. I work with retail vendors to find their point of view, create thought leadership and get it out there. (Shameless plug.)
The fact is, so many vendors are having to re-invent themselves as retail is being re-invented. Some are scrambling to make acquisitions that will better fill out there product suites to meet current retail needs. The next step is to figure out what your new point of view is.
When I am doing competitive research it amazes me how many vendors I see with web sites that look like the five and dime stores of old. A plethora of little ads for everything imaginable and no cohesion.
Vendors, it’s time to get your stories straight! And that’s my 2 cents.
“No point of view” is a point of view, but it takes knowhow in a variety of areas to pull it off. In the meantime, what happens when a fast follower packaged technology industry meets the un-package? Cognitive dissonance. Does the un-package vendor care? Nah, they are going down a different path. They’ve built a company and culture that is looking for a few different companies, with technical chops and a willingness to tinker with business models and the customer experience. It’s a new culture. The counter culture:
“There’s something happening here
What it is ain’t exactly clear…”
This is a good sign.
The umbrella view is the “any way you want it.” What is off the screen is when solutions are prepped for deployment and design thinking is brought into play and great vendors have the expertise to advise new ways of doing things.
I know many vendors like this — but the old umbrella and noise approach lives on. Non vertical marketers are to blame. Most marketers were not born retail….
TRedd – Born retail and discounted!
The short answer to the discussion topic is yes, today’s rapidly shifting environment is forcing technology vendors to be more flexible. However, that’s not always a bad thing.
While it’s important to have a point of view about where their industry is heading, clients, specifically retailers, know their businesses better than anyone. They know what drives sales, what brings in customers and what builds loyalty, so for them to be calling the shots doesn’t seem that outlandish.
However, it is important for tech vendors to be thought leaders on the subject matter. A retail client may say they want a specific feature but it’s up to the vendor to find out what the client’s real goal is, and if there’s a more efficient way to achieve it. Likely in these scenarios the tech vendors will be able to suggest a faster, more cost-effective way to achieve the client’s goal, which typically benefits both parties in the end.