Dr B K Mukhopadhyay
(The author is a Professor of Management and Economics, formerly at IIBM (RBI) Guwahati. He can be contacted at m.bibhas@gmail.com)
Dr. Boidurjo Rick Mukhopadhyay
(The author, international award-winning development and management economist, formerly a Gold Medalist in Economics at Gauhati University)
Electronic retails or simply, e-tails, registered an extraordinary market growth during the pandemic. Businesses that maintain Omnichannel – an enhanced multichannel approach whereby consistent information and experience is provided to customers at both physical stores and online platform of the company. The difference between multi-channel and omnichannel is that while the Omnichannel involves using all available media channels and is focused solely around the customer, multichannel involves using more than one channel and is more directed towards the product or service. As per Forbes, the global market for Retail [including e-tails] Omnichannel platforms is estimated at US$8 Billion in2022, and is projected to reach US$14.6 Billion by 2026.
Confucius said: "Without knowing the force of words it is impossible to know men." Words are what hold societies together. In marketing, words and sense score most of the goals. Marketing refers to the very exchange process: how transactions are initiated, motivated, facilitated as well as consummated. The focus remains very much on marketing strategies based on market driving capabilities and resources. At the same time, marketing management deals with how organisations and people can improve their exchange activities to produce more income for themselves and more activities for others. Thus, any organization that creates genuine consumer satisfaction usually succeeds in achieving the organisational goals.
"We all live by selling something."Marketing is fundamentally something that we all do. It is also something that would enable a business to obtain a competitive advantage when they are able to study, identify, create, and communicate reasons of preference for their customers, with respect to their competitors.The core tasks, therefore, remain: identifying customer needs, developing want-satisfying products and services, and delivering value to customers.
For example, Kodak as it once met the need for inexpensive reliable cameras very well, and now diversified its product lines for CGI, Dolby and Production House equipment. To have successful marketing we, thus, have to look at: needs, wants, demands, products, exchange transactions and market's nature. And today, AI, deep learning, machine learning all come to aid to help marketers know a particular market, target demographics up, close, and also personal.
Realizing the 'Goldfish effect' of Social Media – A
Industry 4.0 came with several innovation in digital technologies, with AI and machine learning are picking up consumer behaviour and demand patterns at a whole new different level supported by a deluge of content and platforms. Capturing the attention of the customer is one thing, but to what extent the initial novelty lasts is the immediate after.A report by Microsoft shows that since 2000, the average person's attention span has dropped from twelve seconds to eight seconds. Research supports the so-called 'goldfish effect' of social media – 33 per cent of viewers stop watching a video after 30 seconds, 45 per cent by one minute and 60 per cent by two minutes. Another distraction – 85 per cent of Facebook videos are watched without sound, suggesting consumers prefer muted ads. On one hand, it is difficult for the companies to come up with an advert that will make the users pause the screen as they scroll along the excessive volume of ad content, and on the other hand, it is equally difficult for the users to know how to select amongst very similar ads offering almost identical products and services.
How e-tails market their
online stores – B
In Electronic-retailing or simply 'E-tailing', the businesses use web-space for creating virtual shops where intended products and services are displayed through images, listing adequate features, price, and above all the value that it creates for customers along with other businesses like suppliers &distributors to nameafew.The e-tails thrive on customer satisfaction and review ratings above everything else. In China and India, big e-tails have certainly supported the growth of small businesses and established newer supply chain networks creating jobs that did not exist before.
E-tails make the best use of omnichannel(as defined earlier, this is a multichannel approach whereby consistent information and experience is provided to customers at both physical stores and online platform of the company) and working with innovative partners with their demand forecasting. This is topped up by information on customer analytics, identifying and acting on newer forms of demand and needs. Electronic word of mouth is essential in this scenario, as after the initial phase of product info is provided in ads, the customers will then read through reviews of other users and past customer experience and product ratings before deciding which 'online store' to go with.
'Read Customer Reviews', electronic word-of-mouth marketing – C
Word-of-mouth marketing (or simply, WOMM) is essentially a process of influencing and encouraging organic discussions about a brand, organization, resource, or event. It can make or break a business that is further amplified by the toxic use of social media. If word-of-mouth marketing is done right, the business may not need to keep an exorbitant ad budget; customers will share their stories (good or otherwise) across their social media and connections if they are happy with the customer service, quality of products or services, quick and hassle-free delivery.
Customers spreading the word about a business, particularly if good, is definitely better than the stubborn, lifeless and overpaid billboard.
This works heavily in e-tails and online streaming platforms where choice of product purchase is heavily influenced by 'recommendations' for friends and family which is further influenced by user reviews of experiences online.
Luxury Marketing? Go Ethical. Go Green. Sell Dreams – D
Research shows that luxury brands set up their image in the market using four broad steps - firstly, establishing a culture of trust and ownership; secondly, putting the customer at the heart of strategy; thirdly, as risky as it can get at times it is important to stay agile whereby making use of data and streamlining decision-making becomes a priority. Agility and adaptability help in keeping disruption at bay. Finally, reimagining the organizational model and leveraging a knowledgeable board. In the luxury sector - fashion, in particular - it is absolutely essential that the board members are fully up to date with technology which otherwise causes a significant lag in decision-making. A board generally benefits from having a digital expert in the boardroom and diversity in terms of gender, background, and experience, and age helps a ton. As for any other industry, the board composition matters for organizational performance and overall effectiveness.
Another study shows that the basic tenets of a luxury brand are about A) Creativity, B) Craftsmanship, C) Authenticity, D) Timelessness, E) Heritage and F) Human values. Many luxury brands have traditionally been led by families, they share organizational stories, history, and identity which helps in building a culture of trust and ownership (as mentioned in the last paragraph). E.g., Hermès, Patek Philippe, Ferragamo, etc.
Luxury is in the business of being and staying unique, and at the same time, it is important to note that it is not about comparing with a competitor. The nature of competition is different. Essentially, therefore it is about 'this is what I stand for' or 'this is who I am' and not 'that depends on'. Positioning is important and critical; therefore, a luxury brands' internal organizational culture matters heavily. The sense of permanence of these brands could be achieved with rarity, timelessness, and authenticity over time and growing client trust. For example, Chanel or Bugatti has an identity rather than what products they sell.
The rise of 'conscious' and
'responsible' consumers
A study by the Harvard Business Review suggests that luxury consumers around the world, especially Generation Z and millennials expect that brands make a more positive impact on the planet and society. Consideration of triple bottom line, i.e., people, planet, profit is therefore important for brands, regardless of which sector they are active in. Board composition of luxury brands are therefore changing, and consumers have various channels to verify whether the companies align words with actions.
The demand for green and sustainable practices, ethical manufacturing, respect of digital privacy, and taking a stand for social justice are some of the actions that the companies try to stay active with. Leveraging the brand name to support (and build new ones) social causes is now a prerequisite. e.g., Stella McCartney and Gucci – they have both partnered with luxury fashion resale seller TheRealReal to ensure pre-loved clothing does not go to waste. Similarly, Tesla's green innovation successes (both with EVs and solar city) led it to be the highest performing automaker in terms of total return, sales growth and long-term shareholder value - this evidences that consumers are keen to support eco-friendly luxury businesses.
'Walking through the doors is just like walking into our website', Angela Ahrendts, CEO of Burberry, recently said. Firms with multiple point-of-sale (physical and virtual) could benefit from reverse Omni-channeling but the challenge lies in ensuring that in-store marketing needs to have that tech boost to catch up with online channels by enabling BOPIS, buy-online-pick-up-in-store model, that enables them to have an excellent in-store experience and interact with the salesforce. To conclude, as mentioned earlier, words and sense score most of the goals in marketing - it is a job of everyone involved in the process. Marketing is everything and equally how everything is marketing.