It’s no secret that organizations need to consistently innovate. As American Apparel, closes it’s doors, down goes another once a upon a time giant. At it’s peak, it has valued at $1 Billion in 2007 and yet now, it was sold to Gildan for a meager $88 Million and is shutting it’s doors.
Macy's is closing 100 stores, Sears-Kmart is closing 150, The Limited is closing all 250 stores, JC Penny and Nordstorm is planning on more closures as well. All of this as total retail sales are up.
How can stores close while sales are up? The answer lies in omnichannel and ecommerce.
Ecommerce stores require less employees to manage it compared to traditional stores relative to the amount sold. There’re open 24/7 and are able to test and innovate quicker.
“The first e-commerce product was actually a caffeine t-shirt out of my dorm room in the early '90s and my whole career has been around high-speed technology changes where industries get disrupted about every 18 months.” says Dave Asprey, founder of Bulletproof Coffee. Noticing the consistent change, his team is consistently innovating to not only beat the competition but equally to stay ahead of the curve.
Ben Burmaster, the founder of Snuggle Bugz, a children’s retailer mentions that “we’re innovating the way customer wants to interact with us and what they expect of us”. The retailer which celebrated it’s 10 year anniversary, started off with one brick and mortar store and has since evolved into 8 stores and thriving ecommerce platform.
Describing his company as “helping families navigate parenthood”, Burmaster has a central purpose that guides his team and organization. One that allows him to consistently innovate to help the customer. Even if it means transferring a product from one store to another at no charge so that customer can have their product, “because that’s the thing that you’d do for your friends”. Since no one else does it, it’s paid off well for Snuggle Bugz.
In the era of mass choice, serving customers well is a key point of differentiation.
After being in business since 1946, Frank Sports, the sporting goods retailer has learned a thing or two to stay innovative over the 50+ years. Adam Franklin, who kickstarted the ecommerce division at Franklin a few years ago realized that selling online alone isn’t enough to stay innovative. “It’s about being nimble, with no red tape when innovating” says Franklin. He described his company’s innovation process as both top-down and lateral.
Being in the sports and apparel sector means developing product lines for the next 2 years today. So they’re constantly looking at “what’s happening with competitors, local retailers and internationally” mentions Franklin.
It’s this process that’s allowed them to realize that since the “customer wants what they want and want it immediately”, to not only create a customized batting glove maker, but also deliver it 4 times faster than the average.
This same process is what allowed BuildDirect to create an ecommerce platform built to serve homeowners and their home renovation projects. Their north star is to be “constantly looking to create a world of possibilities for home owners” mentions Joseph Thompson, Head of Marketing and Growth at BuildDirect. “There are so many sources for innovation when you read customer comments and feedback. I take some time each month to read all the customer comments”
It is with this tenacity with his team that they were able to launch a marketplace that grew their SKU size by more than 10 times. Following their vision of creating a simpler and smarter home industry and following the first principles: Is there an under-served customer need? Are we equipped to solve it? Will the Economics work?
It goes without saying that as leaders don’t have all the ideas. It’s about creating a culture of innovation to move the entire organization forward. As such, some companies like Bulletproof go as far as to provide food to drive innovative thinking for employees so that “they can eat foods that don't diminish their energy, because when your energy is low, your innovation is low.“ notes Asprey.
On the other hand, other organizations such as BuildDirect take some time for quarterly offsite retreats for big bold ideas. When it comes to small projects however, Thompson says that “we tell our employees that you have the freedom to test and learn for small projects”. Their system has worked for them and is serving them well as they surpass serving 2.5 Million customers every month.
By understanding and following the purpose that drives the existence of their companies, the teams and employees are able to better serve the customers by thinking about the best way to use today’s technology and resources to drive growth for the organization.