To deliver the connected experiences today’s consumers demand and expect, enterprises need to find partners that can help deliver more value across the end-to-end customer journey.
The nature of business partnerships has changed dramatically over the past decade, resulting in unusual and exciting collaborations. The go-it-alone approach is no longer viable as connected consumers demand frictionless experiences that reach across multiple brands. Collaboration and strategic partnerships are more than common place, they are formalized as ecosystems and often include companies more traditionally considered vendors versus partners.
Today’s ecosystems are communities of businesses, partners, and consumers – across multiple industries. Retail ecosystems are expanding quickly as are those in banking and other customer rich facing industries. Ecosystems are reshaping the landscape and businesses have to be able to react quickly and with determination.
IDC’s Leslie Hand brings this into context in a whitepaper “Multiplying Innovation in the Age of Experiential Retail.” In the paper Leslie states “Consumers are driving business change at an unprecedented pace, and retailers are adapting by becoming more agile. To this end, retailers are investing in partnerships and technologies that enable “multiplied innovation,” which is the ability to continually learn and adapt strategies and tactics to drive exponential business performance growth”. Seizing more value from business ecosystems by leveraging data and analytics to better understand the customer is a key component of these partnerships.
So why are ecosystems so valuable? Here are a few reasons why they should be considered and embraced.
- Enhance competitive advantage
You just can’t do it all. Concentrate on core competencies and create partnerships to excel in areas outside of your wheelhouse but that are critical to your business success. Focus on creating the experience that will delight your customers beyond expectations.
- Leverage others investments
Take advantage of what other businesses have already created. Whether it’s resources, expertise, software, a professional network or a customer base. The potential is exponential if the ecosystem is established to leverage each partners’ unique capabilities. Stay focused on the customer journey and expectations and look to the marketplace for solutions that exist to round out the ecosystem faster while supporting your business mission and budget expectations.
- Expand and extend your customer base
Depending on a loyal long term customer base is not always a solid business plan based on today’s reality. The most successful companies are constantly looking to capture the interest of new customers. As markets and products evolve, staying customer stagnant is not an option. Partnerships can be a great alternative to stay fresh and relevant.
Ecosystems have vast benefits and can provide access to leading edge capabilities such as data and analytics insights, supply chain networks, customer bases, cloud services, and software and services. Scale is one of the key competitive advantages of an ecosystem enabling you to use your resources to reinvest in your core competencies while leveraging others capabilities to achieve competitive advantage.
Partnerships are industry agnostic, but with banking and retail at the forefront of customer experience revolution here are a few examples.
At NRF 2019, Kroger and Microsoft announced a new partnership focusing on the customer experience. As Kroger strives to build a seamless ecosystem driven by data and technology to create new profit streams to drive growth, they are partnering with Microsoft to reinvent the customer experience. The partnership will enable Kroger: provide customers with personalized food inspiration, a shelving system that uses digital displays to indicate nutritional and dietary information, promotions and prices. The shelving system will connect with Kroger’s Scan, Bag, Go® for frictionless checkout. Additional advantages include the ability to generate new revenue by selling digital advertising space to consumer packaged goods brands, the use of video analytics to present personalized offers based on customer demographics.
Banks pose a unique case for partnerships as an industry inundated with fintechs and traditional banks trying to keep up with technology and maintain market share. As featured in Customer Think, “With pros and cons to each, most banks and fintech companies are experimenting with multiple partnership models to cover their innovation bases. While each partner reaps some benefit in the symbiotic relationship, the real winners are consumers. The evolving partnerships between fintechs and big banks ensure inventive banking solutions, built on a foundation of trust, and focused on the changing needs of today’s savvy customer.”
In 2014, an unlikely partnership was formed when fashion retailer H&M partnered with high-end designer Alexander Wang. The end result was customer base growth for both companies. H&M gained a reputation as a trendy affordable fashion store and Alexander Wang captured future customers for their high-end fashion business. The partnership also resulted in improved customer satisfaction and experience at H&M.
Partnerships and ecosystems are needed to deliver innovative, connected consumer experiences that utilize data and analytics to build deep customer loyalty and sustainable competitive advantage. To retain customers, satisfy their high expectations, and stand apart from rivals, businesses must think beyond their own products and services. Enterprises need a new type of intelligence. A kind of connected intelligence that allows them to design experiences that logically connect each and every touch point of the consumer’s digital and physical journey. Learn more about how we can be part of your customer experience ecosystem with our Connected Intelligence Platform and Customer Insights & Intelligence software.