Leaders across sectors are recognizing the power of digitization & empowering their businesses. However, for some organizations the journey has not been simple. Odgers Berndtson invited leaders from the consumer sector for a dialogue to understand how digital transformation has impacted their business.
Digital transformation in India
The key takeaways from the dialogue are as follows
Power of real time data offered by digital platforms
The pandemic has pushed businesses to look at real time data in order to stay ahead of the curve. “My 3 broad observations about 21st century consumers in a digital world are that (i) regardless of the industry, leaders are recognizing the power of having first party data to understand consumer insights and this can enhance the ability and agility of the organization to serve customers better, (ii) the need to understand customer journeys to create relevant user experiences which impact an organization’s retention rates/ brand equity in a world where there is a multitude of choice for customers, and (iii) in a social media fueled world, it becomes even more important to offer choice and quality as now the conversation has moved from one-sided advertising campaigns to conversations,” remarks Siddharth Banerjee, Managing Director – India & Asia, Pearson Education.
Changes in the shopping experience aided by digitization
With the aid of mobile applications, the conversion funnel of a consumer, moving from a shopper to an end buyer, has seen a dramatic shift. The decision-making process for the consumer within the shopping environment, has itself become dynamic. A small business owner can easily sell to different parts of the country by taking the support of the distribution channels offered by online sellers such as Amazon and Flipkart. The challenge however is to identify which products can be sold digitally and to continue to scale up the business to greater heights.
“The exciting thing we are observing in the digital world is testing few digital-first brands, which we are incubating as ideas for the future, betting on them, gaining scale, and going wider. E-commerce may not always be the most viable option given the high cost of service, but e-commerce does offer you an opportunity to pick and choose where you want to be present. There is no specific playbook, and organizations are finding their own ways and means to find the sweet spot,” says Achyut Kasireddy, Managing Director & CEO – India & India Subcontinent, Mayora India.
How COVID-19 has accelerated the digital journey
Though Leaders recognized the need to automate, the pandemic spurred the rapid adoption of digital solutions, thereby accelerating the transition to the digital economy. This meant integrating technology into supply chain solutions, emergence of omnichannel sales & marketing solutions, collecting real time data to forecast demand, collection of payments, manufacturing & audit processes etc.
“Luminous shifted to a digital payment only mode at the height of the pandemic. There was a huge resistance at first as our channel partners were used to manual payments via cheques & drafts, but they themselves transformed to only accept payments from retailers in a digital manner. In fact, the whole audit process at Luminous was carried out in a digital manner, which is a massive and complex exercise in itself. COVID has brought many learnings & has pushed organizations to innovate & digitize rapidly,” says Vipul Sabharwal, Managing Director, Luminous Power Technologies.
Digital transformation has to be clubbed with a change in cultural mindset
Digital transformation has not been easy for those organizations in which there was an apprehension towards automation.
“Traditional industries like metals, minerals and mining, construction etc. have adapted very well to digitization. The last two years for businesses has been about the survival of the fittest & the quickest to adopt digital transformation,” says Dr. Prasad Medury, Managing Director India, Odgers Berndtson.
“Digitization initiatives across revenue growth and cost/capital efficient pillars can deliver transformational benefits beyond organic revenue and profitability growth. For example, it is no doubt a highly effective tool to track the entire lifecycle of the customer and figure out what interventions can be done in a timely and cost-effective manner to enhance both efficiency and effectiveness for customer communication, social media engagement, reducing acquisition cost, up-selling, cross-selling, and referrals. However, one of the big learnings for me, especially being part of a consumer services business, has been that the key to successfully leveraging technology and digital initiatives is to bear in mind that employees are your first customers. Organizations need to incentivize employees to facilitate the digital journey and answer the ‘what’s in it for me‘ question for them,” remarks Jayant Khosla, Managing Director & Group Head, VLCC Health Care Limited.
Omnichannel experience is here to stay
Digitization is now a critical piece of the go-to consumer strategy. And analytics is the backbone of digitization. Leaders are closely looking at which channel is working for their business, finding the right channel matrix and then riding out the waves of the pandemic. By partnering with e-commerce platforms like Amazon, Flipkart, one of the leading wellness & beauty brands could increase its e-commerce contribution to almost three times in two years. However, the significance of traditional sales channels such as physical stores cannot be undermined.
Leadership & Talent
Organizations are using a pyramid approach wherein individuals with subject matter expertise are at the top of the pyramid, followed by upskilling of existing staff on some basic understanding of digitization. It was agreed by the leaders within the consumer sector that that there is a skill gap in the industry today. There is more demand than talent supply. Organizations are willing to take unique approaches to fix such talent gaps.
“As executive search consultants, we ourselves are witnessing an increase in demand for talent with some level of digital skills across all levels and functions – from CEOs who have led digital D2C businesses, to chief marketing officers who are experienced in acquiring customers digitally, to digitally-savvy supply chain leaders. The definition of how customers are going to the market is evolving rapidly, and businesses are already digitizing in some way or the other to stay ahead of the curve,” says Ramit N Bhel, Principal – Consumer & Retail Practice, Odgers Berndtson India.
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