Trends – 1
Before we go deeper into unravelling the secrets of forever high profitable growth, let us step back to understand the trends that are shaping tomorrow’s world.
Digital Customer = *Tech: The rise of the digital customer began with the Internet a quarter century ago, the smartphone and high speed networks drove it forward, and the pandemic accelerated it. With the customer’s digital devices being the window to the world, every business has to become digital by adopting tech. Traditional businesses have to transform, while new businesses can natively architect themselves around tech. Thus, everything from agri to education, health to insurance, finance to food now carries the “tech” suffix.
Linear to Exponential: With massive capital available thanks to surging liquidity, there is a land grab out there. In India, every day of 2021 has seen an average of $100 million flowing into startups and growing businesses from VCs, PEs and public market investors. This is driving a change in expectations: growth by itself is not enough, what is demanded is exponential growth.
Adtech to Martech: As we discussed earlier, acquisition at any cost will give way to retention and cross-sell. This is being driven by two factors: the changes being made by Google and Apple in their data tracking policies to give primacy to privacy – Google phasing out cookies in the near future, and Apple’s privacy framework being rolled out in its new software releases. These changes, combined with plentiful capital, is leading to an escalation of customer acquisition costs. Brands will thus need to focus on leveraging the base they have, sell more to them, and use alternate methods to generate new customers (influencers and referrals).
Broadcast to Conversations: The world of push messaging has been primarily one-way – SMS, email, push notifications. Clicks have been the call-to-action. The messaging apps and channels are getting a makeover. Innovations in push messaging platforms are now giving rise to greater interaction and more conversations, mirroring the customer demand for interactivity. SMS via telcos is giving way to SMS over IP, RCS is on the rise, Email is getting AMP, and WhatsApp is opening up to businesses. Chatbots can power the first-level of engagement for commerce and support. All of this engagement is now powered by fine-grained customer data.
Data to differentiate Experiences: The digital interactions between the brand and the customer led to the generation of massive first-party data. Storage and computing costs have fallen over the years to make it affordable to create data lakes, data warehouses and customer data platforms. This enables marketers to get a unified customer view. AI can then work its magic – and marketer and machine can together create omnichannel hyper-personalised experiences for customers, providing a second level of competitive advantage beyond the actual products.