Often you come across a small talk or a post on some social platform that carries so much insights and meaning, you tend to read it again and again and try to apply it in your life and work. I came across such a post by Herman Singh, Group Executive Innovation & Strategy, that I thought is worth sharing with my readers. He was kind enough to allow me to take his points and elaborate them with bit of my own interpretation.
Here are six insights for digital entrepreneurs.
1. Stop responding to events – plan around trends
Events are short term and they are readable by most of the people. Eid is an event. Muslims buy more clothes before Eid. You know it and you can plan your sales and marketing activities around Eid to get most out of it. Same way Ramzan is an annual event. You can develop and offer Sehr & Iftar deals if you are in food business. It’s easier to keep track of events and take proactive action.
Now let’s talk about trends. Trends are long terms and get mature over a period of time. Also, trends stay for a longer time. Adoption of smartphone was a trend. Nokia didn’t read that trend and is gone. Buying online is a new trend that is shaping up in Pakistan. Therefore it poses great opportunity for e-commerce businesses. Trends are about change in consumer behaviour and habits that take time to change and those who can read them in advance are the ones who can reap the benefits.
2. Shift focus from a product to platform
Platform is an enabler. It is infrastructure that connects one service to another service. It enables people to create further digital products built on the foundations laid out by the platform. A very good example is API’s. API’s are not products. They are platform since they allow everyone to use them in different ways and build new products and services.
Facebook, Google, Amazon and many others provide API’s for login, navigational services, buying and selling and many other services. Platforms build eco-systems where multiple entities are connected in the value chain. Ali Express is another example of platform.
Products are easy. You sell them to consumers. A good example of digital products can be of a payroll software. Inventory management system is another example of products. In nutshell, a platform has a bigger scope and utility than a product.
3. Stop measuring success on transactions – Focus on Engagement
Transactions can be misleading. Your online sales might be rising month on month. But, are your customers engaged? Do they provide feedback, positive or negative? Do they come back for another purchase? And most importantly, do they advocate your brand?
A good customer is not only one that comes to your website or app, conducts a transaction and leaves. A good customer is one that explores all sections of your site, stays for sometime on pages, and interact further as leaving comments, doing likes and sharing stuff. An engaged customer is the one you can up-sell new products to. Campaigns to get new members are often based on engaged customers who bring new customers. Careem has done such campaigns lately because it enjoys a truly engaged customer experience.
Transactions will ultimately drive once you have an interested customer.
Vice versa, transactions can go down after a while if your customer maintains a transactional relationship with your product or service. It’s easier for such a customer to switch to another service.
4. Satisfaction and repurchase is much more important than revenue
This is linked to previous point. Unfortunately, this happens a lot in Pakistan where brands often compromise on quality of products. How often it happened to you that you start buying a certain product or service because you like it and after sometime you stop because the quality has come down. I’m sure it has happened to most of us.
Daraz.pk is one such example. It was taken well initially by Pakistani consumers but too blinded by the revenues and traffic, the margins for the sellers were reduced later on and the prices were kept high than regular prices to give an impression of discount offers. This leads to an unsatisfied customers and in such cases it just takes a new entrant in market to steal all the traffic.
A satisfied customer will ultimately come back. Focus on quality of service.
5. Over time, insights could be more valuable than margin.
We are moving to strictly data driven digital economy. Data analytics and insights are no more just a fancy ways to impress management. This is what every business needs. With ever increasing digital presence of customers and evolution of digital experiences in day to day life, it is essential to gauge consumer behavior resulted from insights from data.
A good data insight creates future roadmap of products.
What customers are doing online and what are they looking for are the insights every business needs in today’s digital world.
6. Your ecosystem is more important than your market share
Build the value chain. Connect the entities in a smooth seamless way to serve your customer. Be an integral part of the value chain. Apple is probably the best example. It has developed an ecosystem that keeps customers hooked in the apple universe for all their needs. iTunes is one sub-example of this ecosystem. Samsung is just a product. Apple is an ecosystem and that makes all the difference.
What do you think? Share more example from your experience.