- July 11, 2018
- Posted by: OIA Admin
- Category: Association News
ISPO Digitize Summit 2018 – a report from an OIA member and digital evangelist
Editorial Review by John Shirley, Sales Director – Hark
Digital readiness survey highlights analogue mismanagement
At the first ISPO Digitize Summit held in Munich 28th -29th June 2018 everyone really was talking about digital transformation and how to model the digital future for the industry.
Back in January at ISPO Munich 2018 the ISPO Digital Readiness Check survey was launched. The results so far show that for many companies it’s still about trying to do the right things to ensure basic survival. And for some that may not be anything digital at all. The shocking results of this survey show that long established companies, those that began when the world was mostly analogue, are increasingly losing out to their competition in the shape of digital first and data driven companies.
According to the ISPO survey: “.. the problem isn’t the new technologies, it’s the old ways of thinking, the encrusted patterns in the minds of executives and employees. Digitalization seems to bring to light the analogue mismanagement, ignorance and lack of knowledge companies have about their own customers.”
Being an enthusiastic UK Outdoor Industries Association (OIAUK) member, championing digitalisation in the UK and abroad, it was great to chew these subjects over with Andrew Denton OIAUK CEO. And while there is much to be done in steering a path through the digital maze there are some great examples of how companies, often small single store retailers, can get organised with e-commerce and smart marketing platforms, gain a competitive edge and sell more product. Ask Andrew about his recent online shoe purchasing experience.
The hard facts are that customer behaviour is changing, primarily driven by mobile access to internet shopping. Sales through online e-commerce channels are growing and will continue to do so. This means data in all its forms is very important. You must enable a customer to have fast and open access to the right information to support a sale – you need a premium presentation online. And from a product development and customer experience point of view you must anticipate and meet their changing needs.
For the ISPO presentation of the results of the ISPO Digital Readiness Check click here
ADIDAS – move fast in to the future and expect mistakes
It’s a big ask and first up at ISPO Digitize to share their experience from leading the way on digitalisation was two keynote speakers from Adidas: Roland Auschel, Executive Board Member with responsibility for Global Sales and digital evangelist Jacqueline Smith-Dubendorfer.
They explained that everything is being accelerated by digitalisation. So, to maintain a lead begs the question: “How quickly can we switch over – from the things we’ve done in the past to the processes necessary for the future? An example: We opened numerous new stores in the past. The question today is: How many of these stores will we as a brand really need in the digital future?”
“Anyone who dares to do something new will always make mistakes. But it also means learning faster than the competition. Our industry has unbelievable potential. We’re happy about every competitor who thinks in a consumer-oriented manner and promotes innovation. That remains our business. That’s how the market of the future works.”
Dig a bit deeper in to the Adidas experience and you can find out why showrooms will be a thing of the past soon, how virtual reality is being implemented in B2B, what role retail is taking on, and which retailers are facing existential challenges in the field of digitalisation.
To read more on the Adidas perspective click here
Innovating the consumer experience and the supply chain – Mammut may have started late but they have ambitions
Oliver Pabst, the new CEO of Mammut led one of the more interesting and directly relevant workshops that talked about using near-field-communication (NFC) to connect with the consumer on the one hand and on the other a digital initiative aimed at innovating the supply chain.
The Mammut Connect campaign had some impressive customer engagement stats from the pilot as well as an uplift in sales of 10%. And the motivation for innovating the supply chain was clear from Herr Pabst’s statement that a large % of your P&L goes on product costs so any efficiency savings or extra sales opportunities will go straight to the bottom line.
Mammut’s partnership with Foursource for this innovation is a simple proposition, given that by providing an online equivalent to the purchasing directors rolodex they open the process to better scrutiny and easier comparisons between suppliers.
Another reason given by the Foursource CEO was the need to change buying behaviour from planning-driven to demand-driven. The promise is that vertically integrated players can pace the market and set new standards going from trend to retail in 30-40 days, and in doing so reduce overstock/understock, mark-downs and write-offs. In the words of the Foursource leaflet “Digitalization is the linchpin for all this, helping companies to achieve these changes, while also advancing into the future”.
Read more about the Mammut vision here
Let’s bust some myths – and learn from others
The Summit gave a platform to a few speakers outside of the Sports industry and their perspective is helpful to learn from other industries and gauge our progress. One rhetorical question I hear often is “.. well maybe we are a bit slow to adopt new things in our industry” and I don’t believe it. There is plenty of innovation and enterprise in our sector and so it’s wrong and leads to a state of mind that says because we are slow to adopt we don’t have to do anything about digital.
We got a glimpse of BMW’s take on the future of sustainable and autonomous cars from Peter Schwarzenbauer who is responsible for Customer Engagement and Digital Business Innovation at BMW Group. He reinforced the message for all of us in case we hadn’t heard – the consumer’s experience with the product (all product) is changing.
BMW research says 73% of people will change brand or supplier if they see a better integration of innovation to deliver to their needs. What can this mean for product development in the Sports and Outdoor industry? How can we deliver to what are currently unmet customer needs? What do customers today think they will want the day after tomorrow? Could it be a custom shoe created on a 3D printer, a running top that uses smart fabrics to monitor your body and regulate temperature, or a down jacket with an emergency GPS locator built-in? Will a customer use your network of high street shops for product recycle and repair? Will you allow them to stroll in to your shop, self-serve with a new item from the shelf and stroll out, payment for which is automated by a smart phone linked to an electronic apple pay (or other) account?
Deutsche Telecom a giant corporate with 32,000 employees gave a good “start small start slow” case study based on engaging customer’s through their retail shops. Their methodology for embracing the digital challenge is to start small but most importantly – start. They use four steps: Explore, explore with the help of experts, do the digital thing and ultimately aim to be digital – get it into your DNA.
DNA was also mentioned by an excellent and insightful presentation by Gunter Althaus. As president of a 250,000-member SME association and CEO of the ANWR Group (which includes Sport 2000), he is only too familiar with retailers’ concerns. Having in his own words caused a “shit storm” at ISPO Munich 2018 by saying there would be more store closures “.. because some stores don’t have the right to exist”, he was more reassuring on how the bricks-and-mortar trade will survive digital transformation – if they don’t try and do the things that digital can do better.
For example, shops used to be the only way to show product, but web sites present the range options much better. What e-commerce cannot do is address the fit or colour question. “Sports retailers have one great advantage that online shops cannot replicate: It is down to our senses: feel, smell, taste, touch. That’s something that the Internet does not possess and cannot deliver”.
Read more here on how retail will survive the digital transformation.
A bigger slice of the pie So what’s in it for you?
Never one to miss a cross-selling opportunity the ISPO Digitize Summit signposted the ISPO vision for their version of the OutDoor show in 2019. It was a room with a mini exhibition which had been launched the day before with a lot of well-chosen words from which I quote: “Digitilisation will be a radical paradigm shift for you and your business”.
But I was struck by one quote in particular “We all want a bigger slice of the pie – so let’s bake a larger pie”, which is a tantalising proposition.
In conclusion then here are four slices of pie to chew on:
1. Relax about digitalisation – it’s not too early or too late.
2. Start small but start. Explore, bring in experts, do it and then become digitally transformed.
3. Understand the DNA of your company if you want to lead effectively. Look for example at the Mammut rebranding – subtle but effective and it shows they have thought about it and have purpose.
4. Be in learning mode, it’s not so much about know-how, what you think you know already. Things are moving so fast you need to be flexible, which means being open and listening to the people around you. Fixed hierarchies obstruct innovative processes.
For the full ISPO version of events see here
John Shirley – Hark https://www.harksolutions.co.uk/