For many years, the ultimate goal behind many businesses has been that of universality. To have a product that could service a universal, perpetual demand, and to dominate in that market in the way of John D. Rockefeller with Standard Oil, or even Bill Gates with Microsoft, was the one golden ticket to success.
But with the rise of modern digital technology, the game has changed. Social media websites like Facebook, Twitter, and Instagram are transforming the landscape of retail, providing avenues of opportunity for new leaders to innovate their way to success. The disruption introduced by enterprising digital natives are breaking down the established boundaries of a time-tested industry, casting away ideas like mass demography-based segmentation, single-dimensional business models, and traditional advertising.
Multinational professional services firm Deloitte, in a 2017 study titled Disruptions in Retail through Digital Transformation: Reimagining the Store of the Future, wrote, “Retailers have had two options in the way they have responded to the digital opportunity. A vast majority have seen digital as an enabler of better customer service or greater operational efficiency and have hence implemented many digital technologies to improve their performance on these parameters. This approach is an incremental response to the opportunities presented by digital and is primarily driven by a low risk propensity to allocate scarce resources to what can be a fundamental disruptor to the business model of retailers.”
“However, there have been a few retailers who have truly awoken to the possibilities presented by Digital. They have seen digital as an opportunity to shape a long term sustainable business model which is a departure from the paradigms of the past. Integral to this digital approach is the view of the retail eco-system as a network of suppliers and franchisees supporting the central actor (retailer) in orchestrating a business model with the long-term objective of maximizing customer lifetime value and not just focused on a transactional approach,” Anand Ramanathan, Partner at Deloitte, wrote.
A more personalized approach to retail
Shifting the focus of business from a transactional approach to a maximized customer’s lifetime value necessitates businesses to approach their market in a more intimate manner, tapping into data points made available through social media platforms. In essence, the focus of marketing is moving away from the idea of advertising the product in the best possible way and securing a purchase, but instead towards creating the best possible relationship with one’s customers, and establishing loyalty through personal engagement.
It is perhaps no surprise that the era of personalized marketing has become a boon for smaller companies. Felipe and Sons, a men’s lifestyle brand here in the Philippines that primarily uses digital as a means for its business, believes that digital technologies are forcing businesses step up their game as easily accessible platforms like Facebook and Instagram have torn down the barriers to entry for new players in the retail market.
“With a small marketing budget you are able to reach or at least make people aware of your brand or business,” Martin Warren, Co-Founder and Chief Operating Officer of Felipe and Sons Barberdashery, said in an interview.
The company uses Facebook and Instagram mainly for marketing and as a venue for customers to keep in touch with the brand. These platforms also provide their customers a convenient online booking platform for easier registration.
“We in Felipe and Sons think a personalised approach to engaging with customers is definitely better for a business because you are able to create a more personal relationship with your customer, which in turn makes them feel more special, more connected to your brand, like they are a part of your company, especially if you take the time to address their concerns and needs and make sure that they feel like they’ve been taken care of or listened to,” Mr. Warren said.
Nikka Uson, who runs the personalized necklace shop House of Monogram, agreed, saying that the ease of which a customer-business relationship can be fostered on social media platforms like Facebook can be extremely beneficial for building a lasting brand.
“In general, engagement with customers through these platforms is better for businesses. These platforms can greatly help in boosting brand awareness as well as strengthening relationships and trust with your customers,” she said in an interview.
“Finding a niche through these platforms can be easier. They can help businesses target Facebook and Instagram users based on their demographics (i.e. age, gender, location), purchase behaviors, and even on interests related to a particular niche. This can be done altogether in your Facebook Business account.”
Even companies with an established physical brand are finding the opportunities presented by the digital space too cost-effective to pass up. Name Fairy, a brand which offers personalized items and souvenirs, relies on its physical stores in Bacolod, Dumaguete, and Iloilo City for the bulk of its sales, but has increasingly turned to digital for its marketing needs.
“Online platforms help us find our niche and allow us to market ourselves easily. Posting attractive photos and captions really help a lot in gaining a bigger market for our products. Gone are the days when you have to spend a lot on advertisements to promote your products,” Name Fairy’s Tonette Diente said in an interview.
Ms. Diente added that having a personalized approach with one’s customers can give insights into the market that would otherwise be unavailable to them, perspectives with which companies can then address and serve.
Creating the store of the future
That kind of authentic relationship would be difficult to create but may ultimately pay off long term. Joseph Aaron Angeles of Godfather Shoes, a handcrafted shoe brand from Marikina City, believes authenticity could be the key to the stores of the future.
“Trying to make a change doesn’t happen overnight, and taking advantage of the online community to do that can be a leverage to anyone,” he said in an interview.
“It’s very hard and expensive to reach a community using the traditional way, like ads on TV or print. But using the internet, you can reach millions of people, all you have to do is show them something they can believe in. Someone who they can trust online.”
Mr. Angeles added that a personalized approach to business is ‘the only perfect way’ of reaching an audience, as people would be more likely to engage in an individual or an organization they believe they can trust.
“I had been in sales for several years before starting Godfather, and I realized one thing— people would always want to speak to someone they can trust, and to someone who cares for them.”
For any business moving into the fourth industrial era, this is the crux. The retail eco-system, including suppliers and franchisees, must become a holistic network with the retailer, recognizing and addressing the needs of the consumer through careful analysis, marketing, and brand engagement using the power of digital technology.
Deloitte’s Mr. Ramanathan wrote that the fundamental tenets of the digital approach is a collaborative mindset where the retailer is the first among equals in the wider network who invests in building the capabilities of the entire network to be agile and responsive to consumer needs, a concept that is entirely different from conventional practices of retail companies in the past.
“At the core of digital for any retailer is a wider ability to build a culture of collaboration, the capability of using data to break through functional and organizational boundaries, the art of using technology to unearth new possibilities for enhanced customer value and in the process completely reimagine the store of the future,” he concluded. — Bjorn Biel M. Beltran, Special Features Writer

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