“If your company is not an icon on a person’s mobile phone, you really don’t exist.”
That’s the risk that Australian brands face, according to Gerd Schenkel, Leader of the Digital Practice at consultancy Partners in Performance.
Schenkel, who previously founded UBank and Telstra Digital, believes Australian businesses need to do more to adapt to the generational and technological shifts that are drastically altering consumer behaviour.
“A lot of incumbent companies in Australia have well recognised brands, and they think that brand and the incumbency that comes with that protects them from all sorts of things,” Schenkel told Which-50 in a recent interview.
“They might have a big brand but if they are not on my mobile phone then they don’t exist and that place needs to be earned.”
Schenkel used the example of buying insurance to illustrate his point. While a customer might know and recognise several insurance brands they will typically begin their journey with a Google search or an aggregator which offers discounts or cash back offers like Cash Rewards.
“Therefore the price pressure you are exposed to is much greater if you are not on someone’s phone to begin with,” he said.
Schenkel said this change in behaviour has so far been quite slow, but will accelerate. The rise of wearables and home assistants in smart speakers will also erode the power of brand to command consumers’ attention.
As a result, incumbents will experience greater margin pressure and competition from overseas players and competition from digital native players like Amazon, Google and Facebook.
There’s no one answer for companies hoping to survive the impending wave of change, but Schenkel believes companies can adapt by identifying and resolving their weaknesses.
“There are normally a number of weak links in a company and they could be technology, skills, or [a lack of] initiatives and projects to move forward with customer experience,” he said.
“It’s about identifying those weak links, addressing them and doing that over and over again. Ultimately it’s about the capability of diagnosing yourself and fixing yourself.”
While companies can use external partners, technology vendors or consultants, it is a capability which organisations need to develop internally, or as Schenkel puts it, “you can’t outsource transformation”.
“It’s important to have someone hold up the mirror every now and then, but the ability to improve yourself and transform yourself is vital.”
Often the difference between success and failure is a strong leadership team.
“I find the companies that are good at this tend to be confident, mature and authentic, and they know what they don’t know. They are quite open to seeing other companies be better at something, or being told they have gaps and they are quite eager to fix and learn.”
Gerd Schenkel is a member of the advisory panel for the Which-50 Digital Experience Awards.
Source:https://which-50.com/brand-wont-protect-incumbents-from-digital-disruption/