In this new normal, I see the model of doing business changing especially from the generic way of doing business to a perceived new normal where the epicenter of the business is the client experience. Today I feel we should look at a business model taking shape in our counties and I hope you will take some learnings to improve your business. In this pandemic era with most consumers afraid of going out at all times, businesses are affected with their returns on investments (ROI) below expected margins. Most of the industry for instance and in an aim to keep afloat they have increasingly seen the need to be more active online to tap on some new emerging consumer trends.
A further look through social media, there has been a need for many clients to get items delivered to a place near their homes or better still at their doorstep. This has prompted an on-demand economy shift and in order for more providers to benefit, then changing from the old model has been inevitable. Anyway in Business we say the customer is king.
The On-demand economy is an economic activity, influenced by digital transformation, in which companies are providing on-demand products and services to consumers on their doorstep on an immediate basis. My workplace is currently shifting to this model with home deliveries services for commodities we offer our clients.
The Rationale behind this….
Fulfilling a client’s demand involves a lot of things, companies are moving away from the four Ps and offering extra so that the client experience can be good in order to achieve return clients in the process. The new normal has taught firms to consider getting products to clients more quickly. For instance, a client with underlying infections will decide to send a Piki to the market/grocery rather than travel to the market/grocery and risk coming in contact. To tap onto these clients, the grocery will decide to offer free delivery service to this client and soon enough the message will get to other clients who will reach out to the grocery store.
Given the products life cycle there is a need especially for vegetables or any other perishable products to have an omni-channel distribution, having non-moving stocks in store hurts businesses but offering deliveries to clients will encourage more to purchase or even the few to purchase in bulk knowing that transportation has been sorted out. Most firms are now engaging third-party transporters to run deliveries on their behalf. The likes of Glovo, Sendy, Jumia, etc are ripping big in the city, in my county lambs deliveries are really supporting many businesses as they shift this direction. While in Kakamega County please contact lambs deliveries, these guys are providing great service.
While we are focusing on getting platforms ready to support these niche clients there are risks that as a business, I should alert you on since I have seen a lot of this happening with third-party transport providers. The first is the pricing of the final products: like any business, once you acquire a platform or a service provider to help offer a better client experience the cost of the service acquired will definitely translate to some margins on product pricing. My advice is that please consider your margins before adopting a third-party provider. You wouldn’t want to sell a product more expensive than your competitor with limited value addition to extended service.
Secondly, for returning clients, be sure that customer service isn’t compromised. If you indeed are getting a third party to provide you this services, consider having a budget for training. I have seen a lot of businesses who go for third party but fail to keep their clients because the rider or driver has less knowledge on communication or clients’ management, 2 months down the line they end up losing these clients due to poor service. Why not try Mistry shoppers/clients to stress test the third party provider’s ability to handle different sets of clients or irate clients. On this please do not compromise on it, if you have a budget to build a platform or offer these extension service, please go ahead, you will gather nice learnings on clients’ needs and who knows maybe introduce new products based on dirt feedback. In a nutshell, the on-demand business model will ensure that customers or clients of your business are able to access your services anywhere they want at any time that they need. You will be able to virtually extend your opening hours and reach out to a wider client base, in essence, all businesses will need a paradigm shift in how they attend to their clients. In my next series on personal finances, I will dive into the platforms, what to consider creating one, its relations with ecommerce dominance, and social commerce growth.
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Okay, Good Work