{"id":104450,"date":"2020-03-30T14:00:00","date_gmt":"2020-03-30T19:00:00","guid":{"rendered":"https:\/\/www.dacgroup.com\/our-lasting-adaptations-will-create-the-new-normal-2\/"},"modified":"2024-12-19T16:43:18","modified_gmt":"2024-12-19T21:43:18","slug":"our-lasting-adaptations-will-create-the-new-normal-2","status":"publish","type":"post","link":"https:\/\/www.dacgroup.com\/en-gb\/insights\/blog\/strategy\/our-lasting-adaptations-will-create-the-new-normal-2\/","title":{"rendered":"Our lasting adaptations will create the new normal"},"content":{"rendered":"

Nasser Sahlool has just nicely articulated<\/a> the human imperative for a return to normalcy, as well as the sureness that what follows the COVID-19 pandemic will be a new<\/em> normal. And it’s true: we’re experiencing an unprecedented period of forced adaptation that’s both rapid and global\u2014as well as heartbreaking and terrifying\u2014but it will<\/em> bring out the best in us.<\/p>\n

The human creative spirit will rise to meet this challenge. We will adapt, and once we have, we will not soon forget what we have learned. On the other side of this emergency, we look forward to a world in which the following will remain true.<\/p>\n

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  1. \n

    We will be more mindful of the need for resilient systems<\/h2>\n

    Many of us have met someone who lived through the Great Depression and subsequently carried with them what we thought of as a laughable frugality\u2014perhaps it was the grandfather who would wash and reuse plastic bags, or darn his tattered socks. Our own collective experience of a sudden collapse of just-in-time systems will remain similarly ingrained for us. This means a painful reckoning with everything from how many people are living paycheck-to-paycheck, to just how difficult it is to depend on the availability of everyday essentials when our supply chain is overburdened by a demand spike.<\/p>\n

    Some have observed that at the peak of this demand, grocery pickers who were fulfilling orders placed online actually outnumbered regular shoppers attempting to buy for themselves in-store. The modern grocery store is useful not only as a pure retail experience, but as a local distribution center. Other businesses may increasingly look to set up locations that serve a dual retail\/distribution hub purpose in order to make their supply chain more resilient than it would be under a purely just-in-time model.<\/p>\n

    \"Distribution<\/p>\n

    In 2011, right before US e-commerce sales growth initially assumed its more rapid upward trajectory, McKinsey predicted the need for retailers to unify their distribution assets between online and retail in order to meet expectations for rapid local fulfillment<\/a>. “Many of today\u2019s retail supply chains are simply not set up to handle this demand for speed and convenience in a cost-effective way, and are already creaking under the strain of the new multichannel world.” Nearly a decade later, this statement of problem and recommended solution is stunningly relevant.<\/li>\n

  2. \n

    The ecommerce growth trend will record a step-change<\/h2>\n

    In some local markets, we have seen search interest for “grocery delivery” spike to more than 20x normal volume. Many have not purchased through this channel previously, perhaps because the potential convenience incentive did not outweigh the psychological resistance to change, or justify the perceived learning curve. Apptopia, meanwhile, reports that downloads of grocery delivery apps are also surging<\/a>.<\/p>\n

    With these first experiences under our belts, a significant barrier to adoption has been eliminated. The growth trend for online ordering is likely to experience a lasting step-change, as opposed to the gradual, year-over-year growth we have observed up until now.<\/p>\n

    It has long been accepted that modern retail is an omnichannel experience, but we are now faced with a new understanding of “channel fluidity”\u2014that is, there can be a rapid swing in how customers transact, and how those orders are fulfilled, essentially overnight. This has implications not only for the role of customer experience design in facilitating a seamless switch, but how well businesses are operationally equipped to respond. This may lead to staffing models under which employees are cross-trained to either support retail shoppers in store, or suddenly switch to enabling order fulfillment.<\/p>\n

    Models such as this, while more complex to implement, would provide more resilience to both business continuity and employment of retail and service workers. Walmart has been successful in rapidly scaling its hiring to support this new demand<\/a>, while priority is given to reallocating existing employees.<\/li>\n

  3. \n

    We will rapidly scale our investments in real-time data and insights<\/h2>\n

    When everything can change overnight, how can we know that we are doing the right thing? Thus far, the businesses that have most successfully navigated the COVID-19 crisis are the ones with the most insight into what is changing\u2014and, most especially, what their customers need from them. We’ve helped several businesses use digital channels to achieve two-way communication with their customers at scale, find out which needs are most pressing, and deliver against them.<\/p>\n

    Demand-capture channels such as search have given us incredible insight into how consumer behaviour is changing, and these insights are remarkably differentiated when viewed through a lens of local granularity. Often, these insights run completely counter to what we may assume. For example, in this time of great economic uncertainly, a significant number of people in the US have suddenly become bullish on investment, looking to buy stocks, open investment accounts, and more.<\/p>\n

    \"Google<\/p>\n

    Recovery will ultimately happen at the local level, and unevenly across different customer segments. The ability to turn data into audience and local market insights, with at-or-near-real-time frequency of update, will allow businesses to chart the most effective course.<\/li>\n

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