Can the channel survive in a world of Selfsumers?
You're in the market for the latest portable media device and you want and need it now. With no access to a computer, you use your smartphone to access the Internet and the Web site of your favourite manufacturer. You find what you're looking for and a few moments later, you've ordered your new device, without having to even set foot in a store.
Thanks to the Internet, smartphones, social networking sites and other multimedia tools being so readily available, end-users in the consumer space have now evolved to become what PricewaterhouseCoopers calls Selfsumers. And in order for the channel to keep pace, partners will need to adapt to this new type of purchaser, says the company's David Jacobson, director of emerging technologies in Canada.
For a long time, consumers have traditionally made their purchases by visiting and shopping around stores. However, with the recent rise and popularity of the Internet and portable devices capable of being connected at high speeds, many consumers have changed how they go about making their purchases, to now evolve into Selfsumers.
"What's happened is the consumer has evolved into this new type of person, the Selfsumer," Jacobson said. "The Selfsumer is connected and is able to communicate anywhere and at any time of the day and can participate by making a phone call, chatting, or surfing the Web. With devices being connected at high speeds, Selfsumers can surf the Web and can participate in discussions (about products) on social networking sites."
Jacobson explains that Selfsumers no longer need hard sell advertisements to convince them whether or not to buy a product. This is because Selfsumers are now able to find their desired product information in other ways. With the help of the Internet, Selfsumers can go online to look at review sites, social networking sites and more to communicate with other like-minded individuals before they make any purchase decisions. In this day and age, many manufacturers now have their own dedicated Web site with product and stock information easily accessible.
"Many people are buying electronic devices directly over the Internet so they aren't going through a channel partner, because they can find all the information online," Jacobson said. "This is the empowered Selfsumer, and in order for channel partners to be successful, they'll need to understand how to adapt to and serve the Selfsumer."
According to Michelle Warren, president of Toronto-based MW Research & Consulting, if retail shops want to stay competitive, they'll have to "play the Internet game."
"The Internet's where the customers are," Warren said. "They're blogging and asking questions online, so the retailers will have to be there too and they'll have to embrace social networking sites like Facebook and Twitter to find out how these customers want to purchase, if they haven't already."
But no matter how much information can be found online, Paul Edwards, director of SMB and channel strategies at IDC Canada, says there will always be a place for the retail channel in the market.
"There will be a segment of the consumer population that will still want to go in (a store) and be able to hold and see something and play with it," Edwards said. "There will be another segment that might not want that interaction, so these consumers will just buy online. I don't see the ultimate demise of the retail channels because the larger retail operations will probably have a niche opportunity, but you may see the demise of the smaller Ma and Pa-type shops."
Beyond this, Jacobson says it's important that the channel community adapts to this new type of purchaser by adding value around whatever it is the Selfsumer is looking for. Retailers will have to be more creative when it comes to developing a new product and any sort of promotional content in order to meet the needs of Selfsumers, he added. This could include Web links to review sites right on the company's Web page, Jacobson offers.
"Partners will have to ask themselves how they can add value to really captivate Selfsumers in order to serve them," Jacobson advises. "Over the next five years, we'll see some remarkable developments in advertising, sales and value-added situations as companies change how they reach out to and convince customers to purchase their products. There is value in services and partners will have to find a way to connect to Selfsumers through social networking."