Why value today matters critically for both your business and consumers

Businesses must drive value and efficiency in their business and operating models to ensure they remain viable as the UK and other leading economies lurch towards economic recession.

As living costs continue to soar at unprecedented levels, consumer confidence is dropping to lows we have not seen since the Covid-19 pandemic. Many analysts are now forecasting that the cost-of-living crisis could hit businesses even harder than the impacts of the pandemic.

The ramifications of the cost crisis on today’s consumers will force consolidation and cutbacks in spending, and businesses are already resetting their revenue expectations and budgets for 2023.

With a drop in demand and pressure on margins for many businesses, the matter of value has never been more important for business. But what does this mean?

Many businesses will be trying to balance sweating their assets to stabilise costs with driving profitability through a tough economic outlook, whilst also trying to keep up with consumer expectations and future-proof for long-term success. Many organisations will be unable to address these multi-faceted challenges themselves and will call on external support, aligning and collaborating with strategic partners to cut through the complexity, aid decision making and ultimately drive value for both your business and consumers.

This article explores some of the challenges - and the solutions - observed in the market today.

Driving value through efficiency

Having the right operations in place to support the strategy and objectives is imperative. This touches the end-to-end running of a business from production, logistics, technology, through to market, sales and customer service. Any misalignment between the operations and business goals can be hugely wasteful and detrimental to goal achievement.

With many external influences contributing to the rise in business costs, such as hikes in energy bills, taxes, wages etc., the internal operating model is a logical place to start, in exploring workstreams which could be boosted to drive efficiency and productivity whilst lowering costs and maintaining margins.

Operations analysis and process mapping can give a holistic and detailed view of operations which benefits companies by highlighting inefficiencies. Uncovering these areas of improvement can contribute to offsetting the impact that external influences are having on the bottom line. For example, organisations can find that simply documenting processes within a business function or team enable some immediate term benefits, such as identifying and eliminating bottlenecks, mitigating cost risks and assessing skills and resource gaps.

How we can help: At VML Commerce, we can focus on an area of the business, whether that be operational or a particular business function or channel. We will gain an in-depth understanding of the business and document the end-to-end process, resulting in an output which captures obstacles alongside a succinct plan of action to tackle the challenges. Connect with Andy Waugh.

Realising value though investment

Whilst the world is experiencing high degrees of uncertainty, it is tempting for businesses to shy away from innovation and focus on stability and endurance. However, arguably it is more important now than ever to think about how to future-proof your business and address these challenges, whether that be developing new features, introducing new experiences or inventing new products to excite customers.

Despite the return to in-store, many businesses will find it important to continue to invest in their ecommerce strategy and capabilities to keep up with trends and consumer demands.

Our research into Headless & Composable Commerce found two-thirds of IT leaders conceding they will need to replace their current commerce platforms within 12 months, and move to a headless architecture, offering agility, flexibility and scalability – and vitally, accelerating speed to market. Forrester’s 2022 data also shows that close to half (44%) of software decision-makers whose organisation has, or plans to adopt, B2C commerce solutions tell us they are evaluating, or plan to replace, their commerce platforms.

How we can help: as a technology-agnostic partner, we offer deep experience in commerce platform design and implementation, creating powerful platforms for some of the biggest brands and retailers. We can offer organisations a free platform migration consultation where we discuss your current tech infrastructure, goals and strategies, and offer guidance on what it takes to migrate to a high performance, future-ready platform. Connect with Nick Harry.

Value through enablement

‘Enablement’ should also be considered a vital part of technology investment. We have seen instances where companies pay huge licence fees for top-of-the-range tooling but rarely make effective use out of it. As new tooling is invested in, and introduced to an organisation, it is critical to adopt a business user enablement plan in parallel to set the team up for long term success and realise the full value of these capabilities. The themes associated with business enablement include:

Change approach (including communication and governance) – early engagement with business user to encourage technology adoption to deliver maximum value.
Business readiness – developing the optimisation roadmap to ensure the business continues to utilise the tool appropriately as the organisation matures.
Training development and documentation – onboarding new users and educating existing users on features, capabilities, and benefits of current or new technology

How we can help: VML Commerce can create an enablement approach bespoke to your requirements and business needs. A typical engagement will include a short discovery and assessment phase to understand the tools, business owners and how this could be impacted but current or new technology. Completing this phase will surface training needs and impacts to existing user roles and teams in terms of roles and responsibilities. An enablement plan can then be created in the form of training modules, learning labs and the creation of user guides and playbooks for onboarding. Connect with Shalina Ganatra. Shalina explains more about enablement in this video too.

Traditional value levers in today’s market

Deals and discounts will continue to be at the heart of marketing plans. Events such as Black Friday and Cyber Monday are becoming increasingly dominant in the retail calendar and, during the Qa-2022 peak period, brands introduced their deals earlier than ever, reflecting the needs of budget-conscious shoppers looking to take advantage of deals and spread their costs over a longer period.

Whilst Black Friday, Cyber Monday and Christmas used to be distinctive peaks, they now have an element of overlap or what we term a retail ‘Mega Peak’, and it is important that promotional strategies are well thought out and will sustain over the full period. Customers will be kept engaged through a blend of offers to keep them coming back – for example, personalised offers, deeper discounts, innovations etc… with brands continuously conjuring up ways to demonstrate value to customers.

Our peak retail research found that 57% of Brits planned to start their Christmas shopping during Black Friday. Companies matching this shopper mindset are reaping the benefits, with brands such as Hamleys and Molton Brown reporting volume growth up to 219% vs this time last year. Luxury gift retailer Biscuiteers was offering free delivery on Christmas orders booked during October which contributed to a 30% uplift.

How we can help: Through its Peak Operations Centre, VML Commerce supports many of the UK’s leading brands and retailers throughout the peak retail periods via a dedicated 24x7 support service. Connect with Jason Franklin.

Our consultancy and CX teams have also helped deliver record breaking Black Fridays for the likes of Tommy Hilfiger and Calvin Klein. Connect with Tim Bishop.

Providing value through your channel portfolio

There are some inherent contradictions in what consumers want. On the one hand, they crave simplicity, convenience, a seamless journey that gets them the products they want as quickly as they want. On the other hand, they demand choice & flexibility.

Operating mainly across third party channels online leads to a fragmenting of the brand experience and a loss of control with your customers which can end up damaging rather than building your brand. Previously, businesses invested a lot in channel breadth, ensuring that their products were well represented wherever the customer wanted to shop. However, within the today’s retail environment, businesses should be prepared to re-address strategies to do the right thing by their brand today. It is important to frequently evaluate your distribution channels to assess how your ecommerce partners stack up against the market across a range of KPI’s. Be prepared to streamline third party partnerships where needed and have discussions those not contributing to your brand value.

How we can help: we have developed a strategic framework called Channel Audit to rapidly assess where the biggest opportunities lie for your brand(s), and how to overcome the challenges that are slowing down your eCommerce growth. Our services also include assessing your challenges and opportunities across distinctive areas such as channel distribution, marketing and retail partner assessment. Our methodologies enable us to make recommendations which can be transformed into growth and optimisation opportunities.

For a limited period, we are offering a free Channel Audit service. Connect with Chris Slade to apply and for further information. Chris explains more in this video.

Winning the hearts of customers through great experience

Our latest Future Shopper survey found that 58% of shoppers would not shop with a retailer, brand or marketplace that did not meet their expectations. Customer experience has replaced brand as the primary lever that determines customer retention, loyalty, average spend, reputation etc. In fact, we could go as far as to say that customer experience goes a long way to defining brands these days.

The pandemic forced brands to rapidly shift to a digital-first model and accelerated ecommerce adoption drastically, with 62% of consumers globally seeking to increase their use of digital channels in light of their pandemic experience (based on our Future Shopper research). Now that these newly adopted digital channels are becoming more established in the sales mix, it is important that customer experience is brought into strategic focus to accelerate growth potential.

All this makes nailing the ‘brand experience’ critical - and should be a shared responsibility across the brand and retail partners.

How we can help: We help our clients create experiences that delight, rather than frustrate, customers. Our proprietary methodology ensures our clients win this battle, by providing clarity on what precisely needs to be done, and how to create an experience both powerful and engaging. We examine every touchpoint in the omni-channel journey to determine solutions for how to organise people, support infrastructures, integrate services, and present communications as well as highlighting customer needs and expectations. This serves to inform the prioritisation of your roadmap to drive maximum value and the biggest impact to your business, and the customer. Connect with Rachel Smith to conduct an end-to-end journey map.

Consumers crave superfast shopping experiences and shoppable moments

Pricing and promotions will get you so far, but it is vitally important to ensure your customers’ path to purchase is fast and friction-free to retain your customers throughout the journey across all channels. Our research found that 80% of shoppers globally want to get from inspiration to transaction as quickly as possible; and 64% of consumers prefer ordering from a single destination. With the significant appeal and threat of marketplaces, it’s essential the brands provide a slick path to purchase for their customers to maximise their opportunity to convert.

How we can help: With customers shopping on more channels and devices, we have a suite of solutions that make every online moment shoppable, converting buyers into loyal customers through engagement across the purchasing funnel. For instance, “Where To Buy” empowers clients (typically lacking a D2C channel) to reach customers by surfacing contextualised ‘shoppable moments’, and our fully managed product feed management service helps maximise client sales by optimising product feeds. Connect with Ken Platt.

Creating value through measurement

60% of global shoppers said they will increase their usage of digital shopping channels in the future (according to our Future Shopper survey). Today’s customers are connected and empowered. Fierce competition means that those who don’t meet expectations will fall behind. Harnessing the power of data will enable teams to feel enabled to make customer-centric, high impact decisions which could have a significant impact on KPI performance. It can be difficult to cut through the complexity when it comes to developing a data strategy, but we can help to define what to measure, how to measure it and what to do with the results – transforming data into insights to optimise performance across customer journey, channel performance, commercial performance and more.

How we can help: VML Commerce work with organisations in taking their first steps in data transformation. This ranges from undertaking an audit on customer data tracking set up to understand behavioural and conversion analytics across your digital estate, right through to the creation of measurement framework and reporting dashboards, in order to equip your teams with tangible insights to inform decision making and improve metrics aligned with your business strategy. Connect with Adonis Themistokleous.

Simplifying decision making with AI

As discussed, there is a myriad of avenues to help prepare your business for the current challenges, but how do you know where to focus your time and investment? Unless you have access to unlimited resources, it can be overwhelming to know where to turn to first - whether that be technologies, channels, strategies, talent or partnerships etc. Artificial Intelligence can be utilised to generate smarter decision making to drive the right actions at scale.

To minimise risk, AI can be leveraged by way of a “digital twin” to simulate potential scenarios. Digital twins are virtual models which can enable rapid ‘what-if’ scenarios to aid data-driven decisions and effective business planning whilst minimising impact to resources and customers. A digital twin can bring a wealth of benefits such as identifying potential bottlenecks or capacity opportunities in the supply chain to name a few. And they’re just one example of how AI can improve businesses outcomes. In our recent survey on Disruptive Technologies, AI was identified as the leading technology to help organisations move forward.

How we can help: Our AI experts “Satalia” are thought-leaders in AI, and have integrated AI technologies and solutions into many leading businesses such as Tesco, DFS and Techdata to powerful effect. Connect with Daniel Hulme to discuss how the development and application of digital twins can inspire better outcomes across your business. Watch this video to see how Satalia averted a supply chain crisis for DFS, and hear from Daniel on the impact AI can make here.

Appealing to today’s consumers through new value perceptions

Despite the economic downturn and uncertainties, it is not uncommon to see consumers continue to spend on small luxuries such as cosmetics, beauty and electronics as they trade off big indulgences, such as holidays, with smaller, more regular treats. Brands that find new ways to help and appeal to cash-strapped customers will shine above the competition and raise the opportunities to retain customers and market share.

Listening and executing initiatives that are in line with your customers’ values will put you in a strong position and can have beneficial repercussions such as reduced churn, increased retention and customer loyalty. IKEA, for instance, are moving away from Black Friday in favour of a ‘Green Friday’ initiative, encouraging customers to re-use furniture through the incentive of a buyback and re-sell scheme in favour of deep discounts.

There is no doubt that the subject of brand and margin protection now weighs more heavily in the context of value when considering the current environment and the road ahead can be daunting.

We can help! Get in touch at if you would like to discuss any of the above in detail, to take advantage of the offers we have mentioned, and to explore how we can you tackle the challenges outlined above.