Small companies have agility on their side. They can pop up in new and existing markets in the blink of an eye and pivot their entire proposition faster than some enterprises can schedule a team meeting. Lower operational expenses leave more time for R&D whilst smaller teams can collaborate on, test and iterate new ideas quickly.
Just take high growth hospitality startup AirBnB, which has more rooms listed on its site after a few years than many of the largest hotel groups in the world have in half a century. Nobody saw that coming five years ago.
Disruption isn’t a one way street
Harvard Professor of Business Administration Clayton M. Christensen suggests that established firms fail when they stop keeping up technologically with other companies in the same sector. Christensen called this the ‘technology mudslide hypothesis’, explaining when companies are at the top of the food chain they become complacent.
But why should scale make you stale? Acting smartly, big retailers are more able than ever to keep up with smaller players and ensure they are serving their customers every bit as well.
And often this comes down to tech.
Explore your ecosystem
One company that does this exceptionally well is John Lewis. It has shown how even one of the most established businesses can tap into the new opportunities, ideas and trends.
The heritage co-op retailer continues to innovate and just launched the next round of its startup accelerator JLAB following success last year. The accelerator offers mentorship and office space to retail technology startups with winners getting £100,000 and a potential contract with John Lewis.
Some retailers such as Tesco have even gone as far as to open separate innovation offices in areas like London’s Old Street - a hub of London’s tech startup scene - just so they are closer to the digital and technology businesses growing up there.
Lead the charge
Large retailers have the capital and clout to be able to speed up adoption of new technologies. Just look at contactless payments, which encourage spending and improve the shopping experience for customers.
After the major high street stores and supermarkets deployed contactless payments uptake increased dramatically. In 2014 there were 54 million contactless cards issued and more transactions took place than over the previous six years combined. This was all down to major high street stores and supermarkets deploying the technology ubiquitously across their stores.
Take the plunge
In some situations, the levels of bureaucracy and adversity to risk within larger retail businesses can make innovation and evolution difficult. For this reason it’s more important than ever that these retailers have someone on the management team dedicated to the identification and implementation of new technology.
Argos chief operating officer David Robinson is a great example of an individual driving technological change in an organisation. He spoke recently at Retail Week Live about the company’s move away from their traditional catalogue to focus on a digital-driven marketing campaigns. He also explained how Argos could now deliver personalised experiences to 12 million customers through data collection and analysis.
The executive’s aerial view is essential for identifying pain points and introducing tech to alleviate pressure. Pilots can be implemented to minimise risk and once a system has been proved a success then your company structure should make it easy to roll out across other stores and teams.
Don’t rest on your laurels
Continuing to explore, experiment and innovate is essential to building the retail experiences of the future. With businesses large and small working together we can truly change the market place and raise standards across the board. Your customers deserve the best and you’re in the best position to provide for them.