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Lead story – Target’s omni-push proves a digital point

MyPOV: Our pandemic retail coverage comes down to this: the sector’s digital pressures are going to separate the market. But we haven’t had what I’d call a definitive example – until this week.

Stuart has the story in Target’s omni-channel retail thinking pays off with largest quarterly sales surge in nearly 60 years. Yep, we have a winner:

Target just upped the stakes by turning in the largest quarterly sales surge in its 58 years history.

Before Coronavirus was a global scourge, Target was well into upgrading its store footprint and integrating its retail apps. Now we see the results, sharpening the pick-up/drop-off options up to the last minute, adding fulfillment locations, etc. And yes, the revamped storefronts are integral. Stuart quotes Target’s CEO:

Our stores actually drove more than 90% of our second quarter growth, given that they enabled more than three quarters of our digital sales and an even higher percentage of our digital growth… As a result, the majority of our digital demand is driven by items that are already available in our stores, which positions us to efficiently rely on those locations to fulfill the demand.

This isn’t rising-tide-lifts-all-boats; this is retail Darwinism with a pandemic twist. As Stuart notes, even Walmart has its digital hands full: Walmart sees a digital COVID boost, but e-commerce still doesn’t turn in a profit. But with its expanded fulfillment options, booming in-store sales, and Walmart.com nearing profitability, Walmart’s success looks inevitable. Not so much for others, like, say, Kohl’s:  COVID-19 crisis shines a light on the digital shortcomings at Kohl’s . As Derek writes:

The sense you get from Kohl’s leadership at this time is that the company is very much taking a reactive approach to the changes being forced by COVID-19, rather than speeding up plans that were already in place prior to the pandemic.

Reactive/catchup in a volatile market with a different kind of consumer? It’s the story of too many retailers right now.

Diginomica picks – my top stories on diginomica this week

• Returning to work – a challenging set of decisions – “Return to work” is the rallying cry for economic recovery. But Brian’s got some issues to consider first, not the least of which is worker safety and employer liability.
• A maturity model for enterprise digital teamwork and the collaborative canvas – digital teamwork is frought with a proliferation of tools and remote work issues. But our collaboration guru professor wizard ace Phil Wainewright has a matural model to contrast with your organization.
• Diversity training – a good start, but a truly inclusive organization needs more – Cath flags up the danger of faux inclusivity. Diversity training is, at best, a start. Without follow-through, it counts for little.
• Enterprise penetration testing is a security audit IT can’t fudge – Kurt examines the merits of white-hat hackers, versus the passive approach of hoping your tools will stand a true test.

Vendor analysis, diginomica style.

• How NHS Scotland built its COVID-19 contact tracing service in four weeks with ServiceNow – Derek on a timely and speedy project – this will be a good one to return to as they get further into contact tracing.
• “The only way to close the skills gap is to close the opportunity gap” – the CEO of Revature wants to change how programmers are trained and hired – I got lured back into the great skills debate, with a worthy foil and business model to explore.
• Welcome to Software AG – diginomica welcomes a new partner with a deep IT history and modern integration chops – welcome penned by yours truly.

A couple more vendor picks, without the quips:

• Burton Snowboards aims to give customers a frictionless ride with Infor – Jess
• Commonwealth Bank of Australia is using Pega to aim for millions of personalized experiences – Derek

Jon’s grab bag – I thought Brian was fresh out of gaskets, but he had a special fumigator ready for the life-and-shift crowd blew another gasket in this epic takedown: Friday Rant – moving to a hyperscaler is NOT digital transformation  Meanwhile, Martin unfurled a quality think piece in Will a new data economics govern how infrastructures grow?

Derek flags up a collective problem on the slow boil: The enterprise needs to prepare now for a COVID-19 mental health crisis. A culture of openly discussing your mental health without consequences? Not many enterprises can claim they’ve accomplished that.

Stuart easily wins the diginomica headline-of-week contest yet again with 101 damnations – privacy activists launch fresh challenge to firms conducting ‘illegal’ data transfers to the US. Bonus points for inserting a Monty Python reference immediately thereafter.

Best of the rest

Lead story – Meet the next-normal consumer 

MyPOV: No amount of super-fragilistic AI can predict what consumers in a pandemic will do next. People are still doing moronic hoarding of readily available paper products whatever they feel they need to do. But we’re far enough into the pandemic to nail down some trends. Precisely what McKinsey did in a meaty post this week. They boil it down to three:

• COVID-19 is changing how consumers behave across every aspect of their lives.
• Broad shifts to new behaviors hide significant variations.
• Companies must rethink how and where they connect with consumers.

One notable data point: overall consumption has shrunk by 12 percent. As McKinsey puts it: “Think fewer cosmetics and more flour.” (Yes, gobs more flour). Some insights border on the bloody obvious, e.g. consumers bunkered at home are digital shoppers. But will new behaviors stick after the pandemic? It’s a question with enormous implications for retailers. McKinsey contends that the answer is linked to buyer satisfaction:

In Italy, for example, 60 percent of consumers shopped online during the crisis, but fewer than ten percent found the experience satisfying. This suggests there will be only a limited uptick in long-term e-commerce use by Italy’s consumers. China, on the other hand, has seen a high level of new adoption with a high percentage of consumers indicating they will continue shopping online after the pandemic.

But consider telemedicine. Right now, only 40 to 60 percent of U.S. consumers say they plan to continue using telemedicine after the pandemic. But is this a commentary on telemedicine, or the caliber of service currently being provided? I suspect some health care providers that double down on getting telemedicine right will experience a long term benefit. The new abnormal will be with us, in some significant form, for a while – long enough for enterprises to gather fresh consumer data points, and get cracking.

On cybersecurity

• FBI, CISA Echo Warnings on ‘Vishing’ Threat – Krebs on Security reports on how malicious actors pose as company employees and obtain credentials over the phone.

Honorable mention

• Uber, Lyft granted temporary reprieve following threats to shut down in California – amidst the ride share downturn, important legal skirmishes on the future of the gig economy are unfolding.
• 6 Steps to Successful SaaS Renewal Negotiations – SaaS vendors prepare for renewal negotiations months in advance or more – customers should do the same.
• Where Does Empathy Fit in Industry 4.0? – Constellation’s Liz Miller with one of the most original posts of the week. Pull quote: “Design doesn’t mysteriously open a portal to a land of perfect products. It does, however, have the potential to make leaders uncomfortable. It invites criticism. It demands honesty. It creatively reshapes challenge into opportunity because it remains firmly grounded in a deep understanding of people.”
• Is Your Organization Suffering from Transformation Change Fatigue? – Eric Kimberling of Third Stage Consulting on the problem of change fatigue, e.g. executives piling up change mandates and wondering why their employees aren’t bubbling with joyful enthusiasm.
• GPT-3 Is an Amazing Research Tool. But OpenAI Isn’t Sharing the Code – A budding controversy in the AI community, with a questionable decision by so-called “OpenAI.” (Yes, this is the potent text-generation AI that wound up in the whiffs section last week because it fooled a bunch of Hacker News peeps).

Whiffs

She claims she was joking, but you have to love it when a candidate asks supporters to fast a meal and donate the savings to their campaign.

Speaking of fundraising, I’m thinking of doing some busking for AT&T and T-Mobile, to help them gather the funds needed to pay for the mobile coverage claims they evidently can’t afford. Meanwhile, typos take on a different look in 3D, eh?

The UK is having an algorithmic whiff-fest of it own:

diginomica story to follow. Finally, Google’s plans to disrupt college education drew the ire of my Twitter followers: Google Has a Plan to Disrupt the College Degree. Critiques included:

And diginomica regular Greg_not_so:

The problem here really isn’t Google, it’s the sensational “Google disrupting education” Inc headline, as well as the author’s breathless proclamation that this is a “huge announcement that could change the future of work.” Google’s saying the right things here. The only whiff is thinking the change to the educational system has arrived. That part’s on us. See you next time…

If you find an #ensw piece that qualifies for hits and misses – in a good or bad way – let me know in the comments as Clive (almost) always does. Most Enterprise hits and misses articles are selected from my curated @jonerpnewsfeed. ‘myPOV’ is borrowed with reluctant permission from the ubiquitous Ray Wang.