73. Do You Have a Living Channel Strategy?

Legacy channel executives will want to pick up a copy of The Living Supply Chain, by Robert B. Handfield and Tom Linton. I recently reviewed and recommended it on Amazon. The authors make the case that a convergence of maturing technologies is enabling supply chains to become LIVING, their acronym for what they see as the new key supply chain components: Live, Intelligent, Velocity, Interactive, Networked, and Good. The authors focus more on inbound global supply chains to factories, but you can sample their observations just by shopping through Amazon.

Amazon already gives you interactive, mobile, bottom-up information

Amazon is consistently number one in ratings for online shopping experience. A big benefit is their bottom-up, crowd-sourced reviews, ratings of the reviews, FAQs, photos, and ever-growing library of product-related videos.

Resellers continually interact with the system with constantly curated product offerings and dynamic price changes. How? They use Amazon Web Service (AWS) tools, often with assistance from AWS’s API software partners and reseller consultants.

This ecosystem of information will mushroom, along with cloud computing, bandwidth connectivity, smart device processing, artificial intelligence, and voice recognition. And, consumer shopping expectations and replenishment habits will in turn continue to change.

Informational transparency and logistical preemption

Amazon tells the unvarnished truth. You can read verified purchased reviews, both positive and negative. While brands and resellers hate negative reviews, Amazon strives to be “Earth’s most customer-centric company”. So, Amazon users get ever-better product selection and information. Contrast this with a rep who can only share what they know about only what their company may have in stock.

There are no stock-outs at Amazon. When buying, we see information like: “Only 3 left in stock. More on the way,” or “Buy this in the next 68 minutes and get it by 4pm tomorrow”. After a one-click purchase, the stream of thank you and tracking emails begins. Fulfillment by Amazon rules!

Artificial Intelligence

In my experience, Amazon bot recommendations often lead me to valuable purchases. Humans can’t statistically upsell and cross-sell as well, and even if they can it’s at a much higher cost. Resellers interact with Amazon electronically and the bots do heavy alert work. Whether a reseller gets into the “Buyer’s Box” (based on best service and price) depends upon data and bot decisions.

And, just wait to see what happens with Alexa and voice commerce over the next 18 months.

There are many challenges ahead, and companies need to know how to plug into living-channel federations, new alternatives, and vertical marketplace platforms. I will be addressing these, and others, at the fall APIC conferences. Hope to see you there.

Phoenix: October 16-17th www.apicconference.com
Toronto: October 26th www.apicconference.ca