Vivaldi Founder and CEO Erich Joachimsthaler was interviewed the other day by DayBreak USA. In his conversation with the host, Jay Young, Erich talked about what brands and businesses need to know in order to connect with consumers in today’s digital world. The empowered consumers are Always-On with fickle preferences. Companies must meet this change by enabling their digital enterprises. Erich goes on to explain how companies can do that as well as mistakes to avoid.
You can listen to the full audio here.
A transcript of the interview is below.
Jay Young (Host): New digital business models. Redesigned supply chain. Redefined market strategies. We’re joined this morning by Erich Joachimsthaler, Founder and CEO of Vivaldi, to talk about some of the ways that businesses can respond to changing conditions. Erich, Good morning.
Erich Joachimsthaler: Good morning.
JY: So, responding to these conditions, this has to be important. Just sitting back and doing nothing and pretending that this stuff is not happening, that’s going to put you out of business, right?
EJ: Yes, that’s exactly right.
JY: So, what’s some of the biggest changes facing companies today, Erich?
EJ: I think two things that companies face. Number one, they face a fundamentally different consumer market. I call it the “Empowered Consumer,” the “Always-On Consumer.” The consumer is much more fickle, is changing preferences on almost on an daily, or weekly, or hourly basis. And that is the big fundamental change that companies need to deal with.
JY: And how do they do that? If you’ve been in business, maybe you’re a mom and pop shop, or whatever it happens to be. How do you stay on top of these trends and these changes?
EJ: You need one fundamental thing. That is whether you’re a small mom and pop, or a very very large company such as IBM or Mastercard, let’s say, you’ve got to enable the digital enterprise. The biggest mistake most companies make, they think that they need a website and they call it digital strategy these days. That’s not a strategy – a website. Updating yourself on Twitter or some social media, or monitoring social media conversations, also is not a digital strategy. I think you need to fundamentally think about how to connect the outside of the company, the changing consumer, with the inside of the company. That’s what I mean by enabling the digital enterprise.
JY: So how can brands, companies use this digital to be more consumer centric?
EJ: There is a lot of different ways. I can give you a few examples. Think, for example, a company like Burberry: very traditional, very old, 150 years old in the fashion business, a business that typically doesn’t even change. What Burberry did is, they made videos online shoppable. Their catwalks, that models walk through and show the latest fashion, they made it shoppable. That means that people can click on it and be charged $1000, or pounds if you will, for a particular jacket or skirt they want to buy. Burberry has money in the bank before they make the order in China and then deliver it in 700 stores within the next two months. That’s not just a website, that’s a changing business model that’s fundamentally changing the way that Burberry is going to make their money and how they operate and connect with consumers, to your question.
JY: I imagine a lot of businesses look at that and go, “Oh, that’s just too much. That’s just too much for us. We can’t handle that.” So how does this digital technology help after the supply chain?
EJ: So that fundamentally changes the entire supply chain. but I think what you need to do is this. The biggest problem I see is that most people are too tentative. They believe in this old world of, “Well, let’s study, then act, and then evaluate, and then see how it goes.” So they go step by step by step, you can’t go step by step by step. You’ve got to be committed to a particular change. And that starts with small steps. Every journey starts with small steps. But you’ve got to have a vision and a commitment to fundamentally think that your current business, the way you currently deliver value to customers through your supply chain is going to change. It will change, and if you don’t change it, someone else will and you probably don’t like it.
JY: Erich Joachimsthaler, our guest this morning, founder & CEO of Vivaldi. So, what are some of the biggest mistakes or maybe some of the most common mistakes that companies make when they’re moving into the digital age?
EJ: I think the fundamental problem most people do is that they are reactive and thinking of what competitors are doing. And I think that doesn’t work. We are operating right now at the speed of light. As I said, consumers are always on and empowered. You have to stay ahead. You don’t get on shore by paddling behind the wave. In my opinion, this is a different change I have experienced in 30 years. This is the change: you have to paddle and then you have to be getting on your boat before the wave gets close to you. So it’s trying to stay ahead of it. You don’t have to do everything; you don’t have to bite off everything. But you’ve got to play. You can’t just watch and then think you can apply best practices by hiring consultants or an ad agency to sort of copy and paste best practices. That game no longer works.
JY: And Erich, where can people go, where can business owners go to learn more information about this?
EJ: I find it very useful in the tech space, the digital space, and over the last several years, there are a number of sources: Forrester, Altimeter, think tanks. There are a number of different think tanks in the East Coast and the West Coast that gets you on a regular basis, the latest insights. Gartner has some good information, if you’re more on the digital and information technology side. Every industry covers these particular topics. Unfortunately, some of the traditional industry associations still are in the workshop mode and a little bit uninformative. But I think the sources are out there. We are in an information revolution. Those information are online right now.
JY: Erich Joachimthaler, thank you so much for joining us this morning. Ready to embrace it or we die. Thanks again for joining us.