Consumer habits changed overnight as we were forced into lockdown. Even as businesses reopened, the habits and preferences of consumers continue to evolve as we strive towards a ‘new normal.’ As we mentioned in our previous article, economic recovery will be about innovation as companies seek out different ways of operating. To that end, here are three investments we see companies making right now to protect and even grow their EBITDA.
Most organizations had to make quick shifts once the pandemic hit to deliver their products or services in different ways. Suddenly, companies added sales channels including third-party delivery, curbside pickup, virtual services and online sales even when they had never done so before. As proof, Shopify reported a 47% increase in revenue for the first quarter of the year as companies scrambled to sell online . Zoom’s users increased by almost 20X, not only due to remote working but also because companies have switched to online training and virtual delivery of their services .
One of the challenges companies begin to face is that diversifying across new channels means needing to measure new KPIs (or slicing old ones across new dimensions) to see how they’re performing. An increase in the volume of data collected is natural, but there will also be an increase in the clutter of data sources. What this means is that for anyone who is reporting primarily through a mix of dashboards and spreadsheets will suddenly see their workload skyrocket as executives seek to test a variety of models. So, in addition to the investment in diversifying channels, we see a parallel investment in technology that helps declutter new sources of data.
Between what seems like yesterday and today, some of the metrics you watched closely became obsolete or, at least, much less impactful. For example, in QSR, same-store sales comparisons are much less impactful now when stores are open at only partial capacity, or not open at all. In its place, third-party takeout is much more important. But it’s not just a simple swapping of one KPI for another, since KPIs allow companies in the same industry to be compared side by side. Sudden changes in what KPIs are considered important can put some businesses at a disadvantage if they aren’t able to act on the change, but can also open opportunities to up-and-comers to take advantage of the shift in how the company performance is evaluated. Once again, this could mean an overhaul to legacy internal reporting, which some companies may struggle to do in a nimble way.
Starbucks recently announced the closure of over 400-stores alongside the opening, over time, of new ones with leaner formats, including takeout only . What’s interesting here is that Starbucks was already observing, through the collection, measurement and analysis of their own data, that consumers were increasingly likely to grab coffee “on-the-go”, which is significant for a company that built its brand on the coffeehouse lifestyle. What we see here is a company who was perhaps teetering on the edge of a decision which their own data was supporting. What the pandemic ultimately did was force the hand that resulted in a huge pivot of this kind. Being able to make decisions that may diverge from the original sentiment of the brand, but also based on data they’re seeing and the need to remain nimble during times of uncertainty shows an investment in flexibility. Even in the early stages of reopening and recovery this may help Starbucks weather the pandemic better than its competitors.
Companies are investing more into diversifying their sales and delivery channels, create flexibility for the organization, and retool their KPIs. These are all things that will help protect and even drive profit.
One of the challenges of diversifying channels, retooling KPIs and changing aspects of your business model is that your peoples’ workloads will skyrocket as they make changes to what and how they measure in the business. Pretty soon they’ll realize that a collection of spreadsheets and dashboards isn’t cutting it. TypeSift is a minimalist platform that strips away the bulky installations, huge maintenance teams, and lengthy turnarounds that come with classical business intelligence. If your business is implementing any of the investments we discussed above and would like to know how you can adequately measure their performance without adding 7-figures to your budget, please connect with us today.
 Shopify Sees 47 Percent Revenue Growth in Q1 2020 Amid Impacts of COVID-19. Meagan Simpson, Betakit. May 6th 2020
 Zoom grows to 300 million meeting participants despite security backlash. Tom Warren, The Verge. April 23rd 2020
 Starbucks is closing up to 400 stores and expanding takeout options. Chauncey Alcorn, CNN Business. June 11th 2020
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