Manufacturers and service providers relying on channel and traditional networks for sales and distribution face the challenge of maintaining a unified marketing strategy, and ensuring quality customer service in an environment where each channel partner may have their own tactics for doing so.
Gig platforms are rapidly challenging traditional channel marketing tactics, and even those organizations which still maintain a traditional sales channel partnership program are learning from the innovations being employed by gig platforms.
Companies using traditional channel partnerships leverage partners which, in an attempt to maximize profits, are very specific in their targeting. They go after the deepest pockets, the customers most likely to offer repeat business, and the regions with the highest concentration of potential buyers. While at first glance this may seem advantageous to the bottom line, this approach is leaving money on the table, and results in pockets of underserved regions. Failing to see a way to service those regions profitably, they get ignored. Gig platforms, however, have found a way to do so, and traditional providers need to take a closer look at what the gig economy is offering if they wish to remain competitive.
“Gig platforms have opened up new possibilities for marketers by putting in place a new type of sales channel that doesn’t rely on a formalized network of channel partners,” said Andrew Marcus, co-founder of FitnessTrainer.com, a gig economy platform for personal fitness trainers to connect with people looking for fitness education and guidance. “While traditional channel programs tend to focus on the lowest-hanging fruit of densely populated regions, gig economy platforms open up the sales channel to potentially hundreds of thousands of people, many of whom are in regions that traditional channel partners, retailers, and service providers ignore. The result is better customer service and an expanded customer base.”
An artisan marketplace
In allowing the gig channel to target these smaller regions, companies are opening their doors to the possibility of serving a much broader client base by including smaller entrepreneurs and gig providers in the mix. “The gig economy is an exciting return to the era of the artisan and village marketplace, but on steroids,” said Chip Bell, author of Kaleidoscope: Delivering Innovative Service that Sparkles. “It rewards the entrepreneurial spirit, creates a closer connection with the customer, and enables flexibility traditional organizations cannot match.
Most importantly, it is influencing larger organizations to be nimbler and far more innovative, features that are critical if we are to successfully compete on a global scale. Look how many Uber-like features are being morphed in traditional organizations. The fact that most gig roles have instant customer feedback mechanism ramps up the requirement to be great. And, that greatness gets generalized to every enterprise on the planet. We all benefit from an elevated standard of service, regardless of the source of that increase.”
While the traditional model seeks to standardize offerings, delivering customization only within set parameters, the artisanal nature of more grass-roots gig platforms allow for a great deal more flexibility. Bertrand Patriarca, CEO of WashOS, an on-demand auto detailing app, said “The on-demand economy’s model makes it easy and convenient for the customer to get things accomplished on their own time.
Additionally, it makes them feel that their business is important as each task can be customized to their individual preference, time and location. Rather than long, drawn-out processes of traditional businesses like conducting focus groups, studies and surveys that could take weeks to months to obtain and analyze before creating a new strategy, the gig economy operates on instant feedback and reviews. It allows the company a real-time insider look into what is important to each customer, and therefore target audience, which enables quick and nimble adjustments to be made to ensure optimum service.”
Building a network in Internet time
Traditional sales and provider networks are built up over a long period of time, but the gig model turns that model on its head, potentially creating a channel of thousands of providers in a fraction of the time traditional networks are built. According to Ryan Arshad, Managing Director of BrandCap in the US, “In today’s connected world, everyone is seeking immediacy. Cutting out unnecessary layers and interactions which allows people to focus on what matters is where platforms play a crucial role in improving customer experience over traditional face to face or personal interactions, which can be cumbersome and time-consuming.”
Gig platform lessons for mainstream providers
In the hyper-fast environment of the gig economy, traditional providers are acknowledging the need to change their sales and distribution models. “The key is to take the principles of how these platforms improve customer service and then apply them to a traditional business model,” said Arshad. “For example, recruitment platforms such as ShiftGig can immediately connect employees and employers for temporary work whereas traditional players are still organizing interviews and resume reviews. We’re a more technologically advanced society than ever before. Mainstream providers need to learn from start-ups, embrace technology, and trust customers.”
Those mainstream providers missing out on serving those underserved populations can take a lesson from the gig players in terms of targeting, and in the ability to be more nimble and flexible. Traditional gym and daily workout franchises for example, locate facilities in areas with demographics that support a large customer base of loyal customers, a strategy that does well for those facilities in high-traffic areas, but again leaves out a large potential customer base in outlying areas. “In creating FitnessTrainer, we saw an opportunity that traditional providers weren’t offering,” said Marcus. “Individual providers signed up through a gig platform are more readily able to profitably serve a smaller community that may be ignored by a franchise.”
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Dan Blacharski is senior contributing analyst at Compass Intelligence, a market acceleration research and consulting firm; and the founder and senior PR counsel at Ugly Dog Media, a thought leadership, and public relations consultancy. Follow @Dan_Blacharski