Businesses often face the need to adapt and evolve to remain competitive and meet the demands of the market. Sometimes, these changes require fundamental shifts in their business model and brand message. As evident in the recent case of Takealot, structural changes can be mandated by regulatory bodies to address issues of uncompetitive behaviour and level the playing field for smaller players. While such changes can be challenging, they also present opportunities for growth and innovation.

Earlier this week the Competition Commission published its final report of its Online Intermediation Platforms Market Inquiry. The findings of the final report stipulate remedial actions that require Takealot to make robust changes to its operations to resolve issues of uncompetitive behaviour identified.

Broadly, the online retailer will need to:

Stop forcing pricing limits on marketplace retailers;
Split its marketplace and retail operations;
Change how it displays highlighted products;
Boost previously disadvantaged businesses by giving them a leg up on its platform.

In this article, we will explore the challenges a business may encounter when undertaking integral structural changes, and we’ll discuss potential solutions through a robust brand and marketing strategy, with the assistance of a professional marketing team.

Challenges of Shifting Business Model and Brand Message

Undertaking a transformation in a business model and brand message is a bold endeavour that can yield significant rewards. However, such a profound shift comes with its share of challenges that require careful navigation and strategic planning. As exemplified by the case of Takealot, where regulatory mandates necessitated the separation of their online shopping platform into two distinct divisions, businesses must be prepared to tackle obstacles arising from internal and external factors.

There are very real complexities businesses may encounter when embracing structural changes, particularly in creating separate divisions for their marketplace vendors and conventional shopping experiences. Moreover, we have to explore the implications on consumers and the indispensable role of a sound brand and marketing strategy to pave the way for a successful transition. By addressing these challenges proactively, businesses can emerge stronger, more competitive, and better positioned to meet the evolving needs of their customers in a dynamic marketplace.

Here are some of the challenges a business may face:

Resistance to Change: One of the primary challenges faced by businesses during structural changes is internal resistance. Employees and stakeholders may be accustomed to existing practices and might be reluctant to embrace new processes and strategies. Convincing them to adopt the changes is essential for a smooth transition.
Rebuilding Customer Perception: Implementing significant changes can lead to confusion among customers. They might question the brand’s identity and feel uncertain about the new value proposition. Rebuilding and reinforcing the brand message becomes crucial to retain customer loyalty.
Competitive Landscape: In dynamic industries, competitors are quick to seize any opportunity presented by a market leader’s restructuring. A business undergoing changes must anticipate competitive responses and strategize accordingly to maintain market share.
Resource Allocation: Structural changes often require significant investments in technology, training, and marketing efforts. Allocating resources while continuing day-to-day operations can strain a business if not managed effectively.
Regulatory Compliance: Meeting the requirements imposed by regulatory bodies, like Takealot’s case, demands careful planning and execution. Failure to comply can result in legal consequences and damage the brand’s reputation.

Creating Separate Divisions for Marketplace and Conventional Shopping: Challenges and Transition Strategies

A significant shift that online retailers like Takealot are now facing is the creation of separate divisions for their marketplace vendors and conventional shopping experiences. While this strategic move aims to address issues of uncompetitive behaviour and provide a more inclusive platform, it brings forth a set of unique challenges. Let’s explore the intricacies businesses encounter while segregating their operations, from operational complexities to potential impacts on consumers.

Expected Challenges in Creating Separate Divisions:

Operational Complexity: Establishing and managing two distinct divisions within the online shopping platform can introduce operational complexities. Each division may require separate logistics, inventory management, and customer support, which could increase costs and resource demands.
Technology Integration: Ensuring the smooth integration of two distinct systems can be challenging. Marketplace vendors and conventional shopping customers should have seamless experiences without disruptions during the transition.
Data and Information Management: Separating the two divisions may lead to challenges in managing and sharing data effectively. Ensuring that customer information, purchase history, and preferences remain accurate and accessible is crucial for personalized marketing and customer service.
Customer Experience: Consumers accustomed to a unified shopping experience may find it disconcerting if the transition is not managed well. Any issues with order fulfilment, payment processing, or customer support can lead to dissatisfaction and potential loss of customers.

Impact on Consumers:

User Experience: Consumers expect a smooth and hassle-free shopping experience. A divisional shift could lead to temporary disruptions, potentially affecting user experience and customer satisfaction.
Perception of Marketplace Sellers: Marketplace vendors may face challenges related to visibility and trust during the transition. Customers might perceive them differently when they are separated from the platform’s main brand.
Brand Consistency: Maintaining a consistent brand image and messaging across both divisions is essential to avoid confusion among consumers and reinforce brand loyalty.

Transition Strategies with a Sound Brand and Marketing Strategy

A professional marketing team can be instrumental in orchestrating a successful transition during structural changes. They bring expertise in crafting and executing marketing strategies, understanding consumer behaviour, and leveraging digital platforms effectively. A marketing team can:

Conduct Market Research: Assess market dynamics, competitor strategies, and customer preferences to formulate data-driven marketing plans.
Develop Branding and Messaging: Create a clear and compelling brand message that resonates with the target audience and aligns with the new business model.
Implement Multi-Channel Campaigns: Utilize various channels to reach customers at different touchpoints, maximizing the impact of marketing efforts.
Monitor and Measure Performance: Continuously analyze campaign results and consumer feedback to fine-tune strategies and ensure optimal performance.

At WritersHand Studios, our approach to large structural change is to help businesses transition their business model in a way that identifies new opportunities to grow and leverages them. As brand architecture and consumer behaviour specialists, we look at elements of UX, UI and XD to inform our decisions on crafting a brand and business strategy to deploy changes within a digital business.

Potential Solutions and Marketing Strategy:

Clear Communication: Transparently communicate the reasons for the divisional shift to consumers, emphasizing the benefits they will gain from the improved experience. Address any concerns proactively and keep customers informed throughout the process.
Unified Brand Identity: Ensure that both divisions retain a unified brand identity, including logo, colour scheme, and brand values. This consistency will help consumers connect the separate divisions to the overarching brand.
Personalisation: Leverage customer data to provide personalized experiences across both divisions. Tailor product recommendations and offers based on customer preferences to enhance engagement and loyalty.
Seamless User Interface: Design a user interface that intuitively guides consumers between the two divisions without causing confusion. Implement a user-friendly navigation system to enable smooth transitions between the marketplace and conventional shopping.
Customer Support: Strengthen customer support teams to address any issues or concerns promptly. Ensure that both divisions offer excellent support to build trust and loyalty among consumers.
Promotional Strategies: Develop targeted promotional campaigns to create awareness and excitement about the new divisions. Consider offering special incentives to encourage customers to explore both sections of the platform.
Partner Collaboration: Collaborate with marketplace vendors to align their brand messaging with the platform’s overall branding. Provide them with marketing resources and tools to maintain a consistent image while benefiting from increased exposure.
User Testing: Conduct extensive user testing and gather feedback from customers during the transition phase. Identify pain points and address them promptly to improve the overall customer experience.

Radical Structural Change Is Not Impossible

Shifting a business model and brand message to accommodate structural changes can be a challenging journey. However, with the right approach and support from a professional marketing team, businesses can overcome these obstacles and emerge stronger and more competitive. Transparent communication, brand repositioning, targeted marketing efforts, and adherence to regulatory requirements are essential elements of a successful transition. Embracing change with strategic marketing can pave the way for growth and a renewed brand identity in the evolving market landscape.

Navigating Structural Change: How Will Takealot Transition Its Marketplace?