Digital Transformation Still a Priority for Mexican CompaniesBy Andrea Villar | Mon, 09/21/2020 - 15:50
When the pandemic hit, companies in all sectors realized that their digital transformation strategy could wait no longer. Six months later and with a lingering economic crisis, Mexican companies continue to drive their transformation towards e-commerce processes, automation and even artificial intelligence.
In this uncertain scenario, 48 percent of companies in Mexico believe that the area of their business that requires more attention to maximize results this year is digital transformation, according to a survey conducted by Nielsen IBOPE. The survey carried out among executives from different consumer and retail companies in the country reveals that, due to the COVID-19 pandemic, two out of every 10 expect a decrease in their incomes of more than 10 percent by the end of 2020.
“Suddenly, those who did not have a digital distribution/transaction platform needed one and those who could not deliver their product or service remotely began to falter. On top of this, a generation with enormous purchasing power found itself unable to transact, using interfaces that were never really meant for them. We woke up and the dinosaur was still there, asking for the Wi-Fi password to FaceTime with their family. Every company is now a tech company and even harder to grasp, every company is now an AI company (lest they are ready to disappear),” wrote for Mexico Business News (MBN) Pablo Martinez Flores, CEO & Co-Founder of Klustera back in August.
In recent months, unexpected demand for specific products has led to shortages. Closures have also had a major impact. "Companies have focused on prioritizing production in more relevant segments and on adjusting their innovation strategy, prioritizing and increasing investment in digital platforms, which has also led them to make price adjustments," Nielsen IBOPE survey details. Companies consider that the priorities for the remainder of 2020 will focus on e-commerce and omnicanality, as the digital transformation is one of the key aspects to maximize results.
“Consumer loyalty has been shaken. At the beginning of the health crisis, people made panic purchases. This caused a shortage of many products in supermarkets and thus consumers were led to try products they had not considered before. Currently, supermarket chains have normalized their inventories but people are still concerned about their income. For the time being, they still favor more affordable brands. Since March, about 40 percent of people have tried out new brands,” said Agustín Gutiérrez, Partner at McKinsey & Company Mexico, in an interview with MBN.
According to Nielsen IBOPE's analysis, innovation is one of the most contrasting elements for companies, with one side considering putting innovation on hold, while the other side seeks to redirect innovation towards the emerging health and safety trend. Looking ahead, economic uncertainty is the element that is most worrying for the rest of the year, while insecurity and violence remain concerns despite the lockdown.