Guest article: SOK built a customer-centric e-commerce culture and shares its most valuable lessons

Shifting company culture toward customer-centricity doesn’t happen overnight. Understanding customer needs through research and data has been at the core of S Group’s e-commerce development since 2019. In this post, we’ll unpack how we built a customer-centric culture and redesigned the operating model for both our grocery and general merchandise e-commerce businesses. We’ll also share the key lessons we’ve learned along the way.

Kicking off the transformation right before the pandemic and the shift in grocery shopping

We started transforming our grocery e-commerce in 2019, followed by our general merchandise e-commerce in 2021. Before these changes, SOK’s company culture was quite traditional – process efficiency drove decisions in a hierarchical organisation. Our e-commerce operations, built primarily around buyer-supplier relationships, were not yet fully embracing digital expertise, and customer-centricity was not as deeply embedded in our daily operations as it could have been.

Before the pandemic, most consumers did not yet feel the need for change in how they purchased food, as the competitive environment was very different from today. Digital grocery shopping channels were just starting to emerge. In contrast, online shopping was already well-established in the general merchandise sector, and the pandemic further accelerated the shift to online shopping.

The year 2019 marked a turning point when customer-centricity and data-driven decision-making were placed at the core of S group’s e-commerce development. The timing allowed for a quick response to the shift in purchasing behaviour brought about by the pandemic, as a larger portion of grocery shopping shifted online.

Before the transformation, the grocery e-commerce had been built on a different platform, and the work was rooted in the old culture. The development focused on the predecessor of the current platform, following a waterfall model with technical features at its core. The old version was built with the mindset of 'bringing the physical store online’, without considering why customers would choose the online store. The development reached a dead end, and despite significant investments, the old e-commerce project failed to address validated customer needs, making it clear that a new platform needed to be created from scratch.

The lessons from our previous experience opened our eyes: We realised that if we want to become the market leader in grocery e-commerce in Finland as competition intensifies, we need to completely rethink our approach. Just having an online store is not enough. To turn online grocery shopping into a habit for people, we must make shopping as easy as possible.

Our key lessons learned in creating a customer-centric culture:

1. Customer experience at the core

The results of extensive customer research provided a strong foundation for implementing change. The goal was to make grocery shopping easier, and all solutions were designed with the customer experience in mind.

Letting go of the old e-commerce solution wasn’t easy, especially after investing significant resources and having many satisfied customers. However, building the new e-commerce from scratch became easier when we understood what the true measure of success for an online store was. It wasn’t the number of features, which we had considered important with the old platform, but the superior customer experience: making grocery shopping as easy as possible.

Witnessing how our customers began to shift to the new service eased the transition. The new platform won customers over organically.

2. Data-driven decision making

Before transforming our e-commerce platforms, we didn’t systematically collect customer data, and decisions were more often based on opinion than data. The new approach relies heavily on continuously gathered customer data, which also makes it easy to internally justify the changes we’ve made.

Data also helps the organisation trust the new direction: it often shows that, while internal teams may still be hesitant about developing a particular solution, customers are already completely ready for it. Using data to address issues also helps senior leadership understand what we are developing, why it is the current focus, and how it impacts the overall business.

A customer-centric culture requires clear metrics and continuous collection of customer feedback. These metrics, in turn, helped demonstrate internally why the change was necessary.

3. Decision-making in teams

Rather than relying on available agile frameworks, the new customer-centric culture at SOK is strongly based on nine collectively defined core principles. One of these principles focuses on team decision-making: people with the best knowledge of the issue are the ones who make the decisions. This principle allows placing decision-making as low in the organisation as possible. 

At the same time, teams were provided with a clear service vision to guide development: “How does the customer feel when using our service?”

4. Courage to step into the unknown

Change requires strong leadership and committed individuals at all levels of the organisation. We identified key people who acted as change drivers, ensuring everyone embodied the new way of working. Many of our key team members have a long history at S Group, and we, too, had to go through a significant mindset shift. However, knowing the organisation well is a strength. It allows us to see what works and how to communicate in a way that helps people feel successful.

In all decision-making, we consider the business, customer, and technological perspectives, as no one has complete knowledge of everything. Although we work together in different teams, the cultural shift often relies on individual people. External coaching and sparring have been crucial in providing perspective and strengthening our capacity to change. At the same time, we’ve managed to preserve and utilise the tacit knowledge gained over the years, ensuring it supports our work in the changed environment.

It has been exciting to witness the tremendous progress in e-commerce over the past few years. Without bold, passionate, and committed leaders, we probably wouldn’t be this far.

- Marko Setälä, Senior Enterprise Coach, Nitor

5. Shared principles

The transformation of our e-commerce platforms marked a clear strategic shift, with the goal of growing three distinct online businesses. Despite the significant differences in the nature of our grocery, fashion & beauty, and general merchandise sectors, the guiding principles for all development work have been understanding customer needs, adapting to them, and organising operations based on customer value.

When the pandemic hit, our grocery e-commerce team consisted of only 20 people, and initially, the focus was on making food shopping as easy as possible. Focusing on a well-defined goal allowed us to progress quickly and achieve market leadership in grocery e-commerce earlier than expected.

We share technology, customer, and business insights across teams to ensure everyone understands our customers' needs and the bigger picture. This requires active engagement – technology experts must familiarise themselves with the day-to-day of the business, such as participating in order picking and store operations, to ensure that solutions truly serve the end users.

Continuous improvement centred around customer pain points

One of the significant changes we’ve made regarding goal-setting is the shift from output-focused to outcome-driven work. The outcome-based roadmap helps maintain focus on the overall solution, instead of individual tasks. In setting goals, we use the OKR tool. Leadership sets the broader objectives, but it’s the teams that define the specific outcomes tied to those goals.

Even though we’ve achieved goals, such as market share growth, as a result of the e-commerce transformation, improving the customer experience is the most important cornerstone of achieving business goals. In our ongoing effort to improve the customer experience, we focus on making the purchasing process as easy as possible. Customer experience is measured using both NPS and CSAT metrics, with results linked to employee incentives. These metrics have steadily improved, and teams receive weekly feedback on their performance.

We believe that our e-commerce market share growth is strongly rooted in how our culture has become truly customer-driven. At the same time, we continue to focus on internal development projects that may not yet be visible to end customers. For example, the continuous improvement of our architecture will enable an even better customer experience for our grocery and general merchandise e-commerce customers in the future.

Read more about SOK's transformation in this success story: SOK placed the customer at the center, and enabled online stores’ continuous growth and development