ed with no warning and global technology provider Yopto has announced the winding down of its email and SMS marketing products. “These aren’t ‘nice-to-haves’ – they’re often tightly integrated into sales, retention and customer experience,” Mal Chia, co-founder of digital agency Ecom Nation, told Inside Retail. “The knock-on effect [of providers shutting down services] is felt immediately in customer trust and brand perception, because shoppers don’t care if your provider disappeared – they just know their delivery’s late or their rewards points have vanished,” he added. Survival mode When brands find themselves in this situation, Chia advised that they should first triage, communicating quickly and transparently with customers so they can own the narrative rather than letting customers assume incompetence.  Secondly, they need to find a stop-gap solution, even if it’s imperfect, as long as it keeps operations moving. Dean Salakas, co-founder of the fast-growing “Aussie Retail Community” group on WhatsApp and consultant at the Retail Doctor Group, told Inside Retail that retailers using third-party service providers is still more helpful than harmful. “If you can move faster than your competitors [to replace a third-party service provider], it potentially becomes a competitive advantage rather than a problem,” Salakas said. “Immediacy is potentially either critical to avoiding catastrophe or even potentially becoming an opportunity,” he continued. Salakas recommended that retailers do a strategic review of their tech stacks at least annually to ensure they remain agile and adaptable to the current market. “I think every retailer needs to consider their own situation and forget what’s best practice,” he stated. Creating stability  But there are practices and strategies retailers can implement to mitigate the fallout that often follows when a service provider removes an offering or shuts down entirely. “Just like you wouldn’t build your entire marketing strategy on one channel, you shouldn’t build your entire operations on a single vendor,” Chia explained. “In practice, though, that’s incredibly hard in today’s era of tech consolidation, where the ecosystem is collapsing into a handful of dominant platforms,” he continued. “Dual integrations are rarely financially viable, and building every capability in-house is a fantasy.” With that in mind, retailers must not only thoroughly research service providers before signing on, but also throughout their partnership to stay up to date and anticipate disruption. “Understand their financial health, their strategic direction and their likelihood of disappearing or sunsetting products,” Chia stated. “Most retailers skip this step because they’re time-poor and under pressure to move fast – but the ones who do the homework end up far less fragile when disruption inevitably comes,” he continued. Chia said he understands why retailers have become so reliant on third-party service providers, noting that outsourcing is seductive because it’s faster, cheaper, and allows scale without hiring. “But over time, many retailers become ‘hollow organisations’ that rely on a patchwork of third parties to deliver the core of their customer experience,” he elaborated. “When that patchwork frays, they’re exposed.” Retailers need to recognise that dependency is always a risk, but the underlying problem is that most retailers don’t revisit their relationship with third-party providers.  Chia has a rule of thumb when it comes to deciding what should be handled in-house versus outsourced: “If it’s mission-critical to your brand experience or profitability, build the muscle in-house. If it’s highly technical, commoditised, or a genuine efficiency play, outsource it.” “The challenge for most retailers is they don’t revisit these decisions often enough, so what was ‘non-core’ three years ago has quietly become mission-critical without anyone noticing,” Chia concluded.