Let's Get Digital

Women's Wear Daily recently commissioned a study that indicates brick-and-mortar retailers are far behind the curve when it comes to digital strategy.  While this headline is not all that surprising, digging into the results reveals quite a bleak digital picture for brick-and-mortar retailers.

The study included responses from just over one hundred retail executives, most of which work at companies with brick-and-mortar and e-commerce sales channels.  I have summarized some of the key points from the survey below.

Regarding the current situation:
  • Majority of respondents characterized senior leadership teams and boards of directors as being "not particularly digitally savvy."  
  • 81 percent believe that their websites are not as effective as they could be.
  • About half feel their investments in digital have been inadequate.
And their outlook for the future:
  • 86 percent believe "multichannel initiatives will be a significant driver of future growth."
  • 86 percent expect stores without a strong web presence to have slower growth in the future.
  • Three-quarters expect checkout via mobile device to become standard. 
While an overwhelming majority of executives recognize the importance and inevitable continued growth of the online and mobile sales channels, most are unsure of how to capitalize on this trend.  There are a number of reasons for this knowledge gap.  Les Berglass, founder and chairman of the firm that conducted the study, explains that brick-and-mortar retailers evaluate opportunities in multi-year increments, because they typically sign multi-year leases.  The digital world moves exponentially faster, and operating in it requires a different management mindset. 

I describe this distinction in a previous post entitled "In E-commerce Waste is (Sometimes) Good."  When it comes to digital, retailers need to abandon their often deeply ingrained fear of failure.  They need to embrace new initiatives, and adapt quickly based on the way those initiatives pan out.  If current management is not equipped to do this, they need to bring in new talent that is.  Retail leaders recognize this, as exemplified in this anecdote from a Fast Company profile on Walmart and its efforts to become a digital leader:
Jeremy King was ignoring the largest retailer in the world. For a month, he'd been getting calls from a Walmart recruiter. King was used to being wooed, since he was well known in Silicon Valley as an engineer who built key parts of eBay's infrastructure. The calls kept coming. Finally, he picked up the phone and let Walmart know exactly what it would take to get him to interview. "I was like, 'Why don't you get the CEO on the phone--let him talk to me and then maybe I'll come in?'" recalls King, who didn't even know who the CEO of Walmart was. "I was being cocky. The CEO of the world's largest retailer wasn't going to meet with me just so I'd do an interview.  The next thing King knew, Walmart arranged for him to join a videoconference with CEO Mike Duke. 
To become more comfortable and confident about their digital capabilities, retailers need to learn the digital business inside and out.  Whether this means bringing in the best outside talent that you can get, as Walmart has done, learning the business yourself, or a combination of the two, it is well worth your time to make this a priority.
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