FedEx employees sorting packages at a processing centre. (Joe Raedle/Getty)
When asked who in the company is responsible for leading their e-commerce strategy, the response from Canada’s troubled retailers was a collective shrug.
According to a new study conducted by Tulip Retail and Deloitte , retailers are aware they need to get with the times to remain competitive in a marketplace dominated by behemoths like Amazon and Alibaba. Not only do they lack a clear strategy—there’s some confusion about who’s responsible for it.
When asked directly, the answers varied widely. Thirty-three percent of respondents said it was being handled by their operations team; 19% said it’s up to IT; 14% said it’s the marketing department’s responsibility; 13% said it’s with the strategy department; and 12% said it’s the e-commerce team’s domain. The results were based on a survey of 162 of Deloitte’s retail clients at the start of the year.
The lack of coordination has a clear effect on online sales: as this infographic illustrates, a whopping 68% of Canadians buy from e-retailers outside the country instead of homegrown competitors.
The solution, the researchers recommend, is for companies to establish “a solid governance structure” that makes clear which department is spearheading the effort.
“The biggest impediment…is really the organization itself,” says Jennifer Lee, national retail leader at Deloitte. “You can build the infrastructure, you can build the supply chain, but how do you get the organization to work together?”
Retailers now have to cater to “omnichannel” consumers, the demographic accustomed to researching products online for the best deal before buying in-store, if ever. Ninety per cent of shoppers leave a store without making a purchase because they know other options exist online, according to the study.
These decisions—about how to reorganize supply chains, logistics and technology—need to be made quickly, unless they want to join the spate of retailers that have shuttered their operations in Canada this year.
So, who is the right person to lead? The head of marketing, says Lee. Strategic branding is more important than ever and professionals who understand that and can coordinate around that will need expanded mandates, says Lee.
“The CEO will help sponsor it, the CFO will help fund it, but who’s going to execute it? It’s going to be the chief marketing officer.”
Previously: CMOs are being shut out when C-suites need them more than ever
View the full presentation here:
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