Oups! It did it again...

Who's "it"? 

Those who ansered eCommerce win! eCommerce has transformed the way consumers shop and buy. It always did since its inception.

So, what is different now that is worth a story?

This is the time of the year where publicly traded retailers are reporting their FY 2013 results and I suspect that we will read more stories like this one:

Last week, teen apparel retailer The Wet Seal Inc., owner of the Wet Seal and Arden B brands, made a push to grow in e-commerce following dismal fourth quarter and fiscal year end results.

Apparel/retail industry is challenged by a number of macro issues, such as mall traffic and teen shopping patterns (eCommerce, isn't it ?). To bolster its efforts, the retailer has raised $27 million. One of the strategies will be towards the deployment of resources to grow the ecommerce business. To further those initiatives, Wet Seal added three board members with expertise in social, digital and e-commerce, which CEO John Goodman says are “key areas of focus within our business.” 

The Wet Seal Inc. operates 475 Wet Seal stores and 57 Arden B stores. FY 2013 net sales were down 8.7% from FY 2012. Consolidated comparable-store sales declined 4.1% for the same period. 

My word to you.

Embrace eCommerce and make it your best ally. Be in control of the economic and competitive health of your business.

Of course you will need to transform your business and invest time and money. But the reward will be greater. By shaping your business to satisfy shoppers and buyers behaviours, you secure the future of your business and create wealth for your shareholders.

On that note, I wish you good continuity in business! And do not hesitate to contact me to discuss about the transformation of your business model.

Enterprise Digital Strategy versus Marketing Digital Strategy

If you go on Google and type "Digital Strategy", what will you get?

• Mainly a series of links that relates to digital marketing:
• Great digital marketing strategy advocacy platforms on the Net: Internet Retailer (Top 500 eCommerce platforms and more), Mobile Commerce Daily (daily news on what is going on the mobile integration and successes), and Smart Insights (how to build sound marketing digital strategies and campaigns).
• Marketing firms proposing their ideas and services to make great digital campaigns.
• Digital Marketing Gurus (I personnaly like Baekdal) 
• Few interesting links to different Governments that are promoting digital initiatives and strategies within their departments.
• Fewer links from people (like me) who are promoting their opinions on digital strategy.

My opinion: a digital strategy should be before anything else an "enterprise matter".

Wikipedia definition of digital strategy is as follow:

“ In the fields of strategic management, marketing strategy and business strategy, digital strategy is the process of specifying an organization's vision, goals, opportunities and initiatives in order to maximize the business benefits of digital initiatives to the organization. These can range from an enterprise focus, which considers the broader opportunities and risks that digital potentially creates (e.g., changes in the publishing industry) and often includes customer intelligence, collaboration, new product/market exploration, sales and service optimization, enterprise technology architectures and processes, innovation and governance; to more marketing and customer-focused efforts such as web sites, mobile, eCommerce, social, site and search engine optimization, and advertising. ”

• I have deliberated highlighted the latter phrase. I am a truly believer that marketing is extremely important in any business and that each and every opportunity shall be taken to maximize the chance to uphold and increase oneself position in any industry that we are part of. I like marketing and I love marketers.

BUT, I truly beleive that a company should invest and devote time and money in the initial phases of a digital strategy, minimizing risks, increasing opportunities, and ensuring success. An Enterprise Digital Strategy should be crafted and implemented way before a Marketing Digital Strategy be in place.

What is my definition of a digital strategy?

A digital strategy is the plan that describe how a company can create, capture, and deliver value by transforming their economic and cultural models so that employees, tools and processes become more digitized and connected with customers, delivering persistent unified multichannel experiences. I will decorticate each element.

“Create, deliver and capture value”

• This is the ultimate inside goal.
• Value is created anytime an action is taken for which the benefits exceed the costs, or anytime an action is “prevented” for which the costs exceed the benefits.
• Value is captured anytime the selling price contributes to the firm’s profits AND the difference between what the consumers would have been willing to pay and the price.
• Value is delivered (to shareholders) when value has been properly created and captured.

“Transforming their economic and cultural models”

• This is the recipe to achieve the ultimate inside goal and the ultimate outside goal.
• Transforming the economic model has to do with all aspects of a business, including but not limited to: production, supply chain, legal, human resources, financial, technology, sales, after-sales, and of course, marketing. Basically: employees, tools and processes.
• Transforming the cultural model has to do with, perhaps, changing the way people are remunerated (e.g. Brick & Mortar employees that need to respond to customers that have bought a product online), the new skills that are required are not found in the company (e.g. speaking different languages at the service desk), the new level of expertise is somewhat different (e.g. employees need to be trained on new / different tools), the entire processes (e.g. selling to people that you don't see, managing inventories, etc.).

“More digitized and connected with customers”

• This is the ultimate outside goal.
• Delivering persistent unified multichannel experiences: where a company is not imposing a way to do business with, but rather, having a company that is so profoundly and intimately connected with its clients (visitors, returning customers, and regular customers) that will allow seamless and timeless interactivities (entire spectrum of the purchase cycle) between available channels.

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I like this French Quebecois (really funny) proverb that says: “quand les bottines suivent les babines” – which means: walk the talk.

In this consumerization world, where the power is in the hands of customers more than ever, many companies have deployed digital initiatives more in reaction to the market rather than based on a genuine enterprise digital strategy. Many did not get the return they have forecasted, or they simply failed with dramatic outcome.

Just to make sure: this blog is not a plea against marketing firms. I truly enjoy digital marketing initiatives and campaigns that are going. If I were a marketing firm, I would certainly push ideas like they do.

This blog is more a plea for companies to invest and devote time and money in the initial phases of a digital strategy, minimizing risks, increasing opportunities, and ensuring success.

On that note, I wish you good continuity in business! And do not hesitate to contact me to discuss about the transformation of your business model.

The clock is ticking. We must act!

Last week, Internet Retailer, in collaboration with Optimal Payment, issued Canada's Top 20 Online Retailers. The report demonstrates beyond any doubt that the online business is doing well, very well indeed. Growth is phenomenal, year after year, and nothing indicates a slowdown on the horizon. So why write a blog about it?

After reading and analyzing the report, I conclude that Brick & Mortar businesses, whether they are an SMB or large enterprises, whether they sell to consumers (B2C) or businesses (B2B) they miss an incredible opportunity to sell (or to sell more) online and be among the best online sellers in the country. First, look at the results, then compare and deduce.

Download the report here

• Twelve (12) companies are "Web Only" - they represent 60 % of the Top 20.
• Of the total Web sales in 2012 (1,055,065,590$), these 12 companies generate 525,042,908$, or 50 % of total Web sales.

Consequently, Brick & Mortar businesses represent 40% of the Top 20 but still generate 50% of the sales. But what is most amazing is that if we compare the total Web sales in 2012 with the total Web sales in 2011:

• The growth for the Top 20 was 27.91%
• The growth of the Web Only companies was 14.63 %
• But the growth of the Brick & Mortar was an astonishing 44.49 %

Another interesting finding:

• Six (6) companies have their head office in Quebec: Beyond the Rack (# 2); Ice.Com (# 8) Aldo Group (# 10); Reitman’s (# 11) MyJewelryBox.com (# 13), 33-Off.Com (# 20)
• Of these six companies, four (4) are Web Only.

What these data do not say

Through my work, I meet dozens of business leaders, from all sizes and industries. A majority have no idea on how to integrate - I would go even further – on how to merge the traditional business and online business to have a single well-structured company, able to sell more and better. They are overwhelmed with this.

What I witness in the retail industry is that leaders are concerned about the sales per square foot and the same-store sales ratios. Leaders are paid and measured in terms of ROI (private equity or public - is the same thing). Leaders are increasingly concerned that the growth of online sales (28 % per year) far exceeds the growth of traditional sales (often traditional sales decrease). So they try all sorts of tactics – somewhat expensive - to counter online sales. It's not very winning and it can put their brands at risk.

The other major finding is that they are afraid of the phenomenon of cannibalism. By attempting to sell online they are scared of compromising their in-store sales (same store sales) and thus weaken their profit margins to keep the stores open. Catch 22 isn't it. Notwithstanding all the organizational problems they face when transforming their business, for example, dealing with the reluctance of stores employees who see online sales as a direct threat to their jobs.

My advice

The clock is ticking. Leaders must act. To face the fact that 50% of online sales come from Web Only companies is not normal. Believe me, I applaud these companies with innovative ideas and entrepreneurs who see opportunities that Brick & Mortar do not see. It is to their credit.

But when we see that Brick & Mortar online sales growth (44.49 %) is three times the Web Only companies (14.63 %), it probably send a strong signal to Brick & Mortar business leaders: consumers want the best of both worlds. Give it to them! You are the only one capable of doing it. You will be winning all the way!

What is to do, and how to do it

Transform your business! It does take a lot of courage and strategy. The other day I wrote an article about Staples. (You can read the blog here). Staples in-store sales declined 7% AND while its online sales increased by 10%... and it will continue to grow.

On that note, I wish you good continuity in business! And do not hesitate to contact me to discuss about the transformation of your business model.

How to forge a Digital Strategy

Many companies develop digital initiatives to meet immediate needs and to reduce commercial pressures notwithstanding global activities and corporate objectives. In doing so, they compromise their growth and intrinsic value. Integrating a comprehensive digital strategy to the traditional business model is a must for continuing success.

Process

In a nutshell, first you need to understand and assess the actual customer-experience offering your visitors and buyers are facing. The second step, is to measure your company's digital offering against its direct competitors, its industry and the best practices. Only then you can start drafting your Digital Strategy. Thereafter, you need to analyse the impact and risks on your company with different scenarios. Once you are satisfied with the final draft, you need to add measurement indicators to ensure its implementation and success.      

BeDigital Digital Framework can help you understand the value of integrating a genuine digital strategy as part of your business digital transformation. If you want to chat about some aspects of the Framework do not hesitate to contact me.

On that note, I wish you good continuity in business!

Multichannel and Omnichannel: are they alike? yes and no!

The most used buzzwords in the digital industry these days are “multichannel” and “omnichannel”. Do they have the same meaning? Hum… yes and no. In fact, these two concepts are interrelated, they have the same importance; in short, they cannot live without each other.

Multichannel is the concept related to the “offering”, in other terms, everything that touches the marketing, the visibility (physical or online store), promotions, etc. This is the seller’s view.

Omnichannel is the concept related to the “sale”, in other terms, the accessibility, the inventory, the taking possession of the product (i.e. pick-up in store or delivery), etc. This is the buyer’s view or in other terms, the customer experience.

Through my interventions, I regularly meet with companies that rely on a single concept, multichannel, crossing fingers, hoping sales. Often they forget the concept of omnichannel. Is this because of lack of budget, a planning error, or they simply rely on wishful thinking?

Yet omnichannel – as written earlier – is as important as multichannel. The customer experience that will result, will determine the success of global sales and repeat business that will occur in the medium and long term.

How to develop a comprehensive multichannel and omnichannel winning strategy?

Types of industries, economic and social aspects, brand positioning, etc. are facets that are so vast and different that it is difficult to draw a specific guideline or to give a common and winning recipe for all businesses.

However, let’s put on the table a basic principle: (total) accessibility. Provide the buyer the maximum flexibility to enter into a relationship with you and buy your products. This embraces the buyer’s decision process, buying process, after-sales experience, and, as important, the promoting process of your brand, your products.

How to?

The first thing to do would be to assess the current situation, to evaluate your multichannel and omnichannel maturity. Only then you will be able to evaluate your strengths and weaknesses and build an action plan based on those findings, hence, to build a winning strategy to reach your business goals.

On that note, I wish you good continuity in business! And do not hesitate to contact me to discuss about the transformation of your business model.

Courage, audacity and determination

For nearly a year now, I get up every morning with the joy of reading La Presse + newspaper on my iPad. Even more, I had the chance to travel Europe a few times since and La Presse + has always followed me ... inevitably ... even on Sundays, although the Sunday paper edition no longer exists since June 28, 2009.

Gesca leaders (owner of La Presse newspaper) understood long time ago the inevitable decline of traditional newspaper format before the "too late" alarm goes on. Rather, they had the courage, boldness and determination to make complex and imposing tough decisions - in initiating major digital transformation - in order to maintain their basic mission : to inform!

• June 28, 2009, La Presse put an end to the Sunday edition, achieving $26 million in savings, half in labor costs (ref. 1).
• After three years of R&D and $40 million in developing a new digital business model that is at odds with the model that has always existed, La Presse + was launched on April 18, 2013. (ref. 2). 
• In January 2014, only nine months after its launch, La Presse + application has been installed on more than 400,000 iPads (ref. 3). 
• On February 17, La Presse negotiated with Transcontinental for a lump sum payment of $31 million, so that the newspaper has more flexibility to reduce printing volumes and consequently savings (ref. 4).

Today I want to praise leaders who understand that the future of their business is somewhat similar to La Presse: "Thinking outside the box" which means thinking differently, unconventionally or from a new perspective. Not to be afraid, to charge on new ideas, to invest time and money, and above all, to have a strategic plan.

The World Wide Web, the public Wi-Fi, smartphones and tablets, the multitude of applications and new designs had transformed the way we work, we consume, we get informed, we get educated, we entertain, and we live. Some leaders have understood quickly and to the benefit of all.

On the eve of the first anniversary of La Presse +, I invite all Quebec leaders - from small, medium or large businesses, industrial, commercial or institutional, to have the courage, boldness and determination, to think "outside the box". Likely that the future of your business depends on it.

On that note, I wish you good continuity in business! And do not hesitate to contact me to discuss about the transformation of your business model.

References:

1) http://www.lapresse.ca/le-soleil/affaires/actualite-economique/200906/15/01-875859-la-presse-cesse-de-publier-le-dimanche.php
2) http://www.radio-canada.ca/nouvelles/Economie/2013/04/18/004-tablette-lapresse-pari.shtml
3) http://www.grenier.qc.ca/nouvelles/4697/la-presse-franchit-le-cap-des-400-000-usagers
4) http://affaires.lapresse.ca/economie/medias-et-telecoms/201402/17/01-4739769-impression-de-la-presse-transcontinental-sentend-avec-gesca.php

Jack Stupp, Jeff Bezos, Ronald Sargent and you!

For many people, the mention of Jack Stupp does not ring a bell. But if I say “Consumers Distributing ", then it might remind you some memories . Jack Stupp and Sydney Druckman opened their first store in Toronto in 1957. At its peak, the company  had more than 250 stores in Canada and 250 stores in USA. After many ups and downs and changes of ownership, the company filed bankruptcy in 1996.

Amazon, a Fortune 500 company based in Seattle (market capitalization of USD $ 171 billion), founded by Jeff Bezos in 1994, now offers the widest selection of products in the world.

On second thought, the business model of Consumers Distributing and Amazon is strangely the same... except for one aspect: the Web. While Consumers Distributing was trying somehow to find ways to renew itself, a visionary thought of the Web to create one of the biggest consumer products companies in the world.

Does the name of Ronald Sargent ring a bell to you? He is the CEO of Staples. He announced this week (March 6, 2014) the closure of 225 stores by the end of 2015 (a total of 1,846 stores in North America) . Only last year, Staples had closed 42 stores. The reason: in-store sales are down 7% while online sales increased by 10%. Some analysts suggest that Staples should close 500 stores. To be continued...

I recall the stories of these companies to reflect this :

- Some leaders have failed to find ways (often "out of the box" ) to maintain the continuity of their business.

- A visionary created from scratch a virtual company and continues to invest heavily in optimizing its offer (more products) and operations (think of the drones for delivery) .

- A CEO who does not hesitate to take steps - transforming his business - to meet the expectations of consumers and especially to continue to create wealth for shareholders.

And you?

Are you in control of the economic and competitive health of your business? Are you reactionary or proactive? Do you have a clear and precise strategy on how to invest in the future and create wealth for your shareholders?

On that note, I wish you good continuity in business! And do not hesitate to contact me to discuss about the transformation of your business model.