Retailers are under constant pressure to innovate in order to fulfil ever-changing consumer demands yet most believe that they are playing a catch-up game because they do not have adequate digital practices in place. This week’s Prepare Your Business for the Digital Future report by Forrester , commissioned by Salmon and Rackspace , shows that ‘digital experts’ design their innovation and strategy to improve the experience of their customers.
A large majority (81%) of organisations have clearly defined and articulated digital strategies, reveals the report, which surveyed people in the global retail, CPG, and B2B IT industries. Further, 74% believe their organisation possesses the right structure and skills to deliver on their digital projects. There was, however, a significant gap between aspiration and current reality. A majority (57%) of the 150 companies possess ‘weak digital transformation strategies and [lack] the ability to execute [digital strategies]’. These ‘laggards’, it seems, are the norm in the industries surveyed for the report.
Just 11% of organisations rank as ‘digital experts’ who demonstrate competence across board, with digital transformation well underway. They are characterised by a focus on their customers rather than on process, cross-functional digital talent within the company, and clearly defined KPIs for investment in digital innovations.
In an era where 92% of retailers consider digital innovation as either vital or very important to their business (as revealed in the Digital Innovation Report, October 2015) it would appear that there’s a need to translate this urgency into action with 89% of companies falling below the ‘expert’ level.
Budget is the greatest barrier to digital innovation, according 64% of respondents in October’s Digital Innovation Report. The ‘digital experts’ in this week’s study are notable for their clear funding structure and focus on data analytics.
Innovative digital businesses in the recent survey were more externally focused, with a drive to improve customer experience, and many respondents said that digital innovation could come from extracting meaningful insights from big data, transforming the customer experience for the better.
From innovation to implementation
Especially during Mobile World Congress week, we run the risk of over-stressing the point, but it remains a fact that getting mobile ‘right’ is a real challenge for much of the retail industry. Mobile is more important than desktop – we already know that over half of all ecommerce spending is now from mobile, and in terms of traffic that split is a commanding 60/40. To optimise to this reality it’s not innovation that’s lacking, but application, a point Paul Skeldon makes in his editorial this week.
“As more shoppers turn to mobile, it’s more important than ever for brands to have an exceptional multichannel offering in place.” Said Sam Ambrose, Senior Consultant at Salmon, “our own research has found however that 23% of companies struggle with integrating traditional sales channels with mobile commerce channels.”
About the research
Digital strategy, organisation, and technology were gauged through a survey that covered employees in 150 businesses, examining dimensions such as executive support, vision, resourcing, and operational effectiveness. Based on the results, companies were segmented into four categories: experts, operators, strategists and laggards. Forrester was commissioned by Salmon and Rackspace to conduct the survey and analysis. Access the full report here.