5 Key Retail Trends Every Chief Digital Officer Must Understand

“Digital already influences the majority of store sales,” said Michael Burgess, President of HBC Digital at Hudson’s Bay Company. “If you look at the weight and volume of digital visits, it’s rapidly moving towards influencing 100% of retail sales.”

Burgess outlined 5 important developments for Chief Digital Officers in his presentation, “Key Digital Trends in Omni-Channel Retail,” at the 2015 CDO Summit on Wednesday, April 29, 2015, hosted at Thomson Reuters in New York City.

Hudson’s Bay Company, founded in 1670 by a charter from King Charles II, owns some of the most successful retailers in the United States and Canada, including Saks Fifth Avenue, Lord & Taylor, and Home Outfitters. It also operates Hudson’s Bay, Canada’s most prominent department store, with 90 full-line locations.

“Online sales are the growth engine for retail,” Burgess explained. Research by Forrester has shown that online retail accounted for more than 35% of the growth in retail in 2014.

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While brick-and-mortar stores still produce 88% of retail sales, online channels have a huge impact on consumers’ activities. Data from Forrester, Accenture, and BIGinsight indicates that more than half of U.S. store sales in 2015 are influenced by the Web, a number that no Chief Digital Officer (or retailer) can ignore.

“Consumers are rapidly merging their shopping between online and in store,” Burgess noted.

So how can CDOs take advantage of this development? Here are 5 key trends that, when properly understood and utilized, can mean success for retailers:

 

1. Omni-channel

“Omni-channel shoppers are worth multiples of single-channel customers,” Burgess said. “The more of these customers we are able to create, the more value we’re creating.”

At Hudson’s Bay Company’s retailers, omni-channel customers—meaning those who shop through multiple channels such as mobile, PC, and tablet—spend two to four times as much as the average single-channel customer.

“Ten times more people visit Saks.com than visit the entire store chain—combined!” he revealed. “A lot of research, before the buying decision is made, is happening digitally.”

A 2014 study by Deloitte Research, “The Digital Divide,” surveyed 2,000 shoppers. Some 84% used digital as part of their shopping journey, and when they used digital their conversion in-store increased 40%. And 22% spent more.

“They’re starting their journeys on mobile devices and then converting on PCs and in-store. That’s why we’re seeing conversion improvements on both PC and in-store,” Burgess said.

2. Mobile First

“It becomes clear that mobile is more transformation than the Internet and the PC was, and the reason is that the channels are now collapsing together,” Burgess observed.

“It used to be that you shop online at home and then you go to the mall or go the store and shop brick-and-mortar. That’s no longer the case,” he added. “I virtually don’t buy anything, other than groceries, without first looking it up on my phone.”

A 2014 study by Google of retail consumers showed.....

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