This post is about a brilliant keynote presentation I saw last March at the Dx3 Conference. The keynote was given by Duncan Fulton, Executive Officer and Senior Vice-President of Canadian Tire, where he talked about the necessity for having a Digital Strategy in a Retail Business.
Fulton’s presentation brought up many themes that all retailers are struggling with right now. Themes like 1) Retail Innovation, 2) Technology Disruption and 3) How to remain relevant to customers. That’s why I thought it would make a great post. Fulton’s main message was that retail businesses must create and use Digital Strategies to connect with customers in order to remain competitive.
You can find links to the keynote (video and slides) below, but let’s get started by reviewing the content of the presentation. By the way, in my next post I will add some opinions of my own on what I liked most about Fulton’s presentation, as well as, a few things I think he missed but may want to consider in the future.
I found it very interesting that Canadian Tire’s CFO, Dean McCann, was invited to introduce Fulton. The business relationship between Finance (save/invest) and Marketing (spend) is on a tightrope and must be balanced properly for any business to be successful. Luckily for Canadian Tire, it seems that McCann and Fulton are on the same page when it comes to the strategic importance of investing in the right digital systems.
McCann summed up Fulton’s presentation best when he equated Canadian Tire’s digital strategy as being the same thing as Canadian Tire’s business strategy. I couldn’t agree more. I’ve seen many technical projects fail because business objectives were not addressed in the plan. Any digital project in retail that does not achieve business goals is doomed to be a catastrophic waste of time and money.
Fulton eventually took the stage, but Fulton referred back to CFO McCann when he said that his CFO doesn’t want him to make requests for money in a piecemeal fashion, project by project. The CFO, McCann, wants to be told how it all fits together. He wants to see a strategy that will give a predictable return on investment. Wow, what a concept! Right from the beginning, I knew this was going to be a great presentation.
Fulton sees the scope of tody’s retail problem as being the following …
1) Speed of Innovation & Speed of Obsolescence
2) Rapidly Evolving Expectations
3) Availability and “Curse” of Consumer Data (Big Data)
4) Availability and “Curse” of Content
5) Fragmentation of Expertise
6) Escalating capital costs & expenses related to “Staying Current”
7) Generation Gap for the C-Suite
Fair enough. I think anyone involved in retail technology would agree these are the relevant challenges right now.
As for the solution, these are the things that Fulton suggests a retail business must consider …
1) Invest in Open Platforms
2) Centralize and consolidate data ecosystem
3) Centralize and consolidate content ecosystem
4) Build digital expertise in-house
5) Fuel a culture that embraces digital
6) Do-It-Yourself to drive for cost-effectiveness
Fulton felt that to future-proof your business you must have a focus on and invest in 1) Data, 2) Content, 3) Technology & Applications & 4) Underlying infrastructure.
He added that 1) Top-Down vision & commitment, 2) Talent & 3) a Test & Learn Culture are also necessary.
I thought it was great that he admitted, “We are all still learning”. This shows organizational self-awareness and the willingness to explore and adapt. These are important traits to have in today’s business environment.
He also comment that in the future Retail will become about the experience that you can create in a store, not just the assortment of available products. I recently read a book called “The Retail Value Proposition” by Kyle Murray. You can understand more about how to do this by reading Murray’s book. Hmmm, maybe I will do a future post about that book.
Fulton then came to the part of the presentation where I admit he lost me a couple of times. I agree with his main point, however. Digital change is disrupting the entire retail business. You cannot isolate the disruption to a single part of the business. He also said that digital disruption will take years to work itself through the Canadian Tire business.
Let’s not forget that mixing business innovation with technology innovation makes for a great deal of complexity. Let me give you the description of how Fulton thinks digital disruption is impacting the entire business, but come back for my next post which might help you understand and communicate the business complexity in a simpler way.
Fulton sees digital disruption touching the following parts of a retail business … Merchandising, Finance, Supply Chain, Real Estate, HR, Communications, Marketing, Operations, Legal, IT & Franchisee Ops
In the end, he finished up with a couple statements that I’d like to highlight …
“Digital disruption is swamping everyone, and no one is immune”
“The bottom line for us is our digital strategy is a retail strategy. It’s a business strategy underpinned by a culture and a team that are prepared to invest and believe in digital.”
Both these quotes are extremely important for anyone in the retail business today. Of course, simply having a Digital Strategy is not enough. You need action too. However, if you don’t have a strategy or plan, then you should better be prepared to waste a lot of time, money and energy trying to keep pace with your competitors’ digital investments.
Don’t forget to stay tuned for the next post where I highlight the ideas that I liked in Fulton’s presentation, plus a few things that he may wish to consider for the future.