Assessing Retailers' Digital Maturation Amid a Pandemic
No one, not even Nostradamus, could have predicted what 2020 became. Had anyone even heard the term "essential retailer" before March of last year? Could anyone have predicted that toilet paper would have the same scarcity as a couture dress?
While the pandemic continues, the apparel/fashion industry and the consumers it serves have settled into a new buyer journey, where "experience" is now defined by safety and convenience instead of high-touch store experiences or curated merchandise.
In a study released by Incisiv, the top 100 apparel and footwear retailers across North America and Western Europe were benchmarked to assess their digital maturity during a time when online/digital sales were the only channel to drive revenue.
While no business in the apparel/footwear industry has been left unscathed, the study found that the more digitally mature retailers have weathered the storm more successfully than their less mature peers. Case in point: The more digitally mature retailers have suffered a 25 percent decline in revenues vs. a 46 percent decline for the least mature quartile.
The study, which analyzed over 165 attributes across four stages of the digital buying journey, found that North American retailers have invested in digital far more than their European counterparts, and as a consequence led the rankings in the top 25.
Overall, Macy’s achieved the No. 1 ranking as it led all retailers in both online ordering capabilities as well as customer engagement and service. Leading differentiators for Macy’s in online ordering include multiple payment options, an online sizing tool, and very clear options for promotions throughout each step of the buying process. For customer engagement/service, Macy's led in curbside practices and offer same-day delivery as well as in-store or virtual appointments.
“Macy’s digital strategy is focused on providing the best possible omnichannel shopping experience for our customers,” said Matt Baer, chief digital officer, Macy’s, in response to the company's overall No. 1 ranking. “With shoppers migrating online at unprecedented rates, our early investments in digital and the recent expansions of our omnichannel capabilities and services have helped us to quickly pivot to meet the evolving needs of consumers.”
The remainder of the top five retailers in overall digital maturity include Kohl’s, Neiman Marcus, Target, and Nordstrom. In the remaining buyer journey stages, Nordstrom is No. 1 in Search and Discovery, and Target led the Fulfillment category.
The study highlighted that close to 75 percent of consumers miss shopping in stores, while only 5 percent of consumers would physically try on a product in the next six months (as of July 2020). This means digital engagement is more critical than ever. According to Amar Mokha, chief operating officer and benchmarking leader, Incisiv, “The apparel segment was one of the early adopters of digital technologies and has continued to be a leader in setting expectations for what digital experience should be for customers. However, expectations have been reset yet again and digital platforms will, in many cases, decide if some apparel retailers have a future. New functionalities in areas such as inventory visibility and new processes in fulfillment, social media integration and more will make the difference with customers today."
David Weinand is the co-founder and chief customer officer at Incisiv, one of the leading insights firms for consumer industry digital transformation leaders.