Retailers hamstrung by lack of online experience

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Four in five Australian retailers plan to spend more on developing their online strategy in the next three years, but they may be hampered by internal culture and resourcing barriers according to a new report.

The Australian Interactive Media Industry Association’s (AIMIA) ‘Online Retailing Insights’ study found the majority of retailers will invest increasing resources into staffing, supply chain and marketing their online businesses in the next three years to compete with global businesses.

But the findings, released annually in conjunction with the Australian Centre for Retail Studies, show that while retailers want to invest in digital and online strategies, they’re using staff with bricks-and-mortar retail experience in their attempt to do so. The report highlights issues with internal resourcing and culture barriers as factors hampering more rapid and successful implementation of online goals.

Rob Wong, chair of the AIMIA Retail Industry Group and managing director of CC Media iNC Network says forward-thinking retailers were looking to meet this challenge by recruiting new staff with the required experience.

“Savvy retailers are looking to recruit multi-channel directors and managers, and create cross functional teams to grow their online business and presence,” Wong says. “Email marketing, SEO and online catalogues are considered to be the most important tools for advertising and promotion in 2012/13.”

In moving towards an omni-channnel strategy, some are creating stand-alone units within the organisation while most keep the new online unit within the marketing team, the study found. This is expected to shift as more retailers manage their online strategy across multiple departments.

Online strategy is driven primarily by senior management, with an abundance of external resources being used – 26% of retailers rely on agencies, and 31% use external technical support.

Online stores are fast becoming top performing stores for retailers, with leading multichannel retailers measuring the success of their traditional retail stores relative to their online store. However, not every retailer understands the share of business going through their online store, with 33% of operators with 100+ stores unaware of how much online sales contribute to their total sales revenue.