Despite a tumultuous two and a half years for digital commerce, retail and brand executives are mostly satisfiedRetail and brand executives are mostly satisfied with the structured organization with their core organizational structures. However, defining which internal team ultimately owns which e-commerce functions remains a complex challenge. That’s according to a recent qualitative study designed to assess how e-commerce fits into a larger retail organization conducted by CommerceNext in partnership with CommX. The survey of digital executives from across the retail industry also found that attracting and retaining top digital talent in a fiercely competitive hiring market and modernizing metrics to reflect current trends of the industry remain two of the main challenges for e-commerce leaders.
“The responsibilities and influence of retail e-commerce leaders within organizations have grown dramatically over time, to the point that they are now a powerful voice at the highest levels of business,” said Scott Silverman , co-founder of CommerceNext. “The problem is that the reporting structures of digital teams aren’t always as clear as one would hope, especially when it comes to omnichannel. This means that every leader needs to be able to maintain partnerships and collaborate with peers in marketing, e-commerce and IT to break down silos and achieve digital transformation goals.
“Until digital commerce leaders prioritize customer-focused KPIs, their channel metrics will continue to fail,” said Amanda Elam, chief marketing officer at Bloomreach. “When leaders adopt KPIs that contextualize how customers interact with the brand, their teams will be empowered to put customers at the center of the experience, ultimately driving success across all metrics.”
The CommerceNext study found that more than 50% of digital commerce leaders surveyed report to the CEO or COO/CRO, while CMOs who own e-commerce are taking more direct control in an effort to unify the customer journey. Among surveyed CMOs who directly own their company’s e-commerce and digital marketing businesses, the overwhelming perception is that the right place for these functions is under marketing, as this structure best ensures that brands can tell their stories of consistently across consumer touchpoints.
In most companies, e-commerce teams directly own site merchandising and catalog, content planning, operations, site design, web development, marketplaces, and performance marketing, but all other functions, such as consumer insights and analytics, brand marketing and inventory planning, and administrative functions such as human resources and finance — tend to be shared or owned by another band. Omnichannel is even more complicated, with no single leader and referred to as a cross-functional workflow, according to the survey. The structural complexity underscores the difficulty digital leaders face in delivering a consistent brand and customer experience across all sales channels.
Recruiting and retaining the best digital talent and creating relevant KPIs are major challenges
The study also revealed that finding and retaining talent in a competitive hiring market remains challenging for retailers, with data scientists and CRM experts in particular demand as companies seek to harness the power of data. first party and create stronger loyalty programs.
To attract these professionals, companies are accelerating promotions, paying 20% to 30% salary bonuses for digital talent, and offering remote work options. Some are also creating internship programs that cultivate young talent, seek out remote hires, offer stipends for setting up a home office, and increase employee referral bonuses. Several leaders interviewed mentioned that embodying company values, maintaining strong lines of communication with remote employees, and recognizing team successes are crucial retention strategies that can help employees feel valued enough to stay.
Success metrics also don’t mature as most digital leaders would like, the survey found, with many respondents saying customer KPIs haven’t matured due to data integrity issues, inconsistent calculation methodologies or a lack of analytical resources. Sales, traffic and conversion were cited as the KPIs by which most digital initiatives and teams are still judged, along with return on ad spend and profit margin for some. However, surveyed executives indicated a strong interest in using a more holistic measurement methodology that focuses more on customer lifetime value. When asked which KPIs are important but not tracked enough today, the most frequently cited metrics were customer acquisition costs and digitally influenced in-store sales.
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Designed to help companies assess and improve their own organizational structures in this defining digital age, the survey consisted of live interviews with more than a dozen executives from a range of retailers and brands with annual revenues online from $20 million to over $3 billion. The study aimed to understand how these leaders build and maintain a strong organization and use key KPIs to monitor and improve their digital business. Responses were anonymized to protect company-specific information.
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