ebusiness in canada 2013: pushing beyond "good enough"

eBusiness in Canada: Pushing beyond “good enough”

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How Canadian eBusiness Leaders are preparing to meet global compe==on

March 2013

This work is licensed under a Crea=ve Commons AFribu=on-‐ShareAlike 2.5 Canada License

Why this Survey? Why now? In a landmark 2012 report1, the Boston Consul=ng Group sized-‐up the $4.2 Trillion growth opportunity of the eBusiness industry sector across the G-‐20. Based on measures such as % of GDP and annual growth rates of the eBusiness sector, Canada was determined to be a “Player”, not a “Leader”, ranking significantly behind countries such as the UK and the US. This despite the fact that Canadians consume more online content per capita than any na<on in the world2; despite almost half of Canadian internet users indica=ng that they have engaged in eCommerce2. So where is the disconnect? A Federal Government report2 alludes to an underinvestment by Canadian businesses in ICT solu=ons. Are Canadian businesses holding us back? If so, how? To gains some insight, ePath conducted this survey of Canadian eBusiness and eCommerce managers, including some of the largest and most prominent Canadian eBusinesses. 1 the Internet Economy in the G-‐20. The Boston Consul:ng Group. March 2012 2 Ecommerce in Canada: Pursuing the Promise. Report of the Standing CommiEee on Industry, Science, and Technology. May 2012

2 This work is licensed under a Crea=ve Commons AFribu=on-‐ShareAlike 2.5 Canada License

Survey Methodology A snapshot of Canada’s eBusiness and eCommerce enterprises, with primary focus on mid-‐size and large organiza=ons. Who: •  69 eBusiness Mgrs. with financial or opera=onal accountability for some or all

elements of their online business within their Canadian-‐based company or business unit

When: •  Survey was taken between Dec 2012 and Jan 2013 How: •  Online na=onal survey, by invita=on, averaging 23 minutes in length

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Company Type Company Size


ePath and UofT SCS In 2012 ePath was tasked by University of Toronto School of Con<nuing Studies (SCS) to develop a cer=ficate program in eCommerce / eBusiness Management for business professionals3. The results of this survey will be used to shape the eBusiness / eCommerce Management program at the University of Toronto SCS, and to help both current and future eBusiness / eCommerce managers beFer compete and excel in the global marketplace. ePath is a Canadian eBusiness strategy consultancy focused on improving the online performance of medium-‐sized and large eBusinesses.

www.epathconsul=ng.com epath@epathconsul=ng @epathconsul=ng

3 hEp://learn.utoronto.ca/courses-‐programs/business-‐professionals/cer:ficates/cer:ficate-‐ebusiness-‐ecommerce-‐management


Execu=ve Summary: Findings and Recommenda=ons This slide-‐deck provides key excerpts and data points from the survey. To see how to turn these survey findings into ac=onable insights for your Canadian eBusiness, download our “Findings and Recommenda=ons” report, a concise Execu=ve Summary. To download your copy of the report, go to: hFp://bit.ly/YIauzZ


http://bit.ly/YIauzZ

Profiling the Canadian eCommerce / eBusiness Manager

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Highlights


In-‐Charge and In-‐Control Most Canadian eBusiness / eCommerce Managers have been empowered with broad responsibili<es, including strategic, opera=onal, and financial aspects of their online business. As expected, this scope increases with the size of the company, with over 71% of eBusiness Managers from large companies claiming P&L responsibility for their eBusiness.

7 Ques=on: Q1 Base: 2012/13 n= 69

Ques=on: In our company, the role of eBusiness Manager involves the following responsibili=es: (Choose all that apply)


In-‐Charge and In-‐Control (cont’d)

8 Ques=on: Q1 Base: 2012/13 n= 69


Edited excerpts from 1:1 Interviews: •  “Although I have full control of my eCommerce group, I’m quite

constrained by corporate strategy. The tradi=onal “bricks” part of the business s=ll determines the overall business strategy. They set my budgets.”

•  “The challenge I have is gepng them (corporate management) to buy into

the online opportuni=es. Make the needed investments. Unfortunately we’re typically Canadian. We don’t like risk.”

•  “I would like to be able to find beFer ways to pitch the benefits of eBusiness to upper management.”

Skilled across func=onal areas Most Canadian eBusiness / eCommerce Managers claim a broad range of skills, including strategic, marke=ng & sales, technology, and opera=onal aspects of their online business. As expected, this range of skills increases with the size of the company, with 100% of eBusiness Mgrs. from large companies claiming that their posi=on requires skillset in Strategic Visioning and Planning.

9 Ques=on: Q6 Base: 2012/13 n= 69

Ques=on: The most important skillsets for the eBusiness Manager role in our company are: (Choose all that apply)


Educated and Skilled (cont’d)

10 Ques=on: Q6 Base: 2012/13 n= 69


Edited excerpts from 1:1 Interviews: •  “I was hired in large part for my ability to set eBusiness strategies.

Strategies to help us beFer succeed online. My biggest challenge is not developing the strategies, but to actually sell those strategies to the execu=ve team. And it seems that the only way to do that is by clearly demonstra<ng ROI.”

•  “Running an eBusiness requires broad skills. Having an MBA definitely

helps” Addi=onal Insight: •  32% of the surveyed eBusiness Managers at large companies (over 500

employees) have an MBA

Trained On-‐the-‐Job Less than 37% of Canadian eBusiness / eCommerce Managers have received formal educa=on in eBusiness. In contrast, 77% have amassed their eBusiness skills through on-‐the-‐job training.

11 Ques=on: Q8 Base: 2012/13 n= 69

Ques=on: I possess the following educa=onal qualifica=ons for the eBusiness manager role: (Choose all that apply)


Trained On-‐the-‐Job (cont’d)

12 Ques=on: Q8 Base: 2012/13 n= 69


Edited excerpts from 1:1 Interviews: •  “Most of us backed into this job. We come from a variety of backgrounds.

We had to learn on the job. There was no other op=on available.” •  “Learning the job on-‐the-‐go is not always the most efficient. It’s difficult to

get exposed to best-‐prac=ces.”

•  “eBusiness coverage was quite limited in my MBA. “Online” is a different world, and I don’t believe that execu<ve educa<on is keeping pace.”

Addi=onal Insight from an Execu=ve Search Consultant: •  “It’s tough to find top-‐=er eCommerce Execu=ves in Canada. There is a

rela=vely small talent pool in Canada with deep experience.”

Confident or Over-‐confident? 74% of Canadian eBusiness / eCommerce Managers (85% of eBMs in large organiza=ons) believe they have the qualifica=on, skills, and experience to handle all current and near future challenges in their role as eBusiness / eCommerce Managers. This despite a rapidly changing eBusiness environment and growing global compe==on. Are Canadian eBusiness Managers too confident? Does this s=fle new thinking and new ideas?

13 Ques=on: Q9 Base: 2012/13 n= 69

Ques=on: For my posi=on as eBusiness Manager: (Pick the one best answer)


Confident or Over-‐confident? (cont’d)

14 Ques=on: Q9 Base: 2012/13 n= 69


Edited excerpts from 1:1 Interviews: •  “How can you be totally confident that you have all the skills and exper=se

if you don’t know what’s around the corner? I don’t know of another business where technology, business models, customer expecta=ons change so rapidly!”

•  “I keep thinking of that quote from Andy Grove of Intel: “Only the paranoid survive!””

Benchmarking Compensa=on Over 61% of eBMs in Large Companies receive less than $150K a year in total compensa=on. Only 26% earn more than $200K.

15 Ques=on: Q5 Base: 2012/13 n= 69

Ques=on: My compensa=on last year, inclusive of bonuses, was: (Choose the one best answer)


Benchmarking Compensa=on with the US (cont’d) Addi=onal Salary Range Insight: Salary Range4 for eCommerce/ eBusiness Manager – Canada Salary Range4 for eCommerce/ eBusiness Manager -‐ US Addi=onal Insight from an Execu=ve Search Consultant: •  “When comparing eBusiness Manager salaries, so much depends on job scope, size of

company, and the size of the online opportunity. However, all else being equal, from my perspec=ve Canadian eBusiness Managers are equitably compensated in comparison with their US counterparts”

4 Based on March 2013 data from various sources, including salary.com, payscale.com, glassdoor.com, and indeed.com. Range based on recent open job lis:ngs, which may not be a sta:s:cally representa:ve sample of the actual industry salary range.

16 Ques=on: Q5 Base: 2012/13 n= 69


$52K US $177K US

$97K US

$38K $110K

$76K

Profiling Canadian eCommerce / eBusiness Teams

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Highlights


Plen=ful Supply of eBusiness/ eCommerce Skills Internal development (75%) and direct hiring (67%) are the most common techniques to bring the required eBusiness skills onboard. Surprisingly only 16% of Canadian eBusiness / eCommerce Managers (15% of eBMs in large organiza=ons) are frequently unable to source the eBusiness / eCommerce skills and experience they need. This is in stark contrast to US/UK findings, and raises the ques=on: “Are most Canadian eBusinesses really hiring top eBusiness talent”?

18 Ques=on: Q12 Base: 2012/13 n= 69

Ques=on: To acquire the skills I need on my team I: (Choose all that apply)


Plen=ful Supply of eBusiness/ eCommerce Skills (cont’d) In contrast, 2011 eConsultancy research5 (with primary focus on US and UK) reported a digital talent skills shortage:

“Par=cipants in the survey specified that the challenge of finding staff with suitable digital skills was a poten<al barrier to progress, and further iden=fied specific skill areas that are perceived to be the most difficult to recruit for. Web analy=cs and data was at the top of the list, followed by social media, content marke=ng, SEO, website design and build, and mobile. It is clear that there is already a poten=al skills shortage in these areas.”

5 Digital Marke:ng: Organiza:onal Structures and Resourcing – Best Prac:ces Guide. eConsultancy. Dec 2011

19 Ques=on: Q12 Base: 2012/13 n= 69


Plen=ful Supply of eBusiness/ eCommerce Skills (cont’d)

20 Ques=on: Q12 Base: 2012/13 n= 69


Edited excerpts from 1:1 Interviews re: on-‐the-‐job training: •  “On-‐the-‐job training is inefficient. We struggle to keep everyone up to

speed. Suppliers help. Professional development courses help. But it’s piecemeal.”

•  “As eCommerce head, I’m a liFle lost when it comes to judging highly specialized eCommerce talent. I don’t understand the intricacies of SEO, of web analy=cs. And if I’m lost, my HR department is even more lost!”

•  “eBusiness is a team sport. My challenge is not only how to best develop individual skills, but how to develop them as a high-‐performance team.”

Low skill Turnover Only 31% of eBusiness Managers are loosing their key employees to compe==on. Most are able to successful retain their top talent without special incen=ves.

21 Ques=on: Q14 Base: 2012/13 n= 69

Ques=on: As manager of an eBusiness team, I am: (Choose all that apply)


Canadian eCommerce / eBusiness Priori<es

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Highlights


Canadian eBusiness / eCommerce Priori=es In Canada, Analy=cs, Social Media, Customer Experience Management, and SEO are the top eBusiness thrusts to grow the business.

23 Ques=on: Q15 Base: 2012/13 n= 69

Ques=on: The most important techniques that we will use to grow our online business will be: (Choose all that apply)


Canadian eBusiness / eCommerce Priori=es

24 Ques=on: Q15 Base: 2012/13 n= 69


Edited excerpts from 1:1 Interviews: •  On Analy<cs: “Managing your eBusiness ‘by the numbers’, that’s the new

name of the game. The beFer your web/customer/ opera=onal data, the beFer your business decisions”.

•  On Customer Analy<cs: “Big Data and Customer Analy=cs are the new

buzz. But most of it is coming from the suppliers of data solu=ons. It’s difficult to know where to start.”

•  On Customer Experience Management: “This is becoming cri=cal as we beFer integrate online with offline. It’s important to map the en=re customer experience throughout the customer lifecycle”.

•  On Social Media: “The challenge in Social Media is s=ll finding ROI that the execu=ve team will accept”

Canadian eCommerce / eBusiness Challenges

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Highlights


Challenge: Limited Exposure to Global Compe==on The majority of eBusinesses 58% are not exposed to interna=onal market condi=ons. This is even more pronounced in large companies, with 67% of large eBusiness repor=ng a geographic focus limited to Canada. Are Canadian eBusinesses too insulated from global compe==ve forces?

26 Ques=on: Q2 Base: 2012/13 n= 69

Ques=on: As eBusiness Manager, the geographic scope of my responsibili=es includes: (Choose the one best answer)


Challenge: Limited Exposure to Global Compe==on

27 Ques=on: Q2 Base: 2012/13 n= 69


Edited excerpts from comments/ 1:1 Interviews: •  “eBusiness in Canada is behind the curve. I generally use the US eBusiness

industry to shape projects”. •  “It’s not about bea=ng US compe==on. It’s s=ll about outperforming your

Canadian compe=tor.”

•  “The incen=ve to take risk isn’t there. So why take risk?”

Addi=onal Insight from an Online Strategy Consultant: •  “Canada’s sleepy. There’s a small group of hi-‐level eCommerce execu=ves.

They all move to the same tune. They need to break out.”

Challenge: Online / Offline Integra=on The majority (53%) of eBusinesses within bricks & clicks opera=ons are either not-‐at-‐all or only “loosely integrated” with their offline businesses. This rela=vely poor integra=on is even more dominant in large business, with a full 65% indica=ng that online and offline components do not share organiza=ons or goals.

28 Ques=on: Q3 Base: 2012/13 n= 69

Ques=on: In our company: (Choose the one best answer)


Challenge: Online / Offline Integra=on

29 Ques=on: Q3 Base: 2012/13 n= 69


Edited excerpts from 1:1 Interviews: •  “The offline part of the business s=ll drives the company. That’s where the

big investment is. Online is more of a “have to” rather than a “want to””. •  “Integra=on is tough. For a bricks & clicks business, there are a lot of

legacy technology and processes on the offline side.”

•  “Offline and online is so blurry. Showrooming. ROPO (research online, purchase offline). Mobile. The dis=nc=on from the customer’s perspec=ve gets blurred.”

Addi=onal Insight from an Online Strategy Consultant: •  “As long as online and offline are not well integrated, can an eBusiness

really offer breakthrough value for customers?”

Challenge: Business Model Innova=on Most Canadian eBusinesses (56% of large eBusinesses, and 62% of all eBusinesses surveyed) do not have a formal innova=on program or process. This is stunning since eBusiness and eCommerce are rapidly evolving markets with a constant influx of discon=nuous and revolu=onary innova=on. How are Canadian eBusinesses expected to compete and lead globally with such a staid approach to business model innova=on?

30 Ques=on: Q17 Base: 2012/13 n= 69

Ques=on: Our approach to eBusiness innova=on is that: (Choose the one best answer)


Challenge: Business Model Innova=on

31 Ques=on: Q17 Base: 2012/13 n= 69


Edited excerpts from 1:1 Interviews: •  “Everybody wants to be innova=ve. Who doesn’t? But do we have a

process for producing innova=on? No!” •  “Innova=on only happens when you have an execu=ve who supports

innova=on” •  “Here (in Canada), the preferred approach is to let someone else be the

pioneer. Sit back, and when the idea is proven, and the market demands it, then add it to your offering. Simply put, we don’t like risk”

Challenge: Moving beyond Price & Delivery The rela=vely high cost of shipping in Canada is a strong, recurring theme in this survey, as highlighted by this ques=on and many direct comments from par=cipants. Granted, shipping costs are higher in Canada. But a focus on price & delivery is not a sustainable strategy for Canadian eBusinesses that do not have the “scale” advantages of their larger US-‐based and global compe=tors.

32 Ques=on: Q22 Base: 2012/13 n= 69

Ques=on: Our greatest challenges associated with the online business environment in Canada are: (Choose all that apply)


Challenge: Moving beyond Price & Delivery

33 Ques=on: Q22 Base: 2012/13 n= 69


Edited excerpts from 1:1 Interviews: •  “Let’s face it. Online shoppers are looking for price & delivery. That’s it.

End of story!”

•  “High shipping costs are our biggest challenge. How are we specifically going to address the costs to ship in Canada? How we can get it more inline with the US?”

•  “Everyone in Canada complains about shipping costs. At our company we

try to make them transparent for customers. And we focus on building overall value for the total price the customer pays.”

•  “Whining about shipping costs is an excuse. If that is what your customers complain about, what they are really saying is that they perceive your product to be a commodity.”

Get your Execu=ve Summary: Findings and Recommenda=ons This Execu=ve Summary references and builds on the survey results, by providing addi=onal insight and recommenda=ons based on ePath’s 15+ years experience in the Canadian eBusiness/ eCommerce space as both consultants and educators. The Execu=ve Summary groups insights from the survey into four broad ac<onable opportuni<es:

1.  Crea=ng the Management Condi=ons for eBusiness Success

2.  Innova=ng beyond “Price and Delivery” 3.  Accelera=ng the implementa=on of CEM and Data

Analy=cs Ini=a=ves 4.  Building High Performance eBusiness Teams

To download your copy of the report, go to: hFp://bit.ly/YIauzZ


http://bit.ly/YIauzZ

Thank You!

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www.ePathConsul=ng.com epath@epathconsul=ng.com


A BIG thank you to the eBusiness and eCommerce Managers across Canada who took =me out of their very busy schedule to provide us with their insights.

We all share the same goal: to help Canada beFer compete in an increasingly compe==ve global online environment.

ebusiness in canada 2013: pushing beyond "good enough"

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