You will be redirected back to your article in seconds
Skip to main content

Why Are 41% of Brands & Retailers Not Prioritizing Digital Tools to Engage with Customers?

In order to be a “digital-first” retailer or brand, a company must first understand the definition.

“Being a digital-first retailer or brand does not mean being digital-only,” said Bryan Eshelman, managing director at global consulting firm AlixPartners. “Digital-first retail requires a shift in mindset that resets how the organization thinks about everything from customer acquisition and customer lifetime value to the relationship between marketing and sales and where the buying team sits and to whom it reports.”

Digital first needn’t be all consumer facing, either, but rather a holistic approach for all levels of a company’s operation. “In practice, this means changing conventional KPIs for every part of the business into digital-first benchmarks,” Eshelman said.

The recently released joint Sourcing Journal + AlixPartner 2022 Survey Report Fashion in Focus : New Norms and Paradigm Shifts, explored the fashion industry’s attitudes, commitments and progress on a digital-first initiative, and the findings were surprising. Only 59 percent of respondents prioritized digital tools to engage with their customers, a far cry from what might be expected in today’s digital world catering to an increasingly powerful and digitally connected consumer.

Source: Sourcing Journal + AlixPartners 2022 Survey Report Fashion in Focus: New Norms and Paradigm Shifts

Progress on key digital initiatives was also lagging, with many companies not quite getting there as quickly as they hoped. Twenty eight percent of respondents said their progress in using digital tools to engage consumers was “behind target,” while even more (32 percent) admitted they were behind target on both using technology tools to drive a seamless omnichannel customer experience and using third-party technology to drive efficiencies.

Related Stories

Source: Sourcing Journal + AlixPartners 2022 Survey Report Fashion in Focus: New Norms and Paradigm Shifts

When it came to tracking and utilization of digital-first KPIs, significantly more respondents were tracking KPIs and actively utilizing the data than not, but no one category reached penetration over half. “There’s still quite a distance to go to becoming fully data-driven where data is incorporated into all decision-making,” Eshelman said.

Connecting authentically with the digital consumer

The irony is that to truly be a digital-first brand or retailer, companies must also connect in real life (or IRL as the digital natives say) to their customers. This means not just passively reading one-way information on social media or product previews, but reaching out with live chats, focus groups, events, and even unpolished “authentic” videos, all of which garner deeper interaction and appreciation.

The key is to take those gleaned feedback insights and funnel the valuable data points back for improved customer experiences and assortment strategies. Though only 21 percent of survey respondents prioritized focus groups or customer surveys, and even fewer used text message marketing, smart companies are taking note.

Source: Sourcing Journal + AlixPartners 2022 Survey Report Fashion in Focus: New Norms and Paradigm Shifts

Eshelman advises fashion companies to constantly ask themselves the right questions, “Are we exploring/experiments with innovative digital marketing tools and approaches to drive engagement and loyalty,” he said. “Are we authentically meeting consumers where they are?’”

To download the full Sourcing Journal + AlixPartner 2022 Survey Report Fashion in Focus: New Norms and Paradigm Shifts report, click here.