The series: We look at decision makers among Canada’s mid-sized companies who took successful action in a competitive global digital economy.
For decades, the camera and electronics chain Henry’s has built a reputation for high-touch service at its stores in Ontario, Manitoba and Nova Scotia.
Their camera and electronics professionals are known for sharing tips and advice to customers looking to buy the latest in new equipment, learn new skills or discuss gear-related trends.
But in recent years a marked shift from bricks-and-mortar to online browsing began to occur across the industry.
People were still coming into Henry’s stores, but they almost always compared prices and products online beforehand. A growing number didn’t bother to make that trip at all, preferring to shop strictly online instead.
As Henry’s chief executive officer Gillian Stein points out, 90 per cent of the retailer’s customers now conduct research online before stepping foot in a store.
Even though Henry’s was quick to jump on the e-commerce bandwagon – the company began selling online in 1997– Ms. Stein and her vice-president of marketing and e-commerce, Jeff Tate, understood that if the company was going to keep pace with huge online retailers such as Amazon, continuous innovation would be essential.
“We’re trying to keep up with what our customers are doing and to make our website easier to browse and buy on,” she explains. “We didn’t feel our shopping cart met our customers’ expectations.”
In April, the Toronto-based company of 380 employees launched a responsive, device-agnostic mobile website – meaning content viewed on the Henry’s website will resize or reorient to suit whatever mobile device the online visitor happens to be using at the time – with simplified e-commerce capabilities, making it easier and safer for customers to shop online.
The strategic goal was to not only improve the e-commerce experience for Henry’s loyal community customers – the “traditional enthusiasts,” as Ms. Stein calls them – but also attract a younger, tech-savvier clientele and camera and electronics professionals, for whom an optimized online shopping experience is a baseline expectation.
While it’s still early, initial results have been impressive.
Henry’s has logged double-digit increases in its mobile conversion rates – the number of online visitors who visit the website and make a purchase – as well as average order values. Online sales growth is in the triple digits, according to Ms. Stein, while customers are also viewing fewer screens before reaching checkout, meaning they’re finding the products they want faster than with the company’s old website.
In addition, fraud prevention improvements have helped reduce manual fraud checking by 30 per cent with no increase in charge-backs to the company.
“I really do believe all of these improvements and changes improve the in-store experience, as well,” Ms. Stein says.
Henry’s is not alone in its efforts to make the online shopping experience more appealing. Progressive mid-sized retailers across the Canadian marketplace are constantly aiming to better serve their online customers and compete with global retailers.
But a new study by mobile transaction firm PayPal Canada highlights the uphill battle facing Canadian retailers, many of whom have failed to keep pace with e-commerce infrastructure innovations.
The survey of 1,000 Canadian small and medium-sized enterprise owners found just 17 per cent have an e-commerce enabled website, even though more than 80 per cent of Canadians now shop online. A whopping 71 per cent of this group indicate little to no interest in ever selling online.
Why? The main concern for 30 per cent of those surveyed is offering an equivalent level of service online as in store, while 21 per cent fret over online fraud and 19 per cent report a limited understanding of technology to manage an e-commerce platform, or other daunting challenges such as distribution.
As PayPal Canada president Paul Parisi notes, retailers’ concerns are legitimate, but tend to discount what it takes to provide a satisfying shopping experience.
“There’s this belief that to have a positive experience with the customer, they need to be in front of you and you need to be interacting with them,” he says. “The irony is if you truly know your audience, they want to pay online, spend a lot less time getting the products and services they’re trying to buy and pay for them efficiently and at a low cost.”
Jon Marsella, the founder and CEO of Jasper, a digital agency in Toronto that builds e-commerce platforms for clients ranging from large corporations to SMEs, points to another key reason why Canadian retailers are lagging global competitors on the e-commerce front: underinvestment in the right technology.
“The U.S. and European mid-market retailers are ahead,” he says, “and Canadians are behind because they don’t allocate the budgets to get systems built. They deal with smaller agencies that aren’t technically adept, they get behind and get spooked and become technophobes.”
As far as fears over fraud are concerned, Mr. Marsella feels those apprehensions fail to account for the vast improvements in fraud mitigation in the past decade.
“[Fraud concerns] come from e-commerce days of yore – as long as you’re using a more modern platform,” he says.
At Henry’s, Ms. Stein and her team understood that launching a new website with improved e-commerce capabilities would touch almost every area of the business, so they made a point to work with all affected groups within the company to gain insight into necessary improvements.
That months-long process involved running focus groups and roundtable discussions with everyone from senior managers to staff and vendors, then filtering their feedback to the e-commerce team tasked with redesigning the website.
The top priorities were clear: provide a simplified payment process with better mobile navigation and improved content across the website.
As such, the company upgraded the usability of its product comparison engine and optimized the checkout process while including better fraud protection processes and tools. Hundreds of new product reviews will soon be available on the website, while Henry’s staff will continue to write articles and reviews to engage their discerning technophile customers.
The improvements should deliver double-digit annual online sales growth, predicts Ms. Stein, along with increased in-store sales.
Next on the agenda is the launch of a new customer relationship-management system that will enable Henry’s to better understand its customers and share data across the company.
But will it be enough to rival the millions spent on e-commerce infrastructure by mammoth online marketplaces? It may not have to be.
Ms. Stein’s advice to other mid-sized retailers aiming to improve their own e-commerce infrastructure is to worry less about competing with the Amazons of the world, and focus more on what they can’t do.
“Find out what in your business is unique,” she says. “For us it’s the integration with our store. Our online website has to support the in-store experience. It’s the postpurchase journey that Amazon can’t compete with.”