A new ranking of the digital savvy of specialty retailers is out, with Macy’s, Nordstrom, and Victoria’s Secret shining brightest. L2 Think Tank’s Digital IQ Index, founded by a New York University professor of marketing, looked at the digital competence of 76 brands to come up with the list. And for the first time, it finds “a significant relationship between the size of a retailer’s business” and how well it scores in the index. Bigger stores did better.
The report looked at second-quarter performance, when online retail spending hit $44.3 billion, a 17% jump from the same period a year earlier.
Two key trends are the wildfire-like growth of the mobile commerce channel, and the mighty power of Amazon, which researchers dub “the Great White Shark of Retail.”
With a 37% share of the U.S. m-commerce market, Amazon is dining out on the weaknesses of other retailers, “eating away at one of the few remaining advantages of terrestrial retail — immediacy. Amazon is broadening its prey from slow fat seals to ... everything that swims. And it has turned its sights on specialty retailers, offering high-end brands and an experience that closes the gap with bricks and mortar,” writes Scott Galloway, professor of marketing at New York University Stern School of Business.
The rapid growth of m-commerce is also upsetting the food chain, the report finds. Describing it as “the fastest-growing channel in in the history of commerce,” m-commerce plays a key role in a store’s digital IQ ranking. Mobile, the report finds, is likely influencing more purchases (both on and offline) than broadcast, and perhaps, even in-store sales associates.
“What was supposed to take 10 years took three,” the report says. “Everyone, including Facebook, has been caught flat-footed by the adoption rate of smartphones, which has reached 165 million users in the U.S. alone. E-commerce is now m-commerce. Social media is now consumed via mobile app. Digital marketing is now centered on mobile search and mobile- optimized email.”
Sephora, AmericanEagleOutfitters, JCPenney, Bloomingdale's, Crate&Barrel, Gap and Saks Fifth Avenue all were ranked in the top 10.