1. Digital Transformation Benchmark - 2012
Insights for the Retail Industry

2. Digital Transformation in the Retail Industry
Starting with the arrival of eCommerce in the late 1990’s, few industries have had as much experience with
digital disruption as retailers. Still, after a decade of managing digital competitors and changing customer
expectations, the retail industry faces fresh challenges. mCommerce (mobile) and sCommerce (social) are the
latest incarnations of digital disruption in the industry, and some players have already begun leveraging these
technologies.
Figure 1: firms’ positioning in the Digital Maturity Matrix
Interpreting the
Digital Maturity Matrix
• The vertical axis measures “Digital
Intensity,” i.e. firms’ digital
practices
• The horizontal axis measures
“Transformation Management
Intensity,” i.e. the management
practices implemented by the firms
around digital transformation
For more information, read the MIT Center for
Digital Business and Capgemini Consulting
Research Report “Digital Transformation: a
Roadmap for Billion-Dollar Organizations” (2011)
Asia & Oceania North America Northern Europe
Southern Europe Average
Learning 1: The focus for retailers personalize marketing
is on the customer experience, communications (54%).
less on operations or
collaboration Overall, retailers have done less in
operational applications of digital.
Companies that responded to our Relative to other industries, they
survey highlighted customer reported lower scores for digital
relationships and revenue growth employee collaboration, remote
as two areas where they perceive working and executive
Digital Transformation most communications. Similarly, many
impacting their performance. retailers are not using
Accordingly, retail firms are using technologies like instant
digital technologies to personalize messaging or video conferencing
the sales experience and enable to improve operational processes.
customer self-service. A majority This may reflect the current
of companies also highlighted priority of the “store floor” and
using analytics to target marketing autonomous local staff (see Figure
more effectively (65%) and to 2). However, it may also present
Page 1

3. an opportunity to explore new
models that would take better
advantage of cross-store
collaboration.
Figure 2: worker enablement
31% Our employees can collaborate 58%
digitally with their colleagues as
Copyright © 2012 Capgemini Consulting and MIT-CDB. All Rights Reserved
15% needed 72%
31% When appropriate, our employees 54%
can perform their work duties from
----- RET - Figure 12 -----
20% any location 69%
46% Digital technologies improve 35%
communication between senior
20% executives and employees 64%
65% Our employees actively share 27%
knowledge through collaborative
43% community platforms 35%
Legend:
• Red bars represent the percentage of companies disagreeing with each statement (answers 1, 2 and 3 on a scale from 1 = strongly
disagree to 7 = strongly agree) in the industry; green bars represent the percentage of companies agreeing with each statement
(answers 5, 6, or 7).
• Grey marks represent disagreement (answers 1, 2 or 3) or agreement (answers 5, 6 or 7) across all companies in our study.
Learning 2: The industry’s Digirati represent entirely new channels
leverage social media and mobile for retailers or, at the very least,
with customer more than other important components to consider
retailers in an integrated, cross-channel
customer experience. As noted in
Overall, retailers appear to be Capgemini’s 2012 Digital Shopper
using social media and mobile at Relevancy Report, 60% of digital
least as much as other industries. shoppers continue to expect a
In each measure of how retail cross-channel experience that
firms use these technologies with includes physical channels.
customers, scores were slightly
higher than cross-industry Integrating mobile and social
averages. Yet, only about a third media into that cross-channel
or retailers are using mobile with experience may present an
customers, and less than half use opportunity for retailers.
social media for tasks other than According to our study, it appears
monitoring reputation or that some retailers have already
promoting products/services. begun making headway in building
cross-channel consistency, with
The retail industry’s Digirati are scores slightly higher than the
using social media and mobile
cross-industry average.
considerably more than other
firms. This suggests that both
mobile and social media could
Page 2

4. Learning 3: Retail’s vision for initiatives within their
radical Digital Transformation is organizations are clearly defined.
often limited Yet, most retail companies did not
say they had a vision that was
Some retail companies have clear radical, shared among senior
plans for Digital Transformation. executives or integrated across
56% of the companies surveyed organizational units (see Figure 3).
reported having a high-level digital This suggests that many retail
roadmap – 13 percentage points companies are prepared to deliver
higher than the cross-industry a digital vision that is more
average. More than half said that evolutionary or siloed than
roles and responsibilities for digital
transformational.
Figure 3: digital vision
46% Senior executives have a digital 25%
transformation vision that involves
44% radical changes 32%
Copyright © 2012 Capgemini Consulting and MIT-CDB. All Rights Reserved
36% Senior executives share a common 36%
vision of how the business should
34% change through digital technologies 46%
----- RET - Figure 14 -----
32% 56%
There is a high-level roadmap for
digital transformation
38% 43%
46% Senior executives have a digital 38%
transformation vision that crosses
37% internal organizational units 43%
38% Senior executives and middle 38%
managers share a common vision of
44% digital transformation 34%
Legend:
• Red bars represent the percentage of companies disagreeing with each statement (answers 1, 2 and 3 on a scale from 1 = strongly
disagree to 7 = strongly agree) in the industry; green bars represent the percentage of companies agreeing with each statement
(answers 5, 6, or 7).
• Grey marks represent disagreement (answers 1, 2 or 3) or agreement (answers 5, 6 or 7) across all companies in our study.
Learning 4: New business models that were previously unreachable
focus on enhancing the industry’s with traditional approaches. Most
core business of physical channels retailers have been able to launch
new businesses based on digital
Only 27% of companies reported technology, yet companies
transitioning from physical to observed less cannibalization than
digital products and services average. This suggests that new,
(versus a 45% average across all digital business models are
industries). Instead, digital complementing (rather than
technologies allow most retailers competing with) retail’s core
to connect with new customers business.
Page 3

5. Our survey data shows that some companies in the retail industry are currently
transforming the customer experience and enhancing their core business
models through Digital Transformation. Our analysis reveals some additional
areas for retail firms to consider in developing their digital maturity:
- Reassess vision – Many retailers that responded to our survey did not
recognize a “vision that involves radical changes” within their firms.
They also did not show strong responses for that vision being shared
among executives or integrated across the business. Moving forward,
retail firms may want to review their vision for Digital Transformation,
either to validate that they are on the right path or to develop greater
consensus around a leading-edge vision of the future.
- Leverage social media and mobile with customers – The retail
industry’s Digirati leverage social media and mobile technologies with
companies more so than other firms in the industry. This may be
evidence of opportunities for other retailers to begin using these
technologies to enhance the customer experience.
- Develop consistency across channels – According to Capgemini’s 2012
Digital Shopper Relevancy Report, customers expect an integrated
channel experience that includes traditional physical channels. Building
on established work in cross-channel consistency could prove an
important factor for success.
- Enable internal collaboration – Retail firms today show below-average
usage of digital collaboration, knowledge sharing, or tools like instant
messaging to enhance operations. This may reflect a store-centric
model of internal operations. However, given the geographic spread of
many retail firms, there may be potential to leverage these practices
and tools to enhance operations and worker productivity.
Page 4

6. Acknowledgments
We would like to extend our sincere thanks to the executives who took the time to respond to our survey.
Contacts
For more information, please contact:
Global
Emmanuel
RILHAC
emmanuel.rilhac@capgemini.com
Belgium China Finland France India
Robert Nongfei Sami Laurence Romain
VAN DER EIJK ZHU FINNE JUMEAUX DELAVENNE
robert.van.der.eijk@capgemini.com nongfei.zhu@capgemini.com sami.finne@capgemini.com laurence.jumeaux@capgemini.com romain.delavenne@capgemini.com
Netherlands Norway Spain Sweden USA
Armijn Steinar Fernando Anneli Ken
BEEK SIMONSEN RODRIGUEZ SAMUELSSON TOOMBS
armijn.beek@capgemini.com steinar.simonsen@capgemini.com fernando.rodriguez@capgemini.com anneli.samuelsson@capgemini.com ken.toombs@capgemini.com
United Kingdom Germany, Switzerland, Austria MENA
Michael Ralph Jawad
PETEVINOS BECKER SHAIKH
michael.petevinos@capgemini.com ralph.becker@capgemini.com jawad.shaikh@capgemini.com
About the Research on Digital Transformation
This analysis is based on data collected during the second year of our joint research program with the MIT
Center for Digital Business.
For more information about the research, please contact:
• Didier BONNET
Managing Director and Global Head of Practices at Capgemini Consulting
didier.bonnet@capgemini.com
• Patrick FERRARIS
Global Leader of the Technology Transformation Practice within Capgemini Consulting
patrick.ferraris@capgemini.com

7. About Capgemini
Capgemini Consulting is the global strategy and transformation With around 120,000 people in 40 countries, Capgemini is one
consulting organization of the Capgemini Group, specializing of the world’s foremost providers of consulting, technology
in advising and supporting enterprises in significant and outsourcing services. The Group reported 2011 global
transformation, from innovative strategy to execution and with revenues of EUR 9.7 billion. Together with its clients, Capgemini
an unstinting focus on results. With the new digital economy creates and delivers business and technology solutions that
creating significant disruptions and opportunities, our global fit their needs and drive the results they want. A deeply
team of over 3,600 talented individuals work with leading multicultural organization, Capgemini has developed its own
companies and governments to master Digital Transformation, way of working, the Collaborative Business ExperienceTM, and
drawing on our understanding of the digital economy and draws on Rightshore®, its worldwide delivery model.
our leadership in business transformation and organizational
change. Learn more about us
at www.capgemini.com.
Find out more at:
http://www.capgemini-consulting.com/
Rightshore® is a trademark belonging to Capgemini
Capgemini Consulting is the strategy and transformation consulting brand of Capgemini Group. The information contained in this document is proprietary.
© 2012 Capgemini. All rights reserved.