Alex and Ani demonstrates how today’s businesses must operate like silo-less ecommerce brands, avoiding friction between different departments.
Brands that have been founded within the last 20 years, like Amazon and eBay, tend to have ecommerce figured out. Their chief intelligence officers (CIOs) and marketing officers (CMOs) also tend to be on the same page, focused on maintaining a single channel through which they sell products and services.
There are no silos. Everyone works in harmony.
Traditional brick-and-mortar brands, however, tend to have more of a struggle when it comes to bringing internal departments together. They are much more likely to have traditional CIOs that focus on technology that supports the enterprise as a whole and traditional CMOs that focus exclusively on traditional media.
And as these companies attempt to integrate ecommerce, too, they bring in vice presidents focused on selling products in new channels. This often results in a struggle between three departments that can’t see beyond their own conflicting objectives.
The technology traditional CIOs bring in to support the enterprise doesn’t necessarily also support ecommerce or marketing. And more traditional CIOs don’t always fully understand new channels, often relying on large enterprise systems to fill the gap.
Traditional CMOs, on the other hand, steer clear of ecommerce and want technology to support their specific marketing efforts. Meanwhile, the ecommerce portion of the business tends to be more new media-focused.
As a result, none of these departments work together or understand what the others need . They rely on their own technology to fulfill their own specific objectives and suddenly, there are islands of information throughout the organization and no one wants to share. And that’s no good for anyone.
While L Brands, the retailer behind brands like Victoria’s Secret and Bath & Body Works, tends to be focused on that more traditional sales model, Gap Inc. and Alex and Ani, have really embraced a multichannel approach.
According to Ryan Bonifacino, who recently served as Alex and Ani’s CMO, he met the brand’s founder back when it had a single store and no online presence. It was doing well in terms of sales per square foot, but it was a seasonal business. Shortly thereafter, Bonifacino helped grow the business from $ 1.5 to $ 300 million in topline revenue over five years.
Bonifacino was able to do this by bringing in the digital tools necessary to help the brand figure out attribution, data management, predictive behavioral analytics and the like. He also helped all internal departments work seamlessly together.
Here are his top tips for ensuring every business operates like a silo-less ecommerce brand.
1. CIOs and CMOs must be true partners
First and foremost, Bonifacino said the CMO/CIO relationship needs to be a true partnership. In other words, these executives must work together in establishing a technology roadmap for the brand, but it must extend beyond this to an actual personal relationship.
“They have to go out and do one-on-ones, get dinners, go out for drinks, and do a retreat together: something to get them out of the daily grind and get to know each other,” says Bonifacino. “When your peers see that happening, they tend to view you as partners.”
At Alex and Ani, the CIO and CMO came up with a partnership concept that eventually extended to a buddy program uniting employees who wouldn’t normally cross paths. For example, an engineer and a social media manager would sit next to each other for a time, and go out to dinner or on yoga retreats together.
“We knew this system would be fun, but we didn’t expect the level of success we saw,” says Bonifacino. “Now these relationships are intact and there are lifelong friendships with different people.”
2. Internal departments can’t play favorites
Bonifacino points out that one department can’t add new technology that supports or benefits one channel over another.
“If a CIO is selecting a technology and forcing it on the business without creating a partnership, that puts a process behind a selection and key business drivers, then you’re going to have conflict and friction,” says Bonifacino. “These technology decisions are typically made like that with legacy companies that have traditional structures and don’t have a digital center of excellence.”
He adds that he was lucky to have a blank slate at Alex and Ani. He was able to start from scratch, and build a complete structure and strategy focused around the customer, rather than having to deal with legacy systems, business units and processes.
Further, when either the CIO or CMO make a decision that shifts the budget away from the other, it can disrupt the business in huge ways. It goes back to profit and less management; if there is a disconnect in alignment, costs or calendar, revenue or margin forecasts can be highly impacted and it can create chaos within the relationship. On the flip side, CMOs making technology-purchasing decisions without the CIO’s knowledge can have costly implications.
3. The CFO should be right there with them
CFOs should be in the middle of this CIO/CMO relationship because they understand both modern digital concepts and traditional technology approaches.
“Looking at these two approaches with one lens and a portfolio mentality is best suited for a CFO,” says Bonifacino. “Having a CFO involved at an early level helps determine what’s best for the company and shareholders versus any one sales channel or business unit.”
Governance committees are also important because they help eliminate sales bias.
4. Weekly updates are key
While noting there are “a million different things to call them,” Bonifacino also recommended weekly meetings that include updates on all decisions.
“These meetings allow for open discussion that addresses technology decisions and methodologies, leading to early decisions. What’s more, they reduce or eliminate biases associated with experience, vendors and even time,” he says.
Additionally, it’s healthy for companies to get a product management office – the group within a business that defines and maintains project management standards – view into existing projects at the status level. That validates the the initial business assumptions or value assessments that should be conducted when a non-technology executive sponsors a project.
5. Maintain a knowledge base
During Alex and Ani’s growth period, Bonifacino said he made a decision to say “yes” to any vendor calling on the company. From there, he gathered all the resulting pitch decks, whitepapers and webinars and built an internal knowledge base.
He recommends doing something similar, even if it’s as small as getting things organized on Dropbox and sharing that link with partners in other business units.
“It can go a long way,” he said. “I don’t know if Alex and Ani would be where it is today if it didn’t have this type of foundation for digital literacy.”