The digerati are all – ahem – atwitter about the fact that Canadian Tire, citing economic return, is shutting down its massive e-commerce website.
The venerable retailer, which was hailed at one time as a big-company leader in adopting e-commerce, says the site will now be available only for customer research purposes. This, apparently, is what most customers do now – research a purchase online and then buy it in a store.
Everybody has an opinion on the Canadian Tire ecommerce problem. And, generally, their solution is to put more money into it and make it a properly competitive online shopping site.
But they’re looking at it through only one lens.
Canadian Tire is a large big-box type of retail system that bolted on this ecommerce concept a few years ago when it was all the rage among big companies. It’s really an old-school retailer, with 450 or so brick and mortar stores that boast they’re never more than 15 minutes away from shoppers.
Also, most of these stores are “owned” by local investors in a system similar to car dealerships. These local owners, I suspect, were never happy with a website that sold goods and fulfilled orders from a central warehouse, which, of course, could cannibalize their retail operations.
Couple this fear with an upper management schooled in traditional department store methodology, and it’s easy to see what happened. The iconic Canadian retailer is facing a bleak year, as consumer-oriented operations usually do in a recession. In reaction, it’s likely reverting back to old school methods.
In a tough economy, low ROI usually means a date with the axe. So, somewhere at the top, boffins probably examined their spreadsheets and decided on serious cuts. In this case, the axe cut the e-commerce bolts.
After Canadian Tire weathers this recession, it may re-examine its online strategy. Or not.
I do think that its decision should be seen as a warning bell for others, however. Perhaps the bricks and clicks strategy isn’t always appropriate.