With very little fanfare or notification, Canadian Tire, a Canadian Institution for going on 87 years, put a notice on thier website that they would be ceasing all internet sales activity on January 29th 2009.
On it’s own, this is a non-remarkable announcement. Put into context of the current state of the global economy, the trend to move toward internet sales and the sheer massive distribution capabilities of this home service giant, this becomes a rather remarkable announcement.
From where I sit (and this is my blog so I can sit wherever I want) I see massive loss of opportunity here that Canadian Tire seems to be giving up.
I’m sure they have had a long and hard look at the numbers and the effort required to run an online shopping experience. They probably had a lot of high priced consultants come in and run various scenarios and advise that there was limited opportunity given the current economic downturn in the marketplace and that the best option was to abandon the online store (because someone on high really ultimately wanted to hear that message).
Lets take a look at some of the outsiders viewpoints and see if they make any sense shall we?
Managing product in a warehouse or via drop shipping is a more cost effective means of managing margin. There is no need to do massive distribution chain to stores for products sold online as they can be shipped from the warehouse or direct from the manufacturer if the model allows. Look at Amazon. Do you think they keep millions of copies of titles in stock? Nope. They keep a few in stock and request more from the printer or publisher when they are required. They have centralized distribution and warehousing to facilitate easier pack and pick operations and aggregated shipping. Now I’m not saying that Canadian tire is Amazon but there are opportunites to learn from the likes of Amazon to build a more efficient distribution model for online sales.
Canadian Tire did little in the way of driving customers to the website. A little footnote at the bottom of the page on a flyer is insufficient to advise subscribers that they can buy online. There was also no incentive to purchase online. I can’t recall ever seeing a “Web Only” deal that required a customer to purchase an item through the website to get some great deal. Most successful online store have a daily door crasher that can only be purchased from the web. Dell, Newegg, Home Depot, The Source, The Bay, FutureShop, Best Buy, etc… It keeps people coming back for more. Canadians love a good deal and with Canadian Tire’s penchant for taking that 3000 piece socket set that you absolutely must have and marking it down by 75% to the low low price of $67.95 there had to be some opportunity to leverage this daily deal mania.
Canadian Tire also did something that most people (at least in the online community) feel is an act of cowardice. They did not issue a press release or notify the media, they simply and quietly put a page on their site advising anyone who happened to click on it that this action was happening in a matter of weeks. This type of approach to online marketing and treating your online customers with little respect is probably the main reason that the online store concept failed at Canadian Tire. They just didn’t *get* the opportunity. They assumed, like most noobs, that if you put the page up, people will automatically flock to it ‘For Great Justice’ (sorry, got a little ‘All Your Base…’ there). This is a rookie mistake and one that should have been dealt with a little more effectively by a company with the pedigree of Canadian Tire. They didn’t give the online store the proper care and feeding that it required to flourish and become a great presence in Canadian Online Retail.
There are many opportunities for companies with an online presence to advertise such presence via traditional media to drive traffic. The old guard at Canadian Tire forgot to include the online presence in these media spots when placing the million dollar ad buy’s. I guess that Canadian Tire did what so many Canadian companies are so great at. They built a great product/service but didn’t tell anyone about it and then stood by scratching thier heads wondering why it was not a great success.
Here is my view of this act of cowardice as told by the fine cast of Zero Wing . The names have been changed to include… You 🙂
- Computer: Main screen turn on.
- You: It’s you !!
- CT.com: How are you gentlemen !!
- CT.com: All your base are belong to us.
- CT.com: You are on the way to destruction.
- You: What you say !!
- CT.com: You have no chance to survive make your time.
- CT.com: Ha ha ha ha ….
Sorry couldn’t resist. It just seemed to fit.
Matthew Ingram said it best on Twitter today ‘I love how Can Tire tries to sell it “You’ve told us how great we are… so we’re making our site even less useful” ‘
For those of you who are interested, Here is a screengrab of the impending shutdown notice.
have to go and see how I’m stocked for Socket Sets. I think I’m running a bit low.
Update Jan 21:added image of Can Tire message. fixed typo’s