Magazine Article | October 20, 2017

Are You Overthinking Innovation?

By Jennifer DiMotta, President & Owner, DiMotta Consulting, LLC

Why applying innovative thinking through the brilliant basics of retail will render success.

Headlines like “Retail Apocalypse” and “Disrupt or Die” ignite the need for retailers to innovate urgently, but the reality is that retailers are not positioned well for significant innovation. With tight budgets and executives focused on immediate impact to fight declining sales, innovation ideas are quickly put on the back burner. Innovation most often is associated to a project that includes high costs, long timelines, significant resource demands, and no guarantee of immediate payoff — bites most retailers cannot swallow. So how do you infuse an attitude for innovation in an environment dominated by the “tyranny of the now”?

Thinking innovatively to solve core and critical issues can be a more successful endeavor than large-scale innovation today. While innovative thinking still requires significant courage, confidence, and creativity, a deep understanding of the company, the customer, and the clear impact on results can be invaluable to infusing innovation into a challenged and operational-first retail environment. Below, I have provided a few key insights with personal examples, all of which I have gained throughout my 20 years of experience at companies challenged with budget pressures and heavy day-to-day operations.

When I led’s revenue-generation strategies in 2008, the office supplies retailer struggled with flattened revenue from the impact of the recession and increasing desire from big-box retailers and Amazon to own category share online. In addition, the retailer had a common challenge of thin margins from a drop-ship business model that led to lean investment in other areas of the business.

"After analyzing the 200K drop-ship assortment, we found striking results. Over 100K items could profitably be offered with free shipping and accounted for 60% of current revenues." was in a Catch-22 situation that could easily impact its survival in the industry. They couldn’t profitably offer the standard free shipping over $50, and they couldn’t afford not to with all of the competition offering this table stake. I challenged the team to consider other options that were also as competitive or better. If we can’t competitively offer free shipping by order, can we do so by product? We had a core competency in knowing all of our costs by product, so I leveraged that skill. After analyzing the 200K drop-ship assortment, we found striking results. Over 100K items could profitably be offered with free shipping and accounted for 60 percent of current revenues. In addition, these items shipped from drop shippers delivering product to customers within two days. Our value proposition was immediately intriguing: many items, fast shipping, and no threshold on free shipping. was one of the first in offering “FAST & FREE shipping on over 100,000+ items.” From day one, the results were amazing. Not only did we recognize a 25 percent increase in revenue, but also we had comfort in knowing profitability would not be compromised. With considerable future upside, we had the energy to holistically think in innovative ways about other areas of the business.

"Spending at least 1-2 hours a week with new vendors will give you inspiration for innovation."

Sports Authority was a challenged retail business when I joined to lead e-commerce in 2013, and in the following two years, e-commerce grew from $50M to $200M+ profitability. It was an invaluable experience working with a top-talent e-commerce team that was humble in success and consistently looking to do better. We had a few key hurdles, the biggest of which was our inability to make significant changes to the website. We overcame this hurdle by layering vendor tools that ultimately gave us more control over the website to deliver a better user experience.

XSELL Technologies, a live chat and technology vendor, was an impactful example of pervading innovative ideas from vendors. Their solution took live chat beyond the norm with compelling value. Focusing on the core business value, authoritative content (and talent) became tangible tactics that shaped Sports Authority by inviting XSELL’s sports enthusiasts to service our customers and in turn accomplish results well beyond our expectations, 10 times the conversion rate of an average online consumer.

Spending at least 1-2 hours a week with new vendors will give you inspiration for innovation. The key to prioritization is to align innovation wholly to core value propositions. There are too many technologies out there. Be well informed when narrowing down to the ones that matter.

In 2005, I moved away from my home, Nebraska, where I grew up among the cornfields and cows. I was ready to explore and be challenged personally and professionally. I was offered the head of e-commerce role at PHE, Inc., an adult products company in North Carolina.

With a strategy and plan in hand, I contacted key partners including Google, Paypal, and other e-commerce organizations. I received immediate rejections from every potential partner due to the nature of the category and the experience we had created. It would be nearly impossible to grow without partners like Google.

Every peer executive suggested I keep with the company’s current brand strategy and just “get used to rejection.” My research and gut told me otherwise. I went for it and built a new brand and marketing strategy online. It was a risk without buy-in (except from my boss), but I knew our roadblocks were a sign to think differently about the business. Within six months, we built a new site experience that was female friendly, viewer friendly (no “adult” imagery), and a high-end experience.

Every rejection turned into an opportunity, and within three years sales more than doubled. More importantly, women were our new primary buyers and we were twice as profitable.

Roadblocks are an invaluable occurrence forcing you to dig deeper about how you will move forward. Lean into roadblocks and use them to energize you and your teams to think about out-of-the-box solutions to success.

I don’t believe the above is rocket science but rather is grounded in smart solutions to the basics and fundamentals, which are critically underrated in regards to impact on results. Innovative thinking, applied in organizations struggling with the current state of retail, isn’t about shiny pennies but rather results.