Fifteen per cent of all businesses in Northern Canada are “advanced” according to a new study on businesses’ use of digital technology, conducted by the Business Development Bank of Canada.
The study viewed the business models of 2,000 companies in Canada to measure how well they have incorporated digital technologies tools into their day to day business. These technologies ranged from email and social media tools to e-commerce and management systems.
“We define a company’s digital maturity as a combination of two separate but related dimensions: digital intensity and digital culture,” states the study. “Digital intensity measures the use of digital technologies in a company’s operations … (and) digital culture measures the ability to implement change in a company.”
One business operating in the North that has begun to digitize their operations is BBE Expediting Ltd. The logistics company recently launched an online website that allows for customers looking to ship goods to remote communities in the North to centralize the process online.
BBE president Heather Stewart said the field of logistics had a digital niche that needed to be filled.
“Having an online shipping platform is excellent for people that don’t have a traditional supply chain or don’t know how to get freight into those hard to reach places,” said Stewart. “Now they’re going online and finding out how to do that themselves.
In the BDC’s study, companies were split into four categories, and the Northern companies it looked at were classified as follows: 15 per cent were advanced, 11 per cent were techno-centric, 13 per cent were techno-shy and 61 per cent were conservative.
Advanced businesses have integrated their physical business with an online presence successfully, said Pierre Cleroux, vice-president of research and chief economist at the BDC. Techno-centric are those that are investing in digital technology without a strategy. Techno-shy companies have begun to tconsider their digital presence but have not acted. Conservative companies are those with no online presence.
The NWT’s 15 per cent number in the advanced category was tied with the Atlantic provinces for the worst across the country. Businesses in Quebec had the highest advanced ranking at 26 per cent.
The study stated that businesses with a higher digital maturity rating had higher sales numbers and more potential for growth.
Gabe Powless, the Owner of Raven Web Services, a Yellowknife based digital marketing company, said he has noticed the lack of digital maturity in the north as a real problem.
“That’s a big problem here in the North, a lot of them ignored the transition into digital age or did so haphazardly,” said Powless.
Powless said that a big problem in the north is that a lot of small business view the cost of going digital is too expensive.
“The number one thing that I would tell people is to change their midnset and think of it more like traditional advertising. If done properly its ideally going to bring a return,” said Powless. “What I really want to try to tell people is to think of this as a profit mechanism, you’re going to spend money up front but you’re going to make that money back.
Powless said that if a business isn’t seeing a return on profits, something with their digital marketing has gone wrong. He also noted that digital marketing is about more than just having a website and that there is a need to continue marketing online through advertisements and other traffic generating tools to ensure customers continue to visit the online portion of a business.
“Companies who are using digital technology perform better,” said Cleroux. “Consumers are looking online to see where they can buy their products or services. If you are not online consumers are not going to find you.”
Cleroux said that if businesses don’t transition to the digital world, it is only a matter of time before they start to fall behind.