3 november 2017 - kingfisher plc · pdf fileuplift, driving improved roce. ... redecorate...
TRANSCRIPT
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3 November 2017
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Agenda
• Introduction• Unique & Unified Offer• Digital
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Our ambition: to become the leading home improvement
company
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Our purpose
We believe everyone should have a home they feel good about, so our purpose is to make home improvement accessible for everyone.
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Seven actions
We will address customer needs
We will design a seamless customer process
We will create a unique and leading offer with an integrated supply chain
We will create a leading customer experience in our stores
We will become a truly sustainable company
We will work as one
We will be low cost always
threeone
two
fivefour
six
seven
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Reaffirming our 5(1) year transformation targets
Unified & Unique Offer
£350m
Digital£50m
Operational Efficiency
£100m
£500m EBIT uplift, driving
improved ROCE
£800M aggregate costs to achievec.£600M capital return over the first 3(2) years
(1) FY 20/21(2) First 3 years to end of FY 18/19
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Clear long term roadmap: a reminder Year 3 FY 18/19
Year 4 FY 19/20
Year 5 FY 20/21
Unified & Unique offer
New OSC organisation
‘Cut the tail’
Retail best practices
Screwfix UK & Europe retail expansion
Retail expansion (excluding Screwfix)
E-commerce
B&Q store closures
GNFR
Further operational efficiency initiatives
Unified IT platform roll out
Unified & Unique Offer
Digital
Operational Efficiency
Retail Operations
Store of the future
Year 1 FY 16/17
Year 0 FY 15/16
Customer journeys
Year 2 FY 17/18
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Key messages: where we are
1. Implementing a unified & unique offer based on customer needs, now at 19%(1)
unified COGS (2)
3. Starting to control our end to end process
2. Reorganising as ONE, adapting as we progress
4. Sourcing in a very different way
(1) Consistent with H1 2017/18 guidance(2) Cost of Goods Sold
5. Gearing up for next year, negotiations well advanced
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Sourcing: we are leveraging our £7bn buying scale like never before (1/2)
1.Leverage Group
volumes
Re-designing products to reduce cost
whilst improving quality
3.Designto
cost
2. Bundle volumes by segments
across categories
Source by component e.g. plastic OR by
process e.g. die casting
Fewer Global SKUs &
suppliers = bigger volumes
per SKU
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Sourcing: we are leveraging our £7bn buying scale like never before (2/2)
4. End to end value
chain
Real engine for growth =
higher volumes
Identifying savings along the chain e.g.
packaging
5. Co-build unique ranges
All underpins £350m target
≈ 5% CPR(1) on company buying
scale of £7bn
(1) Cost Price Reduction
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And we are starting to deliver the benefits
Customer benefits
New products
More affordable
prices
Higher quality
Business benefits
Simpler ranges, better merchandising
Higher sales CPR Improved
processes
Early evidence of
delivery
U&U(2) H1 sales growth, pre-disruption
(1) Profit uplift by FY 20/21(2) Unified & unique(3) On cumulative unified & unique ranges by end FY 17/18
CPR in line with
expectations
£350m(1) = broadly equivalent to 5%
CPR on £7bn buying scale
Fewer SKUs & suppliers
Positive customer & colleague feedback
c.80% reduction of
SKUs & suppliers(3)
H1 gross margins up 30bps pre-clearance
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Unified IT platform
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Unified IT platforms – 4 aims
1Enable us to
meet changing customer
shopping habits
2Easier for
stores to serve customers & carry out their
daily tasks
3Establish unified &
integrated processes &
systems across the Group
4Build a flexible & future proof
systems architecture
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Unified IT platform - roll out methodology
Rolled out end to end as
a complete system suite
Reduce dual running time as much as
possible
Rigorous control of any changes to
system (except legal &
financial)
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Unified IT platform – revised roll out plans
2017/18 2018/192016/17
France
Iberia & Romania
France
Poland
Russia
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Unified IT platform was built with flexible architecture across 3 layers
Core systems
Services, integration & API
Web technologies External APIs(1)
APIs & Services
Customer & colleagues
(1) Application Programming Interface
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Digital
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NEEDS & TRIGGERS
INSPIRE & VISUALISE
PLAN & EVALUATE
PURCHASE & FULFIL
BUILD & INSTALL
USE & ENJOY
MAINTAIN & IMPROVE
Our Digital strategy
IN-STORE SELLING
DIGITAL MARKETING
MOBILECONTENT DIGITAL ANALYTICS
SEARCH CLICK &COLLECT
CHECKOUT
Seamless customer journeys
Core E-Commerce: as good as the best
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Core E-Commerce priorities
SIMPLIFYINGCHECKOUT
ENRICH CONTENT
DIGITALMARKETING
BETTER SEARCH
BECOMINGMOBILE FIRST
DIGITAL ANALYTICS
CLICK AND COLLECT
IN-STORE ORDERING
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Customer journeys
NEEDS & TRIGGERS
INSPIRE & VISUALISE
PLAN & EVALUATE
PURCHASE & FULFIL
BUILD & INSTALL
USE & ENJOY
MAINTAIN & IMPROVE
Seamless customer journeys
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What is an end to end customer journey?
PURCHASE
Choice
Tiles, white goods, taps, showers, accessories
INSPIRATIONEMOTIONAL
FUNCTIONAL
HOW TO DO IT?
Bathroom Project: 7 months cycle
38% of projects NEVER complete
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The end to end journey has a hierarchy
PRODUCTPurchase lightbulb, purchase tile,
purchase bbq, etc.
REMIND
Needs & Triggers
Inspire & Visualise
Plan & Evaluate
Purchase & Fulfil
Build & Install
Use & Enjoy
Maintain & Improve
MOTIVATE ENABLE EXTEND
MISSIONInstall new lighting, tile bathroom, lay
new decking, etc.
PROJECTRedecorate living room, remodel bathroom, garden redesign, etc.
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There is a traffic opportunity at every stage in the journey
Why are end to end journeys important?
Needs & Triggers
Inspire & Visualise
Plan & Evaluate
Purchase & Fulfil
Build & Install
Use & Enjoy
Maintain & Improve
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TRA
FFIC
+
-
Needs & Triggers
Inspire & Visualise
Plan & Evaluate
Purchase & Fulfil
Build & Install
Use & Enjoy
Maintain & Improve
We are only currently addressing part of the journey
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Seamless customer journeys will address entire end to end journey
TRA
FFIC
+
-
Needs & Triggers
Inspire & Visualise
Plan & Evaluate
Purchase & Fulfil
Build & Install
Use & Enjoy
Maintain & Improve
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We will get that coverage through a series of steps
INSPIRATION
VISUALISATION
GUIDES
PRODUCTS
HELP
Inspire new projects
Assist with product purchase
Always on help and advice
Full end-to-end coverage
Guide through the project
Digital store and colleague
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Digital methodology
DEPLOY to any channel
(Web, mobile, app, store & colleague)
Identify the customer PROBLEM
Create aHYPOTHESIS
Continuous measuring
andLEARNING
BUILD a service
(Prototype, MVP (1), MMP(2) )
Continuous iteration informed fromcustomer feedback
(1) Minimum Viable Product(2) Minimum Marketable Product
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DEPLOYSCALE & HONE
VENTURESPEC & PLAN
MVPHACK & LEARN
MMPEXPLORE & SOLVE
Finding the FormulaProviding FeedbackEstablishing Hypothesis
Applying to the business
Evolution from ideation through to launch
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Customer journeys – digital build in progress
MMPMVP
Inspire new projects Guide through the project