winning in retail in an omni-channel era
DESCRIPTION
Even though the faith of physical retail stores might seem sealed as new digital channels gain market shares across categories, attention should be focused on how to increase attractiveness. Implement Consulting Group had invited Lee Peterson from WD Partners (US) to talk about “What Amazon can’t do” - the most visited speech at the National Retail Federation’s annual convention in New York this year. More that 80 guests involved in retail attended Winning in retail in an omni-channel era. www.implementconsultinggroup.com/retailcphTRANSCRIPT
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WINNING IN RETAIL IN AN OMNI-CHANNEL ERA - DO YOU KNOW WHAT AMAZON CAN‘T DO?
JUNE 13TH 2014
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Welcome into our world of Retail
WHO YOU ARE TODAY
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Todays key note speaker on
“What Amazon can’t do” from WD Partners, USA
KEY NOTE SPEAKER
The hottest ticket at NRF in New York, January 2014
Lee Peterson
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Martin Lyngaa Simonsen
Welcome into our world of Retail
WHO YOU WILL MEET
Charlotte Wandorf
Anesh Nikolai Naidu
Joachim Lupnaav Johnsen
Johnny Ottesen
Anders Iversen
Nicky Overgaard Pedersen
Nicolai Steen Worziger
Thomas Holm
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Bergen Oslo
Stockholm
Malmö CPH
Helsinki
Tallin
ICG Facts
• Strategy & Transformation
• Commercial Excellence
• Operations Strategy
• Planning & Execution Excellence
• Process Improvement
• Sourcing & Procurement
• Strategic Innovation & Execution
• Finance Management
• Change Management
• IT Management
• Leadership, Energy, Assessment
& Development
12 books
published
400+ Consultants
8+ Years of
experience on
average
5 proven
implementation
principles
250+ articles
published
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WHAT IS SHAPING RETAIL TODAY?
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Less than a minute on the Internet..
6 mill. Facebook views
1.3 mill. Videoes watched on
YouTube
100.000 New tweets on
2 mill. Google searches
20 mill. Pics seen on Flickr
320 New accounts on
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What’s all the omni-channel “fuzz” really about?
A technology revolution at it’s
prime
Multiple end-user touch
points evolving
New ways to win and retain
customers
Seamless integration of marketing & sales – providing customer with consistent offerings across channels
affecting the total operational value chain from A - Z
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‘Retailing is no longer an industry but a function to be pursued by all parties’
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The business model in retailing is changing
FROM TRADITIONAL VALUE CHAIN… …TO CUSTOMER JOURNEY RETAILING
Create awareness and build attitudes
Generate traffic and create interest
Facilitate and activate purchase
Generate demand for category
Build relations to ensure repurchase
Leisure/ toys
Gaming/ entertainment
FMCG
Durables/ electronics
Apparel/
luxury goods
Fashion/ clothing
Furniture/ design
End-user
IT/telco
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To win in retailing, YOU must choose
to do some things and not others and this
must be reflected in your business model
WHERE TO PLAY & HOW TO WIN ?
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The STORE as a sales channel
The STORE as a show-room for inspiration
for go-on-line
The STORE as the contact point for
delivery and service
ON-LINE as a sales channel
ON-LINE as inspiration for
go-2-store
ON-LINE as the expanded product
catalogue
You must initially choose which role the store vs. the on-
line channel should play?
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The business model dilemma 1
Cannibalization
or
Competition Implement
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The business model dilemma 2
Cannibalization
and
Compensation Implement
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Building the right mind-set into the organisation…
Increasing ONLINE sales will cannibalize
IN-STORE sales
ONLINE sales facilitates more sales
in more places
STORE will loose traffic
STORE employees will loose part of their
incentive pay
STORE employees will not support the
ONLINE channel
ONLINE will not become an integrated part of the business
ONLINE will move more traffic to STORE
Customers want an ONLINE channel to
research and purchase
Targeted marketing with customer data collected ONLINE
ONLINE will increase the overall revenue
and profit
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… will open up to new value adding opportunities
Provide in-store pick-up and returns
ONLINE sales facilitates more sales
in more places
Increase store network profitability
Reduce in-store focus on “bread and butter”
Bring shopper insight to sales staff
Build volume across channels
ONLINE will move more traffic to STORE
Customers want an ONLINE channel to
research and purchase
Targeted marketing with customer data collected ONLINE
ONLINE will increase the overall revenue
and profit
Ship to where the customer prefers
Differentiate the shopper experience
Display an extended assortment catalogue
Simplify purchase and increase frequency
Drive margins on premium offers &
services
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Omni-channel performance is coordinating, strategy,
activities & resources across channels
Ad hoc
• Not organized • Experiments • No alignment
(budgets/KPIs) • No role assignments
across channels • Low involvement from
top management
Digital channels
Physical channels
Low
Low
High
Le
ve
l o
f c
us
tom
er
ce
ntr
ic c
oo
rdin
ati
on
*
Engaged
• Top-management attention
• Management drives selected initiatives
• Pilots • Some common
activities organized • Cross channel
resources deployed
Structured
• Align budget and KPIs • Dedicated mng.
responsibilities • Selected development
projects • Channel roles assigned • Targets and
commercial planning across channels
Leaded
• Top management leads change
• Defined targets and performance objectives
• Daily management of resources/activities
• Dedicated roles and responsibilities assigned
Lived
• Clear common strategic focus
• Free flow of resources across channels
• Integrated solutions for marketing, sales & business intelligence
• Organize in omni-channel business units
*) Based on a Forester 2013 report – adapted by implement
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Understanding and fulfilling customer needs across channels are keys to succeed and be
profitable at the same time in the digital era
Implement
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Deliver an end-user experience from single to multiple
touchpoints in sync with needs and preferences…
Multi-channel commerce
Single-channel commerce
Cross-channel commerce
Omni-channel commerce
Yesterday Today Tomorrow Future winners
FROM SINGLE TO OMNI-CHANNEL
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…mastering complexity and costs throughout the
customer’s journey
BUILD AN OPERATIONAL BUSINESS MODEL TO ENABLE SUPERIOR PERFORMANCE
1) Choice: Interact with customers wherever they want to and enable them to buy
2) Consistency: Provide relevant and consistent info & experiences across channels
3) Continuity: Enable graceful handoffs and trigger re-purchase & loyalty
Channels
Pro
cess
es
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Today we will focus on how to align channel elements and
the implication of changes to become Omni-channel…
Seamless delivery across
all channels
• Customers see one brand and multiple touch-points operating together
• Retailers coordinate and operate in a differentiated manner across channels
Implement
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Remember... your company is the driver of the cost incurred. The customer is the driver and
owner of your future revenue
Roger Martin
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“What needs to be true?”
to WIN in retailing?
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Seven must win battles to win in the omni-channel era
2 Find growth
opportunities in
customer journey
management
3 Identify new
sources of income
to add more value
to the customers
7 Seek new ways of
sourcing to ensure
a dynamic cost
base
1 Move from multi-
channel to omni-
channel
4 Transform big data
into customer
intelligence
6 Reinvent network
planning and store
formats
5 Manage category
growth
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