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Internet of Everything: Retail’s Future

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Cisco Consulting Director for Retail, Jon Stine, provides an overview of the value of the Internet of Everything for the Retail industry. This presentation outlines how retailers can capture revenues …

Cisco Consulting Director for Retail, Jon Stine, provides an overview of the value of the Internet of Everything for the Retail industry. This presentation outlines how retailers can capture revenues by implementing Internet of Everything strategies.

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  • 1. Cisco Public© 2012 Cisco and/or its affiliates. All rights reserved. 1 Internet of Everything Retail’s Future Cisco Consulting Services October 2013
  • 2. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 2 Does your Loyalty Program differentiate the brand? Your CRM application? Commodity. Loyalty Programs. Enterprise Applications. Differentiator. Data. Captured. Analyzed. Turned Into Action. The New Competitive Frontier
  • 3. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 3 Delivering the right information to the right person (or machine) at the right time Process Connecting people in more relevant, valuable ways People Leveraging data into more useful information for decision making Performance Physical devices and objects connected to the Internet and each other for intelligent decision making Products
  • 4. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 4 Machine-to-Machine (M2M) 21% Share of Value at Stake Machine-to-People (M2P) 48% Share of Value at Stake People-to-People (P2P) 31% Share of Value at Stake Inventory Visibility Flexible Payment Options Automated Ordering Process Energy Optimization Understand Shopper Behavior Personal-SoLoMo Content Endless Aisle Omni-Channel On-Demand Expert Advice Collaborative Product Development On-Demand Training Source: Cisco Consulting Primary Research, 2013
  • 5. Cisco Public 5© 2012 Cisco and/or its affiliates. All rights reserved. Creating Retail Value from IoE: 5Opportunities 1 2 3 4 5 Light Up and Connect Dark Assets Connect and Build Customer Trust Gain More Visibility into Inventory Drive Higher Levels of Stock Availability Maximize Staff Productivity
  • 6. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 6 POS CREDIT MOBILE RFIDVIDEO SENSORS SOCIAL EMPLOYEEMEDIA STRUCTURED UNSTRUCTURED WEATHER Data is Fuel. Think Quantity and Quality. SOURCES TYPE CRM LOYALTY 1
  • 7. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 7 Customer Data: Identification Transaction History Cohort Data: Aggregate ID Transaction History Loyalty Data: Identification Interests-Uses Transaction Data: Identification Interests-Uses SINGLEVIEWCONSUMER Availability Data: Identification Interests-Uses SINGLEVIEW INVENTORY weathersociallocation time trend behavior P R E V I O U S “ D A R K “ A S S E T S mobile-WiFivideo Etc. SKU conditioninternet staff 1 2
  • 8. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 8 Real-time pairing of shopper’s exact location via mobile device with Weather Channel report = push ad for best type of Pantene product Source: Wall Street Journal, August 2013; New York Times, July 2013; Frontline Insights, September 2013 Real-time pairing of In-store shopper flow (via video) with frequent shopper data (via mobile device)= Quantity and quality of traffic 2011: Real-time pairing of employee feedback textual analysis with POS, promotion and marketing ROI data = Highly accurate leading indicator of performance 2 2 5 2
  • 9. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 9 MGM Resorts uses wireless to create immersive, personal experiences using service, advice, recommendations, prom otions, and pricing. Guests use app via Wi-Fi get directions to locations, receive discounts, MGM developed processes to coordinate location- based/personal offers Data about customer location used to present relevant info. through app Seamless, secure Wi-Fi in MGM properties powers app on guests’ devices Machine People 2
  • 10. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 10 Smart retail operations, proactively anticipate: 1) checkout traffic to dynamically staff front-end resources, reducing customer wait times / increasing associate productivity; 2) potential out-of-stocks to dynamically adjust labor to increase on-shelf availability Video sensors help store managers optimize checkout and restocking Early out-of-stock assessment helps automate logistics and replenishment Predictive video analytics assess in-coming foot traffic impact on checkout volume Smartphones, cart sensors help track customers’ journey through the aisle Machine People • Shelf Sensors - Inventory • Video- Demographics; Shopping Units • Video-shelf Inventory • Wi-Fi – shopper traffic Sensor fusion Operational Systems FastDataEngine Alerts, Dashboards, Automatic processes 4 5
  • 11. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 11 Tap QR code to get jeans delivered to dressing room in 30 seconds through chute via a robotic arm; card on record auto charged Customer uses mobile to engage with merchandise, try on and purchase Automated product delivery & return from changing room. Automated payment. RFID links products and customers. Mobile linked to encrypted database Mobile device and recorded details act as customer identifier. People Machine 2 3 4 5
  • 12. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 12 Value at Stake 2013 (Jan. – Dec.) $1.2T Value realized in 2013 IoE Value Index $613B (53%) $544B (47%) Value “left on table” in 2013 Global Value at Stake 2013-2022 (10-year total) $14.4T* 2013 $1.2T Note: chart is not to scale * $14.4T is conservative because it is based on a set number (21) of private-sector use cases and discounts future cash flows due to uncertainty around privacy and regulatory issues.
  • 13. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 13 55.1% Opportunity 44.9% Value Realized N=7,501 N=7,501 respondents onScaleof 1 to 10, Retail ITexec. rate theirabilityto capture valuefrom IoE *10-point scale: 1 = extremely weak ability; 10 = extremely strong ability Confidence Level to Capture IoE Value $99B $81B
  • 14. © 2012 Cisco and/or its affiliates. All rights reserved. Cisco Public 14 44.9% 45.8% 46.0% 50.7% 50.8% 54.2% 57.4% 60.5% 65.4% 55.1% 54.2% 54.0% 49.3% 49.2% 45.8% 42.6% 39.5% 34.6% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Retail / Wholesale /… Energy Manufacturing Transportation Other Healthcare / Life sciences Services Financial services High tech / Telecoms IoE value realized IoE opportunity $118B N=7,501 Value at Stake 2013 ($B) $118.3 $115.2 $276.9 $98.7 $65.4 $23.6 $224.4 $55.0 $179.6$99B $121B
  • 15. Thank you.

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