Tony D'Onofrio gave a presentation on the disruptive future of retail. He discussed trends like globalization in retail, the importance of making wise technology choices, and how technology is driving shifts in retail power. He also covered evolving technologies impacting retail like mobile and digital influence, and looked at retail trend setters. D'Onofrio believes the future will see less store labor through more interactive retail stores and item level intelligence driven by source tagging.

1. Tony D‘Onofrio
October 2016
The Disruptive
Future of Retail

2. © 2016 Tyco. All Rights Reserved.
Agenda
2
• Who is Tony D’Onofrio?
• Retail Globalization
• Make Wise Technology Choices
• The Disruptive Future of Retail
• Retail Trend Setters
You are the Leaders to Shape It.

3. 3© 2016 Tyco. All Rights Reserved.
Who is Tony D’Onofrio
Top 15 Retail Influencer1
Top 25 Retail Website2
Top 40 Retail Blogs3
Retail Leadership Awards4
Global Visionary Connector
Of Ideas and People
For Profitable Business Growth.
1 Vend’s Top 50 Retail Influencers
2 Vend's Top Retail Websites
3 Market Inspector
4 Asia Retail Congress

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An Immersive Positive Customer Experience
Source: YouTube.com

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5
Retail
Globalization
Retail
Globalization
Tony D’Onofrio
Email: adonofrio@tycoint.com
Phone: +1 561 866-9462

6. 6© 2016 Tyco. All Rights Reserved.
Global Retail Market - $13.6T
Fastest Growing
Market
5.7%
Middle East & Africa
Fastest Growing
Channel
12%
Online Retailing
Source: Euromonitor

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Level of globalization
by product sector, FY2014
Product sector profiles, FY2014
The Global Top 250 Retailers
Source: 2016 Deloitte Global Powers of Retailing

8. 8© 2016 Tyco. All Rights Reserved.
Q Ratio LeadersFastest Growing
Source: 2016 Deloitte Global Powers of Retailing
Top 10 Fastest Growing / Q Ratio Retailers
Retailer Country
FY2009 - 2014 retail
Revenue CAGR¹
RANK Retailer Country Q Ratio
Vipshop Holdings Limited China 320.8% 1 Hermès International SCA France 6.422
JD.com Inc. China 106.3% 2 Tractor Supply Company US 6.113
Axel Johnson AB/ Axfood,
Axstores
Sweden 49.3% 3
H & M Hennes & Mauritz
AB
Sweden 5.811
AB Acquisition LLC (now
Albertsons Companies Inc.)
US 45.3% 4 Inditex S.A. Spain 5.792
Steinhoff International
Holdings Ltd.
S. Africa 41.6% 5 Amazon.com Inc. US 5.307
Southeastern Grocers LLC
(formerly BI-LO Holding LLC)
US
36.0% 6
Nike Inc./Direct to
Consumer
US 5.180
Yonghui Superstores Co.
Ltd.
China
33.7% 7 Next plc UK 4.952
OJSC Dixy Group Russia 33.3% 8 The TJX Companies Inc. US 4.438
Chongqing Department Store
Co. Ltd.
China
32.5% 9 Vipshop Holdings Limited China 4.400
Jumbo Groep Holding B.V. Netherlands 30.1% 10 Ross Stores Inc. US 4.369

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9
Make Wise
Technology
Choices
Make Wise
Technology
Choices
Tony D’Onofrio
Email: adonofrio@tycoint.com
Phone: +1 561 866-9462

10. 10© 2016 Tyco. All Rights Reserved.
Store Systems Priorities
Top Store System Priorities for 2016
15%
16%
16%
19%
21%
29%
32%
35%
42%
52%
Assisted Selling
Ship-from-Store
Workforce Management
Improved Training Tools
Single Transaction Engine
WAN/WiFi Upgrade
Inventory Visibility
BI/Analytics
Mobile for Associates
Advanced CRM/Loyality
3.9%
Average increase
in-store technology
spending in 2016
Source: 2016 IHL / RIS Store Systems Study
6.5%
5.0% 4.7%
2.8% 2.4%
Predictive
Analytics
Proximity
Marketing
Data
Visualization
RFID Internet of
Things
Emerging Tech

11. 11© 2016 Tyco. All Rights Reserved.
Age of Amazon:
Challenges & Opportunities
Source: RIS / Gartner Retail Technology Study 2016
1.
Developing personalized
marketing capabilities 51%
2.
Network and IT systems
security 47%
3.
Leveraging social media
(for sales, CRM, hiring,
customer service, etc.)
46%
4.
New payment technologies
(EMV, contactless, mobile,
etc.)
45%
5.
Expanding unified
commerce (omnichannel)
initiatives
44%
Top 5 major strategies
over the next 18 months
Top 5 challenges
over the next 3 years
1. Customer data security 49%
2.
Retiring legacy
systems 46%
3.
Optimizing digital
commerce as growth
channels
39%
4. Application integration 35%
5.
Optimizing stores as a
growing channel 29%
Investments in technologies that improve the
retailer’s ability to meet customer
expectations, exploit innate strengths,
overcome weakness and disintermediate
others, will move the needle.
Make wise choices.

12. 12© 2016 Tyco. All Rights Reserved.© 2016 Tyco. All Rights Reserved.
12
The
Disruptive
Future of Retail
The
Disruptive
Future of Retail
Tony D’Onofrio
Email: adonofrio@tycoint.com
Phone: +1 561 866-9462

13. 13© 2016 Tyco. All Rights Reserved. 13
Technology Driving Shifts in Retail Power

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EvolvingTechnologySystems
ImpactingRetail

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Top Retail Trends
Multichannel consumers
more profitable than single
channel*
shoppers to refrain
purchasing from
store if desired
brand not available*
*Sources: RIS 2015 Shopper Experience Study; RSR
2015 Omnichannel Report; RSR 2015 Mobile Study
retailers believe
consumers are using
mobile as part their
shopping experience*
50%
69% 90%

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The Evolution of Loss Prevention
Item Intelligence
Store Intelligence
Item Security
Data & Video
Analytics
EAS Video RFID
Traffic & Shopper
Analytics

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The Smart Store
Loss
Prevention
Employee
Theft
Protection
Storefront
Visibility
Shoplifting
Protection
Staff
Allocation
Zone
Performance
Draw Rate
Foot Traffic
Conversion
Shelf
Sweeps
Fitting
Room
Analytics
Omni-
Channel
Fulfillment
On Floor
Visibility
Track & Trace
Authentication
Inventory
Intelligence
Traffic
Insights

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An Omni-Channel Multi-Sensored Retail Future
SCREEN TIME
(Per Day)
30 Country Millward Brown study of 16-45 year olds
Source:
Transparency
Research
Deloitte Digital
Frost &
Sullivan
Frost &
Sullivan
Global Theft Barometer
IHL Group
Global Theft Barometer
$1.5 Trillion
Mobile & Digital
Influence on in‐store
sales in 2014, up
from $334B in 2012
$5,409Million
Retail RFID Market
By 2020, up from
$542M in 2013
$5.8 Billion
Global Wearables
Tech market by 2018,
Up from $750M in 2012
$123 Billion
Global Retail Shrink
$4.3 Trillion
Global Online
Retail Sales
By 2025, up from
$0.55T in 2011
$1.1 Trillion
Global Inventory Distortion
$634 Billion From
Out‐Of‐Stocks
63%
Global Retailers
Maintaining / Expanding
Global Source Tagging
Phones
147
minutes
TVs
113
minutes
PCs
108
minutes

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Planning the Perfect Celebration
Source: YouTube.com

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Macy’s RFID Journey
• Inventory count 1x / year
• Inventory accuracy deteriorates
2-3% per month
• Inventory accuracy 60-70%
BEFORE RFID
• 1x / year & can cycle count up to
24x / year
• Achieve nearly 99% accuracy
w/annual inventory
• Annual inventory accuracy 95%
• RFID categories out performed
non-RFID categories with avg.
10% sales lift
WITH RFID
• B2F – Back to Front, Sales Floor
Replenishment
• Increased sales and margins,
reducing MDs
• 1/3 reduction in basic stock
required on-hand
• Improved display compliance from
avg. 65-70% to nearly 100%
• P2LU – Pick to the Last Unit
• Leverage 15-20% of store
inventory that exits in single units
• Omni-channel readiness enabling
$1B reduction in store inventory
• Sales lift on regular & 1st MD
merchandise
BEYOND
REPLENISHMENT
Peter Longo
Former Macy’s, President,
Operations and Logistics -
January 2015
RFID is your foundational ‘air supply’
to deliver an omni‐channel promise.
Source: GS1 panel discussion ‐‐ January 13, 2015 at NRF Big Show

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Relevancy of the Store
Educate & empower in-store
employees using technology
#1
Brick & mortar stores account
retailer revenues*
85%
Sources: PSFK and RSR Research; RSR 2015 Store Report
Opportunity for improving
in-store experience*

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Store Reinvented - The Future of the Store
“Retailers reported 16.5%
YOY improvement in KPI’s related
to sales, customer engagement
and satisfaction as a result of
empowered sales associates”
Source: EKN Modern Labor for
Omnichannel Success Report

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The Consumer Power
What
Consumers
Want
How are
Retailers
Addressing
it?

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The Consumer / Retailer Information Dichotomy
…disclosing information about themselves? …having store employees welcome the customer
by name when he/she enters the store?
Source: HUI Research (2015)
Consumer
Retailer
60%
40%
55% 50%
How do consumers in general feel about…
10%
22%
10%
Consumer
22%
Retailer

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25
Trend Setters
Tony D’Onofrio
Email: adonofrio@tycoint.com
Phone: +1 561 866-9462

26. 26© 2016 Tyco. All Rights Reserved.
Global Retail Apparel Trend Setters
FY’15 Revenues - $28B
• 900 corporate stores in
41 countries
• 12,000 franchise stores
• FY’15 Revenues - US$23B;
62% of revenues from EMEA
• 7,013 stores with 8 different
store concepts
• Global presence in 88
countries

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It’s all about the customer
Source: YouTube.com

28. 28© 2016 Tyco. All Rights Reserved.
Global Retail Apparel Trend Setters
• FY’15 Revenues - USD$24B; ~40% of
revenues coming from Germany, US and UK
• 3,924 stores globally in 61 markets
• 6 distinct store concepts
• USD$16B in annual sales, 46%
comes from Uniqlo Japan
• 2,978 global stores
• Manage multiple brand portfolio
including Uniqlo, GU, Theory etc

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Technology Will Continue to Disrupt the Store

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Global Source Tagging & The Future of Retail
Future Plans of Using Source Tagging Across Regions Future Plans of Using Source Tagging Across Product Categories
The Future of Retail
• Less Store Labor / Improved Customer Experience
• Interactive Retail Stores with Employees as Brand Ambassadors
• Item Level Intelligence Driven by Source Tagging / Out of Stocks FOCUS
• A Focus on “Value” Integration
• A Sustainable Retail Future

31. 31© 2016 Tyco. All Rights Reserved.
Muito
Obrigado
Tony D’Onofrio
Email: adonofrio@tycoint.com
Phone: +1 561 866-9462