Customer Centric Retail Innovation - Bucharest May 29, 2008
 

Customer Centric Retail Innovation - Bucharest May 29, 2008

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This is a second keynote I gave at the Retail Innovation Forum on May 29, 2008 in Bucharest

This is a second keynote I gave at the Retail Innovation Forum on May 29, 2008 in Bucharest

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Customer Centric Retail Innovation - Bucharest May 29, 2008 Customer Centric Retail Innovation - Bucharest May 29, 2008 Presentation Transcript

  • RETAIL INNOVATION: A STRATEGIC PERSPECTIVE FUTURE LAB
  • GO TO WORK FUTURE LAB
  • 1. GET ON A PLANE TO LEARN AND NETWORK FUTURE LAB
  • 2. IMPORT – SKILLS, IDEAS, FORMATS FUTURE LAB
  • 3. SECURE AND TRAIN THE BEST PEOPLE
  • 4. INNOVATE LIKE ONLY ROMANIANS CAN COPY MODIFY CREATE Introduce global formats that already exist Modify existing concepts to better match local needs Develop new concepts, targeting specific local segments and needs DEGREE OF INNOVATION FUTURE LAB
  • POP Systems Online RETAIL INNOVATION, ACCORDING TO MANY FUTURE LAB
  • BRANDS Be the first to become friendly with your new customers Help your existing distribution to « make the jump » Pro-actively say goodbye to those who can’t or won’t innovate. RETAILERS/INVESTORS Be first to bring a (modified) format into the market Come with something « unique » which internationals can’t offer Get out of the way and sell as expensive as possible. FUTURE LAB THEN, GO TO WORK
  • FUTURE LAB Source: IBM Business Consulting Services – The Retail Divide, 2004 BUT WE WILL START WITH INNOVATION FROM A STRATEGIC PERSPECTIVE And to be more precise: « customer centric retail innovation »
  • FUTURE LAB Broaden Your Innovation Horizon Think Beyond the Store
    • Traditional Innovation is Broken
    • Competition is Changing
    • There’s not much to be done at retail anyway
    Why Customer Centric?
  • Quiz: Which % of innovations fail? 97% FUTURE LAB Why Customer Centric?
  • WHO COMPETES WITH MARS? FUTURE LAB Why Customer Centric? CONSUMER PERSPECTIVE
  • WHY CUSTOMER-CENTRIC? FORMAT INNOVATION IS LIMITED FUTURE LAB
  • WHY CUSTOMER-CENTRIC? FORMAT INNOVATION IS LIMITED FUTURE LAB
  • WHY CUSTOMER-CENTRIC? FORMAT INNOVATION IS LIMITED FUTURE LAB
  • WHY CUSTOMER-CENTRIC? FORMAT INNOVATION IS LIMITED FUTURE LAB
  • WHY CUSTOMER-CENTRIC? FORMAT INNOVATION IS LIMITED FUTURE LAB
  • WHY CUSTOMER-CENTRIC? FORMAT INNOVATION IS LIMITED FUTURE LAB
    • Traditional Innovation is Broken
    • Competition is Changing
    • There’s not much to be done at retail anyway
    Why Customer Centric? FUTURE LAB
  • CUSTOMER CENTRIC RETAIL INNOVATION Customer Centric Retail Innovation WHAT ABOUT THE CUSTOMER? FUTURE LAB
  • REMARKABLE FUTURE LAB
  • Apple Retail 2001 Sorry Steve, Apple Stores Won’t Work (Business Week) Apple Retail 2004: Fastest retailer ever to reach the $1 billion mark a year Apple Retail 2006 Fastest retailer ever to reach $1 billion/quarter mark Apple Retail 2007 Sales per sq.meter = $ 30,176 (as comparison: BestBuy = $10,643) FUTURE LAB HOW DID THEY DO IT? Watch video on http://www.youtube.com/watch?v=m-Y7vZMEPrU
  • DRIVERS FOR RECOMMENDATION IN ICT Source: Net Promoter ™ Economics: the Impact of WOM, Satmetrix, 2008 FUTURE LAB
    • Careful segmentation and focus on students, educators and creative professionals (even now consumer appeal broadens)
    • A retail experience differentiated by service before, during and after sales (Genius bar)
    • Scenario or lifestyle Marketing & Sales vs. Product « What do you want to do ? »
    • Style & design
    FUTURE LAB THE RESPONSE Source: Net Promoter ™ Economics: the Impact of WOM, Satmetrix, 2008
    • No commissions
    • Team bonuses
    • Focus on experience
    • Fashion & design people to run computer retail
    • Hire for personality, attitude and customer fit … train the rest
    • High identification: Tshirts, iPod, discounts, …
    • 3 week immersion at start of job ONLY on customer relationship skills and understanding customer needs/lifestyle
      • All product training is online (except geniuses)
      • Training on store computers or borrowed laptop
    Ron Johnson Target MickeyDrexler The Gap BREAKING ALL THE RULES FUTURE LAB
  • Source: Net Promoter ™ Economics: the Impact of WOM, Satmetrix, 2008 Apple: 2007 Net Promoter Performance and 5 Year Trend vs. Overall B2C High Tech Computer Hardware Manufacturers RESULTS FUTURE LAB
  • Total Customer Value of an Apple advocate is almost twice that of the industry average Source: Net Promoter ™ Economics: the Impact of WOM, Satmetrix, 2008 FUTURE LAB RESULTS
  • Revenue Growth % 2007 vs 2008 Source: Fortune Magazine, May 5,2008 RESULTS FUTURE LAB
  • HOW ABOUT YOU? FUTURE LAB 5 steps To Customer Centric Retail Innovation
  • Image by : Zombiefactory, CC-license 2.0 #1 TAKE THE CUSTOMER PERSPECTIVE FUTURE LAB
  • THE CUSTOMER JOURNEY – BRAND/RETAIL PERSPECTIVE HOTSPOT HOTSPOT FUTURE LAB
  • CUSTOMER PERSPECTIVE Flipchart Time Which are the steps in the customer journey when booking a holiday? How could you innovate on them? FUTURE LAB THE CUSTOMER JOURNEY
  • FUTURE LAB
    • I dream of going on holiday
    • I research my holiday
    • I plan my holiday
    • I select my holiday
    • I purchase my holiday
    • I receive travel documents & tickets
    • I anticipate departure
    • I prepare my trip
    • I travel to my destination
    • I discover my destination
    • I experience my destination
    • I record my memories
    • I share my experience
    • I travel back home
    • I share my memories
    CUSTOMER PERSPECTIVE THE CUSTOMER JOURNEY How Can You Innovate Now? LVMH - AOL Time Warner UBS - Richemont
  • TRAVEL Photo Nils Bremer, cc. 2.0 FUTURE LAB BANKING CARS FOOD How About You? CUSTOMER PERSPECTIVE THE CUSTOMER JOURNEY
  • #2 GET THE CUSTOMER HEARTBEAT FUTURE LAB Photo: Joeannenah, cc: 2.0
  • WHICH EMOTIONS ? ARE ALL EMOTIONS EQUALLY STRONG? FUTURE LAB WHAT DO YOUR CUSTOMERS REALLY CARE ABOUT?
    • I dream of going on holiday
    • I research my holiday
    • I plan my holiday
    • I select my holiday
    • I purchase my holiday
    • I receive travel documents & tickets
    • I anticipate departure
    • I prepare my trip
    • I travel to my destination
    • I discover my destination
    • I experience my destination
    • I record my memories
    • I share my experience
    • I travel back home
    • I share my memories
  • BUT DON’T JUMP TO CONCLUSIONS … THINK SCENARIOS FUTURE LAB
  • #3 FOCUS YOUR EFFORTS FUTURE LAB
  • WHERE SHOULD YOU FOCUS? FUTURE LAB
  • WHICH IS THE EASIEST PATH TO WALK? FUTURE LAB Photo: StuSeeger, cc 2.0
  • PROCESSED FOOD PHARMA INNOVATORS SEEM TO DISAGREE AIRLINES BANKS COMPUTERS UTILITIES FUTURE LAB Source: The Doblin Group
    • I dream of going on holiday
    • I research my holiday
    • I plan my holiday
    • I select my holiday
    • I purchase my holiday
    • I receive travel documents & tickets
    • I prepare my trip
    • I travel to my destination
    • I discover my destination
    • I experience my destination
    • I record my memories
    • I share my experience
    • I travel back home
    • I share my memories
    THIS ALSO APPLIES TO CUSTOMER CENTRIC INNOVATION FUTURE LAB Observation Most of the travel industry focuses on those areas which have least or most negative emotional involvement
  • FUTURE LAB DEBATE: ARE YOU A PENGUIN?
  • High Low Low High Customer Engagement Innovation Intensity CROSS YOUR INNOVATION LANDSCAPE WITH THE CUSTOMER ENGAGEMENT FUTURE LAB Opportunities for meaningful differentiation Areas to keep up or stay ahead Look at the niches Copy when proven only
  • #4 MAKE SURE YOUR PEOPLE ARE WITH YOU FUTURE LAB
    • perception
    • 80% of CEO’s believe of believe their brand provides a superior customer experience
    • 8 % of their customers agree
    • (Bain & Company)
    FUTURE LAB
  • We show that we value our customers by serving them well, putting their needs and interests at the center of everything we do. (from the AOL mission statement) FUTURE LAB Watch video on: http://www.youtube.com/watch?v=xaaAYVUWP0I
  • BAD EMPLOYEE? FUTURE LAB
  • Source: Norton, D. Aligning your Strategy to the Customer Value Proposition, 13/9/2005 ONLY 5% OF THE WORKFORCE UNDERSTANDS THE STRATEGY (when innovating this gets even worse). FUTURE LAB
  • WHILE THEY NEED TO DELIVER THE RETAIL (INNOVATION) PROMISE. FUTURE LAB
  • 76% of consumers don’t believe that companies tell the truth in advertisements Yankelowich,2006 FUTURE LAB
  • BUT PEOPLE TYPICALLY DON’T HAVE “EMOTION MANAGEMENT” IN THEIR JOB DESCRIPTION FUTURE LAB
  • WHEN YOU INNOVATE, TRANSLATE INTO 6 DIRECTIONS Remarkable Practice: Gemalto
  • Remarkable Practice: Gemalto FUTURE LAB
  • #5 START SWIMMING FUTURE LAB YOU
  • FUTURE LAB
    • Take the Customer Perspective
    • Get the Customer Heartbeat
    • Focus Your Efforts
    • Make Sure your People Are With You
    • Start Swimming
    5 steps To Customer Centric Retail Innovation
  • AND DON’T FORGET TO STEAL WITH PRIDE
  • POP Systems Online AND THEN WE WERE GOING TO HAVE A WORD ABOUT FUTURE LAB
  • THOUGHTS ON DIGITALLY AUGMENTED RETAIL FUTURE LAB
  • Mobile THREE PRACTICAL OPPORTUNITIES FUTURE LAB Internet In-store Digitally Augmented Retail
  • INTERNET IF YOU PLAY, GET THE BASICS RIGHT “ Out of 35 European premium brand dealers only 1 responded to an email enquiry from their own website … after 2 weeks”
    • 2007 Retail Study for Customer Focused Excellence
    • (N = 300 large online retailers)
    • 61% do not offer any information on the product page regarding in-stock availability
    • 38% of sites have difficult to read fonts
    • Only 58% correctly answer an e-mail question within 24 hours
    • Only 33% offer customer reviews.
    • 24% do not allow customers to enlarge the product image
    • Source: FutureNow, 2007
    FUTURE LAB
  • INTERNET LISTEN AND REACT FUTURE LAB US Online Review Users Identifying Review as Having Significant Influence on their Purchase Source: Comscore Inc., the Kelsey Group, Oct. 2007 Hi Joel, Sorry if we weirded you or your friend out by following you on twitter. @JetBlue isn’t a bot, it’s merely me and my team keeping our ears to the ground and listening to our customers talk in open forums so we can improve our service to them. It’s not marketing, it’s trying to engage on a level other than mass broadcast, something I personally believe more companies should try to do. Because corporate involvement in social media is a new and evolving discipline, I also take a specific interest on conversations revolving around our role here. I’d have DMd you and Lisa directly if you allowed DMs, so please also forgive me for following the link on your twitter page here to send you this note. You and Lisa are no longer being ‘followed’ as you seem to indicate. Again, my apologies Morgan Johnston Corporate Communications JetBlue Airways Category % Restaurant 79% Hotels 87% Travel 84% Automotive 78% Home 73% Medical 76% Legal 79%
  • KEEP IT SIMPLE ON THE MOBILE FRONT On-Demand SMS push Location Based Push INFORMATIONAL (PART OF EXPERIENCE) PROMOTIONAL ! RELEVANCE PERMISSION FUTURE LAB
  • FUTURE LAB IN-STORE INSPIRATION Watch video on http://www.youtube.com/watch?v=gQBFaVfBi9w&feature=related#
  • Queen’s Arcade (Cardiff) WATCH THE CONTENT LESSONS IN NARROWCASTING FUTURE LAB McDonalds Amsterdam Veritas Antwerp INSTORE
  • FUTURE LAB COPY MODIFY CREATE DEGREE OF INNOVATION Turnover of Retail Trade in Romania 2001-2007, 2010 (€ billions) ROMANIA IS ON THE VERGE OF SOMETHING BIG
  • FUTURE LAB THOSE WHO INNOVATE WIN
  • FUTURE LAB GO !!
  • For more information contact Alain Thys via [email_address] Or read up on the Futurelab blog at: http://blog.futurelab.net FUTURE LAB