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Retail 2.0 A New Paradigm For Location Analysts

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    • 1. Retail 2.0 - A new paradigm for location specialists Steven Feldman KnowWhere
    • 2. Location still matters – or does it?
      • “ The dream of electronic commerce has become a reality in today’s wired world, where physical geography no longer presents a barrier to retailers or consumers – and shopping has never been easier.  ”
      • Nielsen
    • 3. Agenda
      • Web 2.0
      • Generations
      • Impact of online shopping
      • Bricks ‘n Clicks
      • New demographics
      • Impact on retail location strategies
      • How will we find our customers of the future?
      • Future data creation and analytical techniques
    • 4. Web 2.0
      • Rich user experience
      • User participation
      • Dynamic content 
      • Openness, freedom
      • Collective intelligence
      “ creating network effects through an " architecture of participation ," and going beyond the page metaphor of Web 1.0 to deliver rich user experience ” Tim O’Reilly
    • 5. Generations
    • 6. Why Web 2.0 matters to Retailers
      • 16m UK households have internet access
      • Online sales £55bn in last 12 months!
      • Sales growth 25-30%
      • 30-50 year olds lead online spending
      • Generation Y are the high value customers of the future
      • Main impact today is in comparison goods but tomorrow ……?
    • 7. Categories – who is buying online and where?
      • Books & music
        • Losing share to online
        • Higher in remote rural areas
      • Clothing & footwear
        • Catalogues go online and upmarket
        • Mix of rural areas and prosperous suburbs, urban professionals and areas of high ethnicity
      • PCs/Games consoles & software
        • Losing share rapidly
        • 15-30s boys
        • Asian Communities
      • Household Goods & Appliances
        • Frequently need delivery
        • Online winning where large retailer not close
        • Source CACI
    • 8. Where is hurting? Source CACI A mixture of affluent suburbs, some prosperous urban areas and an affluent rural hinterland
    • 9. OnLine vs InStore
      • OnLine
      • Price
      • Convenience
      • Wider Range
      • Comparison
      • Customer Reviews
      • Product information
      • InStore
      • Want to evaluate
      • Immediacy
      • No shipping costs or waiting at home for delivery
      • Trusted Brand
      • Knowledgeable Sales people
    • 10. OnLine vs InStore
    • 11. Bricks ‘n clicks can beat online only
      • Combining an online presence with physical outlets may offer the best option
        • Leverage core competencies
        • Supplier and distribution networks
        • Brand equity
        • Consumer trust
        • Economies of scale
    • 12. Bricks ‘n clicks can beat online only
    • 13. Finding the e-consumer
      • Target
        • 30-50s
        • May come from minority groups
        • E-literate
    • 14.  
    • 15. Location still matters
    • 16. RETAIL 2.0 A New Paradigm for Location Specialists
      • Andy Thompson
    • 17. The World of the Customer
    • 18. Impact on Retail Location Strategies
      • Here are three possible future states....
        • Retail catchment areas will be much smaller in size
        • Customers will reject brand loyalty in preference to price/convenience trade-off
        • Purchase behaviour will become more complex and transaction patterns less predictable
      • We need to find or create new data and analytical techniques to understand the customers and markets of the future
    • 19. WHERE 2.0
      • Electronic generation of mapping and location technology
      • Location enabled mobile devices will become the norm in the future
      • By 2012 at least 18% of phones will be smartphones .
    • 20. Crowd Sourced Data
      • Been around for centuries!
        • C19 th Oxford English Dictionary
      • WEB 2.0 provides the structure for collaboration
        • e.g. openstreetmap.org
      • Debate around coverage, currency and quality
      • What about crowd sourced retail data ?
    • 21. Pervasive Location
      • Path Intelligence
        • Tracking individuals using mobile phone signals
      • Footpath TM Technology
      • Retail applications
        • Rental valuations and tenancy mix
        • Shopper flow management
        • In centre marketing
        • Behaviour analysis
      Copyright 2007 Path Intelligence Ltd
    • 22.  
    • 23. Pervasive Location
      • Geo-location Services
        • Yahoo Fire Eagle
        • Mozilla Geode
        • Google Geolocation API
      • Don’t need a GPS service
      • Detection of “where” people are interacting with the web
      • Location intelligent Web 2.0 services
        • Sales and marketing offers.... not new anymore....
        • Security (location verification)
        • True “location-tailored” content
        • Intelligent Near Field Communication services
    • 24. Historical Data Analysis?
      • “ When you rely on historical data, its much harder to tease out causation”
      • Ian Ayres, Super Crunchers - “ How Anything Can Be Predicted”
      “ Marketing is concerned with recent past and near future.... and human beings are remarkably consistent in their behaviour over short periods” Sean Kelly, Customer Intelligence - “From Data to Dialogue”
    • 25. Random Sampling
      • Sir Ronald Fisher
        • wikipedia.org/wiki/Ronald_Fisher
      • Randomisation test
        • Study of errors in data with a non-normal distribution
      • Gold standard in medical research for testing success of treatments
      • Why aren’t we using randomisation?
        • We have the resources
        • We can create new data
    • 26. Randomisation in Action
      • Divide your customers randomly into groups, treat them differently and measure the responses
      • Sample size is key
        • If the sample is large enough we can assume they are statistically identical
        • Our intervention can then be measured purely - the “treatment effect”
      • Capital One – proactively intervenes in the market through randomised experiments
      • Today we have data which has random characteristics but are we treating it as random data?
    • 27. New Techniques in Predictive Modelling
    • 28. Generalised Linear Model
    • 29. Generalised Additive Model
    • 30. GAMs in Performance Modelling
    • 31. We need to act now!
      • “ Statistics are like a lamp-post to a drunken man.... more for leaning on than illumination”
      Lets make data analytics the currency of our organisations and the first activity of decision making not the last!
    • 32. Location still matters
    • 33. Thank You Steven Feldman [email_address] http:// GIScussions .blogspot.com Slides at http://www.slideshare.net/stevenfeldman Andy Thompson [email_address] www.thewendovergroup.co.uk Slides at

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