Multi Channel Retailing Webinar

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Multi Channel Retailing Webinar

  1. 1. Bridging the gap between Offline andOnline Retailing:Multi-Channel Retailing8th webinar of the retail ecommerce seriesan embitel initiative19th May 2011 Better eCommerce 2010 Embitel
  2. 2. Speaker Founder dmc digital media center GmbH, Germany www.dmc.de Chairman Embitel, India www.embitel.comDaniel Rebhorndr@dmc.de• Studied Computer Science at University of Stuttgart• Entrepreneur since 1992• Investor and business angel for 5+ IT companies• Working in retail e-Commerce for last 16 years• Responsible for development of e-retail sites like Neckermann, Kodak Better eCommerce 2010 Embitel
  3. 3. Consumers choose their favorite channel Search engines Price search portals (Google…) (become.com …)Brand /Manufacturer Communities(Nike …) (facebook …) OnlineInternet Pure Player marketplaces(vente-privee…) Store (amazon…) Brick-a-Mortar Mailorder Retailer Retailer (Sears …) (Walmart …) Better eCommerce 2010 Embitel
  4. 4. Complexity of sales channels at argos UK• Attention step slide !!!! Source: argos, AT Kerney Better eCommerce 2010 Embitel
  5. 5. Agenda• Idea of Multi-Channel Retailing?• Is Indian customer ready for Multi Channel Retailing?• Does Multi - Channel Retailing leads to cannibalization of your existing sales channel?• Channel Integration in Multi-Channel Retailing• Worldwide Case Studies• Suggested approach for Multi Channel Retailing• Multi - Channel Retailing Outlook Better eCommerce 2010 Embitel
  6. 6. Idea of Multi-Channel Retailing? Better eCommerce 2010 Embitel
  7. 7. CommunicationCommunication Communication n Communication 1 1 Consumer 1 Consumer 1 Consumer n Consumer Mobil e Channel 1 Channel n Store Online-Shop Prin t …Product mixProduct mix Product mix n Product mix n 11 Product mix Inventory 1 Inventory 1 Inventory n Inventory n Inventory Multi-Channel vs. Multi-Channel Consumer doesn‘t care which channel he uses. Only the brand experience has to be the same. Better eCommerce 2010 Embitel
  8. 8. Client behavior matrix Preparation for buying(product information and price comparison) Offline Online 4% 8% „Digitaly converted “ „True Onliner“ Informs himself offline, Does everything online: Online but purchases online only informs himself, also purchases onlineExecution of buying „True Offliner“ Denies online, „RoPo“ Offline only informs himself offline Informs himself online, and also purchases but purchases offline offline 31% 57% Better eCommerce 2010 Embitel
  9. 9. Mapping of behavior matrix to verticals „ Digitaly converted “ „True Onliner“ Books/Media online Consumer electronics Apparels Sports goodsExecution of Lifestyle goods buying Footwear Furniture Do-it-yourself (DIY) Cosmetics offline „True Offliner“ „RoPo“ offline online Preparation for buying(product information and price comparison) Better eCommerce 2010 Embitel
  10. 10. Forecast of non-food sales in Europe 100.0 % 100.0 %Online only 6.9 % + 48% 10.2 %Multi-Channel 9.5 % + 78% 16.9 %Store only 83.6 % -13% 72.9 % 2009 2015 Source: Accenture, GfK Better eCommerce 2010 Embitel
  11. 11. Costs effects Increase service level After Sales activities (e.g. e-mailings) Increase speed Target offline-clients within online channel Easier aquisition Multi-Channel Value-driven client Replace offline-Ads with online-Ads aquisition CostsRetailing Reduction of Online as a self service platform process costs Selling via marketplaces, 3rd party portals, etc. Access to online crowd Better eCommerce 2010 Embitel
  12. 12. Is Indian customer ready forMulti-Channel Retailing? Better eCommerce 2010 Embitel
  13. 13. Current Size & Future Projections for Indian Retail Market 900 800 800 700 600 530 486 445bn. USD 500 408 342 373 400 300 200 100 0 2007 2008 2009 2010 2011 2012 2017 Total Retail Organized Retail Better eCommerce 2010 Embitel
  14. 14. Contributing factors• Boom in Retail• Coverage of broad-band internet, including 3G mobile networks• Web is primary source of information = First point of contact• Trust and experience leads to: online buyer at second time Better eCommerce 2010 Embitel
  15. 15. Contributing factors• Significant increase in mobile penetration – M-Commerce / In-Store promotions/ Reviews and comparison. Example: SMS/Bluetooth promotions at Spar- Hyper market• An option to switch channel from interaction to transaction.• Major Players: Better eCommerce 2010 Embitel
  16. 16. Does Multi - Channel Retailing leadsto cannibalization of your existingsales channel? Better eCommerce 2010 Embitel
  17. 17. Search Online Purchase Offline (RoPo)Case Study, Oct 2009, GermanyProduct segment: Apparels 13,9 % of Online sales is initiated through local store ( = 0.6 bil. EUR) 13,9 % Local stores 10,7 % of Offline sales is Online shop initiated through online shop 10,7 % ( = 5.3 bil. EUR) + 4.7 bil. EUR Better eCommerce 2010 Embitel
  18. 18. Research Online Purchase Offline (RoPo) 42 % of consumers are using more than half of their „Shopping- Time“ for online information reserach! Better eCommerce 2010 Embitel
  19. 19. Channel Integration in Multi-Channel Retailing Better eCommerce 2010 Embitel
  20. 20. Aspects of Multi-Channel Retailing Pick up at Retail Delivery to storePOS: Store Pick-up-at-Retail Stock reservation in store Pick up at Retail Return-to-Retail Store finder for availibility in store Return to Retail Drive-to-Retail Drive to Retail Return to Retail Return product in store Change product in store POS: Web Refund in store Pick up at Web Drive to Retail Return to Web Online Marketing (Local SEM, Newsletter) to motivate consumers to visit store Drive to Web Confirmation mails with information about nearby store „Book personal shopping assistant“ Better eCommerce 2010 Embitel
  21. 21. Aspects of Multi-Channel Retailing Pick up at Web Longtail in RetailPOS: Filiale Online order of sold-out products Pick up at Retail Order in store, deliver to home Return to Retail Return to Web Drive to Retail Return via online distribution channel POS: Web Drive to Web Pick up at Web Promote URL in store (e.g. bags) Return to Web Vouchers to promote Webshop Drive to Web Customer card services in Web Better eCommerce 2010 Embitel
  22. 22. Worldwide Case Studies Better eCommerce 2010 Embitel
  23. 23. Multi-Channel Retailing Benchmarks: Big Players Better eCommerce 2010 Embitel
  24. 24. Benchmark from TOP 50 Online Retailers (USA)Rank Company Category Online Sales Growth (in mil. US $) (2009)2 Staples Inc. Office Supplies 9.800 27,3%6 Waltmart.com Mass Merchant 3.500* 19,8%10 Best Buy Co. Computer / Electronics 2.458 25%16 J. C. Penney Co. Inc. Mass Merchant 1.500 0,0%20 Macy‘s Inc. Mass Merchant 1.243 19,6%24 L.L. Bean Inc. Apparel / Accessories 1.064 2,0%29 Nordstrom Inc. Apparel / Accessories 784 14,3%43 Kohl‘s Corp. Mass Merchant 492 38,1%45 Saks Direct Apparel / Accessories 430 13,0%50 J. Crew Group Inc. Apparel / Accessories 347 2,5% Source: internetretailer.com Better eCommerce 2010 Embitel
  25. 25. Multi-Channel Retailing Benchmarks: Big PlayersPercentage ofOnline Saleswithin Total Saks US Retailer 16%Sales EU Retailer John Lewis 14% 12% 10% Nordstrom JC Penney 8% Debenhams 6% Macy‘s 4% Kohl‘s 2% 0% Sales in 2.000 4.000 6.000 8.000 10.000 11.000 12.000 14.000 16.000 18.000 mio USD (2009/2010) Better eCommerce 2010 Embitel
  26. 26. Benchmark Multi-Channel: John LewisReservation of products in store • Online Sales 08/09 = 327 Mio. GBP • 12% of total sales • 8% of all online sales are picked up in stores Better eCommerce 2010 Embitel
  27. 27. Benchmark Multi-Channel: Best Buy„…pick up your order in as little as 45 minutes after you place it.“ • 95% more sales with multi-channel customers • With 80% higher margin! Better eCommerce 2010 Embitel
  28. 28. Benchmark Multi-Channel: LabuylaEntertainment shopping via Multi-Channel Better eCommerce 2010 Embitel
  29. 29. Macy’s Setup • Online-Shop www.macys.com • 800+ stores in USA • Catalogue • Mobile (ishop App) Specials • Macy´s ishop App (++) • Book your personal shopping assitant (+) • Macy´s text messages (+) • In-Store-Saving-Pass (++) • Social Media /Social Shopping-Features (Facebook, Twitter, YouTube) (++) • Macy´s TV (+) Folie 29 Better eCommerce 2010 Embitel
  30. 30. Macy’s (inkl. Bloomingdale’s) 2008 2009Sales– Online 117 Mio. $ + 20% Sales– Online 141 Mio. $Sales – Offline 24.775 Mio. $ - 7,8 % Sales– Offline 23.348 Mio $Sales - Total 24.892 Mio. $ Sales - Total 23.489 Mio. $ - 5,6% 0,5% 0,6% online online2008 2009 99,4% 99,4% offline offline Source: Macy‘s Annual Report Better eCommerce 2010 Embitel
  31. 31. Benchmark Multi-Channel: ArgosReservation in store and availability across all channels • 43% Multi-Channel sales of total sales • 22% of total sales through „Check&Reserve“! Better eCommerce 2010 Embitel
  32. 32. Leading Multi-Channel retailer in UK: argosMulti-Channel Sales : £ 1,9 bn. (Total sales: £ 4,3 bn.) Multi-Channel sales Multi- ChannelMulti-Channel features realized: sales 43%• Traffic of over 300 Millionen PIs 57%• Visits up 25% other sales Source: Argos (2010): Full-Year Results 2009 Better eCommerce 2010 Embitel
  33. 33. Leading Multi-Channel retailer in UK: argos MCR features used Reserve-in-Store (Internet) 22% Home Delivery (Internet) Reserve-in-Store (Phone) 9%57% Home Delivery (Phone) 2% 8% 2% Home Delivery (Store) Other sales Better eCommerce 2010 Embitel
  34. 34. Suggested approach forMulti Channel Retailing Better eCommerce 2010 Embitel
  35. 35. FromPoint-of-Sale to Points-of-Sale Better eCommerce 2010 Embitel
  36. 36. Success factors for MCR organisations• Coordinated communication >> Related divisions in the organisation: Purchasing, Marketing, Stores• Centralized CRM Stores IT Purchasing >> Related divisions in the organisation: Customer Service, Marketing, Stores MCR Customer• Core category concept Finance Service Marketing >> Related divisions in the organisation: Purchasing, Marketing, Stores Better eCommerce 2010 Embitel
  37. 37. Success factors for MCR organisations• Common brand and corporate design >> Related divisions in the organisation: Marketing, (Stores)• Complexity and cycle-time reduction >> Related divisions in the organisation: IT, Customer Service, Purchasing, Finance, Stores Stores IT Purchasing• Channel controlling MCR >> Related divisions in the organisation: Customer Finance Service MCR team, Finance Marketing• Corporate culture >> Related divisions in the organisation: all ! Better eCommerce 2010 Embitel
  38. 38. Multi - Channel Retailing Outlook Better eCommerce 2010 Embitel
  39. 39. Future topics Drive-InLoyalty programs Local online marketing Mobile Customer care User profiling Recommendations Drive-In User profiling Predictions Better eCommerce 2010 Embitel
  40. 40. Mobile Commerce – an extension for retailing Pre salesM-Commerce = E-Commerce + Environment + Timing After sales Better eCommerce 2010 Embitel
  41. 41. Mobile links online channels with stores Better eCommerce 2010 Embitel
  42. 42. Mobile links online channels with storesCheck-in at store, scan product and get your coupon Better eCommerce 2010 Embitel
  43. 43. SummaryMulti-Channel is not a future thing.It is already there and successfully done. Be aware of key success factors. And prepare your organization.Don’t be afraid of cannibalization yourself,or you will be eaten by others. Take care that consumers experience is same on all channels. Better eCommerce 2010 Embitel
  44. 44. Our Company• E-Commerce service company • 350+ employees in since 1995 Stuttgart (HQ) and Berlin, Germany• e-commerce projects in • 100+ employees in Bangalore 30+ countries (incl. Europe, US, • Offering Online Commerce services Australia, India, Japan) in India and overseas• Responsible for … – consulting – 100+ Webshops – design – 1.000.000.000+ USD – technology E-Commerce Order Volume/year – hosting – 5.000.000+ – shop management E-Commerce Transactions/year – online marketing (SEO, SEM, SMM) Better eCommerce 2010 Embitel
  45. 45. List of our webinars• # 1: E-Retailing - A perfect storm in India• # 2: Essence of Retail e-Commerce and its optimization• # 3: SEO - More Visibility, More Traffic & More Sales for free?• # 4: Social Media Marketing• # 5: Customer Acquisition & Retention• # 6: Mobile Commerce for Retailers• # 7: Online Retailing using facebook Better eCommerce 2010 Embitel
  46. 46. Thank you for your interest! Any questions?Daniel Rebhorndr@dmc.dewww.xing.com/profile/Daniel_Rebhornwww.linkedin.com/in/danielrebhornembitel Technologies (India) Pvt Ltd.www.embitel.comwww.smarte-commerce.comwww.linkedin.com/companies/embitelwww.facebook.com/embiteltechnologies Better eCommerce 2010 Embitel

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