OmniChannel Retail Best Practices for Brands and Retailers

OmniChannelRetailBestPractices©StephanyGochuico-16June2014
OmniChannel Retail
Best Practices
For BRANDS and RETAILERS
©StephanyGochuico
@stephgo77 1

2

3
Contents
1. Why and what is OmniChannel Retail?
2. What are the consumer behaviours?
3. Who are the Best-in-Class OmniChannel Retailers?
4. What are the OmniChannel Challenges in France?
5. What are the OmniChannel Best Practices?
6. How to deal with Showroomers?
7. How to be successful in implementing OmniChannel?

1
Why and what is OmniChannel Retail?
4

5

6
Why OmniChannel?
BECAUSECONSUMERSARE
So Lo Mo
SOCIAL LOCAL MOBILE

What is OmniChannelRetail?
7
Photo Courtesy: National Retail Federation “Mobile Retail Initiative”, 2011

Multi-Channel
8
Source: C. Wonder, Balance Internet, Fit for Commerce - imagine 2012, Magento Conference
Retailers have multiple channels but they aren’t
integrated.

Cross-Channel
9
Source: C. Wonder, Balance Internet, Fit for Commerce - imagine 2012, Magento Conference
Starting in one channel and transacting in another.

Omni-Channel:For customers
10
Many Channels. Many journeys. But One Brand.

Omni-Channel:For Retailers
11
Single view of the customer and data.

2
What are the Consumer behaviours?
12

13
Source: Google “The New Multi-Screen World: Understanding Cross-platform Consumer Behaviour,” August 2012,
15738 respondents

14
Source: Google “The New Multi-Screen World: Understanding Cross-platform Consumer Behaviour,” August 2012,
1611 respondents.

15
Source: Google “The New Multi-Screen World: Understanding Cross-platform Consumer Behaviour,” August 2012.

16
Source: Ipsos OTX/Google 2012 Holiday Shopping Intentions Survey, 1500 respondents.

17
Source: Ipsos OTX/Google 2012 Holiday Shopping Intentions Survey, 1500 respondents

18
Source: Forrester Research “European Technographics® Consumer Technology Online Survey”, Q4 2012

ConsumersSpendMore in MultipleChannels
19
Source: Accenture European E-commerce Survey 2011, 146 European retailers from 6 retail sectors, 7 countries
(France, Denmark, Germany, Italy, Poland, Spain, UK).
76%spend more

ConsumersSpendMore in MultipleChannels
20
Source: PwC “2013 Global Multi-channel Retail Survey”, 11000 respondents,
11 countries (France, Germany, The Netherlands, USA, UK, China, Switzerland, Brazil, Canada, Turkey & Russia).

Understandingthe Multi-GenerationalConsumers
21
Date of Birth Age in 2014 Generation
Before 1946 69 and above Seniors, Traditionalists, Veterans
1947 - 1963 51 - 68 Baby Boomers
1964 - 1979 35 - 50 Generation X, GenX, Xers
1980 – 2000 13 - 34 Generation Y, GenY, Echo Boomers, Millennials

UnderstandingtheMulti-GenerationalConsumers
22
Source: Experian Marketing Services “The 2013 Digital Marketer”

GlobalConsumer Needs:
Topdriversofcustomerspending
23

GlobalConsumer Needs
Topdriversofcustomerspendingvarybycountry
24

3
Who are the Best-in-Class
OmniChannel Retailers?
25

OmniChannelBest-in-ClassRetailers(US)
26
Source: Retail Info Systems “OmniChannel Readiness,” October 2013
#1 Apple & Nordstrom 45.8% | #2 Macy’s 37.5% | #3 Walmart 33.3% | #4 Target & Best Buy 20.8%

OmniChannelBest-in-ClassRetailers(Global)
28
Source: Ebeltoft Group “Global Cross Channel Retailing Report, The (Un)connected Store,” 2012
COUNTRY RETAILER CATEGORY
Australia Dick Smith Electrical goods
Brazil Saraiva Electrical goods
Canada Best Buy Electrical goods
Chile Falabela General
China Suning Electrical goods
Denmark YouHeShe Fashion
France FNAC Electrical goods
Germany Conrad Electrical goods
Italy Marco Polo Electrical goods
Portugal Continente General
Romania Domo Electrical goods
Singapore Traceyeinny Fashion
Spain El Corte Ingles General
Switzerland Interdiscount Electrical goods
Turkey Teknosa Electrical goods
UK Debenhams General
USA Walmart General

GlobalBenchmarkof OmniChannelPractices
29
Source: Dia-Mart Consulting and Ebeltoft Group, November 2013

GlobalBenchmarkof OmniChannelPractices
30
Source: Dia-Mart Consulting and Ebeltoft Group, November 2013
Incredible delay of the
French General Retailers!
The DRIVE is a brilliant invention….
But the OmniChannel issue has to be dealt with!

4
What are the OmniChannel
Challenges in France?
31

OmniChannel Challenges in France
1. Price difference across channels
2. Order management system
3. Inaccurate inventory information
4. OmniChannel support from C-suite
5. Lack of communication about OmniChannel
6. Loyalty programs are not OmniChannel
7. Culture shock between RETAIL and DIGITAL
8. Store associates are not OmniChannel ready
32

OmniChannelChallengesin France
33
OFFLINE
ONLINE
MOBILE
SOCIAL
The
HUMAN
factor
is the
BIGGEST
Challenge
in
OmniChannel
RETAIL
Operations.

5
What are the OmniChannel Best Practices?
34

35

OmniRetailMatrix1: Strategy
36

Strategy:Customer
37
“There is only one boss. The customer. And
he can fire everybody in the company from
the chairman on down, simply by spending
his money somewhere else. ”
-Sam Walton, Founder of Wal-Mart Stores Inc.
Walmart is present in 27 countries, total 10,942 retail units (4,203 in the US).
Retailers must be Customer-Centric.

Strategy:TransversalOrganization
38
Get Executive Buy-In and Evangelize OmniChannel

39
Appoint an OmniChannel Director
Hired Karen Dracou,
ex-OmniChannel Director of John
Lewis to head Tesco’s multi-channel
team.
Hired Burberry CEO Angelo
Ahrendts to head Apple’s retail and
online stores, joins Apple in the
spring 2014.
Hired Robert B. Harrison to be Chief
OmniChannel Officer to oversee the
integration of store, online and
mobile operations.

40
Equip all employees with OmniChannel strategy
Source: Retail TouchPoints Survey 2012
Increase investments in
Mobile Technology 36.7%,
Product Merchandising 36.7%,
Employee Training 34.7%.

Strategy:DevelopDigital Channels
41

Datamust becentralizedon a singleplatform.
42
#1 Customers
#2 Products
#3 Inventory

InventoryChallenges
43
Source: RSR Research, July 2012. Retailers with presence in the USA, Canada, Latin America, UK, Europe, Middle East,
Africa & Asia Pacific.

Strategy:ObtainReal-timeInventoryVisibility
44
Source: Skyetek
The Solution: Item-Level RFID
Inventory is so much faster, more accurate, & long-term cost-effective solution

45
Source: Weidenhammer
The Solution: Item-Level RFID

46
Retailers using Item-Level RFIDs

Strategy:OptimizeOrderFulfillmentOperations
47
Situation from Best-in-Class OmniChannel Retailers

48
RETAIL
DISTRIBUTION
CENTER
E-COMMERCE/MOBILE
DISTRIBUTION
CENTER
Situation in France…

49
RETAIL
DISTRIBUTION
CENTER
E-COMMERCE/MOBILE
DISTRIBUTION
CENTER
The Solution: Ship from Anywhere
SHIP
FROM
STORE

50
The Solution: Ship from Store
versus
>50 km distance
0-5 km distance
E-COMMERCE/MOBILE
DISTRIBUTION
CENTER

51
The Solution: Ship from Store
1. Setup Distributed Order Management (DOM) technology
2. Setup Miniature Warehouse Management Systems (WMS).
Stores become a mini distribution center for online orders.
3. Train all store associates for their “new” role.

Strategy:LoyaltyPrograms
52
Provide customers with Coupons, Loyalty Points, Loyalty
Vouchers, Promotions, Instant rewards, …
*Source: Deloitte National Research Survey and Loyalogy “Loyalty Plus Research Study” Jan 2013
88% of businesses with loyalty programs
are more profitable than their competitors who
do not use this solution.*

How to have360° Customer Insight?
53
Source: Alexis Lecanuet of Accenture

Strategy:LoyaltyPrograms
54
HIGH Employee Engagement = INCREASED Customer Loyalty
Source: Demand Metric Benchmark Report “Employee Engagement: Revenue Growth Strategy for 2014” Dec 2013

OmniRetailSalesIncentive
55

OmniRetailReturns Management
56

Strategy:OmniChannelCampaigns
57
Source: Maxxing

OmniRetailMatrix2: Channels
58

Channel: Webstore
59
• Webstore = Online Store = E-Commerce Site
• Choice of a reliable E-Commerce platform is very
important!

Channel: Webstore
60
Source: NBS System “Benchmark of E-Commerce Solutions” June 2013
Use E-Commerce platforms with OmniChannel Capability
Sales > €15M > €15M > €150M > €15M > €15M <€1.5M<€15M

SocialCommerce
61
Source: AddShoppers / Graph Courtesy: BI Intelligence
Social Apps tracks websites to determine sales revenue generated from
social media sites.

SocialCommerce
62
Source: Unmetric “Social Media Shakedown of Top Brands“ April 2013

63
Source: conversationprism.com
Are Facebook,Twitter,Pinterest,et al.
the only ones who can impact
retailer’ssales revenue?
Check out THE CONVERSATIONPRISM.

64
Source: conversationprism.com

SocialCommerce
If you make customers unhappy in the physical world,
they might each tell 6 friends.
If you make customers unhappy on the Internet,
they can each tell 6,000 friends.
-Jeff Bezos, CEO of Amazon
65
“

OmniRetailMatrix3: Technology
67

OmniChannelStrategy
68
Retailers must work with a System Integrator

6
How to deal with Showroomers?
69

70
• Price matching strategy
• Exclusivity of brands
• Customers want a personalized experience*
 55% want their retailer to use prior purchasing to offer new promotions
 43% want their prior purchases to result in new product recommendations
 43% want their retailers to invite them to events
 36% want their retailers to involve them in new product ideas.
• Consumers are interested in new retail concepts that improve
the shopping experience*
*Source: IBM Institute for Business Value, May 2013, surveyed 26,737 shoppers in 14 countries (Japan, Australia,
China, Italy, United Kingdom, United States, Brazil, France, Canada, Mexico, Spain, Chile, Germany and India).

Customerswanta personalizedexperience
71
Source: Capgemini Consulting “Digital Shopper Relevancy,” July 2012, 16000 respondents, 16 countries (Australia,
Brazil, Canada, China, Finland, France, Germany, India, Italy, Mexico, Russia, Spain, Sweden, Turkey, UK, USA).

72
Develop Personalized OmniChannel Capabilities
Source: RIS News Custom Research “OmniChannel Readiness”, October 2013

7
How to be successful in
implementing OmniChannel?
73

Give100%attentionto eachelementin
OmniRetailMatrix1:Strategy
74

OmniRetailStatus123™
75
OmniRetail Status123™ will enable retailers to assess their own
OmniChannel status, and consider the next steps in order to achieve
greater efficiency, enhance the customer experience, and expand retail
business to the fullest extent.
STATUS
1. CUSTOMER
The secret of successful omnichannel retail business is to give customers what they want. The customer must be at the
heart of business.
1 Have a centralized customer data (name, address, telephone number, birth date, …) 1
2 Know which channel each customer prefers to use - Store, Web, Mobile, Social 1
3 Know the customer’s purchase history 1
…
…
116 Have one Channel Manager specializing in each channel’s technology 1
117 Technology solutions accompany the business unit but not vice versa. 1
TOTAL SCORE OUT OF 117: 117

OmniRetailDifferentiators
1. Customer service
2. Customer experience
3. Employee Engagement leads to
Customer Loyalty
4. K.I.S.S. Principle
5. Innovation at All Times
76

OmniRetailDifferentiator
Customerservice
77
The best customer service is
if the customer doesn’t need to call you,
doesn’t need to talk to you. It just works.”
-Jeff Bezos, CEO of Amazon
“

Customerservice
78
Lousy Customer Service Costs
UK Businesses £12 Billion a Year.”
-Our Social Times, 29 May 2013
“

Customerexperience
79
You’ve got to start with the customer
experience and work back toward the
technology – not the other way around.”
-Steve Jobs at the World Wide Developers Conference
in May 1997
“

Customerexperience
80

Customerloyalty
81
Loyal customers, they don’t just come back,
they don’t simply recommend you, they insist
that their friends do business with you.”
-Chip Bell, Founder of Chip Bell Group
“

82
That’s been one of my mantras — focus
and simplicity. Simple can be harder than
complex: You have to work hard to get
your thinking clean to make it simple. But
it’s worth it in the end because once you
get there, you can move mountains.”
-Steve Jobs
“
KISS = Keep It Simple, Stupid.

83
Products don’t kill business but failure to
adapt quickly to a new ecosystem does.”
-Stephany Gochuico
“
Innovation at all times.

84
OmniChannel:expensive,long,difficult,energyconsuming.
Inevitable…

Retailersestimatethey lose$65M
(€47M)for every billion dollars(€721M)
in revenue due to a lack of OmniChannel
readiness.”
85
Source: Retail Info Systems “OmniChannel Readiness,” October 2013
“

Thankyou foryourattention.
Pleasedropme alinewithyourfeedbackorquestions.
Stephany GOCHUICO
(Looking for a new challenge in the digital/high-tech sector)
Twitter: @stephgo77
E-mail: stephgo@rocketmail.com
LinkedIn: www.linkedin.com/in/stephanygochuico
Blog: www.omniretail-experts.com
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