Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

Achieving Customer Experience Excellence in Retail

241 views

Published on

A prospective view on how big data analytics and connected data is enabling customer experience (CX) innovation in a digital economy that is reshaping an age-old industry.

Published in: Retail
  • Be the first to comment

Achieving Customer Experience Excellence in Retail

  1. 1. 1 © Hortonworks Inc. 2011–2018. All rights reserved The Dawn of a Retail Renaissance Achieving Customer Experience Excellence through Big Data Analytics Brent Biddulph GM, Retail Industry Solutions Hortonworks
  2. 2. 2 © Hortonworks Inc. 2011–2018. All rights reserved The Digital Economy Is Reshaping the Retail Industry ….OFFLINE & ONLINE NOW IRRELEVANT Personalization Consumers who use a device during their shopping journey convert at a 40% higher rate (Deloitte) Mobilization Digital supply chains respond 25% faster due to real- time information (BCG) Fulfilment Omni-channel Today 64% of in-store purchases are influenced by digital, expected to be 90% by 2020 (Deloitte) 90% of consumers say personalization positively effects their purchase behavior, drives return visits (Data Candy) ….“Digital” is primary reason half of companies have disappeared since 2000 (Accenture) 88% of companies in the Fortune 500 from 1955 are gone (S&P)… …Only 42% of CEOs have begun Digital business transformations (Gartner) THE BUSINESS IMPERATIVE…
  3. 3. 3 © Hortonworks Inc. 2011–2018. All rights reserved The Connected Customer • ‘Always on’ and in control • They are Mobile and Social with more knowledge than ever before • Their voices are louder and farther reaching than ever before • They are harder to influence • They expect frictionless commerce (payment and delivery options) • They are value seekers, redefining ‘loyalty’ Better informed, more interactive, and more empowered than ever
  4. 4. 4 © Hortonworks Inc. 2011–2018. All rights reserved Customer Experience Expectations… 35% of online consumers are willing to share personal information to receive coupons, discounts “Make It Relevant to My Needs” 89% “I am an Educated Consumer” of consumers conduct their own research using search engines • Consistent across all channels, brands and devices • Personalized to reflect preferences and aspirations • Contextualized to present location and circumstances • Relevant, in the moment, to her needs and expectations Goal: seek to leverage each experience to connect with customers and cultivate deep, long-term relationships Converging on the brand, not channel nor device Source:PRNewswireandMcKinseyMe-CommerceandtheFutureofRetailInfographic
  5. 5. 5 © Hortonworks Inc. 2011–2018. All rights reserved Understanding Customer Journeys is Key 15 to 20% Reduction in Cost to Serve • Begin with understanding the journeys customers take when they want to buy something or get something done • Those steps leave a long and complex (multi-channel) digital trail across interaction points • Data are typically collected at each touchpoint and in huge quantities • Using big data to understand customer journeys provides behavioral data that is both: • Observable in operations, and • More predictive of true customer needs and wants than socioeconomic segmentations Gaining better customer behavior insights can be challenging, but pays off Source: McKinsey Research 10 to 15% Boost in Cross-Selling 10 - 25pts. Drop in Churn
  6. 6. 6 © Hortonworks Inc. 2011–2018. All rights reserved Over 60% of consumers take the time to review a return policy before making a buying decision 62% of global shoppers use self-service kiosks, primarily to avoid lines and save time 39% of global shoppers use social networks to get inspiration for purchases 95% of consumers share bad experiences with others 59% of global shoppers want an inviting ambiance when they shop 85% of shoppers said they’d be more likely to shop in stores that offered personalized coupons and exclusive in-store offers 96% of global shoppers have left a store empty handed on at least one occasion Sources: https://www.retailtouchpoints.com/topics/store-operations/study-reveals-why-96- https://www.pwc.com/gx/en/industries/retail-consumer/total-retail.html http://www.inreality.com/resources/stats/100-industry-stats-retail-current-future Today, 64% of in-store purchases are influenced by digital and is expected to be 90% by 2020. Customer Experience Implications in Retail… Across the Pre-Shop, Shop and Post-Shop Journey
  7. 7. 7 © Hortonworks Inc. 2011–2018. All rights reserved ...Requires New Analytic Capabilities Customer Insights New Business Models (e.g. Marketplaces, Formats) Distinctive Products & Services Onsite & Paid Search Optimization Recommendation Engines Dynamic Pricing Understanding Product Usage, Replenishment Cycles Social Listening & Response Micro-Segmenting to Better Understanding Individual Needs Paths to Purchase (omni-channel insights) Multi-Channel Interactions (In-Store, Web, Mobile) Personalized Content Flexible Fulfillment Personalized Offers, at Right Time
  8. 8. 8 © Hortonworks Inc. 2011–2018. All rights reserved Mobile Apps, Logs In-Store Apps, Bots Wearables Call Center Logs Shelf, Bin, & Rack Sensors Video Streams Competitive Pricing Social Networks Logistics & Asset Telematics In Home Devices Scan & Go Technology RFID Streams SINGLE VIEW OF CUSTOMER FRICTIONLESS COMMERCE UBIQUITOUS FULFILLMENT RELEVANT INTERACTIONS OPERATIONAL EFFICIENCY Streaming Capabilities Enable Real (Right) Time Response New Data Sources Extend Retail Intelligence
  9. 9. 9 © Hortonworks Inc. 2011–2018. All rights reserved Amazon Go Store, Seattle, WA - Launched to public 2018 / 1,800 sq. ft. - Computer Vision (100s of cameras on shelves, ceiling) - Deep Learning (advanced pattern recognition, 100s of algo’s) - Sensor Fusion (cameras, shelf scales) Data Driven Experimentation… …’Frictionless’ Commerce In Action
  10. 10. 10 © Hortonworks Inc. 2011–2018. All rights reserved Proximity Marketing Connected Data and… Proximity Marketing Boosts Engagement “With mobile & beacon technology, targeting consumers who are close to the store with personalized offers, and even Pinterest tie-ins.” Target, Macy’s, CVS, Carrefour • 71% retailers able to track, understand customers’ buying patterns • 65% felt that they were able to target customers down to the aisle level. • 59% felt that customers were more engaged in the store. • 53% retailers felt that they were able to create more relevant and compelling offers in the store. • 24% retailers saw an increase in sales. • 24% retailers saw an increase in offer redemption. Source: Retail Touchpoints
  11. 11. 11 © Hortonworks Inc. 2011–2018. All rights reserved Dynamic Pricing Dynamic Pricing Enables Real-Time Response “Pricing options allow real- time adjustments based on a variety of factors including competition, customer loyalty, shipping costs, and inventory updates. Jet.com Connected Data and… “Retail leaders can expect to capture significant and sustained impact— typically, sales growth of 2 to 5 percent and increases of 5 to 10 percent in margins, along with higher levels of customer satisfaction through improved price perception on the most competitive items.” Source: McKinsey Illustrative: Amazon executes 53 price changes in 12 weeks on Diet Coke during key holiday period (avg. 4.4 times a week) Source: camelcamelcamel.com
  12. 12. 12 © Hortonworks Inc. 2011–2018. All rights reserved Robots scan shelves to help restock items faster “The robots are 50% more productive than their human counterparts and can scan shelves significantly more accurately and 3x faster.” Walmart Improved In-Stocks Connected Data and… Automation & Intra-day Insights: • Out-of-Stock Notifications • Merchandising Compliance / Execution • CPG Information Sharing / Monetization
  13. 13. 13 © Hortonworks Inc. 2011–2018. All rights reserved Streaming video enhances guest experiences Video capture helps identify (proactively) customer engagement opportunities, improve customer experiences. Leading US Retailer In-Store Engagement Connected Data and… Scenario: Engage customers and Improve in-store experiences. Using Facial Analysis, a retailer can determine a customer’s sentiment and pro-actively initiate contact before a customer decides to leave as a result of frustration, improving customer experiences in-store. VR Enriches In-Store Experiences “Lowes Holoroom is a virtual reality home improvement design and visualization tool that empowers homeowners with an immersive, intuitive experience in the room of their dreams.” Lowes Scenario: Engage customers and Improve in-store experiences. Using Virtual Reality, a retailer can provide immersive customer engagement in-store, assisting customer purchase decisions, whilst providing a differentiated in-store experience versus competition.
  14. 14. 14 © Hortonworks Inc. 2011–2018. All rights reserved Frictionless Commerce Inventory Visibility Informs, Guides Purchase Paths “Our Product Locator displays a map of the store, the exact aisle location, and the current inventory available for items you're looking for.” Home Depot Digital shelves provide interaction at moment of truth “Displays pricing, ads, coupons, nutritional info. Communicates with smartphones, highlights products on shopping lists, matches dietary needs.” Kroger Interactive indoor maps enable in- store navigation “Instead of a static map, the application shows your own location on the map, as indicated by a blinking dot – like ‘GPS for your shopping cart’.” Target Connected Data and… Video improves self-checkout “Analyzing video of customers in checkout ques, understanding ‘dwell’ times and potential scanning delays to proactively speed checkout process.” Leading US Retailer
  15. 15. 15 © Hortonworks Inc. 2011–2018. All rights reserved InnovatorsChallengersCompetitorsOperators ---MaturityStages Stores & Services Supply Chain & Logistics Digital Merchandising Foundational Capabilities Dynamic Pricing Peer Competitive Scale Standard among peer group Common among peer group Strategic among peer group Innovative among peer group Retail Big Data Analytic Use Case Maturity Continuum Challengers and Innovators tend to be focused on digital and streaming (real-time) use case capabilities Distinctive Product Dev. Enhanced Demand Forecasts Customer Driven Assortment Enriched Basket Analysis Customer Micro- Segmentation Customer Loyalty & Retention Sentiment Analysis Supplier Collaboration (CPFR) Real-Time Personalization Location Based Marketing Recommendation Engines Clickstream Analysis Data Monetization Data Science ‘Labs’ Inventory Optimization Customer ID Matching EDW Optimization Single View of Inventory Single View of Customer Behavior Analysis (video) Mobile Customer Engagement Merch. Execution (video, bots) Labor Optimization Predictive Maintenance Marketing Attribution Price & Promo Optimization Search Optimization Virtual Ordering, Connected Home Flexible Fulfillment Transportation Optimization Path to Purchase Traffic & Conversion Response Store Communications & Response Endless Aisle, Marketplaces Marketing
  16. 16. 16 © Hortonworks Inc. 2011–2018. All rights reserved Retail Leaders are Getting Results… Social Feedback: responding to operational improvement opportunities Hyper Localized Assortment tailoring product mix based upon local tastes and preferences Proximity Marketing personalized messages, dynamic pricing, recommendations, offers Mobile Engagement seamless cross channel experience: product locator, info search / QRs, availability, coupons, weekly ads Improving In-Stocks at SKU level improved replenishment forecast accuracy with external demand signals such as weather, local event calendars, social trends, in-store bots Personal Touch: empowering store associates with clienteling, up/cross-sell suggestions and intra-day traffic patterns, hot spots and dwell times 5%-20% increases using big data analytics - McKinsey 10%-30% revenue uplift using real-time analytics - Deloitte 56% engagement using devices while shopping - Accenture 3%-6% avg. basket size increases using big data analytics - RIS 40% conversion uplift using real-time delivery - Deloitte 8%-12% revenue risk avoidance using big data - McKinsey
  17. 17. 17 © Hortonworks Inc. 2011–2018. All rights reserved Transformation is Required Connected Customers Are Redefining ‘Loyalty’ Consumers increasingly expect relevant offers, personalized interactions, frictionless transactions and a seamless experience across all channels. Inadequate and Non- Integrated Systems Notoriously underspending on technology, retailers face aging, disconnected systems. Data silos persist, limiting enterprise access, scalability, portability, agility. 1 3 2 4 Competitive pressure from both traditional and ‘disruptors’ drive focus on differentiation through brand, formats, in-store technology. Business Model & Format Experimentation Retail supply chains that once assumed that customers would travel to stores and acquire whatever inventory happened to be there are now obsolete. Fulfillment Requirements Drive Supply Chain Complexity
  18. 18. 18 © Hortonworks Inc. 2011–2018. All rights reserved Three Business Imperatives for Retail Organizations 1. Accelerate business analytic capabilities, competitive differentiation • Marketing & Digital > personalization and relevance is everything • Merchandising > shift from product to customer-driven assortment, pricing, promotions • Store Operations > embrace automation and ‘connect’ the front line • Fulfillment > profitable flexibility and ‘front door’ delivery capable 2. Leverage data capital to create new business models, revenue streams • Collaboration 2.0 > strike meaningful information sharing with trading partners and mutually beneficial business opportunities (e.g. demand forecasts, in-stocks, product development) • Monetization > perpetuate customer engagement to enrich profiles, personalization capabilities 3. Modernize information infrastructure, simultaneously improving business processes • Enable innovation > rapid spin-up of data labs and seamless propagation of AB tests, result sets • Embrace open source technology > maximum platform flexibility, portability, speed to innovation
  19. 19. 19 © Hortonworks Inc. 2011–2018. All rights reserved Let’s Keep the Conversation Going… bbiddulph@hortonworks.com @brentbiddulph +1 425.273.6851 https://www.linkedin.com/in/brentbiddulph/

×