10 Trends Transforming The Store

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10
Trends
Transforming
The Store

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#10RetailTrends

Panelists

Greg Girard Sally Hartnell
Program Director Marketing Manager
IDC Retail Insights IBM

MODERATOR

Debbie Hauss
Editor-in-Chief
Retail TouchPoints

#10RetailTrends

Top Ten Trends in Omnichannel Merchandising
Technology Strategies and Retail Analytics
Greg Girard, Program Director
September 2012

Circa 1997 Circa Now

© IDC Retail Insights. Reproduction is forbidden unless authorized. All rights reserved. Page 7

Readying Ourselves for What’s Coming

Change
“The future ain’t
want it used to be.”

Yogi Berra


#1: Retailers will hone lessons learned for profitable agility
•  The Great Recession: If it didn’t kill
you, you got religion…
•  Analytics and optimization
•  Process integrity
•  Organizational alignment
•  Mobile, social, local
•  3600 Worldview of everything

•  New strategies for the new normal (economic, social, cultural, ethnic)
•  Good fortune begets innovation—Family Dollar and Dollar General
•  Big box stalwarts play small ball—Walmart, Target
•  Established brands change the rules of engagement—Walgreens
•  Dramatic shares of CapEx for Omnichannel capabilities—Nordstrom, Macy’s
•  A visionary re-invents the store in the image of the brand—Apple (JCP TBD)
bigger: AMAZON | GOOGLE | FACEBOOK | EBAY


#2: Four pillars of the 3rd platform—
big data, cloud, social, and mobile
— will accelerate transformation of retailing


#2: Four pillars of the 3rd platform—
big data, cloud, social, and mobile
— will accelerate transformation of retailing

New bases of competition
Collaboration

• Shopping apps
• Living apps
Social merchant
Stores as Centers
3I consumers for Omnichannel
•  Instrumented
•  Informed
Orchestration
•  Interconnected

• Omnichannel
•  Commerce
•  Transparency
•  Offer Orchestration
• Analytics
•  Next Best Action
•  Socialytics
•  Collective Intelligence


#3 Resourceful, smarter
consumers in command:
instrumented, interconnected,
and informed
Successful growth strategies will revolve
around consumers, not products or channels


#4: Omnichannel Orchestration and Optimization …O3…
will define a new retail enterprise technology model


#5: Big Data and Analytics are the new coin of the retail realm


#6: Social retailers will start making better decision
New Product
Merchandising Marketing Channels
Development



Retail Social Gnome

Socialytics Insight/
Response Ladder



Socialytics Insights > Actions > Outcomes


#7: Retailers will struggle with transparency

Consumers

Competitors


Consumers Are Online Inside…
Retailers Must Be Too


#8 Merchandising, marketing, and operations together must
transform stores into centers of omnichannel orchestration


•  Accelerate investment in:
•  Passive and active customer check-in
•  Personalized self-directed shopping
•  Interactive and transactional digital signage
•  Augmented reality in a few instances
•  Omnichannel Points of Commerce Platform
•  Personalized customer offer orchestration
•  Customer order orchestration
•  Endless aisle assortment localization strategies
•  Wifi for all

•  Omnichannel Customer Experience Management, a mash-up of …
•  Associate enablement
•  Web experience management
•  Content management
•  Merchandising—assortment, price, space strategies
•  Marketing and offer orchestration
•  Order and fulfillment orchestration


#9: Trends 1-8 are driving merchandising /
marketing cooperation
Product centric RRM Customer centric RRM 2.0
1.0 has matured is emerging
(Public Prices) (Private Promotions)


#10 Retailers are engaging consumers in “Beyond & Between
Commerce”


#10 Retailers are engaging consumers in “Beyond & Between
Commerce”

Use, maintain, and repair
hardlines
Apply health and beauty products Take supplements and medications

Lifestyle Apps: Lives, roles, jobs, community, school….

Tailor, wear, accessorize, and care for
Consume media apparel and footwear
Prepare and consume food and beverages


Essential Guidance
•  Four forces….mobile | social | big data | cloud
…your choice
•  Four Horsemen of Your Apocalypse
Four Aces in Your Hand

•  Customer…context and relevance...foundation of engagement

•  Stores – the new focal point of omnichannel competition

•  Omnichannel…real-time…analytics…excellence in the ordinary

•  O3…core competency…on the 3rd Platform


Meeting Retail Industry Imperatives
without Breaking the Bank

Sally Hartnell
IBM, Marketing Manager

September 26, 2012

© 20122011 Corporation
© IBM IBM Corporation

Responding to the needs of the smarter consumer requires
retailers to adopt three strategic imperatives.

1) Deliver a 3) Drive efficiency
smarter shopping and reduce cost of
experience operations
Retail

2) Tune merchandise
and supply networks to
customer demands


A smarter shopping experience is personalized, consistent,
and relevant to the customer.

Ø Develop intelligence on customer wants and needs
Ø Empower customers to use their technology of choice
Ø Ensure consistent, timely, and relevant interactions


What if … … faster insight into
information assets could help
you increase sales and gain
competitive position?

Do I have enough inventory in all locations to
last until the end of the promotion?

What percentage of items How long will it take my vendors
purchased today were on to fulfill these orders based on
promotion? current inventory levels?

What are my top 10 selling Should I offer free shipping to this
items today and how are customer?
they trending?

What items should I offer this customer
Are slow-selling items priced based on her past purchases?
higher than my competitors?

32 © 20122011 Corporation

Skechers USA Accelerates Sales and Inventory Decisions
What’s smart?
•  Average acceleration of
warehouse queries by 450X
•  No tuning or application
changes to improve warehouse
performance
•  Plugs into existing environment

Smarter Business
Outcomes
•  Rapid insight into inventory
optimizes revenue opportunities
•  Agility to quickly respond to
pricing and other variables
enhances competitive position

“Our complex inventory and sales reports took anywhere from a few minutes to 45 minutes to run. When we
tested those same queries with Informix Warehouse Accelerator, they ran in 2 to 4 seconds each! That
acceleration ranges from 60 to 1400 times faster, with an average acceleration of 465 times, all without any
index or cube building, query tuning or application changes. "
- Ashutosh Khunte , Senior Database Architect, Skechers USA


IBM Informix Warehouse Accelerator for Smarter Business Intelligence
What is it? How is it different?
IWA leverages an in-memory, columnar Ø Performance. Unprecedented
approach to process very complex response times with 100+ faster
queries at real-time speeds, without performance than traditional
requiring any tuning or changes to warehouses
business applications. Ø Transparency. Keep using your front-
end analysis and reporting tools without
having to make any changes.
Ø Simplified administration. Appliance-
like hands-free operations, eliminating
database tuning tasks.
Ø Software only. Optimized for Linux on
the commodity hardware of your
choice.
Ø Plugs into existing environments. No
Analysis at the Speed of Thought
“rip-and-replace” required!


Smarter Retail
One of world’s largest retailers enables managers across thousands of
stores to have instant insight into consumer buying behavior for faster
business decisions.
What’s smart?
•  500+ managers get answers to complex
queries in < 10 seconds
•  No tuning or application changes to
improve warehouse performance

Smarter Business Outcomes
•  Rapid insight into promotion items and
inventories optimizes revenue
opportunities
•  Agility to quickly respond to pricing and
Powered
by
Informix
other variables enhances competitive
position


What if … … your information assets were
part of an intelligent network,
always available and easily
managed, regardless of global
locations or IT platforms?

How do I meet Service Level Agreements
when I need to do regular maintenance?

We want to track more product I need to upgrade my data
attributes but isn’t it hard to centers but I don’t have staff
change all the product tables at at each location.
every location?

Our US stores change prices We just acquired a chain of stores
more often than our Canadian who are standardized on Windows.
stores. How do I easily make We use Linux. How do I avoid IT
changes just to US stores? expenditures and vendor lock-in?

How do I keep product and customer data current
when the data is replicated all over the world?


Smarter Retail
McLEOD RUSSEL INDIA LIMITED, the world’s largest tea producer,
eliminates downtime in the tea trade.
What’s smart?
•  Enables 100 percent data availability to
critical data across 300+ endpoints
•  Delivers 90 percent faster database
performance
•  Return on investment within a year
Smarter Business Outcomes
•  Accurate tracking of harvest, production
and sales of 220+ million pounds of tea
per year
Powered
by
Informix
•  Satisfying customers with 24x7 service
availability
“Previously, an outage could take us up to three days to recover from, and in that time, we’d be
losing data and business. Since upgrading our databases to IBM Informix, we have had zero
downtime.” - Shantanu Das, Deputy Manager-IT, McLEOD RUSSEL INDIA LIMITED


Optimize Retail Networks with Informix Flexible Grid

An easy to manage clustered environment
for High-Availability, Scalability & Workload Balance

Six 9’s of
availability – Redistribute work Administer Mix hardware
zero downtime locally, regionally, the grid and versions
for planned globally as if it were a of OS and Informix
maintenance single server

"This is a real innovation that lowers our operating costs with less investment
in hardware, and lets us leverage existing investments and resources.“
Hector De Santiago Ramirez, IT Infrastructure Manager, DHL


Informix Flexible Grid for Smarter Retail

Store3

Home

Oﬃce

Store2

Store4

Store1
Store5

Store6

Store7


Smarter merchandise assortments and supply networks are
essential to serving the smarter consumer.
Ø Use customer insight to tailor assortments and product ranges to local markets
Ø Tune stock allocations to local or fluctuating demand
Ø Design flexible supply networks to shift stock according to customer demand


IBM Software

ColCerámica Reduces Time-to-Market by 20 Percent

What’s smart?
•  50% faster performance when tested
against competitive databases
•  Only .5 DBA needed to administer
16 sites

Smarter Business
Outcomes
•  Reduced time-to-market for order
delivery by 20 percent
•  Improved supply chain management
across 16 distribution centers
•  Lower operational costs with
Increased operational efficiency and
reduced costs

“We can now look at the distribution chain across all our centers and closely monitor the detail of
each production step. It has helped reduce time-to-market for products by 20 percent.”
- Saul Vargas, Senior Database Admiinistrator, ColCerámica, A Corona Group Company
IMP14439-USEN-00


Improving operations and reducing costs are essential
ingredients to compete for the smarter consumer’s business.
Ø Do More, Spend Less Time and Money
§  Higher performance means fewer servers – and less space, power, cooling
§  Heterogeneous grid means using your existing HW and avoiding vendor lock-in
§  Automatically sense and respond to changes without intervention
• Self Maintaining means you avoid over provisioning or idle resources
• Self Configuring and Self Healing mean maximizing DBA resources


How can Cloud Deployments Help Retailers today?
Doing more with less
Why act now? Reduce capital and operational expenditures
Informix is only database that can be utilized and
§  Time to roll out new solutions takes provisioned in the cloud on heterogeneous,
too long commodity hardware
§  Maintenance and operation of Reducing risk
existing application landscape are Ensure the right levels of security and resiliency
too expensive across all business data and processes
§  Retailers are facing major strategic Informix provides a single console to easily
decisions with regard to provision only what is needed, when and where
infrastructure it’s needed, across the entire environment
§  Retailers need to risk and Higher quality services
investment while testing new Improve quality of services and deliver new
markets. services that help the business grow and reduce
§  Transformation activities of costs
acquisitions are behind schedule Informix provides around-the-clock services with
and synergies are not being realized virtually NO downtime, even for routine
maintenance and upgrades
§  Data center transformation is
Breakthrough agility
needed to support the future
generation of capabilities.
Increase ability to quickly deliver new services
while containing costs and managing risk
Informix manages workload utilization cost
effectively for both OLTP and BI applications
43

A System for Smarter Retailing

1) Deliver a 3) Drive efficiency
smarter shopping and reduce cost of
experience operations
Retail

2) Tune merchandise
and supply networks to
customer demands


For More Information

Ø Learn more about IBM Informix at www.ibm.com/informix
§  Learn about the Informix Warehouse Accelerator at www.ibm.com/informix/warehouse
§  Learn about Informix Flexible Grid at www.ibm.com/informix/flexgrid

Ø Read the case studies
§  McLeod Russel India Limited (click on title or go to short URL: ibm.co/UqcrzE)
§  Colceramica (click on title or go to short URL: ibm.co/SeuzdI)

Ø Test drive a free trial of IBM Informix Ultimate Warehouse Edition (click on title
or go to short URL: ibm.co/SgtqGK)


Q&A // Submit Your Questions

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#10RetailTrends

Q&A

Greg Girard Sally Hartnell
Program Director Marketing Manager
IDC Retail Insights IBM

#10RetailTrends

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