Slide deck of a presentation I gave at Service Design Drinks on the potential for innovation in (fashion) retail in April 2014.

1. Service
Design
Drinks
FJ O R D / A P R I L 2 3 , 2 0 1 4
Service Innovation
in Retail

2. Martin
User Experience,
Nokia
Katrin
PhD Candidate,
University of
Potsdam
Who are we?
Olga
Business
Consultant,
FuxBlau
Manuel
Service
Designer,
Fuxblau

3. Where we are today

4. Where we are today

5. Who is talking today?
Johannes Wrubel
Founder of ///

6. “The Times, They Are a-Changing!”
— B O B DY L A N , 1 9 6 4

7. smaller type
Retail is broken!
Service Design can fix it.

8. /

9. Future of Shopping
1. Retail is struggling to face
the challenges of digitalization
2. New business models threaten old ones
3. People adopt to new technologies
with new behaviours
STAT U S Q U O :

10. Some Numbers
Increase of online sales in fashion retail
2007: 4,9%
2012: 16,8%
Increase of mobile sales
> 1.000.000 mobile transactions in Q1/Q2 2012
= 152% more than 2011
!
Increase of mobile devices:
T H AT H AV E I N C R E A S E D :

12. New Technologies
Mobile Social Communities:
Twitter, Facebook, Instagramm
Location Based Services:
Foursquare, FB Places, Google Places
Physical World Connectors:
NFC, RFID, QR, iBeacon
Mobile Payment:
Square, SumUp, Google Wallet
T H AT D R I V E M O B I L E CO M M E R C E :

13. Treiber: Social Media

14. Treiber: SoLoMo

15. Treiber: Digital-Physical-Convergence

17. New Behaviours
Shop everything everywhere anytime
Use whatever device is there
!
Get instant social feedback
!
Buy & Try > Return
!
Showrooming: choose offline/order online
T H AT D R I V E T H E C H A N G E :

19. Retail Store Sales in Germany, 2012
H O W B A D I S I T ?
$
Quelle:&BrandEins&04/13
- 4 %
- 3.000.000.000€€

20. Retail Sales
H O W B A D I S I T ?

21. Physical Store
P R O : CO N T R A :
Costumer
!
Experience fashion
!
Immediate Take-Away
Costumer
!
Limited Selection
!
No time to decide
!
!
!
!
Company
Higher conversion rates
!
Lower return rates
Company
!
Showrooming
!
High fix costs/
Hard to “scale“

22. If the average online customer spends
100€ per order
!
and the retailer has
!
18.000 orders a year:
How much profit will they make?
$
Price Question
W I N S O M E M O N E Y

23. Price Question
W I N S O M E M O N E Y
Costs Minus Rest
Average Basket Size 100,00 €
Returning 40 % -40,00 € 60,00 €
Cost of Product 40 % -24,00 € 36,00 €
Discounts 10 % -6,00 € 30,00 €
Cost of Advertising 10 % of ABS -10,00 € 20,00 €
Shipping 4,90 -4,90 10,93
Callcenter/Fulfillment 13,5 -8,10 2,83
Shop Setup 40.000 € -2,22 € 17,78 €
Product Shooting 35.000 1,95 15,83
Cost of IT 5 -3 -0,17
Result -60,16 -0,16
18.000 = -2880€
Quelle:&BrandEins&04/13
$

24. eCommerce
P R O : CO N T R A :
Costumer
!
“Unlimited” products
Research & Compare
Costumer
!
Cannot touch and try
!
Waiting for delivery
!
!
!
Company
Tracking of
customer behavior
!
Instant improvement
Company
!
High return rate
!
!
No “customer contact”
and insights
!

25. So what?
”eCommerce and stores both got their pro’s and
con’s. If you know what you want, web shop is the
place to go.
For some products it’s nice to actually experience
them and talk to somebody.
!
The perfect shopping experience in my opinion
would be the
combination of on- and offline regarding
Information, Ordering, Delivery, Returning and
Service
in a seamless process - at a reasonable price.“
!
Werner Reinartz
Professor for Commerce and Customer Management at the
„Wirtschafts- und Sozialwissenschaftlichen Fakultät“ of Cologne University
T H E S O LU T I O N I S

26. //

27. A N E W CO N C E P T ?

28. Omnichannel
A N E W CO N C E P T ?
“Channel’ means nothing to the consumer –
they think in terms of what they’re buying,
not how they’re buying it.”
Quelle:&h5p://www.harvardbusinessmanager.de/he=/ar>kel/a@816329.html

29. Omnichannel
S C E N A R I O S

30. Omnichannel
1. Store to Web
!
2. Web to Store
3. Check and Reserve
!
4. Same Day Delivery
5. Pick-Up Return
S C E N A R I O S :

31. Omnichannel
Complex customer journeys
!
Multiple touchpoints
Seamless switch between devices
!
Blending of offline/online
Best of both worlds
24/7 – EVERYWHERE
C H A L L E N G E S :

32. Returning
Inspiration
Selecting
Wearing
Omnichannel
C H A L L E N G E S : CO M P L EX C U STO M E R J O U R N E YS
Purchasing
$

33. Service Design
H O W I T C A N H E L P :

34. Inspiration Selecting Purchasing Wearing Returning
Home
on the go
Store
Service Design
H O W I T C A N H E L P :

35. ///

36. Case „Kate Spade“
STO R E TO W E B / S A M E DAY D E L I V E RY:

37. Inspiration Selecting Purchasing Wearing Returning
Home
on the go
Store
Case „Kate Spade“
STO R E TO W E B / S A M E DAY D E L I V E RY:

38. Case „NIKE“
F R O M P R O D U C T TO EX P E R I E N C E :
D I G I TA L P H YS I C A L

39. Inspiration Selecting Purchasing Wearing Returning
Home
on the go
Store
Case „NIKE“
F R O M P R O D U C T TO EX P E R I E N C E :

40. Enabler „Go Try It On“
I N STA N T S O C I A L F E E D B AC K :

41. Inspiration Selecting Purchasing Wearing Returning
Home
on the go
Store
I N STA N T S O C I A L F E E D B AC K :
Enabler „Go Try It On“

42. Case „BONOBOS“
W E B TO STO R E :
Text

43. Inspiration Selecting Purchasing Wearing Returning
Home
on the go
Store
Case „BONOBOS“
W E B TO STO R E :

44. Enabler „UPCLOAD“
P E R F E C T F I T T I N G O N L I N E :

45. Inspiration Selecting Purchasing Wearing Returning
Home
on the go
Store
Enabler „UPCLOAD“
P E R F E C T F I T T I N G O N L I N E :

46. Case „Burberry“
P H YS I C A L D I G I TA L M E LT D O W N :

47. Inspiration Selecting Purchasing Wearing Returning
Home
on the go
Store
Case „Burberry“
P H YS I C A L D I G I TA L M E LT D O W N :

48. Case „Burberry“
P H YS I C A L D I G I TA L M E LT D O W N :
”Then, there was the back end: one of our key strategies from day one was operational excellence. We
wanted to be as admired and as respected for the back end of our business as for the front end. When I
started, we had just embarked on a business-wide rollout of SAP.“
!
Angela Ahrens, CEO of Burberry

49. Retail needs to be rethought:
beyond online/offline as
new integrative business/service models
providing the best customer experience!

50. ///
Skalitzer Straße 86C
10997 Berlin
!
jj@iii-agency.net
0151 191 21 889

51. Exercise
Plan the perfect
retail experience
for a persona

52. Retail experience map

53. Service Experience Camp 2014
Sept 13 & 14

54. Thank you!
servicedesignberlin.de
@SD_Berlin
fb.com/servicedesignberlin