IBM Retail Tech Trends

2016
IBM Guide
to Retail
Technology
Trends

Introduction

One of the greatest challenges in the retail industry today is the pace of technological change, and the ways
in which new technologies are fundamentally changing how people communicate, research, collaborate
with each other, and choose goods and services. This revolution has leveled much of the playing field relative
to traditional sources of competitive advantage, and it is redefining what it takes for retailers to win in the
marketplace. Retailers must find new ways to be relevant to tech-savvy consumers, to compete with disruptive
rivals, and to embrace new operating and partnering models that may be required in order to grow profitably
in the future.
IBM has long contended that there are three key mandates or imperatives for success in retail: a) Deliver a
smarter shopping experience, b) Build smarter merchandising and supply networks, and c) Drive smarter
operations. We discuss our point of view regarding these imperatives in greater detail in the IBM Retail
Solutions Guide.
These three imperatives remain a useful framework for thinking about what it takes to be successful in
retail. But the how behind these imperatives is changing dramatically, in great part due to the pace of
technological change: how to deliver better experiences to customers; how to offer unique assortments;
how to drive efficiency and reliability in the supply chain; and how to maintain consistent and cost-efficient
operations across store and back office functions—all of this is in the midst of unprecedented disruption
and transformation.
This disruptive transformation is what we explore in this guide.
There are several dynamics or levers of change in play with regard to this transformation. The first is
Analytics — the rise of many new forms of analytics, including Cognitive Computing, to drive better
understanding and more personalized relationships with the consumer, and to mine insights from the
vast and exploding world of Big Data. In its exponentially increasing volume, variety and potential
uses, Big Data is becoming a new ‘natural resource’. Insight into trends, customers and performance
can be turned into new selling, marketing, merchandising and supply chain strategies that drive market
share and margins.
The second dynamic is Cloud Computing: the delivery of IT and business processes as digital services.
Cloud—the idea of ‘Anything as a Service’—is transforming all industries, through the unprecedented speed
and agility it enables. Cloud can make it possible to inexpensively upgrade store, back office and omni-channel
infrastructures, and to enable what we call ‘designing for digital readiness’, through the use of APIs
to expose functionality and make access consistent across all touchpoints, for customers, suppliers,
employees and business partners.
2

The third dynamic is the rise of Mobile and Social Engagement. The ways in which the world’s people
interact online, and connect with each other, have gone through a revolution. Mobile technologies—
smartphones, tablets, location-sensing devices and the like—have made connectivity a constant and
ubiquitous aspect of our lives. And as network access now extends to a growing ‘Internet of Things’, the
physical world is uniting more fully with the digital and virtual worlds. Simultaneously, social networking
has brought us all into much closer communication with each other, and with the businesses and other
organizations and institutions in our lives.
For retailers, the impact of mobile and social technologies is huge: connecting with your customers as
individuals, and providing information in-context and in real-time, can foster much more relevant
relationships with them. And at the same time, using mobile and social to facilitate the working interaction
of your employees, suppliers and partners can drive significant gains in efficiency and productivity.
The fourth dynamic is the issue of Security in a digital world. Not a profit center, and not a pleasant topic
to think about, security is nonetheless becoming one of the most serious concerns of our time for retail
CEOs. The uncomfortable truth is that the defenses businesses have in place to secure themselves and
their customers’ data are often grossly inadequate, in comparison to the sophistication of today’s
international cyberattackers.
Retail is one of the most exposed of all industries, due to the volumes of information it processes, the
quantities of sensitive private data retailers are entrusted with, and the proliferating number of entry
points to their networks and systems. A retailer’s data must be recognized for what it is: a ‘crown jewel’ that
must be protected from all angles, with security established as a corporate priority that is governed by
value at risk, not just by budget. Effective safeguards are indeed available to protect against intrusion, to
quickly detect suspicious activity, and to mobilize resources so as to ensure containment and defeat.
This guide provides a quick overview of what we believe retailers need to address within each of these
areas of technological transformation, and of the IBM solutions supporting that transformation.
IBM offers everything retailers need to keep pace with today’s transformations. We listen to what our
retail clients tell us, and we design our offerings to address their needs, across roadmap development,
solutions, infrastructure, research sciences and consulting. We help retailers deepen their relationships
with their customers; we help them offer differentiated assortments to drive competitive advantage;
and we help them achieve operational excellence, to support continued profitable growth.
Please contact your IBM representative to arrange for a briefing on any of the offerings in this guide.
Sincerely,
Your IBM Global Retail Industry Team
3

Analytics

Potential Benefits
Better decisions that increase sales
and margins
Improved customer satisfaction
Increased market share
Reduced operating costs
Why it’s important
Big Data is rapidly becoming a significant global ‘natural resource’ that now
can be mined using advanced analytics so as to give new insight into any number
of issues of interest to retailers. A sampler of the kinds of things Big Data could
shed light on might include emerging consumer trends and product trends, the
management of operational resources, the maintenance of equipment and physical
plant, forecasting short- and long-term demand more accurately, and understanding
individual customers much more intimately than has ever been possible in the past.
And now, with the advent of Cognitive Computing—systems that learn as they
process information, and that interact in natural human language—dramatic new
advances are in prospect to leverage these revolutionary capabilities so as to drive
business value in ways never before seen. The vast world of unstructured big data
constitutes easily 80% of the world’s data, but until now, it has been essentially
invisible to IT systems. Social buzz, local news, local weather forecasts—these
can now all be tapped and mined for relevant insights. Cognitive Computing
constitutes a world-changing breakthrough here, by opening this unstructured
information to automated interpretation and analysis—and applying it so as to
make merchandising and offers much more relevant, on a localized basis.
To appreciate the implications here, let’s consider a case-study in how big data
and analytics can drive value for retail. Everyone’s well aware that consumers
are using today’s technologies very aggressively in their shopping. They want
pertinent information and offers, delivered in a timely way: the right information,
at the right moment, based on the shopping task they have defined for themselves
at the time. In essence, consumers want retailers to treat them as if each were a
unique ‘demographic of one’—a single individual who is, at any given moment, at a
specific place in their own personal shopping process, and who should be related
to in an informed and timely way by any retailer hoping to capture their business.
It’s no mystery why consumer demands are escalating like this, in 2016: it is
because their recent experiences have convinced them that retailers can, in fact,
provide this level of service, in a dependable and intelligent way. They know that
the data now exists, and that the necessary analytics exist and are within
reach. At any moment, within this universe of unstructured data lie all kinds of
telltale clues about what individual consumers are shopping for, what their specific
preferences are, who they are taking advice from, what their price sensitivity may
be, and what they are likely to do next. These are clues from which a retailer might
readily deduce what kinds of offers could be decisive in persuading them to
purchase a given item from a specific source—and at the most profitable price.
Of course, the field of customer analytics is just one example of an arena in which
leading retailers will mine insight and gain competitive advantage from analytics and
Cognitive Computing, as applied to Big Data. We stand at the threshold of untold
innovation in this broad realm, as competitors in many different industries will be
inventing new ways to drive value from this rapidly expanding natural resource.
4

Core Capabilities
All Data
• On premise
• Cloud
• External
• Structured
• Unstructured
• Images
• At rest
• In motion
Turn information into insight
• Descriptive Analytics for operational reporting and planning
• Predictive Analytics to uncover patterns and trends
• Predictive Analytics to optimize decisions
• Cognitive Computing to interact with human users more naturally
IT Infrastructure
• Manage new workloads needed for big data and advanced analytics
• Leverage cloud computing for flexibility, scalability and reliability
• Develop a comprehensive approach to digital security
Establish an Information Foundation
• Access, store, archive and analyze many types and sources of data
• Process and analyze data in real-time
• Ensure the quality, availability and integrity of data
New

Enhanced

Applications

Welcome to the Era of Cognitive Computing
Cognitive computing refers to systems that learn at scale, reason
with purpose, and interact with humans naturally. Cognitive systems
can make sense of the 80 percent of the world’s data that computer
scientists call “unstructured”—which the world’s computer systems
have been almost entirely blind to, until now. This enables cognitive
systems to keep up with the volume, complexity and unpredictability
of information and systems in today’s world.
None of this involves either sentience or autonomy on the part of
machines. Rather, it consists of augmenting the human ability to
understand—and act upon—the complex systems of our society.
For the Retail industry, the possibilities here are almost endless:
systems that read incoming customer notes to assess them for
urgency of response, or that ‘look over the shoulder’ of call center
agents, while they interact with customers, to advise them in real
time of key facts about the customer, what their shopping goals and
preferences are, what their mood seems to be, and what path might
be best to answer to or resolve their situation. Or, systems that even
talk directly with customers, engaging them in natural dialog, in a
sensitive, intelligent, and well-informed way.
Cognitive Computing is the next step in our ability to harness
technology in the pursuit of knowledge, to further our expertise
and to improve the human condition. That is why it represents not
just a new technology, but the dawn of a new era of technology,
business and society: the Cognitive Era.™
5

Analytics
How we deliver it
To leverage new data sources, build Our analytics platforms include: • IBM InfoSphere BigInsights™
intelligence, and run a retail business
more strategically, IBM offers a range
of analytic capabilities, from platforms
to prebuilt industry-specific solutions.
Our prebuilt industry solutions include:
• IBM®
Demand Insight leverages
Cognitive Computing to analyze
social buzz, local news, events and
weather data with other external
and internal data sources to identify
key demand signals and derive
predictive insights
• IBM Social Media Insight leverages
Cognitive Computing to provide a
robust retail analysis of customer
perceptions related to attributes like
quality, convenience, and price—at
the item level
• IBM Lift Insight leverages Cognitive
Computing to provide advanced
sales analytics to help understand
the total revenue impact of individual
products and product categories,
including lift analysis and affinity
analysis, so as to help improve your
merchandising and assortment
decisions.
• IBM Predictive Customer
Intelligence (PCI) identifies your
customers’ shopping patterns,
preferences and behavioral drivers,
and predicts the best way to deliver
timely and relevant interactions
with each.
• IBM Watson™
has ushered in a
new era of Cognitive Computing—
technology that can understand
natural human language, processing
information in a way similar to how
people think, and learning as it gains
access to increasing quantities of
information. Cognitive Computing
can make possible significant
advances in an organization’s ability
to quickly analyze, understand
and react to vast quantities of
diverse data.
• IBM Cognos®
Analytics provides
planning and business intelligence
to understand how stores, channels,
merchandise and marketing
organizations are performing,
and how they are contributing to
overall business objectives.
• IBM Decision Optimization
prescriptive analytics can make you
more efficient by automating complex
decisions and trade-offs around
limited resources, to optimize supply
chain design, supply networks
and inventory levels, to fulfill on the
promise of omni-channel retailing.
• IBM Data Warehouse (IBM
PureData™
) helps to organize, store
and analyze various types and uses
of data.
• IBM InfoSphere®
Streams is an
advanced analytics platform that
allows user-developed applications
to quickly ingest, analyze and
correlate information in motion from
various sources.
combines open source Apache
Hadoop with enterprise functionality
and integration to deliver large-scale
analysis with built-in resiliency and
fault tolerance.
To operate in the new era of big data
and advanced analytics, the right IT
infrastructure is essential. Retail CIOs
must intelligently manage, store and
archive data in the most cost-effective
manner. Advanced technology platforms,
such as the IBM PureSystems®
family,
efficiently consolidate and optimize
the use of systems to deliver analytics.
We take infrastructure up a level in
performance by providing systems
equipped to facilitate implementation of
the analytics applications you need to
run your business.
And, a range of improved deployment
options can allow you to plan how big
data initiatives will be run inside and
outside your organization, including:
on premises, in the cloud—public or
private, as a service, or hybrid-a mix
of cloud and on-premises. IBM
SoftLayer®
gives you the highest
performing cloud infrastructure
available, providing automated and
efficient ways of optimizing and
procuring computing capacity flexibly
across many processes, and
dramatically shortening development
cycles. See the discussion of Cloud
Computing in this booklet for more
information.
66

Selected IBM Offerings
Software solutions Consulting, Process and
Implementation services
Managed services Infrastructure
Prebuilt industry solutions: • Marketing and consumer • Advanced analytics on IBM Power
• IBM Demand Insight
• IBM Social Media Insight
• IT Strategy and Performance
Assessment
• Enterprise Architecture
analytics
• IBM Global Technology
Services®
team:
Systems™
and IBM z Systems™
hardware
• IBM PureData System for Analytics,
• IBM Lift Insight
• IBM Predictive Customer
Intelligence
Analytics platforms:
Assessment
• Application Portfolio Assessment
• IBM Business Analytics Jumpstart
• Customer Segmentation and Next
– Strategic IT outsourcing
– IBM Softlayer
– IBM Fiberlink®
mobile device
management on cloud
powered by IBM Netezza®
technology
• IBM Softlayer
• IBM Retail Data Warehouse
• IBM Watson Engagement Advisor Best Action – Backup and archive on the
• IBM Watson Explorer • Shopper Behavior Analytics IBM Cloud
• IBM Watson Discovery Advisor • Media Asset Allocation – Managed Security Services
• IBM Watson Analytics • Trade Promotion Analytics • Through the IBM Global
• IBM SPSS®
• Store and Workforce Performance
Business Services®
team:
• IBM Cognos Analytics Managements – Application management
• IBM Social media analytics • IBM Business Process – Application testing
solutions Management. Visioning and • Business process outsourcing
• IBM Decision Optimization
Roadmap (BPO) record-to-report services
• IBM IoT Foundation
• IBM DB2®
, Informix®
, and IMS™
• IBM InfoSphere BigInsights
• IBM InfoSphere Streams
Case studies
Associazione Amici
Via della Spiga
This luxury retailer uses IBM Social
Media Analytics to uncover the
driving factors behind fashion
purchases and brand loyalty and to
predict future customer behavior.
• 60 percent increase in brand
reputation
• Improved allocation of time and
money spent in individualized
promotional efforts
• Reduced costs by identifying
unproductive promotional methods
Castorama
This European DIY retailer
implemented SPSS to predict which
customers in each region are most
likely to make purchases in specific
product categories, to better target
their promotions and customer
outreach.
• Allowed the quadrupling of
campaigns run for local stores and
tripling of market-research surveys
• Increased customer loyalty
• Reduced marketing expenses
Patagonia
This outdoor gear supplier
implemented IBM Cognos Analytics
to streamline its budgeting process,
and to monitor and forecast global
inventory in detail
• Supports more detailed inventory
planning down to the style and
color of products, by geography
• Improves merchandising and
supply analysis and planning
• Eliminates cumbersome
administrative tasks and procedures
7

Cloud
Computing
Technology continues to change how consumers shop. And, depending on the
choices a retailer makes, information technology can either become a vital enabler
of success—or a crippling impediment. To play its critical role in powering a
profitable retail business, IT must be dependable, it must be secure, it must be
flexible, and it must be as low cost as possible. At IBM, we’ve long been
convinced that there are areas within a retailer’s IT structure where Cloud
computing can offer clear advantages over other available approaches.
Cloud’s most fundamental advantage is that, if applications can be run on
a shared set of computers, a very large amount of computing power can be
made available to each application process, with that computing capacity
being flexed on an on-demand basis to support the intensive bursts of
processing that occur at different moments in the course of each process.
This characteristic is known as dynamic scalability or elasticity. IBM’s studies
have shown that approximately 85 percent of a retailer’s computing infrastructure
may be idle at any given moment—an underutilization of resources that Cloud
can go far toward remedying.
We think Cloud is becoming much more relevant, and of potentially greater
value, than it has been even in the recent past. This is in part related to a broad-
based need to make IT infrastructure more flexible and cost-effective, and also
specifically to the ways that Cloud can be of use in supporting efforts to design
for digital readiness through the wider use of APIs to expose functionality and
make access consistent across all touchpoints. This is becoming ever more
relevant with the proliferation of interconnected devices and the ever-increasing
instrumentation of consumer lifestyles.
And as concerns around security continue to weigh on retailers, it bears noting
that Cloud can be just as secure as other forms of IT architecture, even those that
are maintained entirely within the firewall of a single enterprise.
88
Potential Benefits
Improved IT responsiveness

to business needs

Improved customer satisfaction

Reduced operating costs

IBM SoftLayer
Cloud computing is defined as the
delivery of on-demand computing
resources—everything from
applications to data centers—over
the Internet, on a pay-for-use basis.
Cloud computing doesn’t come out
of the sky. It comes from physical
hardware inside brick-and-mortar
facilities, connected by hundreds of
miles of networking cable. And cloud
is not a commodity: no two clouds
are built the same way.
Core Capabilities
SOFTWARE as a SERVICE
• Commerce-as-a-Service
• Digital Channel Services
• Merchandise Analytics & Optimization
• Payment Systems/Gateway
Highly configurable, multi-tenant software
PLATFORM as a SERVICE
• Mobile & loT Development/
Mashups
• BigData Analytics
• Cloud Applications Development
“Born on the web/cloud” applications
INFRASTURCTURE as a SERVICE
• Digital channel/e-commerce platform
• Cross Channel Operations/DOM
• Customer Analytics
• Enterprise Marketing
• Customer Care
• DevOps, Continuous Delivery
Applications, benefiting from flex capability
ON PREMISE PRIVATE INFRA
• Merchandise Planning
• Finance
• Master Data Management
• Data Repositories & BI
• Enterprise Integration
• IT Ops Management
Typically custom, legacy applications
HOSTED PRIVATE CLOUD
• Merchandise Operations
• Product Development
• Supply-Chain Optimization
• Supply-Chain Visibility
• Supply-Chain Logistics
Typically packaged applications
PROCESS as a SERVICE
• Human Resources
• GNFR/Indirect Procurement
• F&A reporting
Managed processes, typically
non-core retail functions
• Store POS
• Store Ops/Systems
MicroCloud can
bring cloud to
the store
Interchangable
Dedicated and private to retailer
PaaS is typically
built on top of IaaS
IBM SoftLayer®
offers the highest
performing cloud infrastructure
available. It provides a single platform
that takes data centers around the
world, offering the widest possible
range of cloud computing options,
and then integrates and automates
everything.
There are other cloud and hosting
providers who adhere to traditional
billing practices of charging customers
for each and every communication
their servers send or receive. With
SoftLayer, we do things differently.
Our servers come with terabytes of
outbound bandwidth included:
5TB for virtual servers and 20TB for
bare metal servers. And, IBM does
not charge for inbound traffic to our
servers, nor do we charge for
bandwidth usage across our Global
Private Network. This allows our
clients to build on a Global Private
Network essentially free of charge,
just by being a SoftLayer customer.
9

Cloud Computing
How we deliver it
The journey to Cloud computing can
take a number of different paths. Often
retailers want to test out Cloud concepts
by taking advantage of Infrastructure-as
a-Service for specific computing needs.
This often yields valuable lessons that
can then be applied towards broader
usage of Cloud.
In many instances, retailers already
know which IT workloads tend to be
their biggest pain points: perhaps
continuous development and delivery
to support e-commerce and digital
readiness initiatives, customer
analytics, or development and testing
environments to support business
transformations such as e-commerce
or merchandising and supply chain.
IBM addresses these via specifically-
tailored Cloud Managed Services
for ERP or DevOps.
Often, retailers have a general sense that
cloud could be beneficial to them, but are
looking for a more measured analysis on
how to approach this. In such a case, we
begin with our cloud consulting services
to identify quick wins; application
workloads that can immediately benefit
from cloud and then proceed to deploy
our rapid migration techniques to move
the application to IBM’s SoftLayer
Infrastructure-as-a-Service. Depending
on the application, these migrations can
often be done in hours to days.
In parallel, we execute a detailed
workload analysis of the retailer’s IT
portfolio. By looking at applications,
data sources, integrations, application-
affinity, user-group interactions, SLA,
connectivity and security needs, we
identify logical groups of applications
that are the most suitable candidates to
be moved to a cloud environment.
Then, we develop a roadmap to
operationalize the movement of
application workloads into cloud
environments, including private, public
and hybrid. Gravitant enables
companies to optimize computing
services by brokering resources from
multiple cloud providers and across
hybrid clouds. These services as
provided by mixed environments
can now be integrated and managed
uniformly and across environments, for
improved performance and efficiency.
The move to Cloud computing is a
journey, not a one-time-and-done
affair. A part of IBM’s implementation
approach is to empower the retailer’s
IT organization to actively participate,
while also offering fully-managed cloud
services as appropriate.
IBM Bluemix®
is IBM’s strategic cloud-based application
development environment. Based on the open source
Cloud Foundry project, Bluemix provides an open
standards-based platform for building, managing and
running applications of all types, including web, mobile,
big data, and smart devices.
Bluemix allows developers to easily compose new business
applications without the need to code from scratch—so,
what has previously taken weeks can therefore now be done
in minutes. Web and mobile applications can be rapidly and
incrementally composed from services provided by IBM, the
open source community and an ecosystem of partners. This
means retailers can quickly develop, deploy, and continually
enhance applications for consumers, employees, suppliers
and other business partners.
Delivered as a platform-as-a-service (PaaS) model,
Bluemix is offered via three models – public, dedicated,
and local – to provide maximum flexibility to meet the
client’s specific business requirements.
IBM Bluemix
1010

Software solutions
delivered via cloud
• IBM Presence Insights
• IBM Customer Experience
Analytics
• IBM Commerce on Cloud
• IBM Marketing Cloud
• IBM Sterling Commerce®
Order
Consulting, Process and
• Cloud Strategy and Design
• Cloud Security Services
• Cloud Implementation – Retail
Merchandising and Supply Chain
• Cloud Implementation – IBM
Private Modular Cloud
Managed services
• IBM Cloud Managed Services™
for Oracle and SAP
• Managed Security Services
• IBM Recruitment on Cloud
• IBM Emptoris Spend Analysis
on Cloud
• IBM Counter Fraud on Cloud
Infrastructure
• IBM Mobile Web Push
• IBM SoftLayer
• IBM Bluemix
• Gravitant
• CleverSafe
• StrongLoop®
Management and Transportation
Management
• IBM Sterling B2B Collaboration
Network
• IBM Emptoris®
contract
management
• IBM TRIRIGA®
real estate
management
• IBM Kenexa®
workforce
management
• IBM DevOps Services
• Cloud Implementation – Testing
services on Cloud
Case studies
This video game retailer leverages
IBM Bluemix to speed the pace of
innovation and the development of
prototype mobile apps.
• Provides a scalable, reliable platform
for designing and developing new
applications
• Reduces reliance on IT, through
automating the set-up and hosting
of environments
• Enables crowdsourced insights and
innovation with leading universities
and other partners
This luxury accessories retailer uses
IBM Bluemix and the IBM Watson™
Personality Insights service to power
its product recommendation system.
• Website traffic increased by 10%
• Customers spend 15% more time
on website
• Increased customer satisfaction
This UK-based furniture retailer uses
IBM Cognos®
and IBM SPSS®
on
the SoftLayer cloud infrastructure
to enable advanced analytics while
reducing IT spend.
• Eliminated capital investments with
SoftLayer cloud hosting platform
that can scale for growth
• Reporting accelerated by 99%
• Rapid insight into customers aligns
decision-making with corporate
objectives
GameStop Roztayger LLC DFS
11

Mobile & Social
Engagement
Potential Benefits
B2B:
Higher service levels
Great retention
B2C:
Greater loyalty
Increase sales and margins
1212
The ‘Era of Continuous Computing’ is upon us. With smartphones, tablets and other
mobile devices proliferating everywhere, we can all stay in touch at nearly all times
and places. And, as an ever-larger majority of consumers are using mobile devices
worldwide, it becomes possible to paint a detailed picture of a person’s activities—
and to infer a great deal about their interests and intentions of the moment.
For retailers, this truly changes the game: it enables real-time awareness, real-time
understanding, and real-time personalized engagement and interaction. As
consumers become more continuously connected, retailers who are competing
to win must themselves become similarly connected and engaged, in real-time,
with their customers.
Consumers now expect retailers to provide an online experience that is optimized
for their mobile devices. They want shopping to be smooth, uncomplicated, and
personalized, regardless of where they are or what device they may be using.
They also expect speed and responsiveness when they do research, buy an item,
or change an order. Since they are used to using mobile devices to get advice
on products from their friends and social network, many now also want to be
consulted by their favorite retailers on the co-creation and introduction of new
products and services.
Retailers are just beginning to uncover the myriad ways that mobile and social
capabilities might be used to drive increased sales, market share and customer
loyalty. Inside the store, retailers need to invest in wi-fi and in related solutions that
can use real-time information about exactly where shoppers are and what they
are doing, to enrich the in-person experience with relevant digital content, and
to drive more personalized one-on-one engagement than ever before.
And, mobile technologies can at the same time help retailers become more oper
ationally efficient. Tools that enable real-time communication can foster new forms
of collaboration and education, and can make working relationships much closer
and more efficient, such as between managers and employees, employees and their
co-workers, and between employees and suppliers or other business partners.
Equipping your associates with mobile technologies is quickly becoming an
imperative, including support for bring your own device (BYOD). Placing into their
hands the most pertinent info on customers, merchandise, inventory and orders,
across all channels and sources, will put your associates in a far better position to
make the best decisions, and to deliver better customer service, higher sales, and
improved customer satisfaction.

Core Capabilities
B2B and B2C Internal and External Usage
Applications and
User Experience
• Customer Mobile Experience
• Mobile innovation and design
• Out-of-the-box Industry
Solutions
Collaboration Platform
• Social software
• Realtime social
communications
• Content management
Mobile Management
• Device, application and asset management
• Security
• Technical support, services and repair
Mobile Application Development Platform
• Application Development and Lifecycle Management
• Scalable Backend Services, including hybrid cloud
• Integration Services, including API creation and management
• Location-based Services
Apple + IBM
Apple and IBM have teamed to give business professionals
the unique capabilities of iPhones and iPads, powered by the
knowledge, data, analytics and workflows as defined by the
individual enterprise.
Through our partnership, we are redefininge the ways
that work is done, by addressing key industry mobility
challenges and by driving true mobile-led business change,
grounded in four core capabilities:
• A new class of more than 100 industry-specific
enterprise solutions, all with native apps, developed
exclusively from the ground up, for iPhone and iPad
• Unique IBM cloud services optimized for iOS, including
device management, security, analytics and mobile
integration
• AppleCare service and support offering tailored to the
needs of the enterprise. IBM is the exclusive partner for
delivering AppleCare
• New packaged offerings from IBM for device activation,
supply and management
To transform the in-store retail experience, IBM and Apple
introduced the Store Associate Suite with two new apps
designed to enable enhanced engagement between
customers and sales associates. Using analytics, the Sales
Assist and Pick & Pack apps will improve sales productivity
by optimizing the shopping experience for customers through
better empowerment of in-store sales associates. These
apps will use real-time intelligence to direct associates to
customers and allow them to provide real-time product,
inventory availability and location information as well as to
deliver personalized offers for customers, based on historical
patterns and profile data.
The new IBM MobileFirst™
for iOS solutions have been built
in an exclusive collaboration that draws on the distinct
strengths of each company: IBM’s big data and analytics
capabilities, with the power of more than 100,000 IBM industry
and domain consultants and software developers behind it,
fused with Apple’s legendary consumer experience, hardware
and software integration and developer platform. The
combination is creating apps that can transform specific
aspects of how businesses and employees work using iPhone
and iPad, allowing companies to achieve new levels of
efficiency, effectiveness and customer satisfaction—faster
and easier than ever before.
As part of the exclusive IBM MobileFirst for iOS agreement,
IBM also sells iPhones and iPads with the industry-specific
solutions to business clients worldwide.
13

Mobile & Social Engagement

How we deliver it
We start with extending traditional back-
office systems of record into the hands
of your employees, empowering them
with a great deal of new information and
insight, so they can collaborate and make
informed decisions in context, and in real
time. This can revolutionize how they
interact with customers, and how they
collaborate with other employees and
with suppliers and partners.
IBM MobileFirst™
lets you quickly
develop, test and deploy quality mobile
apps across multiple platforms, and
easily integrate apps with your enterprise
data, systems and services. Then, to
accelerate development and create
full-function apps, you need scalable
backend services: mobile cloud services,
including standard APIs, analytics for
reporting and for insight on app usage,
workflow for process automation, cloud
storage for mobile data management,
and app scanning for security. And, to
optimize mobile performance, IBM
Cloudant®
provides local data for users
who are offline and syncs as soon as
connectivity is available.
IBM Mobile Application Content
Manager enables marketers to engage
mobile app users with personal and
contextual content to influence action in
the moment. It does this by allowing
non-technical business users to localize
engagement by creating, managing and
publishing content straight to the mobile
applications without involving IT.
IBM and IBM Business Partners also
provide a wide variety of out-of-the-box
solutions, including Mobile Pick, Product
Finder, and Suggestive Sell, that can give
you a head start in accelerating your
mobile transformation. IBM Mobile Push
Notification provides a flexible, simplified
environment for creating notification
campaigns that engage mobile app users
at the optimal time and place. In addition,
Bluemix makes available many Watson
cognitive services such as speech-to
text, text-to-speech, natural language
translation, machine learning and the
integration of powerful analytics like
Personality Insights. In addition, IBM
Presence Insights analyzes in-store
shopping patterns, and can reveal
patterns and variations that may shed
light on customer preferences and
operational issues.
And, to optimize the experience and
detect unintended customer or employee
obstacles or difficulties in using an app,
IBM Tealeaf®
automatically detects
issues and provides recommendations
for improvements. It’s of course critical to
make your mobile apps as engaging and
value-add as possible. IBM Interactive,
the world’s largest digital agency, teams
with IBM Research to deliver innovative
digital strategy and application design
capabilities, to make your apps appealing
and cutting-edge, whether they are
for use by customers, associates or
business partners. And, security is always
a central concern with mobile apps.
IBM MaaS360®
Enterprise Mobility
Management provides enterprise-class
management and security for devices,
apps and content, to protect your servers,
databases, and IT infrastructure as mobile
devices access them.
Becoming a social business means
connecting employees, suppliers and
other partners so as to enable
superior information sharing that can
improve productivity and profitability.
IBM Connections Suite provides
world-class social software, real-time
social communications and content
management. Among the many
benefits delivered by these capabilities
are relevant shopping and services for
consumers, just-in-time education
and insight for associates, and
improved performance from
suppliers and partners.
1414

Software solutions
• IBM MobileFirst Platform
• IBM Connections
• IBM Presence Insights
• Fiberlink MaaS360
• IBM Security Access Manager
for Mobile
• IBM Trusteer
• IBM Tealeaf CX Mobile
• IBM Mobile Push Notification
• IBM MobileFirst for Sales
Associate Suite (including Sales
Assist, Pick and Pack, Shift Sync,
and Express Pay)
• IBM MobileFirst for Manager
Suite (including Shift Track)
• IBM MobileFirst for Merchant
Suite Associate (including
Dynamic Buy and Order Commit)
Consulting, Process and
• IBM MobileFirst Applications &
Platform Services
• IBM Interactive Experience
Workshop
• IBM MobileFirst Studios
• IBM Ready Apps
• IBM Business Process
Management
Managed services
• IBM SoftLayer®
Infrastructure
• IBM Bluemix Mobile Cloud
Services
• IBM Cloudant
• IBM Watson Cognitive Services
Case studies
This South Korean retail payment
company leveraged IBM’s MobileFirst
platform to develop a feature-packed
mobile app for customer use.
• Enabled deployment of one of the
world’s most advanced mobile
payment apps
• Location-based features and
scannable mobile coupons
• Reduced time to market and
associated costs
This European footwear retailer chose
IBM Connections social business
software to equip store associates
with robust iPad-based social apps
at a reasonable cost.
• Associates equipped with iPad
tablets at 500 stores
• Improved business processes,
productivity and employee
engagement
• Fosters greatly increased
collaboration and knowledge
sharing, while boosting employee
job satisfaction
This US sports apparel retailer used
IBM MobileFirst to develop its new
loyalty program mobile app.
• MobileFirst allowed the app to be
deployed to all device types without
the need for multiple versions
• Enhanced the existing mobile
commerce platform by provided
new features including Message
Center, Product Scan and (Product)
Release Dates
• Deepened the understanding of
the customer, informed enterprise
decisions and encouraged loyalty
and sales
Lotte Card Co. Ltd HR Group The Finish Line
15

Security Why it’s important
It seems that every year, the technology landscape experiences a tectonic shift.
With each new technology and touchpoint comes new IT security concerns: new
data sources, new kinds of devices and applications, and the expanded use of
social networks, collaboration tools and cloud computing. And with all this comes
the threat posed by those who will attempt to prey upon businesses and
consumers, to steal and disrupt.
Potential Benefits
The sophistication and scale of malicious attacks, as well as their sheer
destructiveness, is growing dramatically. While the news of the latest attacks has
come to seem almost routine, the costs are in fact staggering: the average total
cost of a data breach in 2014 was US$3.5 million worldwide, up 15 percent overReduced risk
the previous year, and in the United States, the average cost is higher—estimated
at US$5.85 million. And the issue is particularly acute for retailers, because private
Lower operating costs consumer and credit card data is at stake. Without sufficient safeguards, your
brand, reputation and even your future in business may be at stake.
Higher customer confidence,
And retail is one of the most exposed and vulnerable of all industries, due to the
increased sales
volumes of information and transactions retailers process, the quantities of sensitive
private and financial data they are entrusted with, and the proliferating number
of entry points to their networks and systems. Retailers who have already been
victimized will testify that a major data breach is an extraordinarily disruptive and
damaging event—disruptive to the business, disruptive to customer relationships,
and enormously destructive in terms of public image and reputation, as well as
in direct costs.
In the face of such mounting dangers, many retailers are deciding that security now
merits the involvement of the full C-suite, to establish it as a serious organizational
priority. Only with the participation of the most senior leaders can the right tone
be set, with an effective governance model put in place to ensure that the right
practices are adopted and adhered to across the entire enterprise. These
indispensable measures are very unlikely to be achieved if the matter of security is
delegated primarily to a chief information officer (CIO) or chief information security
officer (CISO).
With the right safety measures in place, retailers can place themselves in position
to reap the benefits of the latest interactive technologies, so to engage with
shoppers in a dependably secure way, while also raising employee productivity and
shielding the organization from intrusion and from possible reputational damage.
1616

Core Capabilities
Detect Threats
• Continuously search for patterns
• Advise of threats
• Contain intrusions before they do
serious harm
Prevent Attacks
• Defend every network access point
• Impede breaches and isolate
threats
• Protect sensitive data
Respond Continuously
• Effective process controls
• Rapid response mechanisms
• Quick action when breach occurs
According to Gartner, by 2020 there will be nearly 26 billion
devices in the ‘IoT’, including every imaginable category
of appliances, equipment and gadgets.
The import of all this is only gradually unfolding, and
will no doubt include more than a few surprises.
Perhaps the most fundamental implication is around
the exploding range and volume of data these devices
will produce.
First of all, the IoT will produce vast quantities of new
data on the operation of these devices themselves. For
business, this will be of untold use in improving asset
performance management, such as reducing downtime,
lowering operating costs, and improving performance.
Retailers can be expected to benefit from improved
visibility to key equipment like HVAC, food refrigeration,
vehicle fleets and other major mechanical components.
Secondly, these devices will shed enormous new light
on their users—what people are doing, how they are
feeling, what their intentions may be, and many other
dimensions of insight into human activity. Healthcare
will experience a revolution, as it becomes possible
to monitor a patient’s vital signs and other indicators,
during the course of their ongoing daily life.
For retailers, it will become possible to access a much
richer understanding of consumers, in their habits,
preferences, and shopping activities. The exact forms
this will take are yet to be determined, and will no doubt
evolve indefinitely in the future. What is clear is that your
organization’s need to send, receive, gather, analyze and
respond to data from connected devices will expand
exponentially, with some of this needing to be processed
in real time.
And, as consumers embrace more interconnected
devices, they will likely move towards investing in
‘systems’ of linked devices, which will work together to
simplify and enhance their lives. These future moves
towards families of interconnected devices will likely
become a significant factor in terms of merchandising,
marketing, and relationship-building with consumers.
No doubt, some retailers will be in the forefront in finding
ways to drive competitive advantage through the insights
they can gain from this new data. The IoT therefore can be
expected to add substantially to the growing realm of Big
Data, which will need to be processed and analyzed by
retailers. And, in addition to increasing a retailer’s analytical
workloads, the need to leverage this data is likely also to pose
additional potential security challenges.
The Internet of Things (IoT)
17

Security
How we deliver it
At IBM, we’re convinced that the retail
industry must address the challenge of
digital security in a long-term, strategic
way, using a combination of hardware,
software and services. Together, these
comprise a comprehensive and robust
set of tools and best practices designed
to frustrate intruders, mitigate attacks
and protect your organization. When
employed consistently, they address
security issues effectively, through
early detection, removal and remedy.
It all starts with leadership and
awareness. An IBM Cybersecurity
Executive Awareness Briefing
can help educate top executives
on the latest attack methods and
defenses, the role of social media,
and on advanced technological and
operational defenses. This briefing
can also help you define quick actions
that can be taken to immediately
strengthen your existing defenses.
The IBM Security Maturity
Benchmark Assessment can evaluate
the effectiveness of a retailer’s overall
security posture, using verified data
to compare your posture with those
of peer organizations. This assessment
can highlight where a retailer is strongly
defended and where it is vulnerable, and
can provide the basis for a strategic plan
of action around security enhancement.
Prevention remains a vital frontline
element of an effective security strategy.
You require real-time protection that can
frustrate attacks and disrupt attack
chains. IBM Threat Protection System
breaks critical points in the attack chain
with preemptive defenses on both the
endpoint and the network. Through
its unique behavioral-based approach,
we detect and prevent even unknown
attacks, including those utilizing
advanced malware. IBM Trusteer
Apex™
blocks the installation processes
related to malware, in order to stop
malware at the point of infection. IBM
Security Network Protection disrupts
the malware lifecycle by detecting
existing malware on the network, and
by blocking command-and-control
traffic to malware websites, which may
attempt to send further instructions in
continuation of an attack.
IBM QRadar®
Security Intelligence
Platform products provide a unified
architecture for integrating security
information and event management
(SIEM), log management, anomaly
detection, incident forensics, and
configuration and vulnerability
management. QRadar can detect
threats that other technologies miss,
by performing advanced analytics and
by anomaly detection such as spotting
traffic spikes on off-hours, or repeated
login attempts, all across a wide range
of data and network traffic. And it can
deliver security intelligence on-premise,
as well as in cloud environments.
IBM Security X-Force®
Threat
Intelligence uses the latest evolving
information on potentially malicious IP
addresses, including malware hosts,
spam sources and other threats, to
enable you to respond proactively.
IBM Fiberlink MaaS360 can help you
balance engagement, productivity and
data security by managing all your
users, devices and data from a single
console that provides instant visibility
into who is connecting to your data
and via which devices. With it, you can
manage and secure all devices:
desktops, laptops, smartphones,
tablets, and whatever comes next—
including support for a bring-your-own
device (BYOD) policy for your employees.
IBM Endpoint Manager streamlines
remediation tasks by automatically
managing patches to hundreds of
thousands of endpoints, including
the latest mobile devices, and also
by providing integrated reporting for
real-time monitoring of patch progress.
Today, it is no longer a matter of
whether an organization will be
breached, but a question of when, and
how much damage will be caused
before an intrusion is caught and
mitigated. You need the ability to
respond extremely quickly once an
incident is detected. The IBM Threat
Protection System provides capabilities
to quickly investigate breaches, and to
retrace attack activity so as to learn
from these findings and remediate
weaknesses.
Understanding the magnitude and
nature of a security breach can be
challenging, especially with limited
resources or a lack of in-house
forensics expertise. IBM Emergency
Response Services can supplement
your in-house resources by providing
immediate guidance and support in the
event of a serious security incident.
1818

Software solutions Consulting, Process and
Managed services Infrastructure
• IBM InfoSphere Guardium®
• Cloud Offerings (SaaS, BPaaS, • IBM SoftLayer
• IBM QRadar Security Intelligence • Database Vulnerability Assessment PaaS, IaaS)—SoftLayer • IBM POWER8™
, System x,
Platform • IBM Cybersecurity Executive • Outsourced or Managed z Systems
• IBM Trusteer Apex Awareness Briefing Security Services • PureData for Analytics
• IBM Security SiteProtector™ • IBM Security Maturity Benchmark • IBM X-Force • For storage: IBM DS88xx, IBM
System Assessment • Surveillance Application (GTS) XIV®
, IBM Storwize®
• IBM Security Access Manager • IT Security Services for: Cloud, • IT Managed Services: security,
• IBM Network IPS
• IBM zSecure™
Suite; IBM
Application, Data, Emergency
response, Identity and access
management
mobile, network
• IBM Threat Protection System
InfoSphereGuardium Database
Activity Monitoring
• IT Risk, Fraud, Security consulting,
governance and compliance
• IBM Emergency Response
Services
• IBM InfoSphere Guardium
Encryption Expert
• PCI Security
• IBM Tivoli®
• IBM Security Operations
Optimization Services
• IBM Endpoint Manager
• IBM Security AppScan®
Case studies
Home Shopping Network
This US retailer is reducing
its security auditing costs by
implementing the IBM QRadar
Security Intelligence Platform.
• Reduced security audit cost by
more than 50%
• Expected to increase revenues and
create new revenue streams by
providing a secure environment for
developers to create new services
and capabilities that tap into
customer data
• Reduces the risk of data privacy
breaches by concentrating private
data in secure, tamper-proof
appliances
Ahold Europe
This supermarket retailer engaged
IBM to implement an integrated store
portal using IBM Security Solutions
and IBM WebSphere software.
• Improved employee efficiency
by securely optimizing their
accessibility to key information
• Reduced the cost of its store
performance management process
• Improved workforce management,
increased employee efficiency and
reduced administrative burden
An International Retailing
Group
This international retailer upgraded
its security access management
environment to protect user access
and improve efficiency using IBM
Security Access Manager.
• Implemented protection against
new security threats
• Reduced cost 30-40% annually
• Increased flexibility of security
infrastructure
19

IBM’s commitment
to the retail industry
IBM has more than 4,000 professionals focused on the retail industry
around the world as well as one of the largest global networks serving
retail, with almost 2,000 IBM Business Partners.
IBM’s preeminence in the development of leading industry solutions
is the direct result of our strong commitment to research and
development. We invest more than USD6 billion annually in R&D,
and for 22 consecutive years have been the world’s leading patent-
earning organization. IBM earned 7,534 patents in 2014 alone.
IBM Analytics
IBM Analytics enables anyone to engage with data to answer the toughest
business questions, uncover patterns and pursue breakthrough ideas.
Retail-specific, advanced analytic solutions help retail organizations
transform insight into action.
IBM Cloud
IBM cloud solutions includes infrastructure as a service, software as a
service and platform as a service offered through public, private and
hybrid cloud delivery models. By leveraging the power of agile cloud
development, organizations can make faster and better business
decisions with total visibility and control.
IBM Commerce
IBM Commerce solutions helps you understand and engage with
customers on a deeply personal level and build the synchronized,
predictive value chain you need to deliver not just products, but
extraordinary experiences.
IBM MobileFirst
Combine the power of enterprise data and analytics with an elegant
user experience to redefine how you empower your retail organization
to interact, learn, connect, and perform.
IBM Security
Our security software and services help clients protect against advanced
threats, fraud protection, identity and access management, and leading
application, data and infrastructure security capabilities.
IBM Watson
IBM Watson, a cognitive system that enables a new partnership between
people and computers that enhances, scales and accelerates human
expertise. IBM Watson Analytics brings intuitive visualization and
predictive analytics to every business user. IBM Watson Ecosystem
developers and partners can embed cognitive computing APIs
(application program interfaces) into their cloud-based applications
to deliver innovative Watson-powered retail industry solutions.
© Copyright IBM Corporation 2016
IBM Corporation
Sales and Distribution Group
Route 100
Somers, NY 10589
Produced in the United States of America
January 2016
IBM, the IBM logo, ibm.com, IBM Watson, Cognos,
PureData, InfoSphere, BigInsights, PureSystems, SPSS,
DB2, Informix, IMS, Global Technology Services, Global
Business Services, Power Systems, z Systems, Bluemix,
Emptoris, TRIRIGA, IBM Cloud Managed Services,
IBM MobileFirst, Cloudant, Tealeaf, QRadar, X-Force,
Guardium, SiteProtector, zSecure, Tivoli, AppScan,
POWER8, XIV, and Storwize are trademarks of IBM or
other companies. A current list of IBM trademarks is
available on the web at “Copyright and trademark
information” at ibm.com/legal/copytrade.shtml
Netezza is a trademark or registered trademark of IBM
International Group B.V., an IBM Company.
Sterling Commerce is a trademark or registered trademark
of IBM International Group B.V., an IBM Company.
Softlayer is a trademark or registered trademark of Softlayer,
Inc., an IBM Company.
Fiberlink and MaaS360 are trademarks or registered
trademarks of Fiberlink Communications Corporation,
an IBM Company.
Trusteer Apex is a trademark or registered trademark of
Trusteer, an IBM Company.
Kenexa is a trademark or registered trademark of Kenexa,
an IBM Company.
StrongLoop is a trademark or registered trademark of
StrongLoop, Inc., an IBM Company
This document is current as of the initial date of publication
and may be changed by IBM at any time. Not all offerings
are available in every country in which IBM operates.
The client examples cited are presented for illustrative purposes
only. Actual performance results may vary depending on
specific configurations and operating conditions.
THE INFORMATION IN THIS DOCUMENT IS PROVIDED
“AS IS” WITHOUT ANY WARRANTY, EXPRESS OR
IMPLIED, INCLUDING WITHOUT ANY WARRANTIES
OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE AND ANY WARRANTY OR CONDITION OF
NON- INFRINGEMENT. IBM products are warranted according
to the terms and conditions of the agreements under which
they are provided.
The client is responsible for ensuring compliance with laws
and regulations applicable to it. IBM does not provide
legal advice or represent or warrant that its services or
products will ensure that the client is in compliance with
any law or regulation.
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