Barriers to Retail Growth - And How To Remove Them

Barriers to
Retail Growth
And how to overcome them
Dick Baynham & Sarah Mitchell - April 2013

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Copyright © SignIQ Pty Ltd - April 2013

Foreword Page 2

The retail industry has never been as dynamic or competitive.

Operational complexities cause many retailers to unwittingly
weaken their own marketing departments and degrade their
customers’ experience – resulting in a failure to maximise the
potential return from each shopper visit.

Yet there is ample evidence that marketers can use retail
ticketing to gain tighter control of in-store promotions and:

• Increase sales on each shopper visit
• Differentiate the customer experience
• Deliver a powerful competitive advantage

This paper explores the barriers preventing this from happening
and explains how the simple outsourced service provided by our
company is turning this situation around by assisting retailers to
set new standards of excellence.
Edward Breese CEO SignIQ

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Introduction Page 3

Retailers have never been more under threat or better In this report we show how this situation has been turned
positioned to achieve sustainable sales growth. on its head, enabling retailers of all sizes to begin tapping
into the data that matters most.
Advances in technology enable companies to process vast
amounts of data and transform it into operational insights on a This is done by placing an additional window into the IT
previously unattainable scale, yet most businesses have been wall, allowing marketers to communicate directly with
unable to capitalise on this opportunity. Why? stores and shoppers in real time at the shelf’s edge.

Part of the reason is because technology keeps changing. The Is this ‘big data’ revisited? No, this is an easy to use service
volume of facts and figures is so large many businesses struggle coming at the issue from an entirely different perspective. The
to process the data passing through their systems. The vision of information flow is simplified and made accountable in real time
enabling marketers to mine this information has remained largely for the sole purpose of ensuring marketing departments have
unfulfilled for the majority of retailers. direct control of the product information on retail tickets.

While a few exceptional companies are obtaining key insights However, it is what can be done once marketing has control of
after developing world-class intergrated systems, most retailers ticketing that makes this service so unique. It enables retailers
are sceptical of ever seeing ‘big data’ provide down-to-earth to test offers in real time and build a bank of knowledge to assist in
benefits that add real value to their business. differentiating their brand and competing at a higher level.

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A Complex Problem Page 4

Only someone who has been heavily involved in retailing for a
The Promotional Collaboration Survey, a research project lengthy period can appreciate the multi-layered tasks involved
sponsored by IBM Smarter Commerce & Booz Allen Hamilton, in designing a mass marketing delivery system capable of
repeatedly cites problems with data as a major barrier to competing in today’s offline and online environment.
collaboration between retailers and manufacturers, including:
Whatever category of retail you operate in, the realities of
• 42% - Systems can’t talk with one another, so the data purchasing, distributing and keeping track of inventory and
can’t be shared transactions are a complicated and never-ending challenge.

• 50% - Systems have inadequate tools to work with data It is all too easy to depersonalise the shopper experience by
inadvertently treating customers as numbers and manufacturers
• 50% - Systems are under-resourced to utilise the growing
as suppliers of commodities. New advances in ticketing
sources of data
technology provide an opportunity to avoid this problem.
• 67% - Data is not made available on a timely basis
So as IT departments juggle ever changing systems, how
• 75% - Data lacks consistency in hierarchies, formats, can marketers access the information within their control to
attributes, etc. better influence their shoppers’ buying decisions?

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A Simple Solution Page 5

In order for marketers to access the information they need However it is becoming critical for all retailers to find a solution
they must remove the complexity, but there are difficulties to that empowers their marketers to communicate directly with
overcome in order to achieve this. shoppers through their ticketing in real time.

As retailers compete on the cutting edge of technology on a ‘Today the in-store decision rate has reached an
continual basis, most have been forced to keep adapting their all-time high of 76%. Shoppers are specifically planning
existing systems to accommodate new advances. less and deciding more at the shelf - suggesting today’s
shopper is more flexible than ever.’
Consequently few businesses use the same combination of
POPAI – 2012 Shopper Engagement Study, Topline Report
hardware and software. This situation is made worse because
the formats used to store data in different parts of the system The fact that a few larger retailers have invested so much is
are often inconsistent or incompatible. indicative of the universal truth that all retailers are governed by -
the customer must always come first.
Over time this practise can build an invisible barrier of gigantic
proportions that places customers on one side and marketing If retailers don’t place the information in front of the right
people on the other. people, in the right place, at the right time - everything
else is irrelevant.
A few companies have met this challenge, but they are the
exception rather than the rule and the costs have been high.

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Ticketing is the starting point Page 6

To appreciate how marketers can reassert their influence it is vital As marketing departments gain control and fine-tune these
to understand the role ticketing plays at the heart of retailing. levers, they can persuade more people to buy more often –
and they can also increase the value of each shopper visit.
The complexities of distribution are designed to process goods
in the minimum time frame to produce a ‘just in time’ result and
The Nielsen Global Survey of New Product Purchase
maximise the return on investment.
Sentiment lists the three major reasons shoppers are likely
The longer it takes to get products through the distribution chain, to purchase as being:
the more capital is required and the less profit is made.
• 81% - Friends/Family told me about it
While other areas of retailing have been streamlined in • 73% - Saw it in store
recent years, ticketing has largely been forgotten because • 71% - Active Internet search
it is literally the last thing that happens. Any retailer seeking to become or remain a market leader
As a result, ticketing is seen as a low priority - an operational needs a strategy that responds to each of those challenges so
necessity rather than a strategic opportunity. It has fallen to sales they can:
staff to bridge the gap by spending hours ensuring promotional • Generate referrals
signage and ticketing is current, which takes them away from their • Maximise every advantage through merchandising and ticketing
primary function of serving customers. • Mobilise online offers to match and align with the quality of
in-store marketing
The slow nature of traditional ticketing in a fast-paced industry
contributes to increased costs caused by inefficient marketing Note: These statistics combine people defined as ‘Much More
processes, operational store issues and compliance violations. Likely’ or ‘Somewhat More Likely’ to purchase products.
It is also responsible for lowering staff morale.

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The rationale for an outsourced service Page 7

The issues surrounding IT systems is an area of risk that often • No implementation costs
carries a huge price tag to resolve. • No consulting fee for IT services
SignIQ has moved to reduce both the risk and the cost by • No software to develop, maintain or license
providing a specialised service that focuses on combining • No hardware / peripherals to buy, except a printer at each store
both the ‘operational’ and ‘strategic’ benefits of having a • No additional services or staff training costs to pay for
fully coordinated and simplified retail ticketing service. • No charges for designing templates

Within a month of partnering with SignIQ store managers and / or • Expert management of your ticketing processes
franchisees feel the benefit of greater flexibility and having more • Future proof ticketing, driven by industry best practice
time to spend getting ‘closer to customers’. • Freeing up valuable time in IT and marketing departments
• Empowerment of marketing to fully control, monitor and
These savings are further magnified at head office where
ticketing templates can be changed in minutes and sent to all manage ticketing across the entire network in real time
stores at the press of a button. • Optional capacity to enable individual stores to create fully
compliant, high quality, ad-hoc ticketing
The immediate advantages of outsourcing your ticketing
services to SignIQ are many.
Continues...

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The rationale for an outsourced service Page 8

The long-term advantages of partnering with us however are
even more important than the immediate benefits.

SignIQ tailors its services for each client. The more
marketing departments adapt our reporting systems,
the more they are able to differentiate their customer
experience and maximise every shopper visit.

Every service we provide is included in one low monthly cost.
While there are minor variables depending on the level of
involvement you may want us to have in refining your reporting
systems, we know we can deliver our service for…

…the cost of one cup of coffee, per store, per day.

This is the why SignIQ is now operational in over 6,000 stores
across Australia and New Zealand.

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How our service works Page 9

As the illustration on the next page shows, SignIQ has the By adding an extra layer of data connected to your
capacity to plug into your system without interrupting the data store’s ticketing, we place your marketing department’s
flow or compromising enterprise data security. finger directly on the pulse of your business.

There is no special hardware or software required at either Management knows immediately which stores have printed the
head office or store level. current promotional ticketing and which stores haven’t. There
is an instant flag raised, highlighting compliance levels at every
All you will ever need at the store level is a suitable printer, a
store in real time across your entire group.
workstation and a good internet connection.
This service alone can save hundreds of thousands of dollars
Once everything is in place, your marketing department has
a year. Again this only scratches the surface in terms of the
direct and ongoing access to our expertise and systems. They
competitive advantage that occurs once your marketing
can immediately cut the time frame for putting tickets into your
department is placed in control of your ticketing.
stores from weeks or days to hours and minutes.
As retailers realise the critical role ticketing plays within their
If you currently use a centralised ticketing system, SignIQ can
marketing mix, they are able to improve the quality of their
save you a small fortune in wasted print costs, as well as time.
decision-making and generate a favourable impact on their
We stress once again this is not the main benefit.
company’s bottom line.
The real competitive advantages lies in the simplicity of
the information we add to the reporting tools sitting on
the back-end of your Head Office systems. Continues...

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How our service works Page 10

Improving the proposition
STORE HEAD OFFICE
What do
Ticket > Decision > Purchase POS
I buy? HOS
Systems
BOS ONL
Systems
TKT MGT INV

STORE SYSTEMS
POS Point Of Sale PUR Reporting Tools
BOS Back Office SignIQ
HEAD OFFICE SYSTEMS
HOS Head Office
MER
ONL Online Store
INV Inventory
PUR Purchasing Analytics ERP
MER Merchandising Key Insights What do
ERP Enterprise Resource Planning
SignIQ we offer?
SIGNIQ SYSTEMS
TKT SignIQ Ticketing
MGT SignIQ Management SignIQ
Improving the process
SignIQ provides in-store ticketing and delivers personalised marketing reports to assist retailers to grow.

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The process of personalisation Page 11

The point of retailing is to develop an experience differentiating The range of potential offers your marketing department can
your business from any other to the extent you establish greater test is limitless and it is easy to begin that process as soon as
trust and build a reputation. the SignIQ service is implemented.

However, in order to build that trust and protect your reputation, Your marketing department can review your inventory and
you need access to processes that enable you to constantly test choose to up-sell, cross-sell or develop different product
and measure your marketing efforts against shopper’s actions. combinations – but they can only do this if they have all the
necessary information and can produce tickets in real time.
This is how each business develops a unique personality
and becomes a brand. If marketing is not testing and measuring results in real time,
they are not learning from experience or adding to your bank
Without developing a formal process to test and measure your
of knowledge. They are simply rolling the dice and going on gut
marketing effort against the action of your shoppers, the words
feel. Which is what we mean when we say…
‘continuous improvement’ amount to little more than lip service.
Improving the process - improves the proposition
How can you do this? You do it by seeing what happens when
you place a specific product in a specific place, on a specific Improving the proposition - improves the process
day, with a specific offer attached to it. Gut feel is fine for a single store retailer that survives by ducking
The offer might be a variation on ‘buy one get one free’, but it and diving, but it’s not a viable strategy for a multi-store chain
might also be as basic as moving an item from one place on that plans to grow its brand on a sustainable basis.
your plan-o-gram to another or changing the size of a ticket. Continues...

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The process of personalisation Page 12

The SignIQ service is intended to assist our clients to gain a
better balance between a potentially ‘vicious cycle’ - based
purely on driving down prices and commoditising the shopper
experience - and a potentially ‘virtuous cycle’ - based on adding
value and enhancing the shopper experience.

The subtle distinctions between those two extremes are what
will eventually determine where your brand is positioned - and
how successful and profitable it will be.

At SignIQ we offer a simple and intelligent system for assisting
retailers to use their ticketing to refine and improve their position
in the marketplace.

The more you use this feedback loop, the more it helps to
develop a differentiated and sustainable business.

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Contact Page 13

For more information on SignIQ and how we can assist in
personalising your ticketing process please contact...

Peter Kennedy
GM Business Development | SignIQ

T: +61 3 9028 0385 | M: +61 417 030 031
E: peterk@signiq.com | W : signiq.com
About the authors
Dick Baynham is an award winning Copywriter and Creative
Director who used to run his own advertising agency. He is now
focused on turning business into brands and he sees ticketing as
a critically important part of that process for retailers.

M: +61 4333 08000 | E: dickb@signiq.com | W: signiq.com

Sarah Mitchell is a highly experienced Content Manager.
She hails from Michigan, lives in Fremantle, has many years
experience in the software industry and is the Australian editor of
CCO, the magazine of the Content Marketing Institute.

M: +61 410 024 404 | E: sarahm@signiq.com | W: signiq.com

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Barriers to Retail Growth - And How To Remove Them

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