2. Retail
Industry
overview
Stores
Customer
Associates
Ecommerce
Mobile
Commerce
External
touch
points
Call
Center
Catalogs
Social
Commerce
3. Retail
Industry
business
environment
– Economic
outlook
• Slow
economic
growth
• high
levels
of
unemployment
impacJng
the
business
– Retail
industry
growth
• Key
Finding
:The
pressures
of
consumerizaJon
conJnue
to
disrupt
many
enterprises,
forcing
them
to
change
their
tradiJonal
business
processes
and
operaJonal
models.
• Need
for
focus
on
–
– PersonalizaJon
– Enhanced
customer
service
– Big
Data
– Digital
business
model
– Threats
to
profits
and
business
models
• LegislaJons
• High
spends
• PromoJons
and
discounts
eroding
profit
margins
4. Trends
and
predicJons
-‐
2014
• Omnichannel
as
the
norm
• Rise
of
the
mobile
wallet
• Personalized
in
store
experience
and
personalizaJon
online
• Highly
integrated
technology
in
brick
and
mortar
stores
• Rise
of
mobile
businesses
• Loyalty
and
beyond
–
reinvenJon
• RelaJonship
markeJng
to
drives
sales
and
markeJng
strategies
• Customers
need
for
speed
to
grow
further
in
2014
• Higher
investment
in
big
data
and
customer
analyJcs
• Privacy
concerns
to
rise
with
big
data
• Impact
of
social
media
on
product
decisions
• ConJnued
growth
in
emerging
markets
5. Technology
in
Retail
-‐
trends
• Disrup;ve
technology
and
transforma;on
– Empowering
consumers
and
changing
consumer
behavior
– Cloud
–
facilitates
Omnichannel
strategy
and
helps
retailers
manage
mulJple
channels
and
locaJons,
integrate
their
websites
with
business,
support
their
Point-‐of-‐Sale
(PoS)
systems,
provide
a
unified
real-‐Jme
view
of
business,
perform
automated
merchandising
and
markeJng,
and
gain
a
360-‐degree
view
of
each
customer.
– Data
and
analyJcs
–
value
add
by
customer
profiling
and
acquisiJon,
branding,
product
management
and
determining
pricing
decisions,
– Mobile
&
Social
media
-‐adverJsing,
product
and
pricing
comparisons,
promoJons,
coupons
– “On
Jme”
/
“Same
Day”
delivery
– Increased
spends
on
IT,
markeJng
and
adverJsing
to
spur
growth
• Surveys
state
retaining
exisJng
customers
and
adding
new
ones
will
be
key
drivers
of
revenue
growth
over
the
next
one-‐to-‐three
years.
And
while
increasing
customer
loyalty
and
the
share
of
a
customer’s
wallet
can
give
revenue
a
boost,
29
percent
also
predict
that
improving
economic
condiJons
will
bolster
revenue
growth.
• While
online
and
mobile
technologies
offer
consumers
convenience,
speed,
and
ease
of
use,
brick
and
mortar
stores
have
a
disJnct
advantage
–
face-‐to-‐face
personal
interacJon
between
the
consumer
and
the
associate
in
the
store.
Leading
companies
are
shrinking
square
footage
and
instead
allocaJng
investment
and
innovaJon
dollars
toward
brick
and
mortar
business
models
that
create
a
superior
shopping
“experience”
for
the
consumer.
7. Omnichannel
commerce
will
rule
the
future.
– Typical
example
:
Store
pick
up
• Order
placed
by
customer
• Backend
process
triggered
by
OMS
and
specific
store
inventory
validated,
a
flagged
response
is
available
based
on
web
only
categories
and
logic
built
in
based
on
the
thresh
hold
of
the
store
based
on
which
the
kill
switch
deacJvates
the
store
once
a
limit
is
reached
(
Item
level
and
order
level).
• Product
moved
to
store
pick
up
Kiosk
for
customer
to
collect
– Key
challenges
• Inaccurate
inventory
sync
• Oversell
• Difficult
to
idenJfy
categories
for
sale
staJsJcs
Banking
in
Retail
/
Store
Credit
cards
to
drive
sales
– Examples
:
• Loyalty
cards
• Gii
cards
• Store
value
cards
• Merchandise
cards
– Key
challenges
:
• Data
risk
and
fraud
• Customer
retenJon
8. Logis;cs
:
– A
key
winning
example
is
Amazon’s
year
round
2
day
delivery
for
$
70
,
where
the
retailer
has
an
influx
of
capital
at
the
beginning.
– Typical
examples
:
• LTL
with
white
glove
doorstep
• LTL
with
white
glove
installed
– Key
challenges
• Route
opJmizaJon
• Same
day
delivery
-‐
minimum
$
amount
order
for
profitability
(
High
impact
to
profitability)
Consumer
Packaged
Goods
:
– Pick
up
in
store
– Key
examples
:
• Frozen
goods
:
Meat
products
• Perishables
:
Nestle
chocolates,
grocery
– Key
challenges
:
• Low
shelf
life
,
frequent
replenishment
• Same
day
delivery
could
work
only
if
inventory
if
found
at
a
store
close
to
a
logisJcs
partner
/
Dark
stores
could
be
used
for
the
same.
• Lower
range
of
assortment
9. Retail
Industry
in
India
5th
largest
in
the
world,
sunrise
sector
with
high
growth
potenJal,
accounts
for
more
than
15%
of
country’s
GDP
– Emerging
Areas
Some
sectors
that
occupy
a
prominent
posiJon
with
the
retail
industry
are:
» Apparel
and
fashion
–Over
$20
billion
were
spent
on
online
apparel
shopping
in
2009
and
increasing
since
then.
» Fashion
&
Lifestyle
-‐
In
India
the
vast
middle
class
and
its
almost
untapped
retail
industry
are
the
key
anracJve
forces
for
global
retail
giants
wanJng
to
enter
into
newer
markets,
which
in
turn
will
help
the
retail
to
grow
faster.
» Food
&
Beverage
retail
-‐
Backed
by
huge
potenJal
and
changing
lifestyles,
the
food
and
beverage
retail
market
is
growing
at
a
robust
30-‐35
per
cent
per
year.
» PharmaceuJcal
Retail
–
Driven
by
therapies
like
anJ-‐diabeJc,
vitamin,
anJ-‐
infecJve
and
dermatology,
it
accounted
for
a
robust
15%
growth
» E-‐commerce
or
E-‐tailing
–
the
next
big
revoluJon
-‐
With
the
advent
of
e-‐commerce
in
the
retail
industry,
retail
stores
are
facing
sJff
compeJJon
from
e-‐stores.
The
rising
demand
for
e-‐shopping
has
lead
to
a
new
debate
cropping
up
in
the
world.
– Factors
driving
growth
are:
» Emergence
of
nuclear
families
» Falling
real
estate
prices
» Growing
trend
of
double-‐income
households
» Increase
in
disposable
income
and
customer
aspiraJon
» Increase
in
expenditure
for
luxury
items
» Large
working
populaJon
» Low
share
of
organized
retailing
» Growing
liberalizaJon
of
the
FDI
policy
in
the
past
decade
