Retail is changing fast. Customers are embracing digital and behaving in more complex and challenging ways. They are shopping everywhere and at any time. They research and compare. They want to make their own versions of the product. They want to know how things are made. Companies need to start tailoring people's retail experiences. Presented at Service Design Drinks Helsinki, 14.2.2015.

1. LEANSERVICECREATION
Tailored Retail
Futurice’s point of view
on Retail digital evolution

3. We create
digital services
for people to love.
Founded in 2000
200+ employees
from 18 countries

4. LEANSERVICECREATION
Lean
Service
Creation
LSC is a multi-disciplinary way of working
that maximizes the probability of creating
successful digital services

5. LEANSERVICECREATION
Futurice people

7. An introduction to Futurice, who we are
and how we work.
Welcome!
1. DIGITAL? Why should I care?
2. The Retail DIGITAL ECOSYSTEM
3. 10 TRENDS: their CHALLENGES & OPPORTUNITIES
4. Quick view on CONSUMERS
5. Physical and Mental EXPERIENCE JOURNEY
6. Retail SEGMENTS
7. Available TECH & TECH to Watch
8. Conclusion
LEANSERVICECREATION
Summary

8. Retail is changing fast.
Customers are embracing
digital and starting to behave
in more complex and
challenging ways.
They are shopping
everywhere and at any time.
They research and compare.
They want to make their own
versions of the product.
They want to know how
things are made.
1. Digital?
Why should
I care?

9. 2. Retail Digital
Ecosystem
Shopper
Internet browser:
Chrome
Internet Explorer
Safari
Engagement:
Loyalty program
In-Store offers
Online store offers
Gift cards
Customer behavior
UX cycle experience
Localization:
Cultural issues
Inventory
Transparency
Payment touch points:
In-store
Online store
Kiosks
Mobile payment
Social and sharing:
Family
Friends
Work
Social network
IoT:
Beacons
Kinect
Sensors
Mobile phones & tablet
platforms:
iOS
Android
Windows
Existing services
integration:
Internet banking
Mobile banking
E-commerce platform
Loyalty program
CRM system

10. 3. //10 TRENDS: their CHALLENGES & OPPORTUNITIES

11. 1. Mobile Confidence
2. Wearables go retail
3. Beyond sales / infotainment
4. Millennial consumers
5. Brand stories
6. Consumers become Creators
7. Going beyond the screen
8. Touch point immersion
9. Shared experiences
10. Brand interaction
10 TRENDS

12. TREND1
Mobile confidence

13. TREND1
Mobile confidence
Confidence in the usage of “mobile” is growing
Exploring what mobile is capable of
Buying and sharing experiences

14. Customers feel more and
more confident about the
usage of mobile
applications.
Retailers should explore
more mobile capabilities,
as buying and sharing
experiences.
Friends are becoming an
unintentional salespeople,
if they like something you
may like it too.
• 65% of the global population will have
a mobile phone by 2015. (Deloitte)
• 83% of internet usage will be through
handheld devices. (Deloitte)
• 30% of e-commerce transactions
globally will be done via mobile.
(Criteo)
• 53% of e-commerce transactions are
coming from smartphones, rather than
tablets. (Criteo)
• Facebook and Twitter added buy-it-
now buttons in 2014. Apple Pay
fingerprint recognition. In its first
month, the cash-free system
accounted for 50% of all tap-to-pay
transactions in McDonald’s in the US.
(New York Times)
Inventory transparency,
chain supply, logistics and
mobile experience design.
People are still concerned
about security and privacy,
so consider these issues is
important.
Customer data integration,
inventory data integration,
mobile e-commerce
services, social media
integration, mobile
payment applications.
Trend intro Facts about the trend Challenges Opportunities
Mobile confidence
Trend 1

15. TREND2
Wearables go retail
Source:
h*p://www.wired.com/2015/03/disney-­‐magicband/

16. TREND2
Wearables go retail
Experiences that go beyond the screen
Personalized, but also reflects more their identity
Open possibilities to collect and respond to customer info data
Knowing customer better is the key to shape more meaningful and
personalized experiences, physically or even digitally.

17. Customers are expecting
digital and personalized
experiences, which go
beyond the screen and
that reflects more their
identity.
Wearables will make
possible to retailers to
collect data, such as
location, personal info,
social network, previous
experiences, among other
kinds of data. By knowing
customers better, retailers
will shape more meaningful
and personalized
experiences, physically or
even digitally.
• Most consumers have heard of
wearable technology by now,
according to a new survey from Magid
Advisors. More than a quarter of the
2,500 mobile consumers surveyed said
they planned to buy a wearable
device within 2016.
• Omni-channel will be the key driver of
growth, but only 38% of senior
executives say Omni initiatives have a
positive impact on profit margins.
(Source: EY Global Media Relations)
Meaningful experiences.
Previous bad experiences
in Retail.
Consumer products and
retail companies struggling
to innovate .
In-door location, smart
lists, in-store digital
experience, loyalty
programs integrated to
on-demand data.
Trend intro Facts about the trend Challenges Opportunities
Wearables go retail
Trend 2

18. TREND3
Beyond sales
/ infotainment

19. TREND3
Beyond sales
/ infotainment
Consumers are buying the best experience.
Companies are teaching people how to use their products and services.
Digital TV is bringing a new generation of advertising models and
customer experiences.

20. Services are no longer
consumption oriented, but they
are consumer oriented and
consumers are buying the best
experience.
Companies are teaching
people how to use their
products and services. They
want users to have the best
experience with their products.
Companies like Apple, Google
and Amazon are getting into
the TV models they are also
bringing to companies the
possibility to brands sell
products inside a show rather
than around it (Futures
Laboratory).
• Buying will begin to live inside of
story experience, becoming a
natural, integral and shoppable
part of it.
• Companies like Google, Amazon,
Apple have their own TV channels
and new advertising models.
Android has open platform where
consumers can personalize their
experience.
Technology maturity, what
to do, how long it will take
to get digital right. Are the
retail company prepared
to the customer dialogue?
Meaningful experience, the
exactly moment where the
digital adds to the physical
experience. Finding the
right moment on the
customer journey.
Second screen cross
experiences. It’s time to
start considering how
retail will ride the next
wave of shoppable TV.
Services that help
customer to understand
your brand and help
retailers to understand
them.
Be involved with
customers daily life.
Be part or give the room to
the communities where
they are.
Trend intro Facts about the trend Challenges Opportunities
Beyond sales / infotainment
Trend 3

21. TREND4
Millennial
consumers

22. TREND4
Millennial
consumers
Millennial consumers are increasingly concerned about the brand ethics.
They care about how things are made and where they come from.
Technologically-savvy. Online experience integrated into in-store
experience.
They inform their choices. They read up and compare.
Tight budgets, cultured and up-to-date.

23. Millennials have distinct
relationships with each of their
devices. The amount of time is
less interesting than the role of
each device itself.
Their laptops act as a retail
portal and catalog, their
toolbox, information curator
and also their preferred device
for viewing TV shows.
Their tablets acts as a luxury
that falls somewhere in
between a downsized
entertainment center.
Their smartphones makes
them feel like they are on
steroids, have a fifth limb and
act as a fail-safe antidote to
FOMO (fear of missing out).
92.3% used a mobile phone in 2012,
among whom 63.2% used the mobile
web and slightly fewer used
smartphones. (emarketer.com)
Over half of twitter users are
millennials (16.6m in 2012).
Millennials can not be
defined by a single device.
Seamless multi-channel
experience.
Insatiable need to be
connected and continually
validated for their level of
“insider” status, millennials
are their own medium.
Addressing clearly your
ethics can help millennials
make the choice towards
your products.
Multichannel experiences
to complement in-store
experiences. Hand over’s
are crucial.
Trend intro Facts about the trend Challenges Opportunities
Millennial consumers
Trend 4

24. TREND5
Brand stories

25. TREND5
Brand stories
Brands tell their stories. They are storytelling about their heritage and their
brand.
They are opening the curtains to give insights to the way they
manufacture and the materials they use.
The brand story becomes part of the shopping experience.

26. Find a heritage moment
Behind the scenes /
Backstage.
People wants to see how things
are done, how they were
created.
Try to remind people moments
and things that they forgot
about. Find the story.
Controls the whole design
process.
People journey, one day in his/
her life. The everyday story.
Companies like Shinola, Dior and Mr
Porter are telling their brand stories,
about their heritage and their mission.
Content creation around how things
are produced. (e.g. Dior, Mr Porter)
Previous experiences with
the brand and product.
People are more and more
concerned with ethics.
Telling their brand stories
may need to answer to
some of those issues.
Believable transparency.
Drafting a brand story can
enhance the customer
engagement. Storytelling
approach can help
customers identify with
brand.
Content production
around the brand story
can enrich the products
and shopping experience.
Co-create brand story
with customers and build
up for future.
Trend intro Facts about the trend Challenges Opportunities
Brand stories
Trend 5

27. TREND6
Consumers
become Creators

28. TREND6
Consumers
become Creators
Customers are becoming the designers.
They will sell customized products to their friends and community.
Consumers will care more about what they can do or create.

29. Customers are becoming the
designers and the best design
will be perceived as the one
which will give the customer
the power of creation.
Consumers will not only buy
from you but also sell the
customized products to their
friends and community.
Consumers will care less about
what they have or buy and
more about what they can do
or create..
• 85% of the 2014 Best Global
Brands have used crowdsourcing
in the last 10 years. (eYeka)
• The Best Global Brands are three
times more likely to use
crowdsourcing platforms than
websites and social media for their
crowdsourcing efforts. (eYeka)
• There is a strong commercial case
for personalization - those who
are doing it report 14% uplift in
sales. (e-consultancy)
Privacy is a big thing when
you create customers
profile. Retailers need to
treat it very seriously.
Creepiness – avoid
services that jus add extra
work to customer, but
rather gives an amazing
and seamless experience.
Find the right blend
between customer
creation and professional
expertise.
Always needs to be part of
the brand strategy.
New ways and channels to
communicate with
customers.
Know from customers
what they want and how
much they are involved
with your brand.
Ideas about new services
and also how to get the old
ones improved.
Create a controlled
environment in which
creation happens
(ikeahackers, Bugatti, etc.)
Trend intro Facts about the trend Challenges Opportunities
Consumers become Creators
Trend 6

30. TREND7
Going beyond
the screen

31. TREND7
Going beyond
the screen
Technology enables extra dimensions to consumer choices.
Emotional conversion. Sense presence more than screen presence.
Collecting meaningful data that can be transformed in to seamless
actions.

32. Technology is the enabler to
people choices. Tech is part of
a bigger and holistic
experience.
Technology can bring
emotional elements that
involve customers.
Sense presence more than
screen presence. Technology
should bring customers
relevant content that help
them to make decisions.
Technology enables the
collection of meaningful data
that can be transformed in
personalized and seamless
actions
90% of respondents who recalled
reading online reviews claimed that
positive online reviews influenced
buying decisions, while 86% said
buying decisions were influenced by
negative online reviews. (Dimensional
Research)
When companies engage and
respond to customer service requests
over social media, those customers
end up spending 20% to 40% more
money with the company. (Bain &
Company)
92% of organizations that view
customer experience as a
differentiator offer multiple contact
channels (Deloitte)
Seamless digital
experience
Support / not a broken
computer in the store.
No integrated experience.
Customer sees something
online that they can’t find
in-store.
There is a screen, but
nobody interacts with it or
notices its presence.
Indoor location, hyper
location services, more
effective loyalty programs,
product info (i.e. QR and
RFID code), virtual reality,
wall projections.
Trend intro Facts about the trend Challenges Opportunities
Going beyond the screen
Trend 7

33. TREND8
The touch point
immersion

34. TREND8
The touch point
immersion
Extension of the customer journey.
Exploration of products in-store.
Planned purchases and get Social proof.
Customers seek a seamless shopping experience.

35. The customer journey doesn’t
start or stop in the store
experience.
Customers can anticipate their
buying process via smart lists,
online stores, etc.
They can explore products in-
store, search for better prices,
find location of products, look
for more information about the
product, etc.
Omni-channel provides
consumers with a seamless
shopping experience across
multiple platforms, including
online and in-store.
A customer’s journey—from first
hearing about a product to
purchasing it—involves a vast and
growing array of encounters with a
product or brand. Consumers “touch”
a brand an average of 56 times
between inspiration and transaction.
(Ed Thompson, Gartner, at the
Gartner Symposium ITxpo in Cannes,
200).
Number of touchpoints is growing due
to digital touchpoints such as blogs,
videos, reviews, etc. The development
of new and engaging touchpoint
opportunities is being accelerated by
technologies such as augmented
reality (AR), Near Field
Communication (NFC), IPTV, and
“SixthSense” technology
Finding the right moment
to go digital.
Controlling organic and
viral social reviews.
“Conducting the orchestra”
in a way that all elements
work well together,
unleashing their full
potential.
Living experiences, based
on customer choices.
Everything is a flux, nothing
is static.
Technology can bridge the
challenges with the
opportunities in the
extended customer
journey.
Trend intro Facts about the trend Challenges Opportunities
The touch point immersion
Trend8

36. TREND9
Shared experiences
(families, friends, etc.)

37. TREND9
Shared experiences
(families, friends, etc.)
Parents and children go shopping together.
Friends go shopping together.
Friends are taking a sales role with online shopping.
Digital can be more than sharing and recommending.

38. Retailers should rethink the
whole shopping experience by
adding also a shared
experience and kinds of
dialogue a family members or
friends could have with each
other when going through a
buying customer journey.
A shared experience will add
very important elements as
such how to entertain children
or how to create a shared
buying list with your friend,
among other interesting
customer needs.
The experience is more intense
when shared with another
person.
• Usually the shopping experience is
not a solitary experience.
• Market is lacking family services.
Companies usually look to
the individual customer
journey and other
members are considered
stakeholders. Sometimes
they are not even part of
the shopping experience.
Creation of services that
fulfill shared customer
experiences.
Trend intro Facts about the trend Challenges Opportunities
Shared experiences (families, friends, etc.)
Trend 9

39. TREND10
Brand interaction

40. TREND10
Brand interaction
Brands allow the customer to interact with them.
The way the interaction takes place and is perceived becomes a feature
of the brand identity itself.
Retailers make use of the digital interactions to add value to brand
communication and to get customer involved with their products and
services.

41. Brands provide the framework
which customers can freely
interact.
The way the interaction takes
place and is perceived
becomes a feature of the
brand identity itself.
Retailers make use of the
digital interactions to add value
to brand communication and
to get customer involved with
their products and services.
Differentiation and recognition
by the use of new or unusual
interaction modes
communicating the brand
identity.
Interaction branding as a new
emerging field in design.
Big brands such as Google, Coca-
Cola are already doing it.
Interaction shouldn’t only
be entertaining and
diverting but should be a
well planned and
strategically implemented
long-term solution.
Coherence across various
channels.
Rational, habitual and
emotional binding of the
customer to a brand.
Trend intro Facts about the trend Challenges Opportunities
Brand interaction
Trend 10

42. 4. //Quick view on CONSUMERS

43. Born 1946 - 1964
Baby boomers

44. Born 1946 - 1964
Baby boomers
• Many introduced a digital element into their shopping process
• Pre-purchase research online
• Most likely to buy products that align with their values and ethics
• Involved with some form of health and wellness
• The occasion, not life-style (habit, celebration, convenience)
• Willing to try new things

45. Born 1965 - 1978
Generation X

46. Born 1965 - 1978
Generation X
• They seek product information / Research online
• Review and rate products online
• They still respond quite well to other traditional ad-channels
• Loyal to brands that serve them well
• They appreciate a diverse range of styles

47. Born 1979 - 1999
Millennial

48. Born 1979 - 1999
Millennial
• Adapt rather quickly to social changes
• Informed shoppers who stick to tight budgets while still managing to stay up-to-
date and cultured
• Strive for goods that express their individuality
• They want to integrate online with in-store experience
• They are the most technologically savvy generation
• Social media platforms and applications are incorporated into their lifestyle and
define them digitally

49. Born from 2000 onwards
Generation
I, Me, One

50. Born from 2000 onwards
Generation
I, Me, One
• Reflects the burst of technology within the last decade
• Instant connection and constant isolation
• Generation I will drive themselves
• Enjoying the process the process of getting better

51. 5. //Physical and Mental EXPERIENCE JOURNEY

52. Physically
Before the visit > in-store >
Immediate post-visit activities >
Later activities

53. Mentally
Awareness > Expectation >
Inception > Introduction > Evaluation >
Engagement > Motivation > Conversion >
Fulfillment > Transition > Advocation

54. 6. //RETAIL SEGMENTS

55. Retail Segments
• Furniture & Home Furnishings Stores
• Building Material & Garden Equipment & Supplies Dealers
• Food & Beverage Stores
• Health & Personal Care Stores
• Clothing & Clothing Accessories Stores
• Recreation & Leisure Activities Stores
• General Merchandise Stores
• Electronics & Appliance Stores
• Specialty Retail Stores
• Motor Vehicles & Parts Dealers
• Non-Store Retailers / kiosks and Online Stores

56. 7. //AVAILABLE TECH & TECH TO WATCH

57. Ready tech & to watch
• Indoor navigation, location
• Beacons / hyper local solutions
• Kinect / body motion scanners
• Interactive tables & displays
• Mobile payment
• Automated stores (smart stores)
• NFC / RFID
• QR Codes
• Virtual Reality
• Projections 3D
• Apple payment / iwatch
• Smart watches

58. 8. //WRAP UP & CONCLUSION

59. Go mobile
Retailers should explore mobile
capabilities such as payments
and sharing experiences in
greater detail.

60. Go
wearables
Wearables will make it possible for
retailers to collect data such as
location, personal information, social
network, previous experiences and
more.

61. The
Creators
Customers are becoming
creators and the best design
is one that allows for
customer creation.

62. Add the
second
screen
All these companies are bringing
new advertising models and
customer experiences to
television. Be aware!

63. Enrichment
of the
customer
journey
Buying becomes a natural, integral
and shoppable part of the story
experience and the moment of
purchase.

64. //Thank you!

65. LEANSERVICECREATION
IMAGES
The White Company
The Walt Disney Company
Nike
Mr. Porter
Wikipedia
Google
Ibeacons
Loblaw
Sources
RETAIL NEWS
emarketer.com
Econsultancy.com
Fast Company
TRENDS
Trend Watching
The Futures Laboratory
Eyeka
Hubspot
Trendone

66. JANE VITA
Senior Service Creator
jane.vita@futurice.com
@janevita
MARIA KULSE
Senior Service Designer
maria.kulse@futurice.com
@mkulse