marketing: what is your technology strategy? what is your technology strategy? jo žek gruškovnjak...
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Cisco Confidential Cisco IBSG © 2011 Cisco and/or its affiliates. All rights reserved. Internet Business Solutions Group 1
Marketing: What Is Your Technology Strategy?
Jožek Gruškovnjak Director, Emerging Markets Practice Internet Business Solutions Group (IBSG)
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Why the Transistor is to Blame for Elvis, The Beatles, and Justin Bieber…
Source: Cisco IBSG, 2011; Wikipedia, 2011; YouTube, May 27, 2011
First Apple iPod: 1,000 songs “in your pocket” for
$400
Mobility Leads to Personal Independence
Teens listen to music almost anywhere
Moore’s Law Drives Down Prices
Regency TR-1 4 transistors
1954 Teens can afford their own radios
Rock’ n’ roll explosion
First transistor
The most downloaded
human on earth
741.3M: views of “Baby”* 5,289 years spent watching
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Source: The Economist, 2010
Time to Reach an Audience of 50 Million
0 10 20 50 Years 30 40
38 years
1 year
2 years
What’s next?
15 years
4 years
The Ever Increasing Pace of Innovation
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Inflection Points and Market Transitions 1
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Evolutions. Revolutions. Inflection Intersections.
Social Media
§ 687,000 Facebook members in Slovenia – 34% of the population (May 2011)
§ Average time per month spent on Facebook è 8 hours as per October 2011 1.42M internet users, Slovenia
71% of the total population 66% use internet at lease once a week
Source: Digital Strategy Consulting, January 2010; Socialbaker, May 2012; Nielsen, 2009; Internet World Statistics, April 2012
Ubiquitous Internet
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Evolutions. Revolutions. Inflection Intersections.
§ 27.6% of online Slovenians own a smart phone
The Smart Phone
Source: GfK, 2011; Digital Marketing Lab, Oct 2010; Online Marketing Trends, March 2011; InSites Consulting. (eMarketer, May 2010)
§ 47.8% of online population have bought products or services over internet
≈ 75% in the U.S., Germany, France
§ ≈ 5% of the total retail sales § Steady growth in EU at ≈ 8% p.a.
E-Commerce
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The Internet Is Invading Stores: Showrooms for Amazon?
iPhone users do… § 4.3 times more web search § 4.1 times more social
networking § 3.2 times more instant
messaging …than average mobile users
Morgan Stanley estimate:
§ By 2014, there will be more mobile Internet users than desktop Internet users
Location-Based
Desktop Internet Barcode + Camera + Web Access + GPS = Lowest price, closest location
§ ShopSavvy: 7 million users, 20 million SKUs
Invasion by Internet
48% of smartphone owners have shopped using a mobile device
§ 40% compare pricing in stores
§ 28% have purchased
Sources: Morgan Stanley, April 2010; ShopSavvy, January 2011; comScore, February 2011; In-Stat, November 2010
Smartphones: 30% of all phones 2011 46% of all phones 2015
Mobile Internet
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Online Touchpoints Have Already Had a Major Impact on the Shopping Journey
Source: Cisco IBSG, 2010
The Shopping Journey for Buying a Camera…
Touchpoints before, during, and after the transaction
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Print in digital format. Text. Photos. Audio. Video. Together. Movable type.
Johannes Gutenberg
1439 2007 2010
Inflection Point: A Rule-Breaking Gutenberg Moment.
Inflection Point Incremental Improvement Inflection Point
Source: Cisco IBSG, 2011
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IPTV: The iPad for Your Wall
Source: Cisco IBSG, 2011
Late 1920s
Broadcast TV Satellite / Cable TV Internet TV
1970s 2010
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Augmented Reality: A New Way to See
Ikea’s Augmented
Reality Mobile Phone
Application
DIESEL Magic Mirror
L’Oreal Virtual Mirror
Sources: IKEA 2009; L’Oreal, 2010; Encyclopedia.com, 2011
Mashing Up the Physical and Virtual Worlds
Microvision & Nokia:
see-through color
eyewear & mobile phone
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Mobile Payments: The Digital Wallet Becomes a Reality
§ Mobile cashless payment system § Supports Nokia, Samsung, LG,
Motorola, Android, iPhone § Current trials in 32 countries
including Europe, North America, China, India, South Asia, Japan, Latin America, and Middle East
Tap and Go § Range: 1.5 inches or less § No Bluetooth “pairing” § Connects in 1/10th of a second Now § Card emulation (like a contactless card) § RFID reads § Device-to-device Tomorrow § Mobile payments § Mobile ticketing § Smart posters § Electronics
Example: ePort Connect
Source: USA Technologies, 2011
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What It All Means 2
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Implication 1: Exceed New Consumer Expectations Stores of the Future Must Exceed the Experience Expectations of Internet-Shaped Consumers
§ Finding: Thousands of
responses
§ Control: Time-shifted
§ Abundance: Endless availability / selection
§ Speed: In a broadband
instant
§ Transparency: All relevant
knowledge accessible
§ Community: Peer advice
most important
§ Interaction: Equal parts
consumer / creator
Source: Grownup Digital, 2008; Cisco IBSG, 2011
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The Six-Screen Life: High-Value Square Footage Now Measured in Centimeters
1. Mobile 2. Home 3. Computing
6. Dashboard 5. Public 4. Media
§ SMS § M-commerce § Social media § Location
§ IPTV § Home TelePresence
§ E-commerce § Chat / blogs § Social media
§ Rich media communication
§ E-commerce § Social media
§ Rich media communication
§ Location-based
§ Recommenda-tions
Source: Cisco IBSG, 2011
Implication 2: Utilize the Most Valuable Real Estate in Retail
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Implication 3: Create the Omni-Channel Future
Source: Retail Systems Research, 2011
Disparate Channels
Stor
e E-
Com
mer
ce
M-C
omm
erce
§ Single source of customer “truth” § Data anytime, anywhere, any device § Any SKU, any site
Data § Product § Inventory § Customer
Function § Merch. § Operations § Fulfillment
Data § Product § Inventory § Customer
Function § Merch. § Operations § Fulfillment
Data § Product § Inventory § Customer
Function § Merch. § Operations § Fulfillment
Data § Product § Inventory § Customer
Function § Merch. § Operations § Fulfillment
Retailer Brand
Omni-channel Shoppers
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§ Consumers using more technology to help shop
§ Tested hypotheses about the future of shopping
§ Survey goals:
– Understand how / why consumers use technology
– Learn how technology is shaping consumers’ behavior / expectations
– Test delivery of technology-enabled shopping experiences that empower customers
Why Cisco Conducted the “My Shopping, My Way” Shopper Survey
Source: Cisco IBSG, 2010
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Common top reasons for using technology in shopping
Top Reasons Consumers Use Technology for Shopping
1. Find lowest price: 63%
2. Save time: 47%
3. Find best selection: 26% Find best-quality product: 25%
Source: Cisco IBSG Research & Economics Practice, 2010. Note: U.S. respondents.
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Sample Size = 1,000 U.S. consumers
Which of the following are the three most important sources of information that you use to help make buying decisions?
Friends / Family
40%
50%
60%
0
Technology Is Reshaping How Shoppers Make Buying Decisions…
30%
20%
10%
60%
29% 29% 27% 24% 23%
Online reviews more important than in-store employees,
traditional media, and social networking
21% 19% 14%
11% 10%
Online professional
reviews
Data on mfg. sites
In-store product displays
Online reviews (store-based retailer sites)
In-store employees
Print Customer reviews
on blogs, message
boards
Customer reviews on
social networks
TV Customer reviews (online-
only retailer sites)
Source: Cisco IBSG Research & Economics Practice, 2010
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What is your experience with using each of the following technologies to look for product or pricing information before you purchase?
Sample Size = 1,000 U.S. consumers
50%
70%
90%
0
30%
20%
10%
85% 80% 76%
45%
35% 27%
43%
23%
12%
80%
40%
60%
…And How They Access Information
36%
20%
9%
Percent of U.S. respondents who “regularly use” or “have tried it”
PC at home Kiosk / touch screen in store
Mobile device in store Mobile device at home Gen Y (18–29) Gen X (30–49) Boomers / Silvers
(50+) Source: Cisco IBSG Research & Economics Practice, 2010
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+ = “Mashop” Physical (stores) Virtual (web)
§ Physical availability
§ See, touch, smell
§ Try it, use it
§ Human interaction
§ Peer reviews / ratings
§ Feature and functionality comparisons
§ Price comparisons
§ Detailed product information, specifications, videos
§ Recommendations
Combined physical /
virtual experience
Source: Cisco IBSG, 2011
“Mashops” Combine Physical and Virtual Retailing
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Personalized product offers
Shelf-edge access to deep, net-like knowledge
Virtual expert adviser
Multi-touchpoint social media customer care
One-click mobile payments
Sources: Cisco IBSG, 2011
Best Buy Connected Store
John Lewis (UK)
Home Improvement Retailer
Sources: Best Buy, 2010; John Lewis, 2010; Cisco IBSG, 2011
Leading Retailers Testing Mashops Ideas in Test or Development
Mashop Experiences Empower Shoppers in Your Store
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All This Is Not Limited to Retail…
Example: Financial Services
§ Remote service assistance (high end video)
§ Remote purchase and payment
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The Internet Invades the
Store
Shopping Comes to the
Internet
Source: Cisco IBSG, January 2011
E-Commerce
Mobile & Social Amazon, b. 1994 → eBay, b. 1994 →
Facebook, b. 2004 → YouTube, b. 2005 → iPhone, b. 2007 →
Mashops Now →
1
2
Best of Both, Together: Store and
Internet
3
Implication 4: “Mashops” Around the Corner
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Summary Thoughts 3
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The Number of Retail Touchpoints has Multiplied Significantly
Source: Cisco IBSG, 2010
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Marketing (& Sales): The Critical Interface Between The Customers And The Company
Research & Development
Design (products, services,
processes)
Production Marketing & Sales Distribution Customer
Service
Customers
Needs, requirements,
value perception, …
Sources: Value Chain Reference Model, Value Chain Group; Competitive Advantage, Michael Porter
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Implications as We Look Ahead: Strategies for Success
Technology Is Retailer’s Problem. 1 Technology Essential. Technology a Differentiator.
Multi-Channel. Separate channels, prices, product delivery, and internal compensation.
2 Omni Channel Anywhere, Anytime shopping, driven by the consumer.
Differentiate on Price-Product-Location. The recipe for past success 3 Differentiate via Customer Experience
Unique to your brand promise, regardless of price point
Smartphone Apps. 4 Technology Strategy. Multi-screen, interactive, integrated with retail..
Traffic. Invest to boost traffic. 5 Conversion and attach.
Invest to win traffic, boost baskets.
P A S T S U C C E S S T O M M O R O W ‘ S S T R A T E G Y
Sources: Cisco IBSG, 2011 The Economist, 2009.
Print Ads, Sunday Circulars Go where the eyeballs are. 6 Internet, Mobility, Social Networking, Video
Go where the eyeballs are.
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So, What IS Your Technology Strategy for Marketing (and Sales)?
Social Networks E-Commerce M-Commerce
Advanced Experiences
…