rsr’s post-nrf big show debrief · rsr’s post-nrf big show debrief february 2014 what we saw,...

RSR’s Post-NRF Big Show Debrief

FEBRUARY 2014

What We Saw, What it Means #RSRNRF14

About RSR Founded in 2007 to quickly become the leading source of insights for trends

in retail technology, and retail in general

Mission: To elevate the conversation about retail technology to a strategic level within the retail enterprise by:

•  Providing objective, pragmatic advice to both retailers and solution providers

•  Leveraging our extensive retail industry experience (75+ years)

•  Providing a deep bed of research into retailers' technology investment plans and the business opportunities and challenges that drive those investments.

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Today •  What Did We See At NRF’s Big Show?

•  3 Major Themes:

•  The Store •  Business Intelligence & Analytics •  Omni-Channel (channel-less) Execution

•  Cool New Technologies

•  Wandering the Show Floor •  Sessions

•  Q&A: Submit Questions at Any Time via the Webinar Panel •  Any questions we don’t get to during today’s call will be followed

up via email •  This is a flyover: happy to engage in further conversations as a

result of any of today’s topics – contact information at end of presentation

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We are recording today’s presentation– all registrants will receive a link when it is ready to watch on demand

Overall

WHETHER YOU WERE THERE OR NOT…

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Hard to Believe: An Even Bigger Show

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Photos courtesy NRF.org

How Big Was It?

•  More than 27,000 attendees

•  200,000 square feet of Expo space (multi-level)

•  More than 550 booths, with a waiting list for more

•  10 Expo stages

•  A dizzying array of banners, signs and ads

•  Strong sessions, well attended

•  Logistical improvements

•  Even faster registration •  More buses

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The Store

RE-EMERGING FROM THE FOG

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The Store Is Alive and Kicking

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7%

50%

21%

43%

29%

36%

17%

20%

14%

26%

40%

63%

10%

10%

14%

24%

66%

76%

We plan to open larger stores in the future

We plan to close stores in the near future

We do not plan to open new stores in the near future

We plan to open smaller stores in the future

We plan to open new stores in new geographies

We plan to continue to open new stores in our existing geographies

Store Growth Plans Winners Average Laggards

“Winners plan to open new stores – not only in the geographies where they’ve already had success, buy also in new markets around the globe.

They view stores as a vital component to their overall brand offering.”

Source: RSR Research, May 2013 Bigger is not better

…but smaller not right either

The Tech-enabled Store

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18%

24%

6%

24%

11%

37%

48%

41%

6%

16%

38%

49%

Future retail growth will come primarily from digital channels, not stores

Our current store technology will not be capable of enabling our future store shopping experience

Our store results will continue to erode unless we find a way to incorporate technology as part of the

store experience

In-store technology helps stores compete with the online experience

"Strongly Agree" Winners Average Laggards

Source: RSR Research, May 2013

Only Laggards missing the value of in-store technologies in contributing to the customer experience

With this data as context…..

Getting Wireless To The Store…

10 4G/LTE: a viable alternative to broadband as a valid and secure wifi solution

Simple Solutions Can Make a Big Difference

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Allowing digital signage to be projected onto curved surfaces

When the Store is Supposed to Look Like This..

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1

2

3 4

5 6

8 7

How do we create a consistent experience across all stores?

New Tools Needed to Track Compliance

13 Unefi – validating in-store digital asset compliance with technology

The Last Low-hanging Fruit

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Several vendors in the space. Success stories are really strong. Basically free money.

The Store as Part of the Supply Chain….

15 “Flexible fulfillment” aptly named. But rules get more complicated.

Key Takeaways

•  The store is alive and kicking

•  Create a differentiated yet consistent customer experience in store

•  Technology recognized as key by winners •  Knowledgeable employees and self-service alternatives

•  Wi-fi a linchpin of customer engagement

•  Consider implications of store as a node in the supply chain

•  Don’t forget low-hanging fruit

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BI & Analytics Moves To The Front “INFORMATION WILL BE YOUR BASIS OF COMPETITIVE ADVANTAGE” GINNI ROMETTY, IBM CEO

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Our Recent Research: Opportunity Knocks Across the Enterprise

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10% 50%

40%

5% 53%

42%

47% 26% 26%

21% 42%

37%

16% 63%

21%

13% 63%

10%

21% 69%

10%

52% 40%

8%

26% 53%

21%

19% 66%

15%

Primarily Data Oriented Data + Experience/Intuition

MARKETING: Primarily Experience/Intuition


MERCHANDISING: Primarily Experience/Intuition


SUPPLY CHAIN: Primarily Experience/Intuition


STORE OPNS: Primarily Experience/Intuition


PRODUCT DEV: Primarily Experience/Intuition

How Decisions Are Made Laggards Retail Winners

Source: RSR Research, January 2014

Winners consistently put more emphasis on making decisions using experience/intuition AND data, particularly when it comes to operational

functions dealing with supply and demand

NRF 2014 Focus: Customer-Centered Intelligence

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IBM’s Focus: 360° View Of The Customer… •  “Customer Intelligence Appliance” & Aginity

•  “Segments of One” Demo

•  Natural language processing example: North Face

•  Announcement of the “Watson Group”


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SAP Had “Vehicles” In Mind… •  “Big Data” Bus (HANA) •  CAR demo: consumer transaction data used to

segment customers and identify target groups for an upcoming promotion (end to end flow of how consumer insights drive business decisions)

SAS Was All About Empowering the CMO •  Harry & David – using Business Analytics to:

•  “Prioritize strategic planning with the customer's viewpoint in mind”

•  “Develop meaningful customer relationships through segmentation”

•  “Measure the effectiveness of efforts over time” Paul Lazorisak, Vice President of Customer Marketing , Harry & David


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Manthan’s Message: “Analyze, Decide, Do” – Using Insights from BI & Analytics to optimize merchandising, pricing, promo, and store operations •  ARC TargetOne Demo

•  Targeting and personalization of customer communication •  BIG IDEAS Session: “ The Power Of Do -

Analytics Driven Assortment & Price-Tuning” – with Atul Jalan, CEO “Retailers have to adapt to new kind of musical tune – So-Lo-MO-ME (Social + Local+ Mobile + Personalized)... The idea of perfect price within a category - one that makes perfect sense on the shelf, no matter which customer is looking at it and where the store maybe located is fading.”

Tee Up For NRF 2015? Physical/Digital Convergence For Shopper Behavioral Analysis

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Key Takeaways Retailers are tracking consumers’ digital “paths to purchase”, and are exploring how to put value into their hands in-context;

Data management technologies are available now that enable companies to store vast amounts of both transactional and unstructured data, search that data, and analyze it in real-time

“Operational-izing” the results of data analysis by injecting insights into work processes (using visual presentation & mobile technologies) enables retailers to impact the outcome of events while they are happening.

Technologies are available now to analyze “the last mile” of consumers’ paths to purchase in the physical store. This is both a big opportunity and a potential issue.

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Omni-Channel Execution GETTING REAL, GETTING TACTICAL

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Big Shift from Strategy to Execution

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20%

21%

28%

35%

40%

45%

66%

Leverage customer knowledge and information assets across channels

Use the digital channels to build a sense of “community” around our Brand

Use the digital channels to drive traffic to stores

Allow inventory allocated for one channel to be used for another channel's fulfillment

Create a single brand identity across channels

Improve operational execution across all channels

Allow the customer to purchase, take delivery, or return a product through the channels of their choice

Top Three (3) Opportunities to Create Improved Customer Satisfaction Across Channels?

RSR Research, June 2013

Leads to a Big Problem: The Current Catch-22

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Insights: In-Store Analytics

I counted 40 vendors that advertised some type of in-store customer tracking on the EXPO floor.

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http://openlab.com.au/retailers-tracking-customers/

In-Store Analytics: A Warning

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http://img.wallpaperstock.net:81/lightning-pink-wallpapers_4122_1280x800.jpg

Action: Local Execution

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Momentfeed: http://momentfeed.com

A Trust Factor

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Action: Connecting Store Expertise

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Theatro: http://www.theatro.com

Mobile Unleashed

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Key Takeaways

•  Always be respectful of the customer

•  Focus on solving her problems or making her life easier

•  Not on giving her more offers •  Don’t wait for someone else to “figure out” privacy

•  Leverage strength in “local”

•  Moving to tactics does mean some of the unsexy integration dirty work that needs to be done

•  But it by no means is an end to the innovation cycle in technology – in fact, that cycle is just beginning

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New Kids On The Block

WHAT’S NEW AND DIFFERENT

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Vendors Include •  Powa - Forbes: “Could eat Amazon’s lunch.” $76M in private investor

funding (CEO Wagner $20M own money before looking for investors). Currently in pilot at Walmart.

•  Mad Mobile: Build optimized sites and apps for phones, tablets. Payless Shoes is their flagship client.

•  Euclid: Tracks customer phones to know walkbys, window shoppers, capture rate, in-store movement. Focus on QSR & Department Stores

•  Plum Slice: Former RH and NM people, product design collaboration solution. 8 current pilots in India right now, all major GMA retailers

•  Capillary: All kinds of customer engagement, but their social connect product grabs people’s preferential data from FB, Twitter

•  Mozu: Volusion takes their platform for little guys up market, demo was impressive

•  Happy or Not…

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Simple Solutions on the Rise

36 Many more single-purpose solutions than in years past

Sessions

Warby Parker

•  David Gilboa, Co-CEO •  Write up in our 2/4/14 Newsletter •  Social Media

21st Century Fashion Evolution

•  David Wolfe, Creative Director at Doneger Group •  Fashion will become like opera

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But There’s a Problem with All of This

1. Not many people will actively block enough time to take in even a small percentage of what the floor has to offer

2. Even if you do have the time, when a show is this big, finding the innovation becomes a feat of happenstance

3. Even if you’re in the right booth, booths have become so overwhelmingly oversized that you can be in someone’s booth standing right next to their coolest offering and not even know it

So with that in mind…

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2015?

IDEAS FOR NEXT YEAR

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Ways Next Year Could Be Even Better

•  Innovation Area

•  Help solve “dumb luck” phenomenon •  Level the playing field

•  Thematic Villages

•  More time to talk, less to walk •  Push Content to the Front of the Agenda

•  Keynote Speakers

•  Trend at lots of shows - some retail relevant/some purely for name recognition.

•  Understand the risk associated (particularly with international interests)

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Resources The following reports were referenced in this presentation:

The Relevant Store in the Digital Age, May 2013

http://www.rsrresearch.com/2013/05/08/the-relevant-store-in-the-digital-age-benchmark-2013/

Retail Analytics Moves to the Front Line, January 2014

http://www.rsrresearch.com/2014/01/08/retail-analytics-moves-to-the-frontline-benchmark-2014/

Omni-Channel 2013: The Long Road to Adoption

http://www.rsrresearch.com/2013/06/11/omni-channel-2013-the-long-road-to-adoption/

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