2018 POS/CUSTOMER ENGAGEMENT SURVEY

Transcription

1 19 TH ANNUAL SURVEY 2018 POS/CUSTOMER ENGAGEMENT SURVEY Platinum sponsors: Gold sponsors:

2 2018 POS/Customer Engagement Survey 2 Executive Summary With the flurry of recent retail bankruptcies and store closure announcements, Retail Apocalypse has been the pervasive topic of the last 12 months. While mentions of apocalypse might work well when trying to grab headlines, the reality is something much subtler and far more interesting. Yes, the ways that consumers acquire goods and services has changed. Yes, consumer expectations continue to increase. And yes, technology and new entrants such as Amazon have disrupted the traditional retail model. However, retail has weathered periods of disruption before and will likewise withstand this turbulence. Catalogs, the move to suburban malls, Walmart, and the rise of e-commerce are all great examples of retail disruption and transformation cycles. The current rate of disruption and subsequent transformation is probably the largest many of us have seen or will ever see. While it might be an apocalyptic outlook for some, the reality is that it is just the ever-evolving nature of retail and consumers. In fact, according to the U.S. Census Bureau, retail sales in 2017, through October, were 4.1% higher than 2016 and in November 2017, the consumer confidence index reached the highest level in 17 years. Focusing on the Retail Apocalypse is like hitting the pause button and ignoring reality the problem is that yesterday s retail model is dead. The customer journey and associated expectations continue to rapidly evolve. Disruption and adaptation are changing the retail model and blurring the lines among retailers, brands and wholesalers. Online pure-plays are opening brick-andmortar stores and traditional retailers are experimenting with new store models: stores as Exhibit 1 Future Store Plans showrooms, theatre, distribution centers or pop-ups. As we see in Exhibit 1, of retailers are increasing their number of showrooms and pop-up shops. Increase Decrease No change Retail and customer engagement models must transform. Brick-and-mortar stores 6 7% However, the legacy retail applications and infrastructure still in place at many retail organizations are not properly equipped to support a continuously evolving retail model. The retail winners in 2018 and beyond need to accelerate the transformation of their organization, business processes and technology to align with the demands of their customers. The key to future scalability and flexibility is focusing on agility, with cloud-based unified commerce. Victory belongs to the agile. So, let s press play and move ahead to a new retail future, one that promises to be very exciting! Store-within-a-store (i.e. small footprint within dept store) Showrooms Pop-up shops Mall kiosks 27% 20% 7% 7% 7% 7% 7% 7%

3 2018 POS/Customer Engagement Survey 3 Key Findings

4 2018 POS/Customer Engagement Survey 4 Table of Contents EXECUTIVE SUMMARY 2 KEY FINDINGS 3 THE NEW CUSTOMER ENGAGEMENT MODEL 5 THE CUSTOMER EXPERIENCE IS THE FOUNDATION 6 PERSONAL 8 MOBILE 11 SEAMLESS 14 SECURE 18 UNIFIED COMMERCE 21 CURRENT STATE OF POS 23 THE FUTURE STORE 25 SURVEY METHODOLOGY 28 ABOUT BRP 29 PLATINUM SPONSOR APTOS 30 PLATINUM SPONSOR CAYAN 31 GOLD SPONSOR DIEBOLD-NIXDORF 32 GOLD SPONSOR ECRS 33 GOLD SPONSOR FUJITSU 34 GOLD SPONSOR MANHATTAN ASSOCIATES 35 GOLD SPONSOR PCMS 36

5 2018 POS/Customer Engagement Survey 5 The retail winners in 2018 and beyond need to accelerate the transformation of their organization, business processes and technology to align with the demands of their customers. Victory belongs to the agile. Brian Brunk, BRP principal The New Customer Engagement Model The new customer engagement model centers around a personalized, holistic customer experience that is channel-agnostic in other words, unified commerce. Retail is in the midst of a transformation. Stores still represent the majority of retail purchases, but the definition of store continues to change. This, coupled with digital experiences that are increasingly personal and mobile, has blurred the lines between channels and created the expectation of anywhere, anytime, anyhow shopping. This fundamentally redefines the retail store experience, requiring a balanced blend of physical and digital that works seamlessly with any customer touch point, creating a holistic brand experience. To enable the new customer experience and support its rapid evolution requires a different technology approach. Retail s legacy technology of channel silos does not support this new retail paradigm. And while it s critical to focus on transformation, retailers need to keep in mind that retail models, customer expectations and technology will continue to be moving targets for some time. That is why agility is paramount in retailers future plans as they look to implement customer experiences for today and tomorrow. Channel-agnostic, cloud-based real-time unified commerce is the agile answer. Cloud-based unified commerce is imperative to enable real-time visibility and integration across every customer touch point. No longer can retailers afford to think about a transaction or an order as occurring at one point in time or in one channel. True unified commerce requires holistic experiences, transactions and orders that move seamlessly with the customer. Legacy retail technology has focused primarily on the point of purchase. This must change to realize unified commerce and shift the focus to robust, personalized and seamless customer engagement. Consumers expect a personalized, secure, channel-agnostic experience in real-time. Retailers who successfully meet these evolving customer expectations take a holistic approach to defining their customer s journey and understand that change is needed at almost every point in their enterprise. Critical focus points for success include optimizing customer engagement, adopting mobile technology and achieving realtime retail across the enterprise. With these tenets in mind, the 2018 POS/Customer Engagement Survey identifies how retailers are faring in their quest to ensure that the four key pillars defining the required customer experience personal, mobile, seamless and secure are in place to deliver unified commerce.

6 2018 POS/Customer Engagement Survey 6 The Customer Experience is the Foundation To achieve unified commerce, retailers must define the ideal customer journey maps to determine the business capabilities and technology required to enable a holistic customer experience. In the last few years, many retailers have taken a more strategic approach to optimizing the shopping experience for their customers. The first step is to embark on a customer journey mapping exercise to understand how and why customers interact at each touch point throughout the customer journey for example, when and where they shop or research products (mobile, online, in-store or catalog), when and where they purchase and where they like to receive their merchandise (in-store or delivered to their home). Once they understand their customers behavior and preferences, they are in a much better position to deliver experiences that are seamless, personal and frictionless. The key to the ideal customer journey is personalization. Providing the same experience for all customers is not a differentiator. Retailers have the opportunity to personalize the experience based on analytics and "customer context" to create a unique, personalized experience for each customer. This requires real-time visibility that reacts and flexes with the customer to understand where product is at all times and flows seamlessly to the final purchase across any channel. Achieving this requires the right applications and infrastructure, like cloud-based POS, coupled with unified order management systems and a rock-solid network to provide the necessary availability and response. differentiate on just product or price, the customer experience is the key differentiator and it s what drives customer loyalty. Ever increasing customer expectations, retail transparency and today s anywhere, anytime, anyhow shopping have put the customer experience center stage for most retailers. There is no longer online only or store only, shopping is now the convergence of the digital experience with the physical environment and it requires a new customer engagement model to support it. Retailers must infuse digital capabilities into the store environment to exceed customer expectations, compete more effectively and offer a more complete shopping experience. Retailers POS priorities this year mirror the last few years with omnichannel integration and adding capabilities to current POS as the top two priorities (Exhibit 2). It is interesting that while more than half the retailers are focused on adding new capabilities to their current POS, more than half are also prioritizing a POS upgrade or replacement. As retailers look to implement the right technology for the future, focused on cloud-based unified commerce, we expect this approach to shape their POS plans. Omni-channel integration Add capabilities to current POS System upgrade/replacement Payment security/pci compliance Exhibit 2 Top POS Priorities for % 56% 56% 54% With today s technology, consumers have the ability to quickly search and compare products, promotions, rewards and prices; they also read customer reviews and get instant feedback from their circle of friends via social media all from their handheld device. This transparency makes the retailer s job more difficult as they can no longer Unified or single commerce platform Mobile POS Hardware upgrade 36% 3

7 2018 POS/Customer Engagement Survey 7 To engage with the customer, retailers need to quickly and easily identify the customer to personalize the shopping experience. Exhibit 3 Top Customer Engagement Priorities for 2017 As customer expectations have been reshaped by the digital retail experience, retailers have shifted their focus in the physical store environment. Customers receive personalized offers and recommendations when shopping online or via mobile that they don t tend to receive when they shop in a store. Customer identification/ personalization of customer experience Customer mobile experience alignment (mobile app/ website/ responsive design) Empowering associates with mobile tools 62% 54% 51% Therefore, it is imperative to identify the customer early in the shopping process and at every touch point. This initiates the dialog and sets the foundation for relationship building. Identifying the customer as they enter the store via their smartphone, beacon or other technology affords the retailer the opportunity to personalize the customer s shopping experience. Real-time retail (disseminating data across all channels in real-time) Customer-facing technology in the store (digital signage, "smart" fitting rooms, etc.) Social media analytics 38% Understanding the importance of personalization, 62% of retailers indicate customer identification is their top customer engagement priority, which is consistent with the top priority for the past three years (Exhibit 3). Guided selling/ clienteling Creating the necessary customer experience also relies on wellinformed and available sales associates. Today s information-savvy consumers are not satisfied with just a warm body or one size fits all experience they expect retailers to put time and effort into establishing and offering a personalized experience. Other top priorities are focused on providing associates with the information they need to personalize the shopping experience. Empowering associates with mobile tools to access customer information based on their previous purchases and/or preferences is important to engage the customer. To effectively provide guided selling services, the sales associate needs up-to-date and readily available customer and product information.

8 Personal Engaging the customer through personalization and relevance is the key to attracting and keeping customers. Customers want to shop wherever and whenever they want with the benefits of both the digital and physical retail environments. Personalization plays a critical role in optimizing the customer s shopping experience. Retailers need to know whom the customer is to create a meaningful experience based on what they want and when they want it. Each step along the customer journey offers retailers another opportunity to engage with the customer and strengthen that personal relationship to drive sales and customer loyalty. Customer expectations have been reshaped by the digital retail experience. As consumers check-in on retailers e-commerce and mobile sites, they automatically receive personalized offers and recommendations based on their purchase and browsing history. However, most shoppers 2018 POS/Customer Engagement Survey 8 are still anonymous when shopping in a physical store so they don t get the same level of personalized service. This is an area of opportunity for retailers as digital and physical retail converge. Customer identification is critical, however, at many stores it is still happening at the point of checkout, which is too late to empower the associate to influence the current purchase decision. Without early identification of the customer, retailers miss critical engagement opportunities that can increase sales and deliver a better customer experience. This year, we see significant progress and interest in newer technology methods utilized in tandem with the customer s mobile phone to identify customers when they enter the store. The most prevalent technologies that retailers are currently using to identify customers are Wi-Fi (40%) and mobile loyalty programs (32%), however more than half of the retailers using these technologies indicate that they need improvement (Exhibit 4). Retailers are shifting their customer identification tools, as they have decreased the use of mobile websites (28% this year down from 40% last year) for identification and increased the use of MAC address, Bluetooth and beacons. Exhibit 4 Customer Identification via Mobile Device Implemented and working well Implemented but needs improvement Implement within 12 months Implement in 1-3 years Mobile loyalty program MAC address Wi-Fi Mobile website Social media listening Mobile app Mobile wallet Bluetooth NFC (near field communication) Beacons 6% 6% 16% 1 22% 1 22% 1 16% 31% 22% 1 22% 16% 16% 1 22%

9 2018 POS/Customer Engagement Survey 9 The big trend in customer identification lies in retailers future plans. Within three years, 67% of retailers plan to use mobile loyalty programs and 6 plan to use mobile apps to identify customers in their stores. Another interesting point is that there does not seem to be one technology choice that is winning retailers are embracing a number of different technologies to cast a wide net and identify and track as many customers as possible as soon as they enter the store. We expect to see an increased use of beacon technology over the next few years. Target has added an indoor mapping component to its mobile app using beacons to help customers find their desired product in the store, calling it GPS for your shopping cart. Retailers that identify customers when they enter the store and equip their associates with the proper mobile tools can personalize the shopping experience based on customer context. Customer context is the interrelated factors of customer insights and environmental conditions the make the shopping experience relevant. It enables retailers to personalize the shopping experience based on preferences, purchase history, their closet, their most recent online browsing history, time of day, weather and their physical location all based on real-time information. up to the wealth of information and technology that customers possess. Putting mobile devices in the hands of store associates enables inventory look-up (enterprise-wide), even for products not immediately available or from external vendor inventories. It also empowers associates with information to offer enhanced customer assistance and even process a transaction anywhere in the store. With mobile devices, associates are free from the constraints of the checkout counter, which enables interaction with customers anywhere in the store. Overall, retailers still struggle with the ability to access customer information prior to checkout (Exhibit 5). The ability to look up a previous customer transaction before the customer is at the checkout is only available to one-quarter of the retailers, with customer-specific messaging, offers and discounts available to less than 20% of retailers. This suggests that retailers are missing opportunities to increase sales because associates can t access customer data until the customer is at the checkout which is too late. With customer data available precheckout, associates can influence the transaction with personalized Exhibit 5 Customer Information Availability Pre-checkout During checkout After checkout Transaction lookup 25% 25% 22% Clienteling and guided selling are an important part of the personal equation to enhance the shopping experience. Clienteling empowers store associates to leverage customer data (purchase history, personal information, preferences, etc.) and deliver highly personalized customer engagement, provide exceptional in-store shopping experiences, and timely follow-up communication with customers. To be effective, guided selling and any other customer engagement tactics can t operate with yesterday s information they need real-time data, context and analytics. Customer-specific messaging Customer-specific offers and discounts Shopping history Contact information Purchase summary Product recommendations Customer attributes/preferences % 25% 16% 18% 16% 31% 5 16% 28% 31% 15% 22% 6% 34% 6% However, while retailers realize the need to arm their associates with the right training and better information, they are still playing catch- Social media profile Information about friends and family 6% 10% 6% 6% 1

10 2018 POS/Customer Engagement Survey 10 promotions and relevant product suggestions to customers. The unfortunate point is that the vast majority of retailers are currently not providing customer attributes/preferences and product recommendations to associates pre-checkout which means the missed sales opportunities are significant! Delving deeper into how associates are able to tailor the customer s shopping experience based on available information uncovers that the capabilities are still limited but plans to implement these abilities are increasing (Exhibit 6). This represents significant engagement opportunities; however, retailers must have a unified commerce platform in place that enables real-time visibility and access to customer information, inventory, product and pricing. Integrating customer and product information to a clienteling solution and early customer identification is imperative to personalize the in-store customer experience. Exhibit 6 Tailoring the Shopping Experience The most prevalent customer personalization capabilities involve offering personalized rewards based on customer loyalty and suggested selling based on previous purchases. While the retailers that currently offer these capabilities is limited, there are expansive plans to utilize customer information to tailor the shopping experience. Within three years, 8 of retailers plan to provide suggested selling based on previous purchases and 76% plan to offer personalized rewards based on customer loyalty. Some retailers are expanding the personalization aspect of retail into a make shopping fun and engaging experience. This includes gamification where game-like interactions, rewards and incentives are offered for visiting a web site and finding a great deal, shopping early or late or on an off day, or providing additional personal information like family size or zip code. The key to this personalization aspect is to tailor the interaction based on the customer s habits. We are also seeing this augmented by artificial intelligence to keep the customer engaged and encouraging further visits and interactions. Currently offer Offer within 12 months Offer within 1-3 years Suggested selling based on previous purchases 2 30% 30% Personalized rewards based on customer loyalty 2 20% 3 Suggested selling based on customer closet/room/garage 20% 20% 27% Suggested selling based on online browsing history 20% 37% Personalized promotions 2 37% Suggested selling based on social media activity/posts 47%

11 Mobile The pervasiveness and ease-of-use of mobile devices offers tremendous opportunities for retailers as the customer takes control of their own retail experience across channels. There is no denying the power of mobile technology as a disruptor in the retail industry. Retailers realize that mobile devices are ubiquitous and recognize that a mobile device in the customer and associate s hands holds tremendous opportunities to enhance the customer experience in the store. Consumers use their phones to research products, compare prices, complete purchases online and increasingly, to pay for in-store purchases. The proliferation of tablets and mobile phones also offers new opportunities for retailers to enhance customer service. Mobile point of sale (POS) enables associates to complete a customer s Exhibit 7 POS Hardware Plans by POS/Customer Engagement Survey 11 purchase on the sales floor at the moment the buying decision is made. It also frees the associate from the checkout area to allow for more personal interactions on the sales floor and simplifies the checkout process by eliminating the need to wait in line. Over the next year, the use of mobile devices both in the hands of associates and customers and tablets will continue to increase along with a decrease in the use of traditional POS terminals and PCs (Exhibit 7). This is consistent with the trends we are seeing in the industry. Mobile POS lowers the overall cost of ownership by eliminating or minimizing the need for big iron (a thick-client cash register) at storelevel and virtually eliminating annual hardware maintenance fees, as most units are disposable. As further confirmation of retailers plans to focus on mobile devices, this year 42% of retailers currently offer mobile solutions for associates, and within three years 78% of retailers plan to offer these tools. Increase Decrease No change Phase out Mobile devices (non-tablets) 62% 16% Tablets 5 22% Customer-owned mobile devices (Apple ios, Android, Windows) 45% Hybrid POS (tablet that can be docked and connected to peripherals) 42% 26% Customer stations (flat panel display, AppleTV, touchscreen, etc.) 24% 34% Kiosks 5% 2 11% Self-checkouts 2 Notebook/laptop computers 18% 5% 45% 5% Traditional POS terminals 8% 16% 6 5% PCs/desktop computers 5% 58% 5%

12 2018 POS/Customer Engagement Survey 12 However, the majority of those retailers who offer mobile solutions indicate improvement is needed. Retailers need to continue to improve mobile capabilities through different processes, better technology or enhanced training for associates. Powerful associate tools are only helpful if associates are trained to use them effectively, especially when associates are dealing with sensitive customer information. Mobile POS also continues to be a priority with 20% utilization this year and 70% within three years, however, a majority still indicates that improvement is needed (Exhibit 8). For most retailers, mobile POS has not become a substitute for a traditional fixed station POS. The majority of retailers continue to use traditional POS stations as their basic POS, adding mobile options and additional PCs or tablets as supplements. The transition from fixed station POS to a hybrid environment and more mobile solutions is underway but it is a slow process. Unfortunately, retailers are continually playing catch-up as the proliferation of tablets and mobile phones is only the beginning. The growing popularity of Internet-powered personal devices wearables will strengthen the case for utilizing customer-owned mobile devices Implemented and working well Implement within 12 months Mobile solutions for associates Mobile POS Customer-owned mobile device as POS 6% Exhibit 8 Implementation Status 8% 36% Implemented but needs improvement Implement in 1-3 years 31% 22% 1 14% as POS over the next few years. The future will likely see new and exciting ways that customers use wearables, which will shape their expectations and experience. Utilizing customer-facing technology is a natural outcome from the proliferation of mobile devices and is a big part of the overall customer experience. As customers become more comfortable and proficient with utilizing mobile technology and researching information on their own, retailers need to offer expanded customer-facing mobile services to enhance the shopping experience. The good news is that retailers are increasingly implementing customerfacing mobile services such as product information, shopping list capabilities, and personalized recommendations via mobile devices. However, there are still many missed opportunities to tailor the shopping experience by offering personal recommendations on customers mobile devices. The bad news is that there are still issues with how well these processes are working. In all cases, the implemented but needs improvement category exceeds the implemented and working well category, which likely indicates that the processes currently in place have been manually pieced together or rushed to production before they were fully tested and perfected (Exhibit 9). We expect this to improve as retailers embrace true unified commerce and work on implementing cloudbased solutions with real-time capabilities instead of piecing together legacy systems and processes to meet customer expectations. In many cases, these customer-facing mobile services encompass the same functions that retailers look to offer associates. Another benefit of unified commerce is that these capabilities or services can be built once and then deployed across various different use cases and clients, whether customer-facing or associate-facing, to ensure that everyone has access to information that enhances the shopping experience.

13 2018 POS/Customer Engagement Survey 13 Mobile technology in the hands of consumers and retail associates is the biggest driver for the needed transformation of the customer engagement model. Mobile is driving retailers to upgrade and replace technology to keep ahead of their competitors customer experience offerings and to keep up with their very informed and technology-savvy customers. While the shift to mobile tools can dramatically enhance the shopping experience and reduce retailers total technology costs, it brings its share of challenges. As with any new technology, these innovative mobile approaches require a fundamental change in processes and corresponding training to educate sales associates and customers to convince them to try and use the new processes. journey will deliver an experience that is as good as the data shared with the customer. This area is clearly transforming retailers customer engagement model, operational budgets, in-store procedures and layouts. Mobile capabilities and expectations continue to evolve rapidly and need to be a significant part of a retailer s customer engagement strategy. To make the best use of these mobile technologies, retailers need to have highly available and redundant in-store networks as well as a holistic approach to real-time retail data. Having a mobile device and engaging with the customer anywhere at any time during their shopping Exhibit 9 Customer-Facing Mobile Services Implemented and working well Implemented but needs improvement Implement within 12 months Implement in 1-3 years No plans to implement Product information (price, location, availability, research) 3 12% 18% Mobile coupons, specials, promotions 18% 36% 24% 18% Mobile loyalty 18% 15% 24% Prior purchase visibility 15% 42% 12% 15% 15% Shopping list/wish list 15% 6% 27% 30% Mobile wallet 12% 15% 15% 36% Personalized recommendations 3 18% 18% Geolocating 30% 15% 12% 3

14 2018 POS/Customer Engagement Survey 14 Seamless Customer expectations for a personalized and seamless experience require retailers to follow customers journeys across channels as they research, shop and purchase. Customers want access to a single cart to shop across channels and be able to reach their cart via phone, computer, or even in the store they want to start anywhere and finish anywhere. Real-time retail, through unified commerce, enables retailers to identify the customer and gather, analyze and disseminate customer, product, pricing, and inventory data across all channels instantly. Since consumers expect a seamless experience in the store, on the Web and via their mobile device, real-time retail is an imperative. Retailers are increasingly turning to a common unified platform to deliver consistent, relevant shopping experiences across all channels. This centralizes data storage and application integration and allows easier real-time access to information across the ecosystem (stores, distribution centers, suppliers, etc.). Retailers implementations of unified commerce have increased significantly in the past year, 28% this year compared to last year. A single commerce platform for store, mobile, and web (i.e, Unified Commerce) Exhibit 10 Unified Commerce Implementation Status Implemented and working well Implement within 12 months Implemented but needs improvement Implement in 1-3 years 25% 22% 31% However, 8 of those implementations still need improvement (Exhibit 10). Demonstrating the importance of a seamless customer experience, an additional 5 of respondents plan to implement unified commerce within the next three years. As retailers and solution providers continue down the path to unified commerce, more and more capabilities are being centralized or offered as cloud-based services. Retailers are embracing this move to the cloud as it is key to enabling unified commerce real-time capabilities and integration that are scalable and agile enough to support evolving business needs. Leveraging cloud computing and IT outsourcing makes a lot of sense for many retailers. IT is not a core competency or differentiator for most retailers it is just a necessity. A cloud approach enables retailers to significantly reduce infrastructure, improve security and increase operational effectiveness by centralizing management of data and processes. Retailers are embracing this move as they realize cloudbased unified commerce is key to accelerating their path to a single version of the truth. Given the move to the cloud and a growing preference by retailers for utility-based, as-a-service solutions, we see the next step in this evolution as IT-as-a-Service or the adoption of a utility model. This is a real opportunity for retailers with a one-stop-service for all their IT needs hardware, infrastructure, applications, implementation and maintenance services. This bundled, all-inclusive approach can simplify retailers operations and give them the agility and flexibility needed for current and future transformation. Further bolstering the move to the cloud is the availability of much more sophisticated network technology, such as SD-WAN and 5G. With today s network technology, retailers can truly achieve 100% uptime removing the last perceived hurdle in moving towards cloud-based commerce solutions and moving away from the decentralized store

15 2018 POS/Customer Engagement Survey 15 environment that has been the foundation of the traditional retail model for decades. Cloud computing, either public or private, offers the quickest and surest path to seamlessly connect all e-commerce, mobile commerce and instore POS transactions to order management, inventory, marketing, financials, supply chain and customer service. One of the best models to adopt is a hybrid cloud where private and public clouds are bound together by standardized technology to enable data and application portability. Many retailers have made the shift to the cloud over the past few years as a means of centralizing their store systems, although we are still seeing some retailers hesitate which may prove to be their downfall as the shift to the cloud enables an agility necessary in today s environment (Exhibit 11). Many retailers have recognized the value of cloud-based applications: speed of deployment, faster software updates, lower software costs and a real-time, single version of the truth. Many retailers have started down the unified commerce path by offering services that emulate the expected seamless holistic shopping experience, but in many cases the methods were manual and involved complex integration across multiple systems and processes, and then they didn't often work very well in real-time. few shopping days knowing that pure-play online retailers generally couldn t fulfill customer purchases in time. Amazon and Walmart continue to raise the bar on quick delivery times as Amazon unveiled Amazon Key to allow deliveries inside Prime members homes, and Walmart acquired Parcel, a technology based, same-day delivery company within the large New York City market to accelerate the development and optimize processes for same-day delivery. Target recently jumped into the game with its acquisition of Exhibit 11 Centralization of Store Systems Business intelligence/ enterprise reporting CRM Pricing Inventory Workforce management (Time & Attendance/ Labor scheduling) Loss prevention 66% 66% 60% 86% 77% 77% As time-constrained consumers demand more convenient and expedient shopping and delivery options, it is critical for retailers to offer omni-channel fulfillment options such as buy online, pick-up in store, same day delivery and other flexible delivery choices. The table stakes continue to increase as consumers are now beginning to expect same-day delivery as the normal lead-time for most products and free two-day delivery for other products. Although this past holiday season, many brick-and-mortar retailers were able to take advantage of their ability to offer buy online, pick up in the store (BOPIS) during the last Point of sale Returns processing Special orders Task management % 46%

16 2018 POS/Customer Engagement Survey 16 Shipt, a leading online same-day delivery platform, and expects to offer same-day delivery to customers at approximately half of its stores within the next few months. Retailers are still working on their offerings of cross-channel and fulfillment services such as inventory visibility across channels and the ability for customers to buy online and pick up in the store (Exhibit 12 and 13). There is still room for improvement as retailers struggle to meet enhanced consumer expectations. The importance of real-time visibility and access to product and customer information has grown exponentially over the past few years as consumers have become more demanding. In today s disruptive and competitive retail environment, real-time retail is quickly becoming table stakes and retailers that don t have the right capabilities will struggle. Without real-time data, information provided Exhibit 12 Cross-Channel Services internally and externally is out-of-date and, therefore, risks being inaccurate and out of context. It s like crossing an extremely busy New York City street with yesterday s traffic information! It is still very challenging for retailers to effectively execute real-time retail. More than two-thirds of retailers say they can access inventory, pricing/promotions and analytics in real-time but most of the processes still need improvement (Exhibit 14). In our experience, many retailers can check inventory in real-time but the inventory data they are accessing is from yesterday as it is not really available in real-time. As retailers move to unified commerce, full access to enterprise-wide data in real-time will become more common. Unfortunately, these processes are likely pieced together from disparate systems and retailers will need new cloud-based unified commerce as the foundation to be able to effectively monitor, access and analyze real-time information seamlessly. Exhibit 13 Fulfillment Services Available and working well Available but needs improvement Implemented and working well Implemented but needs improvement Available within 12 months Available in 1-3 years Implement within 12 months Implement in 1-3 years Returns accepted across channels 34% 1 1 Buy online, pick up in-store 30% 18% Inventory visibility across channels 28% 38% Buy anywhere, ship anywhere 15% 15% Order visibility across channels 25% 28% 25% Buy online, ship from store 12% 27% Reserve inventory in another store 22% 28% 22% Buy in-store, ship from DC, other store, or vendor 18% 27% 12% 18% Special order from any channel 31% 16% 16% Reserve online, pick up in store 12% 6% 24%

17 2018 POS/Customer Engagement Survey 17 Retailers are realizing that the process of offering customers the ability to shop anywhere, ship anywhere is complex and the goal line seems to keep moving as new technology and consumer behaviors constantly change. The key to winning is to map out a comprehensive customercentric strategy, understanding that a new model is necessary to succeed, and the new model requires an agility that has not traditionally been a part of this environment. The road will not be smooth and will likely require partners to help create the required seamless experience. Exhibit 14 Enterprise-wide Real-time Features Implemented and working well Implemented but needs improvement Implement within 12 months Implement in 1-3 years No plans to implement Pricing/promotions 30% 40% 7% 10% Inventory 30% 37% 10% 10% Analytics/reporting 27% 47% 7% Returns management 2 37% 10% Loyalty program enrollment/ change/ status 20% 30% 10% 27% Loss prevention 4 Cross-channel transaction history 10% 37% 2

18 Secure Today s retail environment requires security beyond retailers current focus on payments and networks. As retailers seek new ways to gather relevant information to provide customized experiences, like product recommendations via digital screens in the dressing rooms, MAC address identification or facial recognition, alerting an associate to a shopper s arrival, they must address how to protect their customer s data. While more information offers a more personalized experience, it also provides a greater opportunity for data theft and fraud. Retailers need to establish security policies that ensure the data privacy of their customers information. Purchase and payment touch point options continue to expand with voice-assisted and virtual reality payment-enablement possibilities in the works. With technological capabilities rapidly expanding, keeping up with advancements and ensuring a frictionless experience, while also guaranteeing the security of data will remain a challenging feat for retailers. It is imperative that retailers have a strong information security team to maintain a multi-layered security approach that includes the use of tools and proactive log monitoring analytics. While the liability shift associated with EMV (Europay, MasterCard and Visa) occurred more than two years ago, many retailers are still working towards providing EMV-enabled transactions. While we are seeing further acceptance of EMV-enabled transactions (5 this year up from 52% last year), there are still a number of retailers who are falling behind (Exhibit 15). and staff to keep customer wait times manageable POS/Customer Engagement Survey 18 There are also online repercussions as the enhanced security of transactions in the store has forced fraudsters to look at exploiting e- commerce transactions to capture credit card numbers and other personal data. Most retailers are seeing significant increases in card not present transaction fraud and are spending time and energy trying to increase the sophistication of their online fraud protection and analytics. Due to EMV there has been a significant reduction with instore fraud while online fraud, including mobile applications, has risen dramatically. These changes in the retail landscape make it more important than ever to protect customer data and effectively monitor in-store and online transactions. Implemented and working well Planning to implement within 12 months No plans to implement End-to-end encryption (E2EE) EMV-enabled transactions Mobile payment acceptance (NFC, MST, etc.) Tokenization for single sales channel Exhibit 15 Payment Security Technology Plans 15% 15% 38% 47% 20% 15% Implemented but needs improvement Planning to implement in 1-3 years 20% 2 12% 18% 12% 38% 6% 2 24% In the store environment, many retailers (and customers) have realized that the average EMV-enabled transaction takes longer than a non-emv transaction due to processing times. In many stores this is a costly issue because it requires more checkout lanes Single token solution across enterprise Mobile EMV payment acceptance 14% 15% 26% 32% 12% 18% 38% 26%

19 2018 POS/Customer Engagement Survey 19 Unfortunately, EMV doesn t really offer data security functionality even though it is usually included in the same security upgrade projects because it involves the same partners, programs and hardware as the first line of defense, which is end-to-end encryption (E2EE). E2EE has increased significantly over the past few years with a reported 68% of retailers utilizing it. E2EE prevents third parties from accessing data throughout the system because only the authorizing parties have access to the encryption keys. Mobile payments in stores use tokenization so that the retailer never actually has the customer s payment card number, which significantly reduces the security risk and speeds up the transaction. There are a multitude of mobile wallets and payment apps in the market today. In addition, many retailers are offering their own mobile payment options. For example, Target recently incorporated a mobile wallet option within their mobile application. The next protective layer involves tokenization, which enables retailers to remove sensitive information from the network by substituting payment card data with a token which is used as an identifier but has no exploitable value or meaning. 2 of the respondents have implemented a single token solution across the enterprise, with an additional 38% planning to implement within the next three years. This technology is critical to offering customers a single unified commerce experience for returns, customer profiles and saved shopping carts retrieved across channels. Payment security remains a concern for retailers for the foreseeable future. Most of the retailers involved in our survey reported moving towards a security plan with multiple layers to protect sensitive customer and organization data. Moving store applications to the cloud makes security easier customer and associate information will reside at a data center or home office instead of at the store-level, which means it s easier to secure. If retailers utilize encryption and tokenization there is no critical information residing at the store to secure. PayPal and Apple Pay continue to be the most widely accepted payment types in this survey (Exhibit 16). This year fewer retailers are adopting a wait and see approach across the board likely because of the growing support from the payment software ecosystem and the acceptance for Apple Pay PayPal Android Pay Private (retailer branded) closed loop payments MasterCard PayPass Visa Checkout Samsung Pay NFC Exhibit 16 Alternative Payment Types Accept Accept within 12 months Accept within 1-3 years Wait and see approach 18% 14% 14% 2 24% 37% 37% 11% 6% 24% 2 20% 14% 26% 15% 20% 71% 14% 66% 44% % Mobile payments offer further opportunities for customers and retailers, as it enables customers to make purchases without their wallet (but with their ever-ubiquitous smartphone) and provides an additional level of security that isn t available with credit cards, even EMV-enabled cards. Chase Pay Crypto currency (Bitcoin, etc.) Softcard 11% 12% 26% 85% 88% 54%

20 2018 POS/Customer Engagement Survey 20 these mobile payments by the public. One of the critical factors for mobile payment success in the next few years is education and training. We have found repeatedly that not only are most consumers unsure of how, when and if mobile payments can be used, but even more telling, associates are unsure. For mobile payments or mobile wallets to succeed, there must be further education at the point of sale to ensure that a transaction using a mobile device is no longer or more complicated than traditional payment methods for either the customer or associate. While the pros and cons of each of these payment types and future payment types can be debated, what is most apparent is the adoption across the industry as customers and associates become more comfortable utilizing these emerging payment platforms.

21 2018 POS/Customer Engagement Survey 21 Unified Commerce A common cloud-based commerce platform provides a single version of the truth across all channels to enable real-time visibility and availability of accurate inventory and customer information. Unified commerce goes beyond omni-channel, putting the customer experience first, breaking down the walls between internal channel silos and leveraging a common commerce platform. A common, real-time platform for all customer engagement points is a key tenet of unified commerce. A unified commerce platform is not simply the future instore or Web platform, but combines in-store POS, mobile, Web, order management, call center and clienteling into one integrated platform. It has become the new retail imperative. Unified commerce, with a common commerce platform, supports all customer touch points and channels. This eliminates integration issues and supports real-time visibility, enabling an enterprise-wide, unified view of the customer, inventory, fulfillment, etc. To architect the optimum foundation, there are three major components of a unified commerce platform: networks, service-oriented architecture and order management. Networks The network is a critical element of the technology platform providing availability, security and reliability. Today s networks are robust, fast, reliable and resilient, which is key to supporting a cloud-based common commerce platform across channels. As retailers deploy more applications in the cloud, the new norm has become hybrid cloud environments, with a mix of private and public cloud-based services. This is where the network plays a central role in the future of unified commerce. SD-WAN technology provides the necessary availability and flexibility for cloud-based commerce. A robust, well-architected and properly managed network solution is imperative for unified commerce success in the cloud. Reliability, bandwidth and security are the top network priorities for more than 60% of retailers (Exhibit 17). Today s always connected customer puts additional pressure on retailers to ensure that they can provide a secure, reliable high-speed network to support the shopping environment. Unfortunately, many existing store networks do not have the capability to support current and future store infrastructures; therefore, it is not surprising that this is a main focus. Service-Oriented Architecture A robust middleware layer, or service-oriented architecture (SOA), is essential in effectively enabling real-time capabilities and uniting various retail systems to deliver unified commerce. Many customer interactions or retail transactions require data from various retail systems to be gathered, analyzed and disseminated in real-time. Therefore, every customer or associate transaction traverses the middleware layer, which brings the commerce platform to life. Reliability of networks Network bandwidth Security of networks Network efficiency performance Ability to control and prioritize applications using the network Network resiliency Visibility and understanding of applications using network capacity Exhibit 17 Top Network Priorities Other 10% 24% 22% 4 64% 6 70%

22 2018 POS/Customer Engagement Survey 22 Implemented and working well Implement within 12 months Middleware Layer/SOA Exhibit 18 Implementation Status Implemented but needs improvement Implement in 1-3 years 1 22% 6% Middleware/SOA layer implementations have increased from 34% total implemented last year to 41% implemented this year, although there is still much improvement needed (Exhibit 18). While retailers understand the importance of moving to a unified commerce model, it can be a daunting project when considering the scope of a commerce platform that enables and supports every customer touch point in real-time. An additional complexity is the rapidly evolving landscape of software vendors looking to best position their solutions for unified commerce. Throughout this evolution, more capabilities are being moved out of point solutions like POS and being centralized, or in many cases, enabled as cloud-based services. Retailers are embracing this move to centralized data as they realize that it is key to accelerating their path to a unified commerce platform that is integrated, scalable and flexible to support evolving business needs. Order Management Central to unified commerce is an order management system (OMS) designed to manage orders across all channels, including a POS user interface, complex fulfillment options and inventory in real-time. With significant advancements in order management systems, there is a convergence of OMS with traditional POS. More retailers are evolving to a single (unified) order management system to support all channels (Exhibit 19). Exhibit 19 POS/OMS Capabilities Current state and works well Current state and needs improvement Plan for for next 12 months Plan for 1-3 years Order management capabilities provided by POS software 12% 30% 6% 18% Separate OMS 27% 15% Our OMS acts as our POS 6% 15% 6%

23 2018 POS/Customer Engagement Survey 23 Current State of POS The right technology foundation is essential to support the customer experience across channels. With an increased focus on customer engagement and a convergence of the physical and digital retail worlds, POS and its supporting technology play a critical role in shaping the customer shopping experience. With continuous advances in technology, a POS system that is only a few years old may already be obsolete. mobile POS devices are less than five years old (Exhibit 20). Mobile device usage continues to grow, but at a slower rate than projected in prior surveys. It appears to be tied to the trend of retailers replacing a portion of their current devices with mobile devices when they perform a hardware refresh. It is also partially driven by retailers realizing the shorter life cycle for mobile devices compared to traditional stationary POS terminals. Mobile payment terminals, though, seem to be slow to be accepted, with two-thirds of the retailers not even utilizing them. Retailers seem to be more focused on utilizing mobile devices for line busting and inventory functions. Retailers are looking to refresh their hardware with the latest offerings to take advantage of faster processor chips and larger storage needed to efficiently run more advanced software. Over the past two years, many retailers have upgraded or added mobile devices and almost all Exhibit 20 Current System Age According to this year s survey, 22% of retailers are planning to keep their current mobile devices as a POS in use for more than five years, which similar to the response in last year s survey. This seems a little unrealistic, considering the speed of technology change and the wear < 2 years 3 to 5 years 6 to 8 years 9 to 11 years > 12 years Fixed payment terminals 31% 28% 1 Mobile devices - back-office 31% 11% Mobile devices - POS 28% 6% 8% Store network 26% 37% 14% Mobile devices - customer engagement 25% 8% Mobile payment terminals 22% 8% POS software POS hardware 14% 36% 1 11% 8%

24 2018 POS/Customer Engagement Survey 24 and tear on mobile devices is much greater than on stationary devices (Exhibit 21). Retailers realize that POS software should be replaced regularly to take advantage of better, faster and more reliable technology. However, budgetary constraints and the complexity of a POS replacement project drive the age up, with 5 of retailers reporting POS software that is more than five years old. More than one-third of the retailers surveyed are planning to replace their current POS software and hardware within three years. Exhibit 21 Planned Replacement Timeframe < 12 months 1 to 3 years 4 to 5 years > 5 years POS software 1 36% POS hardware 31% 11% 28% Store network 14% 25% 31% Fixed payment terminals 11% 1 28% Mobile devices - back-office 8% 11% 11% 1 Mobile devices - customer engagement 6% 11% 14% Mobile devices - POS 6% 14% 22% Mobile payment terminals 11% 11% 14%

25 The Future Store The physical store remains the foundation of retail; however, significant and fundamental transformation of retail is underway. The store is not dead and focusing on the customer experience has never been more important. Consumers love the theater of shopping, which is why we are seeing many pure-play online retailers starting to open brick and mortar stores and store concepts continue to change. The in-store experience is paramount for apparel and other products that consumers want to touch, feel, demo or try on. Customers want a multi-dimensional or multi-sense purchase which leverages all their senses. For retailers selling commodity products, you could argue that the experience is the best way to differentiate their brand. Stores must now encompass both worlds - the sensory experience generally available in the physical world, such as touching and feeling merchandise and personally interacting with a knowledgeable associate, married with the unique and personalized shopping experience common in the digital world. The physical and digital worlds will be forever intertwined as we look to the future. The physical store is still the central point of shopping. However, the role of the store is quickly changing. The advent of the digital world offers consumers new ways and places Virtual inventory - ability for store to sell items without carrying the inventory in the store Electronic receipt with personalized suggestions Transaction suspension - customer begins transaction in store and then completes transaction from home Personalized promotions based on real-time location, weather or other analytics Persona-based user interface for POS Scan and deliver - customer purchases item by scanning barcode with actual item delivered to their home (or other desired location) 2018 POS/Customer Engagement Survey 25 to research and shop. These digital possibilities, along with mobility, have modified consumer expectations and behaviors, and retailers must transform to succeed. While e-commerce and mobile continue to grow and garner attention, the store remains a key component of the customer s brand experience. The concept of the store is evolving with new formats, such as pop-ups and store-within-a-store, or even mini distribution centers. As a means of increasing inventory options for customers, retailers realize that their brick-and-mortar locations can sell products without actually carrying the inventory within the stores. 36% of retailers have implemented virtual inventory and another 20% plan to implement this within three years (Exhibit 22). Rather than sourcing and warehousing large levels of inventory for each store, they can provide stores access to virtual inventory, which keeps customers in the store and away from the competition. Exhibit 22 Potential Customer Services Implemented and working well Implemented but needs improvement Implement within 12 months Implement in 1-3 years No plans to implement 7% % 27% 10% 2 27% 10% %

26 2018 POS/Customer Engagement Survey 26 A number of retailers also plan to offer electronic receipts with personalized suggestions for their customers. Offering customers an electronic receipt after a purchase in a brick-and-mortar store gives them the peace of mind that they ll have a copy that won t get lost by the time they get home. In addition, retailers can use electronic receipts as a means for suggested selling by offering recommendations for potential purchases based on what they have already purchased, elevating the customer s current and future shopping experience. Offering customers personalized promotions based on customer context is the future of the store environment and it is gaining traction with having implemented and another 46% planning to implement this capability in the next three years. Younger customer segments, such as Millennials, have grown up in the digital age where they have access to everything at their fingertips (their smart phone), and they have high expectations for service. They expect everything wherever and whenever they want it. They expect the same level of personalized recommendations they receive on Amazon when they visit the store. With higher expectations for a personalized experience, they expect sales associates to cater to their needs. As long as they get the information and service they expect, they don t care if is delivered by a human or a robot. And actually, some consumers might enjoy the novelty of the robot, as long as it offers quality service. While automation can be a way to cut overall costs, there is a fine line where it makes sense to deploy. Some highly personal product decisions and luxury brands will be the last, or maybe never, to adopt automation to replace humans. The real-time retail trend of identifying a customer and guiding the customer through the sale via human interaction won't soon be replaced by automation. The process of customer engagement, context (time of day, how the customer is dressed, what department they are shopping, if they are wearing a wedding ring, etc.) as well as cross-selling and up-selling require a finesse that robotics will likely not completely replace. Disruptive technologies such as artificial intelligence, virtual reality and the Internet of Things (IoT), offer further possibilities for the convergence of physical and digital environments (Exhibit 23). Exhibit 23 Disruptive Technologies Implemented and working well Implemented but needs improvement Implement within 12 months Implement in 1-3 years Augmented Reality 4% 7% 7% 2 (IoT) Internet of Things 10% 10% 37% Videoconferencing - customer shops from home via videoconference with associate in store 7% 2 Virtual mirrors - allow customers to envision themselves in different garments, glasses, or cosmetics 10% 10% Virtual Reality 7% 10% AI (i.e. voice-activated POS, Digital Assistants, etc.) 27%

27 2018 POS/Customer Engagement Survey 27 Artificial Intelligence (AI) offers the ability to pair with the vast amounts of data gathered on customers and their preferences, and turns the information around to help personalize the customer experience. We are currently seeing some retailers experiment with AI to offer purchasing suggestions based on answers to a series of questions. ebay offered a new AI-powered website to its customers this past holiday season that organized and curated merchandise by category and then monitored what customers were purchasing to more accurately personalize the shopping experience. The disruptive technology that is of most interest to retailers is the IoT, with 60% of retailers planning to have this capability within three years. IoT describes an environment where the Internet is connected to physical objects embedded with sensors that can then communicate. The IoT is not just about gathering data but also about the analysis and usage of that data. It has the potential to change the way the customer shops and will also change the checkout experience and transform the point of sale. The Finish Line is currently remodeling some of its stores to utilize IoT as a focal point of an enhanced digital experience in the store while Kroger is using an IoT solution to enhance its analytics capabilities to drive custom recommendations and pricing. We see IoT and similar technology as great examples of how unified commerce will continue to evolve into the future and further shape the customer s experience and their associated expectations. Virtual reality (VR) and augmented reality (AR) are hot topics again this year with more options in the marketplace putting the technology in everyone s hands. We are beginning to see further use of these technologies in retail with Target adding an AR feature to their mobile website to let customers see how furniture will look in their homes, an idea that a number of furniture retailers have also piloted. Sephora has taken a similar path by incorporating AR into its mobile app to allow customers to see how products will look on their face. Both areas have the potential to impact the store of the future. Smart fitting rooms utilize virtual mirrors or motion sensors to interact with customers to offer product information, suggest complementary products or notify an associate that a different size is needed. Virtual mirrors allow shoppers to easily envision themselves in different garments, glasses or cosmetics. These technologies coupled with a personal digital assistant can make recommendations based on customer information, purchase history and current promotions within the store. Smart fitting rooms can further encourage store visits as an effective means to touch and feel the product plus understand sizing. Currently, 10% of the retailers surveyed offer virtual mirrors to their customers. Customer engagement in the future may allow a customer to videoconference with their favorite store associate from home. The customer could request to see different products and even get a better understanding of size and color options based on interaction with an associate. 10% of the retailers surveyed already offer this service to their customers. While retail is definitely going through challenging times, the transformation is exciting with new technologies and opportunities arising to enhance the customer journey. The next year will bring further transformation driving fundamental changes in the customer engagement model. For retailers who are not well into their transformation to a ubiquitous real-time retail customer journey, survival means redoubling their efforts before the competition puts them out of business. The time is now to innovate the customer experience by transforming retail operations for the new customer journey. The key to future scalability and flexibility is focusing on agility, with cloud-based unified commerce. Victory belongs to the agile.

28 2018 POS/Customer Engagement Survey 28 Survey Methodology Through an online survey system, BRP conducted the 19 th Annual POS/Customer Engagement Benchmarking Survey in November and December of The goal was to gain understanding of retailers planned initiatives, priorities and future trends by contacting more than 500 top North American retailers. This report summarizes the results and key findings of the survey, offers insight based on our client engagements and overall retail experience, and identifies current and future trends in the industry. These insights are intended to help retailers compare their customer-facing operations and technology and identify opportunities to enhance their customers experience. Of the retailers surveyed, the breakdown in size based on gross annual revenue included a broad selection of Tier 1, 2 and 3 retailers, with 54% of the retailers having more than $1B in sales (Exhibit 25). This year, more large Tier 1 retailers were included with of the respondents indicating sales of $10B or greater, compared to 8% last year. This year s survey also recognizes the challenges that retailers continue to face as they shift from a single channel environment to a unified commerce environment. While none of the respondents indicate a true unified commerce environment, there is definitely movement from multi-channel to omni-channel as last year 6 of retailers stated they operated a multi-channel environment with 28% indicating omnichannel. This year, 38% are multi-channel and 44% are now operating an omni-channel environment. (Exhibit 26). The primary retail segments of the survey respondents were specialty soft goods with 28% of respondents and specialty hard goods with 26% of respondents (Exhibit 24). The remainder fell into various other categories such as general merchandise and grocery, food and beverage. This focus on the specialty retail segment remains consistent. Last year s survey also focused on the specialty retail segment with 28% falling into the specialty soft goods category and 41% in the specialty hard goods category. QSR / Restaurant 5% Grocery, Food, and Beverage 15% Exhibit 24 Company Category Specialty - Hard Goods 26% General Merchandise 18% Specialty - Soft Goods 28% Other 5% Convenience and Fuel Less than $100M 15% $100M to $499M 18% $5B to $9.99B 10% $10B or more Exhibit 25 Annual Revenue The specific respondents for each company were primarily vice presidents and directors of store systems or IT, and C-level executives. $1B to $4.99B 2 $500M to $999M Exhibit 26 Current Channel Integration Unified commerce 0% Single channel 18% Multichannel 38% Omnichannel 44%

29 2018 POS/Customer Engagement Survey 29 About BRP BRP is an innovative retail management consulting firm dedicated to providing superior service and enduring value to our clients. BRP combines its consultants' deep retail business knowledge and cross-functional capabilities to deliver superior design and implementation of strategy, technology, and process solutions. The firm's unique combination of industry focus, knowledge-based approach, and rapid, end-to-end solution deployment helps clients to achieve their business potential. BRP s consulting services include: Strategy Point of Sale (POS) CRM Order Management Supply Chain Business Intelligence Mobile POS Unified Commerce E-Commerce Networks Business Process Optimization Payment Security Customer Experience & Engagement Merchandise Management Private Equity For more information or assistance on any of the topics covered in this white paper, please contact: Brian Brunk, Principal (405) bbrunk@bostonretailpartners.com Ken Morris, Principal (617) kmorris@bostonretailpartners.com Perry Kramer, SVP and Practice Lead pkramer@bostonretailpartners.com David Naumann, VP of Marketing (916) dnaumann@bostonretailpartners.com Kathleen Fischer, Director of Marketing (330) kfischer@bostonretailpartners.com BRP Atlanta Boston Chicago Dallas Denver San Francisco BRP. All rights reserved No part of this publication may be reproduced or transmitted in any form or for any purpose without the expressed permission of BRP. The information contained herein may be changed without prior notice.

30 2018 POS/Customer Engagement Survey 30 Platinum Sponsor Aptos About Aptos In an era of virtually limitless choice, sustained competitive advantage only comes to retailers who engage customers differently by truly understanding who they are, what they want and why they buy. At Aptos, we too, believe that Engaging Customers Differently is critical to our success. We are committed to a deep understanding of each of our clients, to fulfilling their needs with the retail industry s most comprehensive omni-channel solutions, and to fostering long-term relationships built on tangible value and trust. More than 1,000 retail brands rely upon our Singular Commerce platform to deliver every shopper a personalized, empowered and seamless experience no matter when, where or how they shop. Learn more:

31 2018 POS/Customer Engagement Survey 31 Platinum Sponsor Cayan About Cayan Cayan is a technology company focused on transformative innovations in payments. Whether a business is looking for simple and reliable payment processing, to fully integrated, multichannel customer engagement platforms, Cayan is continuously developing new ways to unlock the power of payments. From buy online, pick up in store to auto-reorder and in-aisle purchases, Cayan makes it possible for businesses to deliver the outstanding unified commerce experiences customers demand. Businesses get new insights into the customer journey, shopping behavior and satisfaction so they can turn one-time buyers into repeat customers. Cayan s fully integrated, multi-channel customer engagement platforms include their Cayan Unified Commerce Solution Suite and Genius Platform. Both are secure and scalable platforms that are fully configurable, tailored to a businesses unique needs and easy to implement. Headquartered in Boston, the company has multiple offices in the United States and Belfast, Northern Ireland. Cayan is one of the world's fastest growing payment companies. For more information, visit

32 2018 POS/Customer Engagement Survey 32 Gold Sponsor Diebold-Nixdorf About Diebold Nixdorf Diebold Nixdorf, Incorporated (NYSE: DBD) is a world leader in enabling connected commerce for millions of consumers each day across the financial and retail industries. Its software-defined solutions bridge the physical and digital worlds of cash and consumer transactions conveniently, securely and efficiently. As an innovation partner for nearly all of the world s top 100 financial institutions and a majority of the top 25 global retailers, Diebold Nixdorf delivers unparalleled services and technology that are essential to evolve in an always on and changing consumer landscape. Diebold Nixdorf has a presence in more than 130 countries with approximately 24,000 employees worldwide. The organization is headquartered in North Canton, Ohio, USA and Paderborn, Germany. Shares are traded on the New York and Frankfurt Stock Exchanges under the symbol DBD. Visit for more information.

33 2018 POS/Customer Engagement Survey 33 Gold Sponsor ECRS About ECRS ECRS is an industry-leading solutions provider that harnesses technology to future-proof today's retailers and prepare them for tomorrow's opportunities. ECRS revolutionary CATAPULT system is the market s only truly unified point of sale platform. With CATAPULT POS, inventory, customer loyalty, back office, e- commerce, and enterprise management are housed under a single system that shares data. This data synchronization, Unified Transaction Logic TM, empowers retailers to prosper by providing actionable business intelligence. Unifying hardware, software, and services, ECRS offers a friction-free, cost-saving solution that will increase customer engagement. ECRS is committed to perpetual development, expanding value through constant innovation. To that end, CATAPULT is fully-customizable. Optional plug-andplay modules work seamlessly with core applications, offering retailers freedom and flexibility in designing their point of sale platform. Retailers can easily expand platform functionality as their business grows. Exhaustive research, intelligent design, and rigorous pre-market testing ensure that ECRS products integrate smoothly into existing retail environments. ECRS technology solutions are backed by a knowledgeable, accessible, and award-winning US-based support team that is dedicated to retail success. On the 2017 RIS Leaderboard, ECRS was ranked #1 for grocery vendors for the fifth year in a row, #1 for midsize retailers, and ranked in the top 5 for quality of support for the ninth year in a row. ECRS is proud to be building a community of retailers and share in their success. Systems that ECRS Innovates Traditional Point of Sale Self-Checkout Systems Click & Collect 2.0 Mobile POS Accelerated Checkout Back Office Management Reporting & Analytics Customer Loyalty & Marketing Enterprise Headquarters Management Inventory & Warehouse Management Supplier and EDI Integration Gift Card Systems Membership Management Fuel Pump Integration Pharmacy System Integration Onboarding & Support Services For more information or assistance, please contact: Caroline Catoe, VP of Marketing and Customer Care, at x5096 or ccatoe@ecrs.com

34 2018 POS/Customer Engagement Survey 34 Gold Sponsor Fujitsu About Fujitsu Fujitsu is a global ICT company providing comprehensive store software, technology, retail managed services, Fujitsu K5 cloud, analytics, IoT and security solutions to more than 500 retail customers in 53 countries around the world. Continual innovation at Fujitsu delivers new solutions such as TeamPOS8000 hardware, Marketplace Enterprise Cloud POS software, Fujitsu Fresco POS for Grocery, GlobalSTORE POS for General Retail, U-Scan Genesis II, Mini-Express and Impulse self-checkout, Cashbox Module (CBM) Taskforce Retail Wearables, and Integro lifecycle management, Retail Engagement Analytics and Interstage Retail Agility BPM, all designed to make running the store more efficient, profitable and engaging for customers. At Fujitsu, our mission is a simple one to help retailers deliver a differentiated experience for their customers by bringing innovative retail solutions, enterprise integration expertise and the experience and delivery capabilities of our global reach. Visit us at Fujitsu and the Fujitsu logo are trademarks or registered trademarks of Fujitsu Limited in the United States and other countries. Fujitsu TeamPOS, Marketplace, GlobalSTORE, Fresco, U-Scan, Impulse, Integro and Interstage are trademarks of Fujitsu America, Inc. in the United States and other countries. The statements provided herein are for informational purposes only and may be amended or altered by Fujitsu America, Inc. without notice or liability.

35 2018 POS/Customer Engagement Survey 35 Gold Sponsor Manhattan Associates About Manhattan Associates Manhattan Associates is a technology leader in supply chain and omnichannel commerce. We unite information across the enterprise, converging frontend sales with back-end supply chain execution. Our software, platform technology and unmatched experience help drive both top-line growth and bottom-line profitability for our customers. Manhattan Associates designs, builds and delivers leading edge cloud and on-premises solutions so that across the store, through your network or from your fulfillment center, you are ready to reap the rewards of the omnichannel marketplace. For more information, visit