Driving Profitable Sales with the New Empowered Customer

Transcription

1 IBM Point of View Driving Profitable Sales with the New Empowered Customer 1 IBM Internal Copyright IBM Corporation 2014

2 The quickly evolving customer 2010 Meeting the Demands of the Smarter Consumer 2011 Capitalising on the Smarter Consumer 2012 Winning Over the Empowered Consumer 2013 From Transactions to Relationships 2014 Greater Expectations Expectations and SoLoMo Developing Relationships Trust Personalisation Use of technology 2 IBM Internal

3 The Age of the Empowered Customer IBV 2013 Study 27% made their last purchase online. 50% increase over % post a review once per month. 54% post 2-3 reviews per month 9 of 10 reasons to shop a retailer involve omnichannel capabilities 67% have a smart phone 64% say reviews are the most important criteria in deciding where to shop 81% expect the same brand experience across all channels 3 IBM Internal

4 People are willing to share more information. Willing to share current location (GPS) % 36% 2013 Willingness to share Social handle = 32% Mobile # = 38% Source: IBM IBV 2013 survey, n= 30,554. Q31 and Q54 Year on year comparisons include 13 of 16 surveyed countries 4 IBM Internal

5 Baby boomers no longer dominate the consumer story Aging baby boomers will mostly be in their 60 s and 70 s by 2020 (1) Still financially crippled from the great recession Focusing on healthcare, aging parents, wealth preservation for retirement Millennials take control Born , they will just be 38 years old in million strong (roughly the same size as the boomers) (1) Completely different values, social norms and expectations Quality over quantity (owning less stuff) Completely connected and mobile Heavily influenced by peers ( we vs. me ) Socially responsible attitude towards companies and products [1] Source: 2010 US Census Report 5 IBM Internal

6 Customers expect a personalised approach Anticipate and service my shopping needs Use what you know about me to deliver a seamless and interconnected engagement regardless of where or how I am shopping with you. Make it convenient and easy to interact with you Consistently capture my history and profile and deliver information and services to me through my preferred channel. Be there when I need you, in real time Empower me with real-time updates, proactive communications and choices before, during and after I shop with you. Remember all of my interactions Understand me and my preferences through our past interactions. 6 IBM Internal

7 The Disruptors 7 IBM Internal Copyright IBM Corporation 2013

8 The Disruptors cause the huge paradigm shift The New Disruptors in Grocery 8 IBM Internal

9 Place your order by 10am have it for dinner Free Same-Day & Early Morning Delivery on orders over $35. 9 IBM Internal

10 Amazon Grocery and Fresh Amazon Grocery Launched 2006: Vitamins and Supplements #1 gross profit dollar category Baby is the #4 category Sells more diapers than Kroger Health and Beauty in top 20 Coffee #24 Specialty Grocery top 30 Amazon Fresh launched ,000 fresh items 28,000 ambient Open in Seattle, LA and SF 28 DCs planed Drives the trip to Amazon Targeting Higher Income Segments 10 IBM Internal

11 Develop Relationships with Your Customers The era of personalization versus paper ads for all 11 IBM Internal Copyright IBM Corporation 2013

12 A Huge Shift in Strategy Current state: I have an offer let me find a customer to sell to Sales and Gross Profit tracked by Category, Store and Segments Target state: I have a customer what do they need today? Sales and Gross Profit tracked by Customer 12 IBM Internal

13 Behavior (spend) Focus on the loyalty levers and with your best customers and your next best customer High Very loyal in attitude and behavior Moderate Low Low Moderate High Attitude Lars Spindler IBM DK 13 IBM Internal

14 Value of Behavior Forecasting by Customer Individual Nano Entity Lifecycles (INEL) Known history Add predicted future behavior based on all expected future data points in the lifecycle Actions in each interaction over time 14 IBM Internal

15 Best Practices Customer First Strategy 41 straight quarters of like store sales and EBIT increases 60 million card holders Focus on 15 million their best customers Personalized incremental ads to best customers 70% redemption on Ecoupons Personalized Promotional Pricing Best customer data used extensively in assortment decisions 15 IBM Internal

16 Play where She wants to Play Build world class omnichannel 16 IBM Internal Copyright IBM Corporation 2013

17 Mobile is at the epicenter of change 17 IBM Internal

18 Identifying presence and location will become essential in enabling timely and relevant customer interactions Identify customers presence as they enter or leave the store Identify proximity to a retail store Identify what aisle or department the customer is located Interact with customers in real time 18 IBM Internal

19 Best Practices Best in Class for Grocery 10% of sales online Large investment to fight Amazon Price Match Click n Collect and Delivery models Diversification and Disruption 19 IBM Internal

20 Technology is allowing companies to offer a personalized and unique shopping experience, inside and outside the store Wegman s offers shopper convenience and community functions, with web-to-store functions such as find/save/share recipes, shopping lists printed by aisle location, integrated Shoppers Club saving, and friendly iphone application. Events and classes in the store, with extensive use of videos on YouTube to promote the brand and products. Click and Collect tops 2% of sales after 1 year Woolworths launched a totally seamless program across tablet, mobile and PC about 1 year ago. Customers can use any devise to order groceries for pick up at store. Woolies is implementing dark stores in beach towns to handle huge surge of business. Additional dark store opening to handle 3,500 items that will be carried only online and not in the stores 20 IBM Internal Mobile Check Out Stop & Shop stores in the Boston area allow customers with iphones to scan grocery items and add them to an electronic shopping cart. By aiming the phone s camera at the bar code on a product package, the customer can see the price and add it to the electronic shopping cart. Once shopping is done, the app relays the information to a checkout register, where the customer can pay with cash or a credit card.

21 Technology is allowing companies to offer a personalized and unique shopping experience, inside and outside the store El Corte Inglés has launched an online operation in the UK, Ireland and Netherlands. The Spanish retailer has introduced a marketplace where customers can purchase more than 50,000 products from 200 brands, particularly Spanish ones. El Corte Inglés is partnering with IBM, which has created an e-commerce platform using a Cloudbased system. The new website offers fashion, sports items, household goods and gourmet products. Customers will receive orders within 48 hours of purchase. These will be dispatched from the retailer s logistics facilities in Madrid, with shipping provided by leading international logistic groups.. In pursuit of enhanced customer service, Waitrose is exploring the use of mobile devices on the shop floor. According to The Grocer, the John Lewis-owned UK retailer is to equip support managers with tablet computers, thereby freeing them from having to use a desktop computer, allowing them to spend more time with shoppers. ARISTO is an IBM Research First-ofa-Kind augmented reality mobile solution. Tesco is using ARISTO to validate planogram integrity and in stock position. Associates or a third party simply scan the planogram with a smart phone. ARISTO s picture recognition technology captrues planogram and in stock position on the shelf and bounces it off of TESCO s authorized planogram. Any differences in items, space and in stock levels is immediately noted and fixed. 21 IBM Internal

22 IBM Interactive s Team developed and deployed Coke s largest and most successful interactive marketing program ever. Business Drivers My Coke Rewards (MCR) is a the Coca-Cola s most high-profile, dynamic, and complex consumer-facing program and web application with 13 million registered members, hundreds of prestigious business partners, advertisers, user-profile targeted and scheduled promotions, and voluminous and ever-improving features, flows, and offers. Solution This engagement continues a long term partnership between IBM Interactive and Coca-Cola North America IBM AIC provides a highly seasoned Atlanta-based build team and operations team leadership and has redesigned and continuously expanded the broad MCR functionality and leverages both landed and offshore resources. also provides day-to-day management for MCR, MCR for schools, & the MCR Code Entry Widget. The Complex and extremely powerful loyalty site includes: Business Benefits My Coke Rewards has 13 million registered members, almost a quarter of a million visits per day, about 50,000 new members each week, and 1.4 million members entering PIN codes each month. 22 IBM Internal

23 Lockers are dominate in the UK and expanding quickly 23 IBM Internal

24 The Merchant Mindset The art of merchandising 24 IBM Internal Copyright IBM Corporation 2013

25 25 IBM Internal

26 Thank You 26 IBM Internal