Jason Simpson From Multi-channel to Omni-channel commerce

1. Jason Simpson From Multi-channel to Omni-channel commerce

3. Technological advancement & changing consumer expectations

4. Omni-channel behaviour is shaping Multi-channel commerce

5. How channels interact: the role of print

6. Reaction to the shifting environment

7. Brand integrity = Multi-channel strategy

9. Traditional model = physical stores with print driving footfall and/or mail order business

10. Today = new channels emerging every year

11. Proliferation of media

12. Marketing reach becoming harder

14. UK e-commerce sales totalled £30bnin 2010

15. Accounts for7% of all retail sales

17. Digital catalogues

18. iPhone/Android apps

19. iPad & other tablets

20. In-store kiosks

21. Social mediaSouth Africa = 5.3m

23. Accounts for 4% of online retail spending

24. Just 2.1% of UK‘s adult population currently shop via a smartphone, but nearly 80% of owners have used it to buy something!

25. But smartphone ownership is growing by c100% annually, driven by iPhone, Android and other comparable products(source: Verdict & Ovum Research)

27. 20% plan to do so, according to a study of 1,500 people in the UK, France, Germany, Italy and Spain

28. The study also found that shoppers who used mobile in some part of the research and purchase process spent 15% to 30% more than those who used just one channel (source: IDC/Akamai) 80% of all web-page views in Japan are via mobile devices! UK predicted to mirror this by 2014 Highly likely that developing nations will leapfrog to this stage

29. Developments in mobile commerce… Example

31. Integrating offline and online media

32. Quick Response (QR) Barcodes

33. Augmented Reality

34. RFID & NFC (Near Field Communication)

37. Omni-channel consumers are shaping Multi-channel commerce… McKinsey research 2009 Clothing retail example USD$ average customer spend per year 3 channels = 4.4 x higher than print alone 4.5 x higher than stores alone 5.6 x higher than web alone

39. The “shop in the home” works

40. Multi-channel is here & increasing revenue

42. today's consumer where we’re headed Private & Confidential, Copyright Pindar & Verdict Consulting 2010

43. 1980sCarefreeconsumption 1990sCarelessconsumption Late 2000sCarefulconsumption 2010sConsideredconsumption Today’s consumer: the mindset shift Private & Confidential, Copyright Pindar & Verdict Consulting 2010

44. Today’s consumer: considered consumption Quantity I buy lots of things: some I need, some I don’t… Quality I buy things I that I really want… Product It’s mainly about the product… Holistic It’s about the product and the background to the product… Price I want everyday low prices… Value I don’t mind paying for good things… Impulse I buy things without thinking about them… Thoughtful I buy things I like, but I think about what I am buying… Private & Confidential, Copyright Pindar & Verdict Consulting 2010

46. A more modern catalogue or brochure

47. Lifestyle magazines from retailers in which the primary aim is promotion or selling (magalogue)

48. Retail inserts & circulars

49. Leaflets & postcards not includedPrivate & Confidential, Copyright Pindar & Verdict Consulting 2010

50. 1999 £9,503m 2009 £4,393m The traditional view – a changing landscape Size of traditional mail order catalogue market ? Private & Confidential, Copyright Pindar & Verdict Consulting 2010

51. The modern scenario Lost in a sea of cross-channel confusion Telephone Online Stores Cats, Mags, Inserts Affiliates Kiosks C2C Social networking Mobile Private & Confidential, Copyright Pindar & Verdict Consulting 2010

52. Perceptions have changed The stigma’s gone – they’re totally different now They’ve changed, they’re a really nice read Private & Confidential, Copyright Pindar & Verdict Consulting 2010

53.           The influence of the catalogue today 20.8% regularly use a catalogue to directly buy products Private & Confidential, Copyright Pindar & Verdict Consulting 2010

54. The purchase decision process Think Research Buy Return Physical 92.9% 84.2% 74.5% 83.5% 63.7% Online 70.7% 69.1% 69.0% 66.3% 40.4% Catalogue 53.9% 53.8% 86.1% 37.4% 53.8% 21.8% 9.5% News/mags 32.2% 12.8% 5.7% 31.0% 31.0% 0.7% Private & Confidential, Copyright Pindar & Verdict Consulting 2010

55. Omni-channel consumers are shaping Multi-channel commerce… McKinsey research 2009 Clothing retail example USD$ average customer spend per year 3 channels = 4.4 x higher than print alone 4.5 x higher than stores alone 5.6 x higher than web alone

56.           The influence of the catalogue today 53.9% regularly use a catalogue in the purchase process Private & Confidential, Copyright Pindar & Verdict Consulting 2010

57. The underlying reasons for usage It’s nice to sit and relax – to sit on a sofa and flick through 36.4% 35.9% 30.4% 29.6% I can see how the clothes will look on my children 21.7% They’re good at product placement Seeking inspiration Gathering ideas Browsing for fun Checking product details Comparing prices Private & Confidential, Copyright Pindar & Verdict Consulting 2010

59. The monetary value: sectors Percentage of spend in each sector influenced by catalogues 74.7% £31.0bn 73.2% £15.9bn 69.4% £8.6bn 67.4% £8.5bn 63.5% £6.8bn 53.9% baseline 54.8% £9.5bn 45.2% £4.5bn 43.0% £1.4bn 14.6% £18.1bn Clothing Electricals DIY Furniture Homewares Beauty Books Music/film Food Private & Confidential, Copyright Pindar & Verdict Consulting 2010

60. Where is print used and viewed? Catalogue browsing The charts below shows the percentage of people who browse catalogues in the various situations and locations. At home 89.4% At work 8.9% While traveling 9.1% In store 24.8% On holiday 3.0% While waiting 14.4% At a friend's home 14.1% Private & Confidential, Copyright Pindar & Verdict Consulting 2010

61. Catalogue dynamics – shop in the home + Average time spent browsing catalogues: 8 hours per month Average household receives 2 catalogues each month 5% of households receive more than 5 catalogues each month Private & Confidential, Copyright Pindar & Verdict Consulting 2010

62. B2C research summary Traditional views of the catalogue do not hold true Catalogues are critical influencers, at the critical points We live in an omnichannel world Driving spend, through channels of choice Private & Confidential, Copyright Pindar & Verdict Consulting 2010

63. Further evidence Why the catalogue is so important… Of those, 80% found their purchase in a catalogue and then went online to order. 70% of those surveyed shopped from home last year. Experian, 2009

65. Focus in IT has been on logistics and ERP/CRM – single customer viewBut: Consumers do not see channels, they see brands. Therefore, brand and service level consistency across all channels is important for maintaining customer loyalty. Sharing product and customer data across channels is vital to achieving a consistent customer services and brand message. A single, central repository is required to provide a single view of the data. But many retailers are still not managing important processes at a multichannel level. (DataMonitor, Sep 2009)

66. The challenges associated with Multi-channel marketing

68. Ensuring consistency of product data & pricing

69. Duplicationof effort across channels

70. Speed to market slow due to complexity

71. Logistical/back-end issues such as:

72. Returns (buy online, return to store)

73. Stock availability across channels

75. Web Web database hand- written note <XML> suppliers Release Release Release Release ERP/main MFG Author Approve Release Analysis Clean Input

76. Web Web database hand- written note <XML> suppliers Release Release Release Release Release Release Release ERP/main Release Release Release Release MFG <XML> Catalog Create hand- written note Author Approve Approve Author Release Analysis Release Analysis Clean Input Input Clean

77. Web Web database hand- written note <XML> suppliers Release Release Release Release Release Release Release Release Release Release ERP/main Release Release Flyers/circulars Release Release MFG <XML> Catalog Create Create hand- written note Author Approve Approve Author Approve Author Release Analysis Release Release Analysis Analysis Clean Input Input Clean Clean

78. Web Web database hand- written note <XML> Tablets/phone suppliers Release Release Release Release Release Release Release Release Release Release Release Release Release Release ERP/main Release Release Flyers/circulars Release Release MFG <XML> Catalog Create Create hand- written note Enrich Approve Author Approve Approve Author Approve Author Integrate Release Analysis Release Release Release Analysis Analysis Clean Input Input Clean Clean Manually embed references

79. Web Web database hand- written note Create Create <XML> Approve Tablets/phone Author Author Analysis Release Release Release Input Input suppliers Release Release Release Release Release Release Release Release Release Release Release Release Packaging/POS ERP/main Release Release Flyers/circulars Release Release MFG <XML> Catalog Create Create hand- written note Author Approve Approve Author Approve Author Enrich Integrate Approve Release Release Release Release Analysis Analysis Clean Input Input Clean Clean Manually embed references

80. Web Approve Approve Web database Email hand- written note Create Create <XML> Approve Tablets/phone Author Author Analysis Release Release Release Input Input suppliers Release Release Release Release Release Release Release Release Release Release Release Packaging/POS ERP/main Release Release Flyers/circulars Release Release MFG <XML> Catalog Create Create hand- written note Author Approve Approve Author Approve Author Enrich Integrate Approve Release Release Release Release Release Analysis Analysis Author Clean Input Input Clean Clean Manually embed references

81. Web Approve Approve Web database Email hand- written note Create Create <XML> Approve Tablets/phone Author Author Analysis Release Release Release Input Input suppliers Release Release Release Release Release Release Release Release Release Release Release Packaging/POS Rest of company ERP/main Release Release Flyers/circulars Release Release MFG <XML> Catalog Create Create hand- written note Author Approve Approve Author Approve Author Enrich Integrate Approve Release Release Release Release Release Analysis Analysis Author Clean Input Input Clean Clean Manually embed references Product Information Anarchy

83. Brand consistency checking

84. Repetitive operational tasks

85. Complex process and duplication

86. Copy proofing multiple times

87. Reformatting refreshed text

88. Inefficient language localisation process

89. Constant verifying

90. Re-checking legal information

91. Manual pricing and re-checking

92. Cumbersome approval process

93. Unproductive communication

94. Time sensitive re-work Etc, etc…. Web database Email hand- written note Create Create <XML> Approve Tablets/phone Author Author Analysis Release Release Release Input Input suppliers Release Release Release Release Release Release Release Release Release Release Release Packaging/POS Rest of company ERP/main Release Release Flyers/circulars Release Release MFG <XML> Catalog Create Create hand- written note Author Approve Approve Author Approve Author Enrich Integrate Approve Release Release Release Release Release Analysis Analysis Author Clean Input Input Clean Clean Manually embed references

95. Web Email Tablets/phone Release suppliers Packaging/POS PIM Solution Rest of company ERP/main Flyers/circulars Catalog

97. Publish content to websites within hours of product creation and convert your business to ‘web first’ publishing

98. Reduce production times for printed promotions by up to 75%

99. Free up designers time to use their creative minds and design more pages

100. Reduce the number of errors and review cycles by up to 90%

101. Do more marketing, with the same resources (or less)

102. Turn your product information into a strategic asset: > Be ready to exploit emerging channels > Speed to market = competitive advantage

103. The challenge is recognised

104. PIM is a crucial foundation Retail Systems Research May 2010 Retailers asked to comment on which business initiatives hadthegreatest positive impact in improving customer satisfaction across all channels Ensuring product information and pricing is up to date and consistent across channels Enabling cross-channel fulfillment Cross selling and personalized promotions Synchronizing customer and inventory information across channels Same day shipping & simple, consistent returns Information sharing with merchandise vendors on product features and availability Enabling real time views of cross-channel inventory

105. The purchase decision process = =

106. Driving multichannel success… + = (Multichannel Success)