Start Over Strategy For Tomorrow's Future
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Josh Siegel, CIO of Natural Markets Food Group and Mark Collin, Head of Retail, ThoughtWorks Europe at ThoughtWorks Live Europe 2014. Today's retail food landscape is in a constant state of change - with digital disruption creating multi-channel challenges. In addition, there is increasing consumer demand for healthier food options. Retailers must adapt by learning how to address these continual shifts and develop meaningful customer experiences across multiple touch points. Learn how Natural Markets Food Group is leveraging experience design and technology to create a truly innovative approach in the retail food and food service industry.
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Start Over Strategy For Tomorrow's Future
- 1. START OVER STRATEGY for tomorrow’s future
- 2. C U S T O M E R ENGAGEMENT ?
- 4. • Doug Stephens is one of the world’s foremost retail industry futurists. He was recently ranked #9 in Vend’s Top 50 Retail Influencers. • Doug conducts speaking engagements globally on retail & consumerism and has 10,000+ followers on Twitter @RetailProphet www.retailprophet.com • Author of the ground breaking book, The Retail Revival: Re-imagining Business for the New Age of Consumerism. • Presenting “The Future of the Retail Store” About Retail Revival
- 8. Natural / Organic Grocery Sales Traditional Grocery Sales organic growth rate MORE THAN 2X growth rate for all food “IT’S JUST A FAD.”
- 9. U.S. ORGANIC MARKET SALES $1B 1990 $11B 2004 $27B 2012 Global organic food & beverages market is expected to reach USD 211.44 billion by 2020, growing at a CAGR of 15.7% from 2014 to 2020
- 10. global $100Bby 2018 U.S. $21B by 2016 organic ONLINE GROCERY SALES $13Bby 2016 Organic Personal Care
- 11. COMPETITION from every angle TECHNOLOGY PRICE PRODUCT PEOPLE
- 12. • Existing operating environments and technical infrastructure • Define and gain internal agreement on the “to be” • Define and gain agreement on roadmap, development and deployment plan • Budget • Time • Organization • Internal resources/capability • Training • Culture • Vendors – current and future • Competitors – current and future • Technology in general OUR CHALLENGES ARE NOT UNIQUE
- 15. Do we look at this as a POS decision? What about on-line ordering and grocery shopping? How does mobile come into play? If we choose a platform that everyone else has deployed how do we create a competitive edge? How long will it take to make changes? How expensive will those changes be? where do we begin?
- 16. 5MONTHS (the clock is ticking) we only have
- 17. Retail Food Food Service
- 18. Guiding Principles 1platform create a JOURNEY leverage our smaller size let history inform the future, not drive the it LETGUESTSCHOOSE quickly move from DECISION to ACTION
- 19. Digital Shoppers Multi-channel buyers Researchers Physical store buyers OUR CUSTOMER
- 21. in both grocery & restaurant properties OBSERVATIONS 1 Individuals interested in eating with their colleagues spent the bulk of their time alone. • Decide what to eat • Separate to place the order • Wait for the order • Find each other • Look for a table 2 Families were in the restaurant together but were not necessarily interested in eating the same food or eating together
- 22. in both grocery & restaurant properties OBSERVATIONS 3 Payment options were “traditional”
- 23. 4 Customers made multiple purchases from multiple stations = multiple payments and standing in multiple queues. 5 The “Queue” during lunch = people leaving the queue in both grocery & restaurant properties OBSERVATIONS
- 24. 6 Moms and dads had difficulty finding a safe way to navigate AND had a hard time finding seating that was "friendly" 7 Differently abled customers struggle with “the queue” and seating in both grocery & restaurant properties OBSERVATIONS
- 25. • Multitude of order options: Self Service Kiosk; Mobile; Online • Unique Payment Options for families and groups • Food related information • Queue busters • In-store format that makes it safe and easy for parents with children, differently abled, and seniors to order and enjoy their food • The ability to grocery shop AND enjoy let’s address the breaks in the journey & CREATE
- 27. what we saw EVERYTHING is still channel based SINGLE- CHANNEL MULTI- CHANNEL OMNI- CHANNEL CATALOG CATALOG ?
- 29. • Start-ups will continue to enter the market in a variety of roles and they will rapidly drive change – Technology – Business models • Larger retailers will begin to more seriously investigate opportunities to transition to a more nimble, customer experience driven operating environment • The definition of convenience will continue to morph as new technologies are introduced • Labeling is the tip of the iceberg • Local origin, artisanal, small batch is the fastest growing segment – and one of the most difficult to incorporate • Mobile payment will become THE form of payment WHAT’S NEXT?
- 30. N E X T G E N E R A T I O N RETAIL ARCHITECTURE
- 31. A retail solution should not be a big box!
- 32. …it should be a combination of discrete capabilities…
- 33. …that leverages the right solutions… Bespoke solutions that are differentiators and offer a business advantage. Commodity solutions that add value, but don’t differentiate.
- 34. …to build a platform for innovation and evolution. REPLACEABILITY FLEXIBILITY SCALABILITY AVAILABILITY EXTENSIBILITY
- 35. 60:40
- 36. JOHN LEWIS
- 38. Q&A
- 40. APPENDIX
- 41. 379+ stores growing to 1000 with a market cap matching that of Kroger 150 stores growing to 1,200 & Sprouts IPO'd in August of 2013 and raised $344M 344 stores in 25 states with an estimated $11B in revenue. Raised $290M for IPO and operates 131 stores in 25 states with estimated $1.3M in revenue
- 42. The “Nature’s Market” sec/on is featured in more than 1,300 of their 2,500 stores. Launched it’s own brand of natural and organic food in 2009 Promising to drive down organic food prices by 25% with a new line of organic food products
- 43. Free same-‐day and early morning delivery on orders over $35 of more than 500,000 Amazon items, including fresh grocery and local products.
- 44. • Our own stores • Competitors stores, online and off • Other consumer facing businesses • Past work experience • Customers • Street and analyst community • Employees Observation (The good, the bad and the ugly)1 Research2
- 45. Identify & Prioritize Customer Segments3 Create a contextual end-to-end customer journey map for each segment 4
- 46. Create and prioritize action-oriented tasks5 Identify overlapping tasks and actions6
- 47. Identify value of the tasks, and ease of implementation 7
- 48. Define the roadmap8 Define tools that support execution of roadmap AND allow for flexibility 9
- 51. • We did not have time to execute a traditional approach – who does anymore? • A traditional approach would have given us a “Traditional” solution and would force us to execute a vision that was not ours • “Traditional” solutions were developed to solve channel issues not to address the complexities of today’s customer journey – do we build a future based upon the past? • We needed to work with a partner that would ask: – Understood the importance of “Speed to Value” – Embraced service and experience design as a necessary step in delivering a solution – Believed that innovation was driven by more than technology
- 52. • Approaching the project with the goal of supporting the customer’s mission was key • “How do we continue to create an awesome customer experience?” • Adopting a test and learn approach to rolling out initiatives can make a huge impact • Design experiences, not touchpoints • Manage expectations and transitions across the ecosystem – Customers – Executive level, mid management, store associates – Vendors – from food purveyors to IT consultants • Do not underscore the importance of testing and training
- 55. Where it Ended
- 56. For Concept Purpose Only
- 57. For Concept Purpose Only
- 58. For Concept Purpose Only
- 59. For Concept Purpose Only
- 61. 6 1 For Concept Purpose Only
- 62. 6 2 For Concept Purpose Only
- 63. 6 3
- 64. 6 4
- 65. 6 5
- 66. 6 6
- 67. 6 7
- 68. Experiences Digital Signage • Subway Entrance Video Wall • Atrium Column Wrap • Virtual Host Hologram • Entrance Floor Projec/on • Express Market Signage Children’s Area • Children Interac/ve Video Wall Digital Menus • Kitchen Sta/on • Bar Screens Customer Ordering POS Single Kitchen Kiosk Express Market Kiosk Fulfillment Screens Kitchen Sta/on Column Screens 68
Editor's Notes
- Hello, my name is Josh Sigel. I been the CIO and Technology leader in a number of organizations. Recently I was with Natural Markets Food Group and today I was to share with you our “Start Over” journey.
- Hello, my name is Josh Sigel. I been the CIO and Technology leader in a number of retail and distribution organizations. Recently I was with Natural Markets Food Group and today I am excited to share with you our recent “Start Over” journey.
- To understand our journey it’s important that I quickly share with you some facts about the Organic and Natural Foods Industry. It’s hard to turn on your TV or open a newspaper (or Turn on a newspaper for those who have gone paperless!) without hearing about the benefits of Organic or the health concerns raised by nutrition experts regarding all the antibiotics, pesticides, and other bad things being introduced into our food supply.
- The customer journey will continue to cause the channels to blur. The customer will demand mobile payment and loyalty cards. The value of conventional loyalty programs will continue to be questioned – creating a higher purpose. The “currency” or the value to the customer is in giving. Do you need demographics? Then check the research.
- We believe that Ralph Lauren needs an IT system that will act, as a platform for innovation, one that can meet the business needs of today and evolve to meet those of tomorrow… How do we build such a platform? Well firstly, it is important to think about the architecture and domain in terms of capabilities, which, for online retail there are really 5 key capabilities that one can think of:
- We believe that Ralph Lauren needs an IT system that will act, as a platform for innovation, one that can meet the business needs of today and evolve to meet those of tomorrow… How do we build such a platform? Well firstly, it is important to think about the architecture and domain in terms of capabilities, which, for online retail there are really 5 key capabilities that one can think of:
- 12 screens making up a window into the world we are creating. We have a concept we have been developing and presenting soon. A farm scene made up of cut-paper creates the background. In front we use the concept of the Farmer’s Almanac, old-time but with modern sensibility. Tweets
- Eye catching imagery connects the space with the upper floor. Landmark place. Combination of typography and messages that draw people in, and imagery of fresh food, coffee, treats. Atmospheric, not pushy.
- Our virtual host puts a face to the space. She talks to the our audience and provides education for how to get the most out of the experience. She makes the use of the mobile app less mysterious. She represents the quality of the food. She is tech savvy, but not tech obsessed. She is smart and uses it to get more time for her life.
- On the floor, we see imagery that points people to the space. It’s a welcome mat that points the way and highlights the kitchen brands.
- The screen rotates among several messages, ranging from how to best use the app, what is looking good, highlight our Children’s area, reinforce the brand.
- Separate area dedicated to families with small children provides a detail that separates this space from a common food court.
- A unified design based on typography and letter pressed menus has a modern feeling with the old time charm. Anachronistic it avoids nostalgia and being ‘fake.’
- Balanced with chalkboards, the design works together, and each medium focuses on what it does best. Digital is able to be updated from the central system, and the analog boards can high light a special or even a particular associate.