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Smart Retail: The Power of Technology (English version)

  1. @Iv_Rodriguez Smart Retail: The Power of Technology Ivan Rodriguez | BDM Smart Signage 6th April 2017
  2. 52% OF COMPANIES WILL NOT EXIST IN THEIR CURRENT FORM IN 2021 Fujitsu Digital Transformation Report (2017)
  3. Netflix didn’t exist 10 years ago, but in 2016 has closed with more than $8000M of turnover, and is the largest provider of video content in the world. When companies ignore changes and do not follow market trends, the result is catastrophic. It happened to Blockbuster who did not foresee how a disruptive agent could wipe it from the map. One way or another it will happen to us, and it’s not good idea to wait for the disruption come and react later.
  4. RETAIL SITUATION Retail and consumer industry PWC 45%About things that will grow in 2017 52%Are concerned about the pace of technological change 58%Forced to reduce social and environmental impact 62%Concerned about the complex supply chain Looking at this survey of retail concerns, it is surprising to see that only 22% are concerned about the security of personal data.
  5. EXECS RECOGNIZE THE CHANGE Retail Forum 2017 "I want us to stop talking about digital and physical retail as if they're two separate things. The customer doesn't think of it that way, and we can't either“ CEO Doug McMillon | Wallmart “We want to bring technology to life in the store […] We know what’s in the aisle and what the mobile shopper has told us and fuse all that data” CIO Chris Hjelm | Kroger “Connect the digital & physical and provide a unified, trusted customer experience from the Tesco stores to the customers’ homes” CTO Edmond Mesrobian | Tesco “The more we can make our stores as interesting as our online experiences, the more we are going to benefit in the future.” CEO Terry Lundgren | Macys
  6. CONSUMER SPENDING Retail in Europe 2016 GFK Per capita purchasing power index Increase Percentage of Retail Spending
  7. RETAILERS SUFFER HUGE LOSSES! (1) Avery Dennison, 2010 (2) WWD-Lifestyle Monitor, Motorola Retail Shopper Study 2010 (3) The Global Retail Theft Barometer, Avery Dennison, 2010 70%Abandoned the purchase process due to excessive time spent at checkout(1) 40%Of stock registered at computer systems of retail stores is not accurate (1) 30%Of shoppers who abandon purchases go to another store (2) 35%Traditional antitheft systems only address customer theft, while employee theft accounts for over 35%(3) Deploying different technologies at the point of sale can help to reduce these losses.
  8. PURCHASING PROCESS The physical store has a great importance in the buying process. Consumers want to see the product, touch it, feel it ... But who doesn’t look for information about a product online? Or compare prices? Showrooming vs Webrooming Physical store + Technology = 21st century purchase process
  9. COMPETITIVE KEYS Retail Forum 2017 DISCOVER CUSTOMER INTERESTS For that it is essential to listen to and use the information generated in the back end to improve processes and products CUSTOMIZE THE INTERACTION Accompany customers, create products with them. Become a social business BUILD WOW EXPERIENCES Apply neuroscience, work on the user experience and emotions, surprise yourself with design and turn your shopping experience into a memorable act WORK WITH THE BACK-END To avoid wasting the work of the Front-end try to achieve a unique and fair stock, practice click & collect, e-tailing and ebooking, reduce lead times and of course use an always mobile strategy
  10. COMPETITIVE KEYS SEEK LOYALITY Practice gamification and immediacy using the mobile phone, avoid shortages and be effective TRANSFORMATION TOOLS The aim is to achieve agility, security, flexibility and capacity. Use fast and secure digital payments. Use Analytics to learn about consumer habits with Data Governance and Data Management. USES TECHNOLOGY AT POINT OF SALE Artificial Intelligence, Smart Data, Augmented reality, instant messaging, IoT and RFID. TRACK YOUR EMPLOYEES It drives the digital leap to be hyperconnected, with an agile culture and above all listen to them, they are in continuous contact with the customer Retail Forum 2017
  11. MARKETING Su principal objetivo es saber qué quieren comprar los consumidores, cuando lo quieren comprar y qué precio están dispuestos a pagar por ello MARKETING The main objective is to know what consumers want to buy, when they want to buy it and what price they are willing to pay for it
  12. MACROTRENDS HYPERPERSONAL SPHERE Hololens, Mobile, Tablet CUSTOMER CENTRICITY Durable and trustful relationships TECHNOLOGICAL MEGATRENDS Big Data, IoT, AI, BYOD, SaaS, VR, AR, MR DIGITAL TRANSFORMATION Reformulation of strategic proposals. Transformation of the value chain
  13. EMPOWERED CUSTOMER Competitive Strategy in The Age Of The Customer “The best advertising is done by satisfied customers” - Philip Kotler
  14. SALES PROCESS STOP SELLING, START TEACHING “How you sell is more important than what you sell” Provides insight “Commercial Teaching” Offers products that the client doesn’t even know exist
  15. ADVERTISERS Internet Trends 2016 Code Conference The opportunity for Mobile is enormous
  16. ADVERTISING “Half the money I spend on advertising is wasted; the trouble is I don't know which half.“ John Wanamaker (1838 – 1922) CURRENTLY 85 - 90%!!!
  17. SOME ANSWERS… My marketing budget is getting less and less There is no transparency. I do not know what I'm buying when I contract advertising I don’t trust measurement systems We have low conversion rates These are the usual answers in the face of a lack of transparency and reliable data on which to base their actions
  18. THE CAUSES Generalized collapse of demand generation through traditional mechanics • Consumers are becoming increasingly impervious • Traditional techniques have become less and less effective on the Internet due to saturation and factors such as ad blockers • Increased competition hinders differentiation Customer analysis and profiling has been trivialized • People no longer see a fundamental value to integrating socially into a group. We want to be treated as unique and special individuals • The promise of segmentation and relevant communication based on trivial interests and factors such as age or gender are having poor results
  27. Everything that is not relevant to the user and adapted to his individual profile is intrusive and therefore rejected Eye-Tracking Heatmaps Reveal Where People Really Look
  28. IS COMMUNICATION RELEVANT OR ANNOYING? We have switched from Broadcast without privacy to the Internet | Desktop with private environments and finally to Mobile and IoT in intimate surroundings
  29. According to Relevance Theory (Deirdre Wilson and Dan Sperber), the search for relevance is a fundamental feature of human knowledge from which speakers tend to take advantage. An input is relevant to a person when their processing in the context of a series of previously available assumptions produces a positive cognitive effect, such as responding to a question he had in his head, increasing his knowledge about a certain subject, resolve a doubt, confirm a suspicion or correct an impression that has turned out to be wrong.
  30. MILLENNIALS New generations boost personalization and digitization
  31. CONSEQUENCES In response, advertising investment is constantly increasing… Nowadays, for an equivalent investment, advertising only creates 33% of the demand it generated 20 years ago
  33. MEASUREMENT By 2021 they hope to have tracking and personalization of information Zebra Technologies study (Survey to 1700 executives in Retail) 79%Individually customized store visit 75%Know when specific customers are in a store 75%Real-time location- based and customer assistance alerts 71%Alert when a customer is in a parking lot to pick up an online order 96% of the sector is ready to adopt Internet of Things technologies in the next 5 years
  34. The main use of it is labeling and tracking products • Inventory • Product location • Thefts reduction • Queue reduction – Checkout RFID
  35. ARTIFICIAL VISION The main use is tracking people • Scene analysis – Opportunities To See • Heat maps – Traffic • People detection – Who’s watching? • Tracking – What are they looking at? • Rating – Gender, age, mood
  36. RADIO ANALYTICS The main use is to track people through their mobile phones • Heat maps – Traffic • Recurrence • Time at shop • Rating – By type of mobile device • Captive portals • RRSS information • Traffic data information
  37. VISUALIZATION DIGITAL SIGNAGE • LCD monitors • LED • Projectors • E-INK (Price tags) • Mobile The main difference of Digital Signage is that we control what and when we emit content
  38. ARTIFICIAL INTELLIGENCE DATA- 1ZB in 2009 vs 44ZB in 2020 BIG DATA - 37% of data in Cloud in 2020 HARDWARE - SPARC M7 transistors MATURATION– Predictive data and optimization
  39. Su principal uso es el etiquetado y seguimiento de productos h/t JieTang
  41. Watson Personality Insights
  42. TECHNOLOGIES IN RETAIL How far do you want to go?
  43. DIGITAL TRANSFORMATION This is to rethink a business, to make it more efficient, to promote what has been learned, to innovate, to think critically to draw up a new roadmap and, above all, to focus on the customer
  44. PEOPLE + TECHNOLOGY Change of mindset of the leaders of the organization Technology as a tool for change
  45. Changes generate doubts and uncertainty, and this transformation needs a person to lead the process THE LEADER
  46. THE EMPOWERED CUSTOMER “It is no longer enough to satisfy your customers. You must delight them” Philip Kotler
  47. IBM Amplify 2015 The Future of Customer Engagement Now 78% Trust the recommendations 86% Use multiple purchase channels 40% Look at products on their Smartphone in the physical store 75% Believe companies lie in ads 4~5x Multichannel customers spend more than average 58% Are more conscious of price than a year ago 80% 8% CEOs think they offer better customer experience Customers agree
  48. We live in "the age of customer". It’s he who chooses the moment, the place and the channel; But it’s the companies that have to be able to offer a satisfactory experience, from any point of contact. Each of these links should be used to understand it better using artificial intelligence, big data and the most advanced automated selling systems. A customer-centric strategy is not possible without an employee- centered strategy
  49. PROCESSES They are the gears that start the business mechanism. Big Data, Business Intelligence or Artificial Intelligence, are focused on obtaining conclusions and improvements.
  50. DIGITAL TRANSFORMATION Global study by Fujitsu, where analyze the digital transformation 52%Believe that they will not exist in their present form 98%Consider that their organization is already undergoing change 92%Think they need to evolve into digitization 75%Say that their sector will change in the next 5 years The search for new ways to make the knowledge and experience come from the use and acquisition of a new way of working.
  52. PSFK Future Of Retail 2017 HEAR + NOW Concept created by: (With modifications for Original) The Challenge: Original regardless of its physical retail, needs to improve its key point of differentiation – personalized customer service. THE SOLUTION: HEAR + NOW is an AI-enabled, in-ear platform for retailers looking to enhance their customer service. The system helps direct Customer Service Representatives to where they are needed most and supplies them with on-demand Access to inventory, product information and supplemental opportunities to cross-sell via e-commerce.
  53. OBSERVATION 01 A couple arrives at the store, just as they enter, a monitor informs them that there is a Wifi available so they can connect for free, also if you access the Wifi, your experience in store will be more personalized. They decide to access the Wifi, and they log in with their Facebook account, it is easier and they also offer a discount of 5% on any purchase that same day. Technology: • Radio Analytics • Cameras with face recognition • Microphones with speech recognition and transfer to text • An AI system with key word detection HELP 02 Through existing store technologies, the system detects that the couple has been standing in front of a sofa for an extended period of time. The Artificial Intelligence system alerts a vendor to help them. The seller comes with a headset and a Tablet to answer their questions. PSFK Future Of Retail 2017
  54. INTERACTION 03 The Artificial Intelligence system is detecting keywords in the couple conversation, and is offering answers to the seller. The seller, tablet in hand, receives information about the material that the sofa is made from, a personal finance, delivery times and options for the same product in other colors. The AI has detected phrases such as "it will be genuine leather?", "it's expensive, we can not afford it", "we need it now, we can not go on any longer with the sofa we have", “the color does not convince me ". OMNICHANNEL 04 The AI has not detected all the questions, and the seller makes a direct voice query: "Do we have it available in 3 places instead of 2?". The AI responds by voice and with information in the Tablet that the product is not in stock at store but they have stock online, and that they can manage the order from the Tablet itself. PSFK Future Of Retail 2017
  55. SELLING, UP-SELLING AND CROSS- SELLING 05 The couple has decided to buy the sofa and to take finance to do it. It is an expensive piece, and the seller takes advantage to offer insurance on the product as well as additional products such as a small coffee table that fits in the same style. These products have been proposed by AI. BACK-END 06 The questions and answers generated in the interaction, feed the database of the product and this particular customer. This conversation will improve the products, the sales process and the production. PSFK Future Of Retail 2017
  56. NEW REGULATIONS, NEW RULES The General Data Protection Regulation (GDPR) imposes new rules on organizations that offer goods and services to people in the European Union (EU), or that collect and analyze data tied to EU residents, no matter where they are located. • Enhanced personal privacy rights • Increased duty to protect data • Mandatory reporting of breaches • Significant penalties for non- compliance
  57. ETHICS
  58. CONCLUSIONS • Retail is changing rapidly • Change needs leaders with global vision of the company • Technologies are tools in transformation • The consumer rules, the strategy must be centered on him • Proposals have to be individualized, we can not treat clients as part of a collective • E-commerce is another channel, it cannot be differentiated • The mobile is the protagonist for the interaction in stores • Data can greatly improve processes • Ethics in business will be more important than ever
  59. • Architecture Design • Cloud Infrastructure. Azure, SoftLayer. • Artificial Intelligence as a Service. IBM Watson, Microsoft Cognitive • Hardware AV. LG, NEC, Peerless, Samsung, Sony, Vision, Vogel's ... • Sensorization. RFID, Beacons • Network infrastructure. Radio Analytics with Cisco Meraki • Cameras with face recognition. Axis, Cisco, Logitech CREATION OF WORKING TEAMS
  60. THANK YOU @Iv_Rodriguez #MaverickSmartRetail No one knows what the retail will look like in the future, these are some ideas supported by data of what could happen. We are in a fascinating time. There are big changes coming and no one knows how this will end, we just know that everything is changing and our attitude towards change will mark our result.