critical_5_technologies_revolutionizing_retailris news_feb_2014_it investment.pdf

Mobile technology serves a dual purpose for retailers, aiding both associates and customers who consider a mobile device part of their daily lives. Careful planning, execution and device management solutions are the cornerstones of a successful mo-bile strategy for any retailer. Those who take advantage of the benefits of integrating mobile capabilities into their brand experi-ence will see increased sales and productivity of associates. With mobile, retailers can send customers coupons and loyalty points, access quicker checkout and redeem rewards automatically.

While 2013 was the year of the mobile pilots, 2014 will be the year that mobile will start to become truly integrated into the store experience and deliver on the vision of becoming closer to the customer. Over the last year, retailers including Perry Ellis, Luxottica and Home Depot have begun to equip both store associates and customers with mobile devices to improve the in-store experience, becoming more efficient and convenient. These devices not only improve the customer ex-perience, but also create an endless aisle, track associate pro-

ductivity, allow for checkout anywhere in the store and create an overall customer-centric brand experience.

Made famous by the Apple experience, mobile checkouts are one of the easiest ways to combat shopping cart aban-donment. If customers can checkout on the floor from a tablet rather than waiting in line, sales will increase. For example, after implementing mobile POS capabilities last year, Nord-strom experienced a 15% increase in sales. When the POS is linked to the inventory and the website, retailers can use pur-chase history data to further personalize the shopping experi-ence the next time the shopper enters the store.

Mobile POS and mobile selling solutions help Perry Ellis to increase customer engagement throughout its stores, provide access to customer loyalty information, and enable associates to use mobile devices for product and price lookup, product recommendations and clienteling. The solution also allows sales associates to check the inventory of out-of-stock items in other store locations and channels, fulfilling the order without leaving the customer.

Transforming theIn-Store Experience

I N - S T O R E M O B I L I T Y

Transforming theIn-Store ExperienceThe use of in-store mobile devices helps retailers create an endless aisle, increase productivity and extend the brand experience

R I S N E W S C R I T I C A L 5 F E B R U A R Y 2 0 1 4 6

CRITICALI N - S T O R E M O B I L I T YFEBRUARY 2014

Five Technologies revoluTionizing reTAil

sPonsoreD BY

IN-STORE MOBILITY // PAGE 3

BUSINESS INTELLIGENCE & ANALYTICS // PAGE 6

UNIFIEd OMNIChANNEL PLATFORMS // PAGE 10

FLExIBLE FULFILLMENT // PAGE 14

LOCATION AWARENESS MARkETING // PAGE 17

Critical_v4.indd 1 2/14/14 1:35 PM

The shoppers embrace of personal technology has forced deep changes in the retail landscape, especially

in the realm of enterprise-level IT strategy and execution. Todays new reality demands a new approach to

retail technology.

RIS News has delved into the five technologies we believe will have the biggest impact on retail in 2014

and beyond. The technologies are explored in depth in the following pages and include:

1. In-Store Mobility. Integrating mobility into the store experience will be a top priority in 2014.

Retailers are using mobile devices to create an endless aisle, track associates, enable checkout any-

where, and create a customer-centric store experience.

2. BI/Analytics. A host of new technologies offer new data-gathering and analytic opportunities.

Retailers are exploring how to turn this new data into useful insights and high-performance outcomes.

3. Unified Omnichannel Platforms. With the number of shopping channels likely to rise, it is

increasingly vital for retailers to abandon the siloed approach in favor of tightly coupled platforms. A

unified approach to inventory, for example, ensures customers get what they want, when they want

it, in the channel they prefer.

4. Flexible Fulfillment. Customers want to take delivery of their purchases as quickly, easily and

affordably as possible. Technology is being introduced throughout retail making ship-to-store, ship-

from-store, store-to-store transfer and a host of fulfillment options a seamless reality.

5. Location Awareness Marketing. Retailers need to personalize the shopping experience

and engage customers at every turn. Smart retailers are marketing to shoppers through mobile net-

works, WiFi and Bluetooth technology in-store via a customers own mobile device.

I N T R O

T i m o T h y D e n m a n

When setting priorities for iT investments in 2014 and beyond, these five technologies deserve to be at the top of every retailers list

TECHNOLOGY GROUP

www.edgellcommunications.com

PUBLISHER

David Weinand 904.374.8590 [email protected]

EDITORIALGroup Editor-in-Chief Joe [email protected]

Senior Editor Timothy Denman [email protected]

Managing Editor Nicole [email protected]

SALESAssociate Publisher Catherine J. Marder603.672.2796 [email protected] Executive Tom Buckley 512.520.5370 [email protected] Account Manager Ashlely Ramirez904.834.2248 [email protected] to the Publisher Jen [email protected]

ONLINE

VP of Online Media Robert [email protected] Development Manager Scott [email protected] of Lead Generation Jason [email protected]

MARKETING/EVENTS/CIRCULATION

Director, Event Planning Pat [email protected], Event Content John [email protected] Manager Jeffrey [email protected]

PRODUCTION

Senior Production Manager Pat [email protected]

Subscriptions 978.671.0449Reprints: [email protected]

CORPORATE

CEO/Chairman Gabriele A. [email protected] Gerald. C. [email protected] President John [email protected]

CORPORATE OFFICE

Edgell Communications4 Middlebury Blvd, Randolph, NJ 07869973.607.1300 FAX: 973.607.1395

FOUNDERDouglas C. Edgell

1951-1998


5 Must-Have Technologies5 Must-Have Technologies


Mobile technology serves a dual purpose for retailers, aiding both

associates and customers who consider a mobile device part of

their daily lives. Careful planning, execution and device manage-

ment solutions are the cornerstones of a successful mobile strategy

for any retailer. Those who take advantage

of the benefits of integrating mobile capa-

bilities into their store experience will see an

increase in sales and productivity of associ-

ates. With mobile loyalty programs for ex-

ample, retailers can send offers to targeted

customers to redeem coupons or earn loy-

alty points. This is just one of many options

available through in-store mobility.

While 2013 was the year of mobile pilots,

2014 will be the year that mobile will spread

throughout retailing and support a strategy

of becoming more closely engaged with con-

sumers. Over the last year, retailers includ-

ing Perry Ellis, Luxottica and Home Depot have begun to

equip both store associates and customers with mobile

devices that make the in-store experience more efficient

and convenient. While these devices not only improve the

customer experience, these also create an endless aisle

that supports selling products that are out-of-stock in the

store. Other important mobile functions include enabling

for checkout anywhere in the store and creating an overall custom-

er-centric experience.

Mobile checkout and line-busting are

effective ways to combat in-store shop-

ping cart abandonment. If customers can

checkout on the floor from a tablet rather

than waiting in line at a cash wrap, satisfac-

tion will increase and loyalty will improve.

For example, after implementing mobile

POS capabilities, Nordstrom experienced a

15% increase in store sales. When the POS

is linked to the inventory and the website,

retailers can leverage purchase history data

to personalize the shopping experience ev-

ery time the shopper enters the store.

Mobile POS and mobile selling solu-

tions help Perry Ellis increase customer engagement by providing

access to customer loyalty information and enabling associates to

tap into product and price information, recommendations and clien-


I N - S T O R E M O B I L I T Y



84% of smartphone shoppers use

their devices to help shop

while in-store.

Google Shopper Marketing Council, Mobile In-Store

Research

Mobility enters a new phase of mainstream adoption and next generation capabilities

N i c o l e G i a N N o p o u l o S

CRITICAL 5

of retailers say store associates use mobile devices to perform store functions. EKN, State of the Industry Research Series: The Future of the Store

64%



The Home Depot also rolled out mobile solutions

focused specifically on integrating the omnichanel

experience in stores, knowing that customers ex-

pect a simple and easy way to shop across channels.

Along with new technology capabilities, new training

was necessary for associates. New functions enable

Home Depots First Phones to be able to manage the

buy online and pick up in-store (BOPUS) and buy on-

line, ship to store (BOSS) processes.

Previously, an associate would have to go to a ter-

minal to complete this activity, which added time and com-

plexity to the action. Now, with the First Phone, associates

can close the transaction immediately from wherever they

are in the store. The training and additional technology have

led to a significant improvement in integrated customer

service. Separately, the retailer tracks customer satisfac-

tion scores on BOPUS and BOSS orders. Those scores

have shown a marked improvement and the Home De-

pot plans to continue to refine and improve the process.

For retailers developing in-store mobile programs,

success will depend on how well they understand cus-

tomer demands and manage mobile expenses. As re-

tailers continue the broad-based rollout of mobility in

stores, they will encounter pain points along the way, but

also dramatically improve the in-store experience and

customer engagement.

teling capabilities. The solution also allows sales asso-

ciates to check inventory status of out-of-stock items

in other store locations and channels and ultimately

complete the order without leaving the customer.

Innovation is something Perry Ellis has always

been known for, so the adoption of mobile selling

in our stores is a natural evolution for our brand,

says Luis Paez, CIO of Perry Ellis. Our clients expect

something different when they walk in and our goal

is to use mobile to deliver an exceptional, unique

customer experience that will keep them coming back.

Similarly, Luxottica set out to transform the shopping ex-

perience and bring new capabilities to traditional systems. To

do this, the eyewear retailer deployed in-store iPads across

its 2,000 Sunglass Hut locations, creating an endless

aisle strategy that makes it easier for customers to find

what they want where they want it, with past purchase

history and other information available through the e-

commerce site.

The tablets enable associates to browse and com-

pare products, check inventory and order out-of-stock

items, providing a more engaging customer experience.

Apps allow the retailer to incorporate associate tracking,

reduce paper messages used in stores, support market-

ing and merchandising initiatives and improve associate

productivity.

1 in 3shoppers use their

smartphones to find info instead of asking

store employees.RIS News, Expanding

the Boundaries of POS

More than 50% of consumers appreciate that retailers are using

MPOS to make the in-store shopping experience

more convenient.I Love Velvet,

2013 Consumer Mobile Point-of-Sale

(MPOS) Attitudes Report

I N - S T O R E M O B I L I T Y CRITICAL 5


A D V E R T O R I A L CRITICAL 5

Aerohive delivers wired and wireless mobility platforms with customer analytics.

What steps must a retailer take to enable a strong in-store mobile network?First and foremost the retailer, like any enterprise requiring mission-critical wireless, must understand their RF envi-ronment. Thorough site surveys are required. Many retail chains have standardized wireless configurations that are nearly cookie-cutter, but theres always a benefit to having the RF environment verified.

Secondly a system that doesnt require complicated equipment at the local store allows for a simple, hands-off deployment; ideal for resource strapped IT departments. Access points (APs) that can not only handle the full traffic load but also perform higher-level security and privacy functions are key. If the system requires additional equipment to comply with security regulations outside of the APs, then you will run into higher per-store costs, which add up quickly.

How can an in-store mobile network be utilized for location analytics?The Wi-Fi being used by mobile devices as well as the infrastructure ac-tually carries a tremendous amount of data with it. The key is to anony-mize the data in accordance with your companys privacy policy for its customers, but also to use a system capable of processing large amounts of data. In addition to serving data to customers, APs are effectively collec-tors that gather huge amounts of data in order to make decisions on how

Secure In-Store Mobile Networks


Aerohive Networks reduces the cost and complexity of todays networks for retailers with cloud-enabled Wi-Fi and routing solutions for in-store mobility, warehouse operations, analytics, and guest Wi-Fi. Aerohives cooperative control Wi-Fi architec-ture, public or private cloud-enabled network management, routing and VPN solutions eliminate costly controllers and single points of failure.

Joel VincentDirector, Product MarketingAerohive Networks

to optimize traffic on the network. That data collected can be analyzed to make better business decisions based on customer analytics, but it needs a backend system that is usually cloud based that can do data mining in real-time.

Do you believe enabling shoppers access to the wireless network or restricting the network to associates is a better strategy?The right infrastructure can do both safely and securely. In fact, the system should be smart enough to understand the users identity and apply the right security policy in real-time without even creating multiple networks i.e. all on the same infrastructure. Thats what modern mobile-centric systems do.

That being said, if I was forced to choose, the answer would be it de-pends on your business model and what your customers want. If youre a quick-serve restaurant you may want to create queue busting strategies because customers desire to get in and out with little delay. If youre a retailer driven by average ticket amount and understand that is tied to the amount of time the customer is in the store browsing, then you may want to prioritize a secure guest network that can help you analyze custom-ers and provide them the ability to research and comparison shop while theyre in the store.

Security is again a big issue in wireless. Should retailers be concerned? No. Wireless networks 10-12 years ago were less secure so many stan-dards organizations like IEEE and IETF, as well as government agencies, put tremendous amounts of research into fixing security holes in wireless. The reality is that because of the history of wireless security, the standards today around WLANs make them MORE secure than wired networks. But security is a process, not a feature, and to truly prevent breaches like the ones in the news today requires active security practice. WLANs have not been the weak link in the process in a very long time.

Secure In-Store Mobile Networks

Critical5_Feb Issue_Aerohive_v2.indd 1 2/20/14 11:32 AM


Smarter Decisions, Better Outcomes

B U S I N E S S I N T E L L I g E N C E & A N A LY T I C S

N i c o l e G i a N N o p o u l o s

Good things happen when analytic tools are designed to deliver re-

ports in near-real time, incorporate omnichannel data and extend

the flow of data to key line-of-business departments. Many retail

experts say that analytic solutions are the most important technolo-

gy today for optimizing performance throughout the enterprise and

achieving measurable, hard dollar gains.

The boom in mobile technology in retail has opened up a new de-

livery system for business intelligence and created new data-gath-

ering possibilities for retailers. In addition to mobile data a number

of other new sources of data, such as social networks and online,

are creating a complex web of data sources that retailers must find

a way to consume. To cope with this complexity,

58% of retailers want to move to a shared services

structure for analytics teams, according to EKNs

Industry Point of View: Customer Analytics: The

Bedrock of the Retail Singularity. For example,

analytics can be

used to gain a greater understand-

ing of store traffic patterns and cus-

tomer behavior, as well as predict-

ing future shopper activity.

What retailers really want from

analytics is not to gather more data

as much as they want to discove

insight and recommendations. The

ability to make smarter decisions

by leveraging data across multiple

sources, including customer profiles, sales, merchandising, social/

mobile and finance, differentiates retail leaders from the laggards.

Walmart, for one, is using an analytics-based solution that analyz-

es customer shopping habits to create suggested shopping lists. Re-

sults show that customers using this Walmart app make more trips

to the store and spend as much as 40% more than other shoppers.

Walgreens is another leader using analytic tools. It is piloting a

program that launches, delivers and tracks marketing campaigns

Business intelligence and analytics help retailers uncover insights needed to deliver informed decisions

Smarter Decisions, Better Outcomes

CRITICAL 5

58% of retailers want to move to a shared services structure for analytics teams. EKN, Industry Point of View: Customer Analytics: The Bedrock of the Retail Singularity

The amount of customers who use Walmarts analytics-driven shopping list app spend more than other shoppers.

40%


Untitled-1 1 2/7/14 3:34 PM

CRITICAL 5


line and mobile. Enabled by timely

data, analytic insights are used to re-

vamp traditional approaches to mar-

keting, pricing, promotion, assortment

and fulfillment. By combining retail

databases, analytic tools and a spe-

cialized data-driven team, Belk is able

to achieve a seamless and successful

shopping experience across multiple

channels.

The same customer metrics that are

used online are increasingly being uti-

lized in-store. Data that tracks shopper

movements, dwell times and conver-

sions is being used to maximize store

layout, product placement and promo-

tional displays. Other areas that will

play an increasingly-important role in

the coming years are big data, predictive analytics, use of third

party and external data sources and unstructured data. The pursuit

of analytic insight is not new in retail and yet retailers still have a

long way to go to get up-to-date with current capabilities. The ma-

jority (62%) say they have only a basic level of analytics maturity

today, according to EKNs 2013 Big Data in Retail report, which

means there is a lot of work that needs to be done to leverage this

critical technology.

through redemption of coupons for specific LOreal Paris products

from LOreal Paris all the way through brick-an mortar POS sales.

Product coupons are pushed through a mobile POS beauty app,

Pretty In My Pocket (PRIMP), and have individualized barcodes that

connect itemized purchases to the consumers PRIMP profile.

Supermarket chain Publix has expanded its enterprise data ware-

house functionality beyond traditional strategic analysis and into

tactical operational intelligence for smarter, faster merchandising,

marketing decisions and insight.

This upgrade of our environment will allow us to expand our

enterprise data warehouse solution, which provides valuable data

analytics, said Laurie Douglas, Publix CIO. This enhancement

enables Publix to leverage data regardless of its type allowing

the retailer to know more and do more

for business performance, as well as

facilitates quicker responses to chang-

ing business conditions and consumer

behavior.

Belk has rolled out an omnichannel

transformation initiative that is fueled

by customer analytics

insight that helps the

retailer integrate op-

erations consistently

across channels, in-

cluding in-store, on-

62% of retailers are only capable of basic analytics or basic reporting, forgoing the opportunity of more advanced analysis leading to deeper insight. EKN, Industry Point of View: Customer Analytics: The Bedrock of the Retail Singularity27.3%

of retailers currently have Analytics/BI shared seamlessly in their IT ecosystems.RIS News, Omnichannel Readiness

B U S I N E S S I N T E L L I g E N C E & A N A L Y T I C S



Building a new customer-centric operating model for retail

Here it is 2014. Does a true unified omni-channel platform really exist?Almost, but not quite. True omni-channel - according to Fu-jitsus customers definition still remains an ambition in our view rather than a reality at this time. If omni-channel means a two-way 360 degree view of the customer and the retailer then no end to end ,out of the box platform currently exists in our view to deliver thus. To deliver a joined up platform across touch points (cash register, mobile), data source (ERP, CRM) and business process (order management) we find retailers

are re-engineering their enterprise IT from a transaction to a customer-centric model. This is what we call Retailing without Walls it means thinking less about transactions on registers and more about navigating customers across touch points. That is why we have launched Fujitsu Market Place, the key PoS application component in building this unified platform.

What do you consider to be the key elements of an omni-channel platform?We believe there are three key elements in delivering an omni-channel platform, each of which have in-built into Fujitsu Market Place:

1. Service-oriented application architecture: adopting what is called a modular or componentised PoS architecture means retailers can plug and play new channels or payment devices or data sources as technology trends change and shopping processes blend across channels. This deliv-

Retailing without Walls

Fujitsu America, Inc., is a leading solutions provider for retailers. Delivering integrated technology and service offerings ranging from managed services and systems integration to enterprise applications and data center technologies, Fujitsu helps retailers improve sales with POS solutions including hardware, software, and self-checkout systems.

Richard ClarkeVP, Global Retail, Fujitsu

ers a true future proof retail IT model.2. Enterprise integration: this means the joining of the customer touch

points to the key data sources and business processes to deliver the omni-channel services like order on line, pick up in store which customers are expecting. This is pooled into a central transaction repository which gives customer and store associate visibility of wish lists, transactions and orders at any time from whatever touch point.

3. Flexible deployment: providing alternative deployment options for application components like the back office PoS server - means retailers can choose where they want to keep data, incur cost but de-risk network connectivity.

Any time the word platform is in mix, big and expensive come to mind. In looking at building out the omni-channel platform, is a rip and replace strategy required?We dont think so. Fujitsu thinks that retailers can and will want to mi-grate from their current platforms to a new omni-channel model over a period of time rather than in a big bang fashion. This means any platform components from the pos to the SOA-based architecture to transaction repository need to be deployable in stages to reduce cost, de-risk busi-ness change and speed overall implementation. Fujitsu would recommend starting with the enterprise data management layer from Fujitsu Market Place the push n pull component of any omni-channel platform on which the pos, device management and data sources can build.

How can a retailer actually save money by utilizing a unified platform? Fujitsu believes retailers can reduce cost or at least improve operational ef-ficiency by leveraging the new solution architecture and deployment model. Cost savings can come from reduced development costs (avoiding recoding the business logic each time you want to add a new device like mobile or a new data source) and reduced technology costs (deploying the back office PoS server in the enterprise with reduced number of servers and associated support costs). Thats the smart thing about Retailing without Walls.

Retailing without Walls


Critical5_Feb Issue_Fijitsu_v3.indd 1 2/20/14 11:36 AM

Death of the Siloed Approach Death of the Siloed Approach

Thanks to a host of new technologies customers are engaging

with retailers across a spectrum of channels. Retailers are juggling

a magnitude of technology systems to ensure that customers get

the products they want, when they want them and in

the channel they prefer. To alleviate the complexity

and expense of operating and maintaining dozens of

systems, smart retailers are streamlining their tech

stack and moving toward a unified

omnichannel platform to ensure

customer needs are met regardless

of the channel they choose to shop.

One example of a unified om-

nichannel platform is a tightly inte-

grated system that pulls together

all the solutions that manage inven-

tory. Dicks Sporting Goods expects

e-commerce to be a $1 billion busi-

R I S N E W S C R I T I C A L 5 F E B R U A R Y 2 0 1 4 1 0

ness for the brand in the next three years, and

has invested in technology and processes that

tie together supply chain, inventory and loyalty

to unify its web platforms around an overall om-

nichannel strategy.

Our goal is to solve the ultimate retail chal-

lenge, Dicks Sporting Goods CIO and SVP Matthew Lynch said.

The right product in the right size and color at the lowest cost

priced by channel and region available at exactly the right time

in exactly the right quantity. And, of

course, located right where the cus-

tomer wants it.

Managing inventory using a uni-

fied platform approach helps retail-

ers satisfy the needs of their most

lucrative customer segment. A cus-

tomer that engages with a retailer

across multiple channels is 21%

more profitable according to the

RIS News/EKN Cross-Channel Tech

Trends Study. With that much ad-

ditional revenue on the line retailers

have significant motivation to up-

grade their systems to a unified plat-

Retailers must remove complexity to ensure a seamless experience

U N I F I E d O m N I C h A N N E L P L A T F O R m S

6.5% of potential revenue is lost today because processes, technologies and corporate structures are not fully synchronized. RIS News, Omnichannel Readiness

Shoppers are 21% more profitable when engaged across multiple channels. RIS News/EKN, 2013

Cross-Channel Tech Trends Study

CRITICAL 5



Untitled-1 1 2/7/14 3:31 PM

CRITICAL 5

they choose to shop. Back-end applications need to be fully inte-

grated in a platform approach to effectively monitor inventory and

provide real-time reports.

We market to our customers through a variety of means, Ca-

belas EVP and CFO Ralph Castner said. We put the customer in

the center of the decision and let them

choose how they want to deal with us.

Its interesting, Ive heard Macys talk

about what theyre doing about filling

direct orders from the stores. They think

about it as a way to save freight costs.

We see it a little different from that. We

see it as a way to enhance the value to

our customer and increase sales.

A seamless shopping experience

keeps shoppers engaged and coming

back, while siloed back-end systems

create disappointing customer en-

gagement. According to the RIS News

Omnichannel Readiness report re-

tailers are losing 6.5% of potential rev-

enue because their processes are not

correctly synchronized. By adopting a

unified platform approach retailers can

increase customer satisfaction while

adding to the bottom line.

form approach.

For example, if a product

is selling in-store but lagging

online, retailers need central-

ized reporting to ensure that

overstock and understock

conditions are quickly dealt

with, a difficult undertaking

when inventory is trapped in

silos. Currently, 18% of retail-

ers have inventory locked into

individual channels, an antiquated approach that they plan to elimi-

nate by 2016 according to the Tech Trends Study.

Breaking down organizational silos is a top priority for good rea-

son customers dont care about a retailers internal workings, they

simply demand seamless experiences and are making shopping de-

cisions based on those requirements. For instance, 62% of shoppers

cite the ability to buy online and then make returns in-store as a key

purchasing decision according to RIS News/Cognizants The Om-

nichannel Value Proposition.

Cabelas has a thriving catalog business as well as an e-com-

merce site and over 50 brick-and-mortar locations. Up until recently

these channels were treated as separate businesses to create a

seamless experience across all channels, the retailer rolled out tech-

nology that supports in-store pickup and ship-from-store to ensure

that customers have access to its entire inventory regardless of how


U N I F I E d O m N I C h A N N E L P L AT F O R m S

18% of retailers still have inventory locked into individual channels.RIS News/EKN, 2013 Cross-Channel Tech Trends Study

62%62% of customers site the ability to buy online and then return in-store as a key factor when picking a retailer to shop.RIS News/Cognizant, The Omnichannel Value

Proposition



Understanding the Next Steps for Retailers and Technology

What is motivating retailers to look for new solutions that interoperate seamlessly across channels and core applications?It all goes back to the changing shopping patterns of con-sumers. Many retailers have created great online shopping experiences for their customers and those experiences have led to higher expectations for the shopping experi-ence across all channels. Customers dont recognize artifi-cial boundaries between channels. They may interact with a brand in the store, online, on their phone, or via a self-

service kiosk and they expect brand consistency with each interaction. Retailers need to equalize the experience across all channels to meet the new omnichannel expectations of shoppers.

What is the next step for retailers to consider who have already begun their in-store mobility journey?Many retailers initial mobility rollout was anchored to a single system usually an extension of a POS system or an ecommerce site. Neither of those is sufficient by itself to create a differentiated shopping experience. Retailers want to leverage mobile technology to sell their entire assort-ment everywhere, transact anywhere, access all product information on demand, know their customers history and preferences across all chan-nels, and fulfill in any way the customer wants to receive merchandise regardless of channel. To do this, retailers cant be constrained by the inherent limitations of a POS or ecommerce system. Mobility should be

OmnichannelConsiderations

Starmount software solutions bring the richness of the web and the power of mobile into the store. From mobile selling to omnichannel engagement platforms, our solutions help retailers deliver a more personalized, efficient interaction from point-of-interest to point-of-sale. Please visit www.starmount.com or read our blog at www.starmountshare.com.

Jerry Rightmer, Executive Vice President and Chief Product and Strategy Officer, Starmount

the vehicle for delivering an omnichannel experience. So rather than ex-tending an existing platform, a retailers next step should be to deploy a true omnichannel model built on a platform that bridges the chasm be-tween channels.

If you were to isolate the key building blocks, the essential elements, of omnichannel retailing what would they be?Starmount has identified four key building blocks retailers need to create an omnichannel experience for their customers:

1. Accurate, real-time, enterprise-wide inventory visibility2. Deep, rich product content for a retailers full assortment (not just online)3. The ability to fulfill regardless of product source, destination, or shopping channel4. A single view of customer across all shopping channels

Why have flexible fulfillment capabilities become so important to success in retailing today?Flexible fulfillment capabilities tip the competitive scale in favor of multi-channel retailers with a strong brick-and-mortar presence. There is limited space in each store for merchandise. As retailers expand product assort-ment, its a challenge to carry enough inventory at each location, especially in apparel where color, size, and style complicate inventory allocation. A networked inventory model enables retailers to use their stores as distri-bution centers, allowing them to leverage all their inventory to satisfy cus-tomers at any location. This helps avoid lost sales and minimizes unneces-sary markdowns on overstocks. More importantly, it makes the customer happy. With all that retailers invest in driving traffic to their stores, the last thing they want to do is tell a customer thats ready to buy that they dont have what the customer wants. The other important issue is the trend toward same day/next day delivery. If stores can function as distribution centers and fulfill orders locally, omnichannel retailers can compete more effectively with online-only retailers. In fact, the store network becomes a competitive advantage.

OmnichannelConsiderations


Critical5_Feb Issue_Starmount_v2indd 1 2/20/14 11:35 AM


F L E x I B L E F U L F I L L m E N T

and today it is helping Macys in a major

way. From impacting the way customers

shop, to extending inventory the Macys

strategy is all about the customer.

What is online? If the customer buys

the product online

and either picks up or returns it to our store,

is that online or is that in-store? And if she

buys something else in our store, where

does it stop and start? said Terry Lundgren,

Macys CEO.

The ability of technology to relieve some

of the retailers risk is an advantage that is

being used with buy online, pick up in-store

capabilities. In the past, Macys hasnt been

able to get several brands out to all of its

stores due to space limitations in its small-

est locations, but now the retailer can sell

the products in these stores by placing them

for sale online and then allowing them to be

shipped to that store for the customer who wants it.

Walmart recently doubled the number of stores it uses for fulfill-

ing orders and announced plans to test the use of lockers to hold

online orders for customer pick-up. The retailer is also executing a

strategy to combine stores, distribution centers and new facilities

Many retailers would argue that they already have flexible fulfill-

ment. But todays supply chains and inventory management capa-

bilities were created in a pre-omnichannel era. A new breed of capa-

bilities is being established by fast moving retailers such as Macys,

Walmart, DSW and Williams-Sonoma that have begun rolling out

ship-from-store capabilities to fulfill online orders. Meanwhile, eBay,

Google and Amazon have launched same

day delivery of select purchases in select

markets. For cutting-edge retailers fulfill-

ment has become a competitive differen-

tiator that adds convenience and speedy

delivery for shoppers.

Ship-from-store capabilities have clear

benefits for both retailers and shoppers.

Retailers can optimize costs with shorter

delivery from centralized warehouses.

They can also reduce markdowns by

helping retailers move out overstocked

merchandise at under-performing stores.

Technology is continuously evolving,

Flexible fulfillment has become a competitive differentiator adding convenience and delivery options for shoppers

From Store to DoorFrom Store to Door

CRITICAL 5

N i c o l e G i a N N o p o u l o S

44% of retailers list

inventory visibility as a top store systems

priority for 2014. RIS News, 11th Annual

Store System Study 2014

#1

63%of retailers say fulfillment/pricing is an application shared across store and online channels. RIS News, 2013 Cross-Channel Tech Trends Study: Understanding the Retail Singularity


IS YOUR SUPPLY CHAIN COMMERCE-READY?

What role should my stores play?Your store network is an asset to your supply chain in three ways: proximity to customers, available inventory, and latent fulfillment capacity. At different times of the year, demand can materialize to varying degrees across selling channels. Your stores can provide a ready backstop if your DC network is maxed outor can form fulfillments frontline if weather causes in-store traffic to fall off. The challenge lies in how you balance satisfying online and in-store customers from your brick-and-mortar locations. For that, you need the right tools.

How do I know if Im flexible enough? Flexibility involves knowing when and why to ship from your stores, whether or not its manual, and if its only when youre out of inventory. Achieving flexibility involves leveraging partners across your networksuppliers, hubs, 3PLs, etc. You know youre flexible enough if you can not only meet peak season demand but can also support omni-channel strategies and customer-friendly initiativeswithout breaking the bank. Implementing Flexible Fulfillment means your supply chain is able to dynamically grow and not turn away or disappoint customers, while still being able to shrink back down when demand subsides.

Which technologies do I take seriously?There are any number of technologies in play in todays retail environmentRFID, iBeacon, NFC, BLE and Wearables, to name a few. And whats all the rage today may be old news tomorrow. At the end of the day, its not just about the technologies. Its about focusing on the business goals and the processes to get thereto bring contextual awareness to whats happening in your stores. Technology is a means to the end, not the end unto itself. By avoiding shiny object syndrome and focusing on the end result, you can make technology decisions that work for your business and get control of inventory across your network.

3 Flexible Fulllment Questions You Should AskYour retail supply chain is under greater pressure than ever to deliver on shopper timelines and satisfaction. Your ability to anticipate and respond to variations in demand across channels is essential for creating return customers and future success. How do you know if youre ready?

Here are three of the most common questions todays retailers are asking:

Manhattan Associates Flexible Fulfillment approach gives you the agility to anticipate and respond. Learn more at manh.com/flex

Demand

Fulllment

ChoiceChannel]SourceSupply]

Untitled-1 1 2/7/14 3:34 PM

CRITICAL 5

to increase control over and improve the customer experience of

furniture home delivery.

In an industry where flexible and reliable fulfillment is paramount,

Davids Bridal has a bigger vision. The retailer is determined to move

beyond visibility and instead use inventory availability information

across all of its channels, creating a single

view of the network across e-commerce, store

and call center operations. In turn, the retailer

will be able to match available inventory across

the network to an individual customers need.

Our business is founded on offering brides

the widest variety of products always delivered

on time no matter how she chooses to shop

with us: online, in stores or by phone. Its criti-

cal that we have one system we can rely on to

provide inventory and manage orders across

our network, said Caryn Furtaw, CIO for

Davids Bridal.

Now is the time for retailers to plan invest-

ments to build a foundation that will support

flexible fulfillment capabilities. The stakes are

high and continue to rise. By 2016, 69% of re-

tailers that will have shared inventory across

all selling channels compared to 20% today. This will have a disrup-

tive effect in the marketplace and retailers caught behind the com-

petition will be at a serious disadvantage.


into what it calls a next generation fulfill-

ment network, according to Joel Anderson,

president and CEO of Walmart.com U.S.

Amazon has consistently been a leader

in finding inventive ways to add conve-

nience and speed to its fulfillment sys-

tems. Like Walmart, it is adding lockers

at 7-Eleven, Rite-Aid and other retail loca-

tions where online shoppers can pick up

or return items. It also partnered with the

U.S. Postal Service during the 2013 holi-

day season to support Sunday deliveries.

The most important step in DSWs omnichannel journey has

already been taken place with the launch of charge-send capabil-

ity. This system allows the retailer to fulfill dotcom orders out of

stores and to satisfy unmet store demand from stock held in other

stores. The new capability was piloted in Q3 2013 and rolled out to

all stores at the start of Q4. Were excited about how the customer

is embracing charge-send, and were proud of its fairly seamless

implementation, noted DSW CEO Michael MacDonald.

To better serve its customers, Willliams-Sonoma has made up-

grades to its supply chain, opening a new distribution center in New

Jersey that is dedicated to retail store fulfillment in the Northeast.

This facility has increased flexibility in how stores are serviced while

reducing the inventory replenishment cycle time. The retailer has

also completed the in-sourcing of two furniture hubs as it continues

45.5%of retailers name fulfillment as a top omnichannel building block shared seamlessly in an IT ecosystem. RIS News, Omnichannel Readiness

F L E x I B L E F U L F I L L m E N T

69% of retailers will have shared inventory across all selling channels by 2016 compared to 20% today. RIS/EKN, Cross-Channel Trends Study

201669%

TODAY20%



L o C A T I o N A W A R E N E S S M A R k E T I N g

Retailers are currently capitalizing on cus-

tomers smart devices utilizing three distinct

technologies: cellular networks, WiFi and Blue-

tooth. The simplest form of

monitoring is through a mobile

phones mobile network. Cell

phones are in constant contact with their service pro-

viders via ultra-high radio frequency. Everyone with

a cell phone travels with a perpetual radio transmis-

sion a transmission that can be passively moni-

tored by retailers looking to analyze shopper habits.

One of the most common areas sensors are de-

ployed in the brick-and-mortar environment is at a

stores entrance. The total number of cell-phone

wielding potential shoppers that pass by the entrance

can be compared to those that enter the store to yield

the foot-traffic conversion rate. Sensors can be po-

sitioned in specific departments to study customers

as well, such as in the cash wrap to monitor the average wait time

and in fitting rooms to determine the percentage of customers that

utilize the space. Shoppers that take the time to try on garments are

significantly more likely to make a purchase; the fitting room expe-

rience needs to be constantly monitored to ensure ease of use for

this highly-profitable customer segment. By analyzing sensor data,

retailers can adjust store layout, staffing and send marketing mate-

In order to stay competitive in todays market retailers need to per-

sonalize the shopping experience and engage customers at every

opportunity. It is difficult for sales associates to personally and effec-

tively engage every customer in-store. Smart retailers are turning to

technology to personalize the in-store shopping experience and stay

connected to customers and drive sales.

Location-awareness technology allows retailers to communicate

with and track shoppers in-store providing a host of data collection

and marketing opportunities never before available. Fifty-six percent

of American adults are now smartphone owners, Pew Internet reports.

With so many people walking around with mini computers in their

pockets savvy retailers are seizing the opportunity and marketing to

customers via their personal devices.

Savvy retailers are adjusting their in-store promotional efforts and marketing to customers on their own devices

Micro-Location Promotions

60% of retailers plan to implement free customer WiFi by 2015 EKN, Industry Point of View: The Rising Importance of Customer Data Privacy in a SoLoMo Retailing Environment


CRITICAL 5

Micro-Location Promotions

56%

of American adults

are now smartphone

owners. Pew Internet


CRITICAL 5


L o C A T I o N A W A R E N E S S M A R k E T I N g

Shopping Behavior in an Internet of Everything World. In addition to

the economic incentive, shoppers need to be assured that their personal

data is safe and is not being collected. Target, for instance, offers cus-

tomers free WiFi access and uses the channel to send promotional of-

fers. It informs users that their unique device ID is being captured but

their personal data will remain anonymous.

The use of Bluetooth as a location-awareness technology in retail is

a relatively recent phenomenon, but one that is gaining popularity with

the release of Apples iBeacon technology. In 2011, none of the senior-

level retail executives RIS News surveyed reported utilizing customer

location tracking technology. This increased to 7% in 2013. Through

the use of iBeacon, retailers can push relevant information and promo-

tions via Bluetooth to a customers cell phone as they shop in-store.

Like in-store WiFi, customers must be incentivized to opt-in to

iBeacon services. Macys recently deployed the technology at six of

its stores and is rolling it out throughout the chain. The technology

allows the retailer to monitor how long a customer is

standing in a particular department, and if he has made

a purchase. If he hasnt Macys can send a note and a

financial incentive directly to the customers phone to

help induce a sale.

The number of smart devices present in the in-

store environment is growing, offering a big oppor-

tunity for smart retailers to market directly to custom-

ers on their own devices through location awareness

technology.

rials to improve customer engagement and flow.

While cellphone monitoring can yield information on customers

specific location in-store, offering free WiFi enables the collection of

rich data and increased marketing potential. By offering free WiFi to

customers (EKN reports that 22% of retailers currently offer it and

60% plan to implement by 2015) retailers can gain insight into a host

of shopping behaviors beyond physical location.

Information on web activity and purchases can be monitored

and promotions tailored to match a shoppers specific interests and

needs. Each customer engagement be it in the store,

on social media, via smartphones or through customer

service channels leaves behind a valuable informa-

tion trail, Gaurav Pant, SVP research and principal ana-

lyst at EKN says.

The trick is to get the customer to opt-in to the service.

The key factor that influences customers release of their

personal data including cell phone information is financial.

Over 50% of digital mass shoppers (those that routinely

shop in the digital realm) are willing to share personal info

in exchange for discounts, according to Ciscos Digital

Just 7% of retailers are currently utilizing customer location tracking technology. RIS News, 7th Annual Cross-Channel Tech Trends Study

Over 50% of digital mass

shoppers are willing to share personal info in exchange

for discounts.

Cisco Digital Shopping Behavior in an Internet of Everything World



2014 is All About the Power Retail Traffic Analytics

What can location awareness technology tell retail-ers that they dont already know? A wide range of important insights. Retailers are acutely aware of what happens at the register, but the true and pre-cise path to purchase INSIDE the store is critical data that is only available with this new technology. Aggregated traffic behavior is a measurement that empowers every category of retail optimization. This Includes merchandising, store

operations and marketing.

What are important steps to take to maximize the full benefits of location awareness capabilities?First, not all location technologies do the same thing. There are many types of applications; some look at the store as a single zone, and others can iden-tify every individual aisle, department even end-caps. Second, get past the hardware. Your decision should include features, cost, ease of operation, flexibility of reporting, even what it costs to maintain and operate over time. Third, get your team together. This is an infrastructure decision, so make sure merchandising, store operations, marketing and IT are all on the team. While that sounds like a handful, thats what it takes to get a decision made. Lastly is the need to treat vendors like consultants. Strive to determine the highest value applications with location technology. Do this, and the tech-nology will make fiscal sense and proceed through the budget process.

Putting Traffic Analytics into Action

With 30 global patents and 15+ years of unrivaled technology expertise, iInside delivers Retails most precise, actionable indoor location solutions. From traffic analytics to departmental performance metrics, iInside advanced shopper behavioral data adds a powerful dimension of insights that both empower decision makers and improve the customer shopping experience.

Jim RiesenbachCEO, iInside

Which departments in the retail organization will be able to make the best use of location awareness data?For store operations, one key measurement that requires indoor shop-per data is Conversion. Departmental performance can now be used as a means to optimize every part of the store or a single department across the entire organization. For merchandisers, traffic data provides a detailed un-derstanding of the effect of practically every major merchandising adjust-ment. Marketing is provided with shopper behavioral feedback to quickly and accurately determine campaign impact. This is data unavailable at the register and is highly actionable by retail professionals.

Where can retailers look to achieve ROI on their location aware-ness investment?There are at least two key categories of opportunity: benchmarking and performance. Under benchmarking, traffic becomes a means to mea-sure each key action taken by marketing and merchandising. For exam-ple, First Visit Location is a traffic indicator of shopper intent. Using this metric, Marketing is provided with feedback to determine campaign im-pact and success. Since not every shopper makes a purchase, the effect of marketing is reflected in traffic, which is a far more detailed feedback mechanism than what lies merely at the register. The same effect mea-surement also applies to each significant merchandising action. Under the performance category, conversion is a great example of the ability to see departmental-level performance across the chain, both in number of shoppers and dwell time in specific departments or areas. To store man-agers, that means each of their departments can be measured against the average and trended over time. To Category Leads, that means measuring their category/department across each store in the entire chain. Either way, traffic delivers actionable, new metrics that will soon become a ubiquitous standard.


Critical5_Feb Issue_iinside_v2.indd 1 2/20/14 11:36 AM

Thank you to our sponsorsAerohiveAerohive Networks reduces the cost and complexity of todays networks for retailers with cloud-enabled Wi-Fi and routing solu-tions for in-store mobility, warehouse operations, analytics, and guest Wi-Fi. Aerohives cooperative control Wi-Fi architecture, public or private cloud-enabled network management, routing and VPN solutions eliminate costly controllers and single points of failure. Learn more at www.aerohive.com

EpsonEpson continues to change the game in retail POS. Its innovative OmniLink smart solutions are powerful enough to replace an entire POS system, yet small enough to fit almost anywhere. From the worlds best-selling TM-T88-series to a growing lineup of mobile printers, Epson is taking retail POS to new heights. Learn more at pos.epson.com

iInsideWith 30 global patents and 15+ years of unrivaled technology expertise, iInside delivers Retails most precise, actionable indoor loca-tion solutions. From traffic analytics to departmental performance metrics, iInside advanced shopper behavioral data adds a powerful dimension of insights that empower both decision makers and improve the customer shopping experience. Learn more at www.iinside.com

ManhattanManhattan Associates, with over 20 years experience in developing best-in-class supply chain software, provides omni-chan-nel solutions to leading retailers around the world. Our Flexible Fulfillment approach helps you respond to variable demand across channels and provides supply chain executives control to shape the way fulfillment accommodates strategic objectives. Learn more at www.manh.com/flex

FujitsuFujitsu America, Inc., is a leading solutions provider for retailers. Delivering integrated technology and service offerings ranging from managed services and systems integration to enterprise applications and data center technologies, Fujitsu helps retailers improve sales with POS solutions including hardware, software, and self-checkout systems.Learn more at www.fujitsu.com/us

StarmountStarmount software solutions bring the richness of the Web and the power of mobile into the store. From mobile selling and cross-channel engagement platforms to digital signage, our solutions help retailers deliver a more personalized, efficient interac-tion from point-of-interest to point-of-sale. Visit www.starmount.com or read our blog at www.starmountshare.com.

TIBCOTIBCO Software Inc. (NASDAQ: TIBX) is a global leader in infrastructure and business intelligence software. Whether its optimiz-ing inventory, cross-selling products, or averting crisis before it happens, TIBCO uniquely delivers the Two-Second Advantage the ability to capture the right information at the right time and act on it preemptively for a competitive advantage. With a broad mix of innovative products and services, TIBCO is the strategic technology partner trusted by businesses around the world. Learn more about TIBCO at www.tibco.com.


Table of ContentsIntroductionIN-STORE MOBILITYBUSINESS INTELLIGENCE & ANALYTICSUNIFIED OMNICHANNEL PLATFORMSFLEXIBLE FULFILLMENTLOCATION AWARENESS MARKETING

critical_5_technologies_revolutionizing_retailris news_feb_2014_it investment.pdf

Documents

mobile devices

mobile technology

mobile capabilities

store associates

mobile checkouts

mobile pilots

mobile pos capabilities

store locations