ibm.ppt

Pervasive eBusiness1

Future of Wireless & Retailing

Scott MullinaxIBM Wireless [email protected]


Discussion objective

Outline the importance of high value Contextual Experiences and how Wireless Technologies can enable the LAST MILE CONSUMER EXPERIENCE.

Define the Wireless technologies that are the vehicle to move from Mass Merchandising to Individual Consumer Experiences.


Agenda

Wireless Market Trends

New Market & Consumer Dynamics

Make a difference in the Store Experience

Technology the tool of Empowerment

Roadmap to Success


By 2004,130 million customers will be generating almost 14 billion transactions, yielding $200 billion in revenue, over 75% of which will come from Western Europe and the United States

0

25

50

75

100

125

150

mill

ion

2000 2001 2002 2003 2004

Mobile Commerce Users

Rest of World

Asia Pacific

North America

W. Europe

0

50

100

150

200

250

US

$b

illio

n

2000 2001 2002 2003 2004

Mobile Commerce Transaction Value

Rest of World

Asia Pacific

North America

W. Europe

Source: Strategy Analytics, 2000


In the U.S. the number of net-enabled phone owners will also represent about 50% of the population by 2004

Su

bsc

ribe

rs (

mill

ion

s)

0

25

50

75

100

125

150

175

200

225

250

200520042003200220012000

Internet-enabled handsets

Mobile data users

Total mobile subscribers

176.9171.1

111.2

Source: Forrester, 2000, 1999


We are poised on the verge of a Wireless e-business explosion… every second of every day a new mobile internet user is born… mobile internet access will surpass PC internet access in 2002

1998 2000 2002 2004 2006 2008 20101

10

100

1000

10000

Ins

tall

ed

Ba

se

(M

illi

on

s)

Mobile phone totalMobile phone w/datacapability

PC installed base

Source:Research Portal.com, Reuters, EE Times, Ericsson, 2000


Agenda- continued





Roadmap to Success


Current Industry Dynamics

There is a tremendous growth of perimeter businesses in retailing because of changing lifestyle attitudes - quick, easy - “I am willing to pay for convenience”

Reduction in capital asset and labor resource spending is mandated by the boardroom

Point of sale has to be scan-capable and able to keep track of more complicated promotions and offers

In-store and channel transactions have to be instantaneous and responsive to the customer’s identity

Merchandising must be specific to smaller segments of the population, while being able to attract larger segments successfully

Product allocation, assortment, pricing, and promotion must be dead-on in where, when, and how it is placed in front of the customer. Every time!


Changing Market Dynamics

Growing concentration of leading brands and power retailers

Bankruptcies and liquidations closing down the non-competitive

Experimentation with complementary business partnerships

Identification of new points of access for consumers, including pervasive and mobile technologies

An increasing need to respond to consumer shifts including demographic lifestyle, and buying pattern trends


The Changing Consumer

More knowledgeable about comparable product costs and price.

More changeable in retail and brand preferences, showing little loyalty.

Self-sufficient, yet demanding more information

Hold high expectations of service

Expecting personalization

Driven by three new currencies: time, value, and information.


New Market Trends

Consolidation in the marketplace continues to change the landscape of retail/wholesale, manufacturing and service provider sectors

Industries are positioning by creating global alliances (Vertically Integrating)

It is becoming increasingly important for companies to manage their capital efficiently as well as controlling their processes

Consumer Retention is becoming more important due to increasing competition

Customized, flexible products will be the future and are expected at the Point of Sale

NEED TO MANAGE THE FIRST THOUGHT IN THE LAST MILE WITH WIRELESS TECHNOLOGY!


Retailing 2001+ is about the End CustomerThe key to multi-channel integration is the ability to utilize the

information collected from all consumer touch points and make the information actionable throughout the value chain.

New measurements need to be in place to measure performance. Multi-channel retailers must now measure the variables that affect satisfaction in a specific channel while establishing uniform standards across all channels. Regardless of the sales channel they are using, customers must feel like royalty.


Agenda- continued





Roadmap to Success


Contextual experiences (conditions) directly impact a customer’s perception of vendor value.

Value experiences include and transcend monetary value and product-based experiences.

Positive Contextual Experiences equal Consumer Loyalty

Laying the foundations for the store of the future is the key to enabling technologies that will support the total customer experience of feeling understood, connected,

and delighted.

Laying the foundations for the store of the future is the key to enabling technologies that will support the total customer experience of feeling understood, connected,

and delighted.


alternativePOS

cash alternatives

self-serve individualized

flow-throughmanagement

eCRM

SCMattentive environment

retailer

Making a Difference in Retailing from the Back-End Systems through to the Consumer - the Components of Experience

TACTICALthe way you sell

STRATEGICthe way

customers experience

your business

OPERATIONALthe way you manageyour store


retailer

Changing the Retailing Environment

How willsuccess bemeasured?

How will the customerexperience thebenefits of thenew vision?

How will the value ofnew technology berealized and amortizedacross a centralized business model through local channels of customer experience?

What are the core valuesto the business

driving forward?

What is the end vision

to support the

near term initiatives?

BUSINESS VISIONSUCCESS

TECHNOLOGY


(hidden)

Store managers can receive remote real-time product

movement updates throughout the day.

POS data can be remotely

retrieved and can be analyzed

immediately to allow for

replenishment / replacement

where appropriate in order to

immediate customer demand.

(hidden)

Store managers can receive remote real-time product

movement updates throughout the day.

POS data can be remotely

retrieved and can be analyzed

immediately to allow for

replenishment / replacement

where appropriate in order to

immediate customer demand.

Back-Office (hidden)

Lost sales can be reduced as

customers no longer face long

POS queues, minimizing

customer abandonment.

Responsive environments effect

efficient store / queue

management.

(hidden)

Lost sales can be reduced as

customers no longer face long

POS queues, minimizing

customer abandonment.

Responsive environments effect

efficient store / queue

management.

Sales Floor

Mass retailing is founded on the premises of speed, ease of use, and convenience. Managing the experience means excelling at being a convenience provider.

Mass retailing is founded on the premises of speed, ease of use, and convenience. Managing the experience means excelling at being a convenience provider.

The Way You Manage Your Store Experience-Now very important


Tickles and Whispers in Mass Retailing drives a valued experience

(hidden)

Responsive environments notify resources how best to manage them

• alert me to open up another cash register line because of long queues

• tell me to adjust the temperature

(hidden)

Responsive environments notify resources how best to manage them

• alert me to open up another cash register line because of long queues

• tell me to adjust the temperature

Tickle Technology (hidden)

A more efficient labor force is better educated, more assisted in real time, and suffers from last turnover

• remind me about cross-sells and up-sells

• remind me about this customer’s preferences

• help me to be more knowledgeable in front of my customer

• help me to be more knowledgeable in front of my employees

(hidden)

A more efficient labor force is better educated, more assisted in real time, and suffers from last turnover

• remind me about cross-sells and up-sells

• remind me about this customer’s preferences

• help me to be more knowledgeable in front of my customer

• help me to be more knowledgeable in front of my employees

Whisper Technology

Technology becomes ubiquitous as we progress from fingertip, to voice, to bio-metric, to human-centric experiences that are human aware and dialogic, natural, and easy.

Technology becomes ubiquitous as we progress from fingertip, to voice, to bio-metric, to human-centric experiences that are human aware and dialogic, natural, and easy.


Moving from Mass Service to Individualized Experiences

• (hidden)

• The responsive environment responds to such conditions as:

•who are the people in a given space?

•where are they (geographic and proximal)?

•what are they doing?

• The enabled environment delivers on the promise of mass retailing based on individuals within a space

• (hidden)

• The responsive environment responds to such conditions as:

•who are the people in a given space?

•where are they (geographic and proximal)?

•what are they doing?

• The enabled environment delivers on the promise of mass retailing based on individuals within a space

Responsive Environment (hidden)

Consumers have more choice than ever and so mass retailers need to grab and retain relationships by extending their value, presence, and opportunity.

By using aggregates of Wireless technology to create dynamic individualized experience retailers can lead the market and capture the attention of their customers. “Customer Retention”

(hidden)

Consumers have more choice than ever and so mass retailers need to grab and retain relationships by extending their value, presence, and opportunity.

By using aggregates of Wireless technology to create dynamic individualized experience retailers can lead the market and capture the attention of their customers. “Customer Retention”

Individualized Service

Mass retailers can now use wireless technologies to get beyond the “last mile” and become the “first thought”.

Mass retailers can now use wireless technologies to get beyond the “last mile” and become the “first thought”.


Metrics of Success

Metric

Operational Efficiency

• Reduce operating assets

• Reduce turnover

• Reduce working staff

• Reduce cost of quality

Improve Existing Customer Revenue

• Increase customer retention

• Improve market share

• Up-sell/cross-sell

New Revenue Streams

• New products / services in same business

• New products / services in new business

Catalyst/Result

• More skilled employees

• More efficient and contextual or “in the moment” training

• Require less resources to support the same production and client base

• Improve customer satisfaction

• Provide competitive services

• Increase brand strength

• Increase revenues from intellectual capital

• New service pricing

Example Strategy

• Remote monitoring of employee performance

• Remote store monitoring

• Dynamic environmental awareness

• Ubiquitous employee training / support systems

• Add wireless channel for ease / efficiency uses

• Integrate with online offering

• Offer unique / personalized services

• Charge for automated service

• Use connectivity of product to drive traffic to service offering “portals”


Agenda- continued



Make a Difference in the Store Experience


Roadmap to Success


eBillBoard

The Topography of OpportunityStore-Box

Parking Lot

BackRoomFrontRoom

PO

S

Aisle

Aisle

Aisle

Aisle

Inventory Management•RFID•Mobile Field Service Agent•Mobile Sales Agent•Barcode Tracking

Unattended Sales•Remote Shopping•Replenishment List•Customer Self-Serve•eCash Payment Options•Smart Gold Crown Card

Assisted Sales•Wireless POS•Individualized Retailing•Remote Access to POS

WLAN

Aware Environment•Tickle Environment Support•Intelligent Environment•eShelf Labels•Cartless Shopping•Smart SKU’s

Self-Serve Sales•Intelligent Kiosks / Vending•Multi-Channel•New Vends•Extended Business Opportunities

Face to Face Sales•Whisper Sales Support•Mobile POS•Customer Awareness•Remote Store Management

Interactive Sales•Virtual Activity Centers•Media Download Centers

ePOS


Multi-Channel Retailing

POS

Printer(s)

Network Computers

Kiosk

ESTs PDAs

RouterRouter

Internet / IntranetInternet / Intranet

E-mail Staffing and

SchedulingInventory

Backroom

Wireless

ConsumersConsumers

Cellular


Store Management

The store will be the place where several emerging technologies will be used:

Cellular

802.11b

Bluetooth

RFID

Smart Card

Kiosk/Vending

The in-store experience will combine customer satisfiers such as line busting and location based services and enhanced shopping with cross/up sales potential.


802.11b is a high speed, reliable solution for in-store wireless solutions

Bluetooth is the 10 meter RF solution intended for device to device interaction

Cellular voice networks will incorporate data services at higher transfer rates using GPRS

Existing data services only networks will be used for devices like Palm VII and RIM

Infrastructure for Enablement - Wireless


Infrastructure for Enablement - RFID

RFID cost will drop to an acceptable price point when multiple uses are incorporated:

Distribution

Inventory management

Point of Sale

Smart Home applications

An example of cost justification is the use of RFID for baggage handling at San Francisco Airport

The ultimate goal of RFID is reliability over life of item and pervasive penetration of scanners that take advantage of ID. For example, RFID embedded in my shirt so that if I drop it into washer at home or take it to laundry, it will be handled correctly.


Reasons to use WLANs

To extend a wired LANNetwork Mobility

To network difficult-to-wire locations Network Flexibility

To extend a ready-to-use LAN across locations LAN-in-a-box

To provide LAN access to mobile users

To better understand and know your customers

To provide location based services…”Where I am” Product Location = Where do I go…

Enterprises have many different reasons for implementing Wireless LAN solutions -- but network flexibility and mobility are the most common.


McDonald’s restaurants will test FAST LANE transponder technology in the some of their restaurant drive-thrus. "Transponders will allow our customers to pay for their favorite McDonald’s food – like the Big Mac and our French fries – without leaving their car or using cash," said Lambrechts. "We expect this new technology will add to the fun and excitement of McDonald’s by improving the speed and efficiency in our drive-thru service for on-the-go New England travelers."

Redefining the Internet - Redefining Lifestyles with Cash Alternatives

Many People consider a smart card to be a PC in the pocket. A smart card is a credit card style card that has an embedded memory chip that stores data and applications relative to the user - that can be coupled with an identification feature, such as: PIN, biometrics, or other types of security checks. Smart cards are portable, secure, interoperable, and convenient.

The iButton is ideal for any application where information needs to travel with a person or object. iButton can grant access to a building, a piece of equipment, can be used to store cash for small transactions, such as transit systems, parking lots, and vending machines.

VALID FROM

VALID FROM

GOOD THRU

GOOD THRU

01/2000

01/2000

01/2003

01/2003

John J. Doe

John J. Doe

4321 076543 78999

4321 076543 78999


IBM Wireless Offerings for Retail(hidden)

Digital Display Boards

(hidden)

Digital Display Boards

Dynamic Environments

(hidden)

Intelligent Vending• ecash enabled POS

• self-serve POS

eCash Transactions• integrated POS

Customer Self-CheckOut Solutions• PSI check-out solutions

• integrated intelligent kiosk solutions

Cart-less Shopping: • consumer barcode devices,

• mobile kiosks

(hidden)

Intelligent Vending• ecash enabled POS

• self-serve POS

eCash Transactions• integrated POS

Customer Self-CheckOut Solutions• PSI check-out solutions

• integrated intelligent kiosk solutions

Cart-less Shopping: • consumer barcode devices,

• mobile kiosks

Unattended Retailing

(hidden)

Environment Tickles

Employee Whispers

(hidden)

Environment Tickles

Employee Whispers

Responsive Environments

(hidden)

Site Survey / WLAN / WWAN

Individualized Retailing• profiling database

• smart card loyalty programs

RFID Supply Management

RFID SKU Management• in supply

• on the selling floor

• in the dressing room

• at the POS

Remote Management - mobile MOD

(hidden)

Site Survey / WLAN / WWAN

Individualized Retailing• profiling database

• smart card loyalty programs

RFID Supply Management

RFID SKU Management• in supply

• on the selling floor

• in the dressing room

• at the POS

Remote Management - mobile MOD

Efficient Retailing


Agenda- continued





Roadmap to Success


IBM Engagement Focus

Our objective is to optimize the value of networked and responsive end-user interactivity via the value proposition of the business objective.

The strategic consulting engagement focuses on business models, initiative identification and user value proposition bound to the overall business objective.


Statement of the Methodology

Our approach is a systematic method for analyzing and delivering mBusiness strategic solutions based on core business objectives.

We are confident that our methodology, people and tools can provide the client with a value-add solution designed to meet their long-term and short-term business objectives.


Conclusion

LET’S IDENTIFY WAYS WE CAN INCREASE THE VALUE OF THE CONTEXTUAL EXPERIENCE.

DETERMINE THE WIRELESS TECHOLOGIES to SUPPORT THIS BUSINESS VISION & STRATEGY.

THEN DRIVE THE FIRST THOUGHT IN THE LAST MILE TO REAP HIGH VALUE SERVICE AND CONSUMER LOYALTY.

THANK YOU!!

ibm.ppt

Business

wireless technology

value of new technology

market dynamics

wireless technologies

changing consumer

value experiences

store experience technology

consumer shifts