© Copyright IBM Corporation 2009
Innovating the Customer Experience
Henrik von ScheelVice President,IBM Software Group
Delivering Smarter Commerce
2 © 2009 IBM Corporation
Today’s demanding customers
More knowledgeableabout products, costs, and price
More savvy about technology and products/services
Less loyal to any given retail entity
Self-sufficient and demands information to make smart decisions
Active participants openly sharing and seeking consumer driven content
Proud of being an individual and expects personalization and high customer service in every interaction
Driven by three new currencies: time, value, and information
Source: IBM Institute for Business Value “Retailing in a World of Extremes”
Today's change — and even more so, tomorrow's changes — will come from newly empowered consumers, who, by harnessing the tools that Web 2.0 technology affords them, can wield power and influence over retailers in a way never witnessed before – Gartner 2008
Delivering Smarter Commerce
3 © 2009 IBM Corporation
Technology is rapidly changing
New Touch points
New Store Formats
New Interaction Models
Innovation
Delivering Smarter Commerce
4 © 2009 IBM Corporation
Delivering Smarter Commerce
Errol Denger: [email protected]
Data
POS
Kiosk
Web
B2B sitesTele, mobile
Customer procurement / systems
Fulfillment
Suppliers
Retailers
Distributors
Resellers / DealersLegacy systems
Back-end
B2B / Partners
Delivering Smarter Commerce
5 © 2009 IBM Corporation
The European Market European online revenue and demand has bucked the economic
downturn. ↑ Growing broadband penetration↑ Increasing consumer experience and comfort↑ Increased confidence in online security↑ Slight increase in European Online citizens↑ Use of comparison sites is likely to increase as people seek low prices
↓ Macroeconomic confidence↓ Consumer confidence↓ Overall discretionary spending
Sources: eMarketer, WSJ, Forrester
Delivering Smarter Commerce
6 © 2009 IBM Corporation
Internet is mainstream in most European countries
92%
86%
73%
72%
63%
52%
45%
64%
Netherlands
Sweden
UK
Germany
France
Spain
Italy
EU-7
“How often do you go online?” (at least monthly)
Source: Forrester’s European Technographics® Benchmark Survey, Q2 2008
Base: 22,673 European Adults
Three quarters of online European connect to the Internet everyday and spend on average over 10 hours a week browsing the Web
Delivering Smarter Commerce
7 © 2009 IBM Corporation
The UK and Sweden are leading in adoption of online shopping.
U
PLVS RLT
25m
28m
16m
5.6m4.8m
4.7m
8m
74%
73%
67%
65%
56%
29%
22%
56%
UK
Sweden
Netherlands
Germany
France
Spain
Italy
EU-7
Q2 2008
Germany and the UK account for almost 60% of Europe’s online shoppers
Base: 14,514 online European adults
“Have you bought any products or services online in the past three months?”
Source: European Technographics® Benchmark Survey, Q2 2008
8
Superior Shopping Experience
Delivering Smarter Commerce
9 © 2009 IBM Corporation
Traditional Marketing View
Awareness
Interest
Consideration
Purchase
Traditional Demand GenCommercials, Ads, etc
Seek more info and determine personal needs
Purchase: Store, Catalog, Call
Browse/Research: Catalog, Web, Store, Discussions
Delivering Smarter Commerce
10 © 2009 IBM Corporation
New touch points and interaction models now define and fragment the customer journey
Delivering Smarter Commerce
11 © 2009 IBM Corporation
Changing the way we market, build relationships, and deliver brand value
Data
POS
Kiosk
Web
B2B sites Tele, mobileCustomer procurement /
systems
Fulfi llment
Suppliers
Retailers
Distributors
Resellers / DealersLegacy systems
Back-end
B2B / Partners
Delivering Smarter Commerce
12 © 2009 IBM Corporation
Best Practices for Next Generation Marketing
What is your brand’s personality?
Are your segments and personas actionable?
Are you marketing across channels? –Marketing is cross channel: Web, Mobile, in-store, contact center
Are you responding to the right interactions?
Test test test
Precision Marketing:• Experiences• + Conversations• + Relationships• = Affinity• …across all touch points
Successful brand experiences don’t happen by accident… they are carefully designed and executed
Marketing budgets are shifting to interactive channels causing spend for interactive marketing categories to grow at 27% CAGR.
Delivering Smarter Commerce
13 © 2009 IBM Corporation
Key Business and IT Strategies for Next 18 Months
Source: RIS News, 2009
Delivering Smarter Commerce
14 © 2009 IBM Corporation
80%of CEO’s believe
their brand provides a superior customer
experience
8%of their customers
agree
44%of consumers
say the majority of their customer
experiences are “bland”
Source: Bain & Company
Delivering Smarter Commerce
15 © 2009 IBM Corporation
It’s an extension of the brand’s personality
Delivering Smarter Commerce
16 © 2009 IBM Corporation
It’s highly personalized
Delivering Smarter Commerce
17 © 2009 IBM Corporation
It’s Social
Delivering Smarter Commerce
18 © 2009 IBM Corporation
It’s Social
Delivering Smarter Commerce
19 © 2009 IBM Corporation
It’s Social
Delivering Smarter Commerce
20 © 2009 IBM Corporation
It’s informative and personal
Delivering Smarter Commerce
21 © 2009 IBM Corporation
It’s Innovative
Building In-store Display Over the Web
22
Rich B2B ExperiencesIt drives action
Delivering Smarter Commerce
23 © 2009 IBM Corporation
Best Practices for delivering a Superior Shopping Experiences
Embrace Web 2.0
Integrate Social Commerce
Extend the brand experience
Built on precision marketing providing targeted information and recommendations at key decision points throughout the purchase process (and across channels)
24
Cross Channel Shopping
Delivering Smarter Commerce
25 © 2009 IBM Corporation
Why cross channel retailing is more important than ever
The majority of online consumers are cross-channel shoppers
– 53 % used the Internet to compare product features and prices
– 25 % did so from a mobile device while in a store
– 1 in 10 sent text messages to friends and family during shopping trips
Connectivity will be a part of life
– Consumers will expect to connect to anyone, at any time, about anything, from anywhere
Superior operational model, especially in challenging economic times
Sources: IBM “2007 Was the Year of the ‘Omni Consumer’”; 2008 IBM Retail Multi-channel Study; Chart 1: n=978 UK respondents
Percentage of respondents who switched retailers by during cross
channel shopping experiences
24%
37%
52%
62%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Groceries App/Acc/Footwear HomeImp/DIY/Appliances
ConsumerElectronics
% o
f Res
pons
es
26
27
28
Delivering Smarter Commerce
29 © 2009 IBM Corporation
Worldwide mobile internet users are expected to grow by 191% from 2006 to 2011 to reach a “Billion”
The millennial generation of “digital natives” are expected to drive up the demand for internet applications and e-commerce
Mobile Internet Users
337.3405.5
489.6
596.4
757.1
982.4
0
200
400
600
800
1000
1200
2006 2007E 2008E 2009E 2010E 2011E
Mill
ions
Source: IBM IBV Research and Emarketer http://www.emarketer.com/Article.aspx?id=1005083
CAGR 2006-2011E : 24%
By 2011, worldwide there will be about a billion users
browsing internet over their mobile phone handsets: A 191% growth over 2006
figures and a CAGR of 24% from 2006 to 2011
191% growth from 2006 to 2011E
Worldwide Mobile Internet Users
-
Delivering Smarter Commerce
30 © 2009 IBM Corporation
Mobile internet usage will grow 39 percent in Western Europe in 2014 from 17 percent in 2008
At the end of 2009, mobile Internet penetration will reach 17 percent in Western Europe, the same level of adoption that PCs with Internet access had in 1999, which represents a critical mass.
Delivering Smarter Commerce
31 © 2009 IBM Corporation
A Superior Shopping Experience now includes Mobile Commerce as key touch point
Multi-channelcustomer experience
TransactPost-transaction
RelationshipDevelopment
ProductAffinity
Browsing
PurchaseDecision
In-store customer experience
Transact
Purchase Decision
Browsing
Store Entry Demand Generation
Post-transaction
Messaging, alerts, promotions(proximity, opt-in, loyalty)
Customer id, personalized experience & offerings
Product information, product look-up, IRC
Cross-sell, up-sell, availability
In-store & online payment scenarios
Warranty services, digital receipt
Provide personalized messages and alerts to your customers: product specials, recalls, etc
Product information, Consumer reviews
Compare, Cross-sell/up-sell, availability & Store locator
CCIS, Online payment
WISMO, Warranty services, digital receipt
Retail Integration Framework
Customer Interaction Platform
Product or category level awareness & education
Delivering Smarter Commerce
32 © 2009 IBM Corporation
Mobile StorefrontB
enef
its“Certain customers were trying to access the website from a mobile
device and weren’t able to perform all of the functions they wanted”
Ravi Acharya, Director eCommerce at Sears Browsing Purchase
Decision Transact
Delivering Smarter Commerce
33 © 2009 IBM Corporation
"Text me back with Rock, Paper or Scissors. I already know what I'm throwing and if you beat me I'll add 100 Moosejaw Points to your account now."
Superior brand experiences now include Mobile
Mobile Campaign targeting loyal customers drove a 69% opt-in rate resulting in 15% of net sales generatedby digital marketing during the same period
And the buzz:I love that I can just walk in and get a book and always have a coupon on hand now.
Save 25% off one item until March 12t h. Just mention coupon 95278 to t h e c a s h i e r .
Save 25% off one item until March 12t h. Just mention coupon 95278 to t h e c a s h i e r . “The customer walks into the
store and is encouraged to pull out their phone. Just like when you walk into a museum
and grab the headset and player. The mobile device will radically enhance the in-store
experience providing consumer reviews,
specs/stats, inventory status, and other key services.”
– Jeffrey Wolfe, COO Moosejaw Mountaineering
Demand Generation
RelationshipDevelopment
Demand Generation
Delivering Smarter Commerce
34 © 2009 IBM Corporation
Not to forget ROPPIS….. and role of SMS “Thanks for your order. Your
product is ready for pick-up at our XXX store. Please quote order reference 123456”
and many more
RelationshipDevelopmentTransact
Delivering Smarter Commerce
35 © 2009 IBM Corporation
Halfords ‘Text and Reserve’ Car owner texts to Halfords a keyword, followed by reg. number ( “Headlamp Bulb R767
SBR”) Vehicle model, engine size, body type etc established by Halfords, using registration
lookup services SMS message returned to the customer:
– “Halfords recommends Halfords Super Brilliance Blue Bulb Single HBU4775BBH7, 802561, £22.99 for your PEUGEOT. Check stock in your nearest store by replying with your postcode.”
Customer sends postcode. Halfords assists further – “From Halfords. Your nearest store with product in stock is Redditch, 2.04 miles
away. To reserve, reply YES to this message.” Customer says ‘YES’. System processes request, sends reservation message to
customer and to store warehouse system e.g. – "Halfords reservation ref 8601043751 – Order reserved at Redditch B98 0DE 01527
584488. Check www.halfords.com for store opening hours.”
PurchaseDecision
RelationshipDevelopment
ProductAffinity
Delivering Smarter Commerce
36 © 2009 IBM Corporation
Best Practices in Cross Channel Commerce
Run all channels on the same platform to provide context and consistency from touch point to touch point
– Web, Mobile, Contact Center, Kiosks
Support cross channel processes: Buy-Online Pickup in store
Mobile is early mainstream
37
Business Innovation
Delivering Smarter Commerce
38 © 2009 IBM Corporation
Operational Innovation
Use drop shipping to reduce risk and cost effectively expand your portfolio
39
700+ Mazda-branded Dealer Sites
Consumer
Channel Innovation: Mazda hosts 700+ Dealer-specific Sites
OEM
Delivering Smarter Commerce
40 © 2009 IBM Corporation
Business Model Innovation: Ritz Interactive
Extend your channel with strategic and affiliate partnerships
Delivering Smarter Commerce
41 © 2009 IBM Corporation
Business Model Innovation: Sears Strategic Partnerships
Arts
Entertainment Music & Movies
Books
Delivering Smarter Commerce
42 © 2009 IBM Corporation
Incorporate Web Channel into strategic planning cycle
Use the web and eCommerce to immediately identify new trends powering the next generation of micro-segmentation, responsive replenishment and mid-cycle assortment shifts
– Target influencers, UGC, ID new segments
Responsive value chains
Boomer
Teen
Consumer Content, Special
Incentives
Boomer Microsite
Teen Microsite
Teen Trends site
Splash Screen
Analysis and Feedback
Mechanisms
Mid-Cycle Assortment Shifts,
CPFR, Influence Planograms
Influencer
Multivariate AB testing
Delivering Smarter Commerce
43 © 2009 IBM Corporation
Customer Interaction Platform Strategy
The WebSphere Commerce “Customer Interaction Platform”, enables companies to deliver a consistent, customer-centric experiences across
multiple channels and touch points
Data
POS
Kiosk
Web
B2B sitesTele, mobile
Customer procurement / systems
Fulfillment
Suppliers
Retailers
Distributors
Resellers / DealersLegacy systems
Back-end
B2B / Partners
Delivering Smarter Commerce
44 © 2009 IBM Corporation
BACKUP
Delivering Smarter Commerce
45 © 2009 IBM Corporation
Power Next Gen Interactions with Precision Marketing Deliver automated, one-to-one
merchandising and marketing based on shopper preference and behavior
Empower marketers to build a dialogue with consumers by processing triggers and responding with actions
Cross Channel Precision Marketing Engine
– Web, Mobile, Cross Channel– Social Participation– Integrated with ecosystem– B2B “behavioral marketing”– Behavioral segmentation and
personas
Triggers
Mobile
Order History
Personalization
Social Commerce
Browsing
Search
Point of Sale
Mobile
Actions
KioskEmaill
Promotions
Cross/Up Sell
Precision Marketing
Engine
Delivering Smarter Commerce
46 © 2009 IBM Corporation
Web activity– Control what displays in
predefined e-Marketing Spots on the store pages
Dialog activity– Automate marketing
actions based on the specific behavior of your customers over time
Management Center for Business Users
Delivering Smarter Commerce
47 © 2009 IBM Corporation
SEO and Landing Page Optimization
Delivering Smarter Commerce
48 © 2009 IBM Corporation
Cross Channel Dialog: Register and OrderCustomer Registers
SMS Order Confirmation
Thank you for your purchase. Your
order # is 13721
Places Order
Delivering Smarter Commerce
49 © 2009 IBM Corporation
Cross Channel Dialog: Register and No Action
Email OfferThank you for your registration. We’re
running a special on ____
Customer Registers
Wait one week
Delivering Smarter Commerce
50 © 2009 IBM Corporation
Social Commerce: Reward Active Participation
Customer Writes 5 Reviews
Change Banner $10 Off Next Order
Send $10 Off SMS Coupon
Thank you for your review.
Receive $10 off next order
Add to Active Participant Segment
Delivering Smarter Commerce
51 © 2009 IBM Corporation
Optimize Cross Channel Interactions with Mobile Commerce
Mobile Store Model– Product Information / Availability– Order Status / Tracking– Store / Stock Locator– Shopping List– Mobile Marketing
Mobile Message Support (SMS)
Cross Channel Transactions– Mobile Transactions
– Buy/Reserve on mobile, pickup in store
Integrated into Cross Channel Precision Marketing with support for Mobile triggers, actions
Delivering Smarter Commerce
52 © 2009 IBM Corporation
Browse Catalog View Product Detail View Ratings & Reviews Compare Products
Mobile Shopping
Delivering Smarter Commerce
53 © 2009 IBM Corporation
Mobile Transaction
Search Products Add to CartSelect Pickup Store &
Checkout View Order Confirmation
Delivering Smarter Commerce
54 © 2009 IBM Corporation
Optimize Cross Channel Processes
Buy Online and Pickup In-store (BOPIS)– Or Reserve Online and Pay/Pickup In-
store
Endless Aisle– Buy out-of-stock items in-store and
ship to home
Distributed Order Management (DOM) Integration
– Store inventory visibility– Order transfer, inventory allocation,
and status update
Delivering Smarter Commerce
55 © 2009 IBM Corporation
Optimize the Customer Experience
Delivering Smarter Commerce
56 © 2009 IBM Corporation
Rich Customer Centric Experience with new Web 2.0 Store
New B2C and B2B Store Models
Merges both traditional Web 1.0 and 2.0
Integrated Social Commerce
New Web 2.0 Widgets B2B Operational Support
Search engine optimization improvements
Performance Improvements
B2C Madison Store
B2B Elite Store
Delivering Smarter Commerce
57 © 2009 IBM Corporation
New B2C Web 2.0 Store
Scrolling e-marketing spot
Delivering Smarter Commerce
58 © 2009 IBM Corporation
Enhanced Category Page, Quick Info and Cart
Faceted Search
Mini Shop Cart
Quick Info
Delivering Smarter Commerce
59 © 2009 IBM Corporation
Integrated Social Commerce
Oliver is shopping for an office espresso machine
Taps into his Facebook network of fellow Office Managers for their insight
Asks Community if this is a good machine for office use
Delivering Smarter Commerce
60 © 2009 IBM Corporation
Integrated Social Commerce
Product ratings & reviews via– Bazaarvoice API-level integration
Forums and blogs via– Lotus Connections and Pluck integration– Integrated Product and Category blogs– Social Profiles (Public user profile)– Photo and Video Gallery– Forum / threaded discussion support
Vendor-agnostic integration via WebSphere sMash applications