what does web2.0 mean to retailers? (jan 2009)

What does Web 2.0 mean to retailers?Chris Hoskin, Chief Marketing OfficerSalmon

Prepared January 2009

What does Web 2.0 mean to retailers?


The term ‘Web 2.0’ means very little. But what Web 2.0 enables will have significant bearing on retail in 2009 and beyond. Inventory management, store systems, logistics, and CRM will all be affected in one way or another.


The term ‘Web 2.0’ means very little. But what Web 2.0 enables will have significant bearing on retail in 2009 and beyond. Inventory management, store systems, logistics, and CRM will all be affected in one way or another. And in eCommerce, it already is having an impact.

Who are Salmon?

Diverse interests and practice areas

Interests in retail, finance, insurance and utilitiesFocus on enterprise architecture , IT / Business ChangeFocus on Business impactApplication management and support - 25% of the business

Innovative risk reward modelsFixed priceManaged RiskShared Reward

Established, global systems integrator

Global SI, Operations in London, New York, Beijing, SydneySuccessful track record over 19 yearsc. 170 staff, c 100 in eCommerce team£16.8M turnover Privately owned, Financially soundOpen, honest and responsive approachStrong delivery-focused culture and Focus

Mission critical systemsBroad and deep expertise in web based applications and technologiesSpecialist skills in highly transactional systems and solutions e.g. B2B and B2C eCommerce, multi-channel integration, insurance underwritingCustomer experience / design

Middleware Infrastructure

& Hosting

Independent Software Vendors

Industry Bodies & Associations

Active in global eCommerce Community

SalmonDelivering eCommerce Solutions for market leading & challenger brands

AgendaWhat does Web 2.0 mean to retailers?

> What is Web 2.0? > Related technologies / vendors / products > Trends & themes> Implications for retail> Real examples> Web 2.0 in retail demo (eCommerce)> Q&A

Quick Video

http://uk.youtube.com/watch?v=6gmP4nk0EOE&feature=channel

What is Web 2.0? Clearly 1.0 to 2.0 Static Central publication control Single site content Slow bandwidth No ajax

“Network as the Platform” “Users add value” (Tim O’Reilly)

Tools + Technologies + Business Strategies + Cultural and Social trends


> What is Web 2.0? > Trends & themes> Related technologies / vendors / products> Implications for retail> Real examples> Web 2.0 in retail demo (eCommerce)> Q&A

Trends & Themes

MashupsWikisBlogsRIAsPodcastsRSSTaggingCloud ComputingSocial NetworkingCloud ComputingParticipationStandardsDecentralisationOpennessModularityIdentity

Attitude, not technologyThe Long TailData is the “intel inside”HackabilityPerpetual BetaRight to Remix (some rights reserved)Software that gets better the more people use itGranular addressability of contentRich user experienceSmall pieces loosely joinedTrust your usersReputationCreation v Consumption

Trends & ThemesPersonified

2005Has a good specked PC in the spare roomUses emailUses Next.co.uk and Argos.co.uk in combination with a catalogueResearches a bit, mainly for holidays Starts to send and receive some picturesWatches TVUses her mobile to arrange meetings

2008Has a very high specification laptop, with speakersUses it all round her flat via wireless broadbandStill uses email plus instant messaging with a webcamDoes virtually all her research onlineBuys far more on impulse e.g Nike+All her music is onlineBanks on-lineShe posts her photos to her family on-lineShe watches BBC iPlayer on-lineHas started a blog on her trek round EuropeSubscribes to several on-line fashion magazinesHas a Facebook and My Space account. Is trialing TwitterRegrets a very dodgy video appearing on YouTube from a girls night outAnd she still goes out to shop and talk to people despite meeting a manonline!!!!!


> What is Web 2.0? > Trends and themes> Related technologies / vendors / products > Implications for retail & retailers> Real examples> Web 2.0 in retail demo (eCommerce)> Q&A

Related technologies / vendors / products

AJAXRuby on RailsAPIsTools / IDEsXMLWeb ServicesRSSPythonFlash & Flex & Air

AggregationEmbeddingFolksonomyRemixingVirtual ArchitectureWidgets

Related technologies / vendors / products Digg37 SignalsZoHoNaymzTechnoratiWordpressBoing BoingTwitterFacebookSecond LifeDel.cio.usflickr

Related technologies / vendors / products Digg37 SignalsZoHoNaymzTechnoratiWordpressBoing BoingTwitterFacebookSecond LifeDel.cio.usflickr

Google (Apps, Docs, Knol, youtube)Yahoo (Flickr, Pipes, Zimbra)MS (Facebook, Office Live, Live Writer, Popfly, XBOX Live, Surface, Silverlight, Sharepoint)IBM (Bluehouse, Support for core technologies)Apple (iPhone, iTunes, iPod Touch, iWeb) Cisco (Five Across, Webex, Holographic video) conferencing)Oracle (web 2.0 ready)

Related technologies / vendors / products Digg37 SignalsZoHoNaymzTechnoratiWordpressBoing BoingTwitterFacebookSecond LifeGoogle (Apps, Docs, Knol, youtube)

Yahoo (Flickr, Pipes, Zimbra)

MS (Facebook, Office Live, Live Writer, Popfly, XBOX Live, Surface, Silverlight, Sharepoint)

IBM (Bluehouse, Support for core technologies)

Apple (iPhone, iTunes, iPod Touch, iWeb)

Cisco (Five Across, Webex, Holographic video conferencing)

Oracle (web 2.0 ready)


> What is Web 2.0? > Trends and Themes > Related technologies / vendors / products > Implications for retail> Real examples> Web 2.0 in retail demo (eCommerce)> Q&A

Implications for retailDifferent segments, different pace

1. Consumer electronics & entertainment2. Apparel & footwear3. Specialty4. Catalogue & mail order 5. Home improvement6. Department & discount 7. Drug stores, health & beauty8. Supermarkets & grocery

Implications for retailbut patterns in adoption emerging

Web 2.0 features/functionalities adopted most by retailersRIA based user interfacesStatic MashupsQualitative as well as quantitative product reviews

Web 2.0 features/functionalities finding limited adoption byRetailersBlogsDiscussion ForumsData Feeds (RSS, Atom etc.)Live Agent ChatDynamic Mashups (live data feeds)PodcastsVideocasts End user product customisationsProduct TaggingSynchronous chat

Web 2.0 features/functionalities adopted least by retailersWikisBookmarks sharingCollaborative product customizationsComparison shopping across multiple retailersEnd user contributed contentVoIP based customer support

Implications for retailAjax-ified UIs: indifferent to engagedFar better customer orientation

Better support for customer goalso Research o Searcho Browseo Navigationo guided sales

Hyper-personalisation

Convergence of ‘brand’ & ‘community’

Web 2.0 will put some Web 1.0 retail companies out of businessMoving beyond eCommerce 2.0 into Retail 2.0 will have its own challenges

Enhanced checkout flow (i.e. embedded AJAX cart, richer controls)Quick Pick Modals with inventory integration (i.e. dynamic)Second generation product reviews (leveraging product reviews as affiliate marketing; adding rich media (audio and video))Linking social networking with commerce controls (playing off social sites and/or adding social aspects to existing commerce sites)Increasingly-granular personalisation (issues with geog)More editorial feeds: RSS & XML CSS + MV Testing: Modals / widgets (x-sell, upsell, reviews etc) to increase AOV> ASP, SaaS / Multi Tennant > White labelling

>> 2009 + Web 2.0 outside eCommerceMagic Mirror2D Bar Codes GPSLive Agent

Implications for retail2009 Projects

Increase salesIncreased conversionFoster loyalty and increase lifetime valueHigher average order value / units per transactionBetter merchandisingDrive more traffic and unique and new visitorsDeliver better customer experience

Implications for retailBottom up ROI

Reviews drive 23% higher revenues per session, 28% more items per order: QVC-UKShoppers who "read all reviews" converted much higher, and had a 67% higher average order value: Boden20% increase in conversions with just dynamic zoom: Bealls Department StoresIncreased sales by 300%, reduced image production time and costs by over 60%: Macy’s“We believe co-browsing provides the ‘missing link’ and is a very effective solution to not only ‘delight’ consumers but can help us further boost conversion. People who view our video convert at around 30% higher then the site average: Thomas CookAlthough it is category dependant, you can expect anywhere in the region from a 20% to 70% increase in conversion rates (ajax): econsultancy.comThe number of subscribers using mobile Internet services will rise from 577 million currently, to top 1.7bn by 2013, spurred by demand for collaborative applications known collectively as ‘web 2.0’, and greater 2.5/3G penetration: Juniper ResearchPolyvore has 4,553 monthly active users on Facebook

Implications for retail‘Evidence’ mounting, seemingly positive, but majority too loosely coupled with CX


> What is Web 2.0? > Trends & Themes> Related technologies / vendors / products > Implications for retail> Real examples> Web 2.0 in retail demo (eCommerce)> Q&A

Real ExamplesTiny url, Live IM, Video testimonials, blog platform, twitter channel

http://www.zappos.com/

http://blogs.zappos.com/blogs

http://twitter.zappos.com/employee_tweets

http://about.zappos.com/our-unique-culture/zappos-video-experience

In 8 years $1B 2008 revenue (2005: $370M 2006: $597M: 2007: $850M)

Stocks 1100 brands, 3m pairs of shoesOrientation to customer service: “A service company that sells ‘x’”

e.g. Free shipping both ways, 365 day return

Diversification into handbags, clothing, eyewear, watches, accessories + anything elseWhen asked about future?

Facebook applicationTwitterYouTubeLifestyle sites e.g. running.zappos.com

Real ExamplesRich Interfaces

Timberland

Threadless

http://www.timberlandonline.co.uk/

http://www.threadless.com/


Nike

Ralph Lauren RugbyHalfords

http://www.nike.com/nikeos/p/nike/en_US/

http://www.rugby.com/

http://www.halfords.com/


Borders

http://www.borders.com/online/store/Home


AmazonWindowShop

http://www.windowshop.com/

http://www.windowshop.com/

Real ExamplesMash Ups

oSkope

http://www.oskope.com/

http://www.oskope.com/

Real ExamplesMash Ups, RSS, Social Bookmarking, Social Networking, AJAX

Polyvore

http://www.polyvore.com/


Real ExamplesMash Ups, RSS, Social Bookmarking, Social Networking, AJAX




Real ExamplesCustomer Reviews, Q&A, Dynamic Imaging,

Halfords

http://www.halfords.com/

A day in the life of AmyRetail & Web 2.0

Unique Approach • Unique Solutions

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Salmon Asia Pacific (Pty Limited)

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Chris HoskinChief Marketing Officer

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3.0 (Tim Berners Lee)

Semantic web

“I have a dream for the Web [in which computers] become capable of analyzing all the data on the Web – the content, links, and transactions between people and computers. A ‘Semantic Web’, which should make this possible, has yet to emerge, but when it does, the day-to-day mechanisms of trade, bureaucracy and our daily lives will be handled by machines talking to machines. The ‘intelligent agents’ people have touted for ages will finally materialize.”