BEYOND OMNICHANNEL STRATEGY,

BUILD A UNIQUE EXPERIENCE TO ENHANCE

THE CUSTOMERS’ WAY OF LIFE

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(gun-il.son@accenture.com)

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Korean Retail Market Trends

106 103 104

28 30 31

42 45 49

32 36 38 9 12 13 9 11 13 22 22 18 1 6

22

0

50

100

150

200

250

300

2011 2013 2015F

Traditional Market Department Store Hypermarket Supermarket

Convenience Store TV Home Shopping Online Shopping Mobile Shopping

Market Size by Retail Category m-Commerce Characteristics

Mobile Shopping

CAGR

180%

• Continuous growth due to the convenience

- “Anytime, Anywhere”

- Ease of use: Payment, search, VOD

- Most Personalized Device : Easy to identify customer and provide targeted offer

• “Mobile revenue has already surpassed EC revenue in 2014” – Client Interview

• Recommended to establish strategy and design operating model for mobile business of high growth potential and profitability

(Unit: Billion Won)

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Source: Bureau of Statistics (2014) , accenture research

Mobile Commerce War

200

300

400

500

600

700

800

Coupang

WeMP

Tmon

GS SHOP

11th

G Market

Auction

Top 5 Players’ Mobile Marketing Expense2) # of e-Commerce Mobile App Users1)

’14 1-2Q (Unit: Million Won)

2,060

384

1,070

734

444

(Unit: 10 thousand)

Source: 1) Nielsen Korea (2014) , 2) Research Ad (2014)

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Exploring Retail Trends

@ Global Level

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…

Personalization @ Scale

Superior Customer Service

Commerce 360°

Digital Empowerment

Social Wave

Context Retailing

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Personalization @ Scale

Nervus System an Shapeways Foldable 3Dprinted dress was made with nylon powder-based 3D printer

and designed with computer simulation and physics algorithms

Adidas mi ZX Flux The app enables people to design their own Adidas shoes using their

phone’s photo library.

L’Oreal Makeup Genius It allows potential customers to virtually see themselves wearing

makeup that isn’t applied in real life..

December 9, 2014

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Commerce 360°

Michael Kors shoppable Instagram posts

#InstaKors asks consumers to sign up, linking their Instagram handle with an email address, and then sends them an email when they like a shoppable image on the

brand’s Instagram feed.

ASAP54 App ASAP54 is an image recognition app that can match photos of

clothing and accessories to identical or similar products stored

in its database. Marc Jacob’s Pay with a Tweet

The designer opened a Daisy fragrance pop-shop in New

York, where customers could post on Twitter, share photos on

Instagram or spread the news on Facebook to complete their

purchases.

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Commerce 360°

Google Shop the Hangout

Retailers can present their products while customers browse catalogue and purchase through the Hangout

Neiman Marcus Snap. Find. Shop.

Customers can snap a photo of an item they like and the app can

search for similar item sold by the retailer.

French Connection Youtique Brand FCUK created a series of interactive clips feature a stylist

providing suggestions for different occasions.

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Digital Empowerment

Amazon Dash

Amazon brought a device to help customers make a shopping list by

voice called “amazon dash”

Flying Catwalk Italian fashion house Fendi live streamed its 2014 - 15 fashion show through a flying "Drone

Cam"

H&M H&M store in Times Square, enables customers to pay for items in the dressing room

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Social Wave

Adidas NEO Label tweet-powered fashion show

Prior to the show, teens had the power to decide everything from music, lighting, and the set design

to styling

Topshop social catwalk hits Facebook and Instagram

Five Instagrammers have been handpicked to curate Topshop channels for the duration of

London Fashion Week.

All Clothing Public

Artists and everyday people get together on an online social platform to create clothing and share their creations with friends.

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Context retailing

Amazon Prime Air

“Octocopter” drones that fly products directly from an Amazon warehouse to your doorstep in 30

minutes.

Trunk Club

A remote personal stylist is assigned to the customer. By creating a personal customer

profile, a selection of clothing is delivered directly to the

customer’s home.

Shopping through the window at Kate Spade’s

Shopping takes place through a large touch screen display on

shop windows.

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Case Study: Nordstrom

Expansion of Value Chain

Company

Overview

• Founded in 1901: Prestigious department store in US • Operating 119 stores across 38 states (290 including

department stores and outlets)

Expand

to

Related

field

“ Growth strategy through expansion of Multi-channel＂

Revenue Growth

• Outlet store (established in ‘73)

– Currently 167 stores in US (number of stores expected to

increase up to 230 by 2016)

• Online outlet shopping mall (Acquired in ‘11) Every morning at 8am newly discounted products are uploaded, and deleted after certain time. Promoting instant purchase by limiting hold time.

- Main products: clothing, accessories, cosmetics etc.

63% 62% 57%

23% 23% 24%

14% 16% 19%

2012 2013 2014Nordstrom Nordstrom Rack Online*

11.8 12.2

13.1

• Customized men’s clothing shopping service (Acquired in ‘14) – Stylist selects and sends out 8 customized products and

allows 10 days for making a decision of whether to purchase or not

*hautelook.com, nordstrom.com,

nordstromrack.com, trunkclub.com

• Create synergy effect through M&A of various channels

such as outlet, online, and mobile channels

[Unit: Billion USD]

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Superior Customer Service

Amazon MayDay The support service

available on Kindle is a single-click support

solution that lets users work with a remote tech support representative to solve problems with their

tablets

Neiman Marcus app for shopper recognition

NM Service allows you see which sales associates are

in store, message and make have many other

benefits.

The Zegna Digital Store

It is a virtual 3D store and mobile application that imitates the feeling of

being inside a retail location.

Amazon MayDay

The support service available on Kindle is a single-click support solution that lets users work with a remote

tech support representative to solve problems with their

tablets

Neiman Marcus app for shopper recognition

NM Service allows you see which sales associates are

in-store, send them a message and has many

other features to enhance the customer experience.

The Zegna Digital Store

It is a virtual 3D store and

mobile application that imitates the feeling of

being inside a retail location.

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Store Office

Gym

Concert

Pub

/Lounge

Parking lot

Library

School

Web

Hairstylist

Mobile

Airport Station Hotel

In the street

Home

Restaurant / Café

Museum

Outdoor

Gas station

Theatre Cinema

Catalogue

Newspaper

Flyer

Store

window Vending

machine

Sales

Assistant Loyalty

card

Kiosk

Contact

center

E-mail Social

Network

Website

Bluetooth

SMS/ MMS

Videogames

TV/Radio ADV

TV/Radio shows

Movie

Billboard

Promoter

News Information

Socialization Networking

Sample

Promotion

Emotion

Participation

Product

Radio

TV

Cars

Apps

Tablet

Wearable

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1. UNDERSTAND THE NEW DIGITAL CUSTOMER AND EXPLORE MARKETS TRENDS The Customer Journey needs to be orchestrated consistently across touchpoints

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Contextualized experience for each client from physical to digital

2. DEFINE YOUR TOUCHPOINTS STRATEGY BASED ON YOUR CUSTOMER ARCHETYPE

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Root Cause Customer Leave Case Funnel

• System Error or delay • No item of interest in top page

Explore store

Search products

Specific product page

Read Reviews

Add to Shopping cart

Choose options

Payment

Complete Purchase

Delivery

Cancel/return

Visit main page Visit

Product

search

Purchase

After

Purchase

···

• No need for purchase • Unfriendly UI and complicated UX

• No advance features supported for product search

• Lack of product variety

System Error

Unfriendly User Interface

Complicated shopping process and

payment methods

Lack of product assortment

Irrelevant Recommendation

Poor marketing message with highlights

price or promotion

Lack of detailed product information

• Lack of product details (incl. image, video) • Low price competitiveness

• No reminder function from shopping cart

• Out of stock • Delay or Poor Service

• Lack of payment options • Complicated payment process

• Lack of assurance about product size/quality

Need to Manage Customer Journey : Online and Mobile shopping

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Omnichannel Commerce Framework

4. SHAPE YOUR STRATEGY INTEGRATING TECHNOLOGY AND DIGITAL CAPABILITIES

Commercial Content Digital Marketing Physical Store

CRM Customer Care

Fraud mgmt

Supply Chain Finance & Payment

User experience and creativity

Omnichannel strategy Process model and governance

Deliver excellent experience

Econometric model

Technology Digital platform, infrastructure and application

Planning, metrics and analytics

Managing the purchasing

funnel Increase traffic and

conversion rate

Integration from the Brick

to The Click

Manage and Localize product

information

Fulfil storage and dispatch Provide certainty and

reliability

End-to-end support

services

Establish loyal and

satisfactory attitudes

Realization of Omni-Channel

Customer Shopping Journey

Touch Point

Store

Social

Tablet

Mobile

PC

Sample Use

Research Touch and Feel

Buy in store cross-selling up-selling

Payment

Purchase due to anniversary/celebration

In store pickup

Kiosk Payment

Like Identify word of mouth

Search customer reviews Leave product

review

Search directions of use

Check delivery status

Payment

Re-purchase, related-product purchase

Receive e-mail

Product/brand search Online Purchase

Recognition > Consideration Assessment > Purchase Payment >

Receive Use Evaluation

1

2

Integration of

on/offline customers

Product Hierarchy Management

3

4 5

4

Location based Marketing

Refund/return

In-store or specified location pick-up

CRM Reinforcement based on analytics

Digital Innovation Blueprint

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Decision making based on customer behavior Analysis

Behavior Analysis Data Biz. Questions based analysis

Collect data from the end-to-end shopping process and integrate them in standardized terms provide raw data for prompt decision making

PC

Mobile

Call

Store

Order Order change

… Visit Search Order complete

Analysis for improvement of customer, channel, product value which composes customer interaction

Product Channel

- How does mobile reinforcement financially affect other channels in terms?

- What is successful order multi-path?

- Does customer use the channel for any purpose?

- Which product category has low conversion rate compared to interest level?

- Are product assortment appropriate?

- What are the most interested products by life-stage?

- Is there difference in customer behavior by product interest?

- What are the characteristics of customer behavior after first visit?

- Who are high-valued customers with chance of continuous purchase?

Customer

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THANK YOU!

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Copyright © 2014 Accenture All rights reserved. Copyright © 2015 Accenture All rights reserved.

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