Issue 63 - October 2018 THE RETAILER
The Retail Realm
2018 AUSTRALIAN RETAIL AWARDS 3
Ask your customers to press CHQ or SAV toget cash out and avoidATMfees.
eftpos is a great way to give your customers added value with their everyday purchases. The more cash they get out from your store, the less cash you will have on the premises, helping to reduce the cost and risk of doing business.
4 2018 AUSTRALIAN RETAIL AWARDS
CONTENTS Issue #63 Features 10 FINDING CUSTOMER LOYALTY IN THE ONLINE AGE Although customer experience has become the newmodel to boosting customer loyalty, consumer data is still the key. 14 DRIVING CONSUMER LOYALTY THROUGH CRYPTOCURRENCY As competition increases locally and globally, retail brands are turning to innovative technologies to increase customer retention and sales performance. 18 TRUE UNIFIED COMMERCE CHANGING THE RETAIL SPHERE With digital commerce revolutionising retail, unified commerce becomes a whole new ball game of opportunities for retailers.
REGULARS 04 From the Executive Director 06 Retail news from across Australia 08 A political storm impacting retail 22 28 Changing the retail conversation 36
BUSINESS OPERATIONS 12
Navigating challenges in the retail sector
Promote your brand, butmake sure it’s protected too 30 Compressing the delivery timeframewithout compromising the customer experience 42 It’s all in the detail: Building a sustainable retail fit-out 44 Mastering the supply chain conundrumwithCX 46 How to use promotions to boost your revenue 48 Complaints are good for business
Started from the shopfront now I’m here
How HR technology can ensure your business is fair work compliant
CUSTOMER EXPERIENCE 26
Keeping upwith consumers: gomobile or go out of business 20 Mobile employee engagement solutions deliver positive results 40 New technology revolutionising retail 50 How to optimise your promotions tomaximise performance 52 The three senses of retail
Customer experience in the race for retail transformation
Coca-ColaAustralia’s road to gender equality
38 Fiveways to develop a CX-centric DNA
ARA PRODUCTION TEAM
Editor Katherine Mechanicos email@example.com Advertising Account Manager Chris Sav 1300 368 041 firstname.lastname@example.org Graphic Design Mikeila Scheckenbach email@example.com
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Australian Retailers Association Phone (toll free): 1300 368 041 Fax: (03) 8660 3399 Melbourne Office Level 1, 112 Wellington Parade East Melbourne VIC 3002 Sydney Office Suite 104, 40-48 Atchinson Street St Leonards NSW 2065
External Contributors AOPEN Group, SAP Ariba, Shping, SOTI, eStar, StaffConnect, Daylight Agency, Riverbed Technology, Manhattan Associ- ates, Adyen, FCB Group, InMoment, WCT Distributors, Coca-Cola Australia, NeoPost Shipping, Pronto Software, Cullaborate, JDA Software, Software AG
Copyright Contents may not be reproduced in any form without permission from the Australian Retailers Association and then only with suitable acknowledgments. 2018 Australian Retailers Association ISSN: 183404720
The Retailer is printed on FSC paper stock using vegetable based inks by a printer with ISO14001 Environmental Management System Accreditation
From the Executive Director
ith Christmas around the corner, and retailers working harder than ever to meet their targets, this last edition
With so many challenges facing the industry, it is very common for retailers to focus on their business. Therefore, this edition of The Retailer focuses on The Retail Realm - which encompasses all elements in the retail sphere including customer experience, technology, payments, sustainability, supply chain, growth, employee development and corporate social responsibility. This last edition of 2018 will encourage retailers across the country to think outside their shop and focus on the entire retail landscape, from product manufacturing to customer fulfillment – and everything in-between. Before you head straight into this insightful issue, I’d like to remind our members that this edition will be the last printed version of The Retailer as this publication will now be moving to an online platform for member convenience and accessibility. To ensure you continue to receive this publication digitally, please ensure your contact details are up to date with our membership team by phoning 1300 368 041 or emailing firstname.lastname@example.org. The ARA are excited to see our members take on this year's Christmas trade and look forward to another transformative year in 2019. Until next time, we wish you all a happy and healthy holiday trade. Best wishes,
of The Retailer for 2018 comes at a poignant time. The Australian retail industry is a strong and resilient sector as this year we’ve seen international giants such as Kaufland, Decathlon and South Korean beauty retailer, Innisfree, enter the Australian market. With new entrants, high overheads and evolving technologies, the Australian Retailers Association (ARA) understand the difficult trading market our local retailers are facing and have been at the forefront of many regulatory issues affecting the sector. This year alone we have worked hard to prevent extra costs to retailers by ensuring mandatory expiry periods on gift cards were kept at three years, and not an indefinite period. We were able to ensure a fairer tax system for all retailers, by implementing the Low Value Threshold (LVT) GST. And finally, we were able to see the second stage of the Sunday penalty rates transitional arrangement take effect in July, with Sunday penalty rates dropping from 195% to 180% for full-time employees and dropping from 195% to 185% for casual employees. This decision was an incredible outcome for the ARA and retailers across the nation, and will continue to provide long-term benefits for employers and employees in the industry.
THE AUSTRALIAN RETAILERS ASSOCIATION COUNCIL
President Rowan Hodge – Battery World
National Councillors Robyn Batson – Sussan Group Graham Dear – Leading Edge Group Ralph Edwards – Bright Eyes Mhairi Holway – Pandora Jewellery Steve Plarre – Ferguson Plarre Bakehouses Mark Daynes – Jeanswest Anthony Wilson – Wilson Retail Toby Darvall – Ishka Andrew Ng – Lagardère Travel Retail (advisory)
Russell Zimmerman Executive Director Australian Retailers Association
4 RETAILER | OCTOBER 2018
Do more than take payments.
$0 monthly account fee on a Business Transaction Account^. CommBank have a wide range of flexible merchant solutions for taking payments online and in person. Our devices make it simple to accept payments in-store or on the move, plus easily integrate with your point-of-sale systems. As a member of the Australian Retailers Association, when you open a new CommBank Business Transaction Account and link it to your existing or new CommBank merchant facility by 31 December 2018 we will waive the $10 monthly account fee^. To find out how CommBank can help your business move forward, contact the member services team at the Australian Retailers Association on 1300 368 041 . commbank.com/merchant
Things you should know: Australian Retailers Association may receive a fee from CommBank for each successful referral. ^Offer available to referrals made via the Australian Retailers Association between 1 July 2018 and 31 December 2018. To maintain the fee waiver you must retain the required products and association membership otherwise the offer may be withdrawn. Offer includes the monthly account maintenance fee of currently $10 on the Business Transaction Account linked to the merchant facility. Association offer excludes the Simple Merchant Plan. This offer may be extended beyond the specified end date at the discretion of the Commonwealth Bank (“CommBank”). Interest rates and fees are subject to change. The Association may receive a fee from CommBank for each successful referral. Referral Fees are not payable on referrals from existing relationship managed customers. Full terms and conditions are included in the facility offer. Applications are subject to the Bank’s normal approval criteria. Bank fees and charges may apply. All fees are subject to change on 30 days advance written notice and are inclusive of GST. The advice contained in this brochure is for general information purposes only and may contain general advice. It has been prepared without considering your objectives, financial situation or needs. You should, before acting on the advice, consider its appropriateness to your circumstances. Terms and conditions are available from commbank.com.au. If you have a complaint in respect of this product, the Commonwealth Bank’s dispute resolution service can be accessed on 132221. Commonwealth Bank of Australia ABN 48 123 123 124 AFSL and Australian credit licence 234945.
RETAIL NEWS FROM ACROSS AUSTRALIA
PARCELPOINT ENABLES EBAY USERS TO CLICK & COLLECT
ast year, eBay.com.au and ParcelPoint collaborated to launch the first integrated returns service for eBay shoppers in Australia. This year the partnership expands with the inclusion of Click & Collect on eBay’s website. This partnership offers buyers the option to collect their purchases from 1,400 extended-hours locations such as pharmacies, newsagents, petrol stations and shopping centres. Currently, 80% of Australian online shoppers live or work within three kilometres of a ParcelPoint location, the network is set for further expansion in the coming year. Increasing customer demand for more convenient and reliable, tracked deliveries, pick-ups and returns has been made more achievable. In just a few clicks, eBay shoppers can now select their most convenient location and then collect their purchase whenever it suits them. Most people enjoy the ease of online shopping, but nobody likes to spend time figuring out where and when to pick up or return items. When you take into account the vast distances between buyers and sellers in Australia, opportunity arises for retailers to lead the charge on making online shopping convenient and connected. There is no doubt that in the future, retailers across the country will be leading customer fulfilment by not just making their processes more efficient, but providing customers with the tools to be dynamic shoppers as well.
FORD PARTNERS WITH NEXT TO BRING CAR-BUYING IN-STORE
utomotive retail makes another bold move as Ford open their new Digital FordStore set within the Next Arndale flagship store in Manchester. This concept has been designed with different customer profiles in mind – from day tripping families, trend-conscious millennials and existing customers seeking an upgrade. This experience allows consumers to explore independently or take advantage of support from Ford ‘Hosts’ – approachable and knowledgeable staff, guided by the core principles of inclusivity, empowerment and simplicity. A ‘disrupt zone’ in the store’s threshold immediately attracts attention with its nine-metre-high digital screen, acting as dynamic signage and a transition from Next to Ford. Further inside, the ‘educate zone’ demonstrates how to select and personalise the perfect model according to a customer’s needs. The ‘consult area’ is a canvas for brand storytelling, highlighting the features and benefits of Ford, allowing customers to explore product information within a lounge space, and having access to free Wi-Fi and phone-charging. Ford has been using renewable, plant-based materials innovatively since the 1930s, including utilising soy, denim and recycled bottles in its manufacturing process. These eco credentials are tangibly communicated in the space via storytelling and artefacts that act as a ‘mini museum’.
6 RETAILER | OCTOBER 2018
REGULARS | NEWS
THE QVB CELEBRATES 120 YEARS
ne of Sydney’s oldest and most treasured shopping destinations the QVB, is celebrating 120 glorious years since first opening its doors in 1898. This building has seen it all from horse and carts, to a CBD growing with skyscrapers. With thanks to all the managers and the public who sought to preserve the QVB over the years, the building was listed on the NSW State Heritage Register in 2010. In 1898 the doors to the QVB were opened by the Mayoress of Sydney, Francis Harris, using a bespoke, intricately inscribed golden key. Joe Bananas is one of the oldest retailers at the QVB and recalled fondly, “The first week the store was open at the QVB, we had a beautiful coat displayed in the window featuring Australian emblems. Elton John’s manager, John Reid, came in, and bought it for Elton. Within an hour, three limousines pulled up, and in came Elton with his party all dressed in swimmers. He said, “I’ll have this, and this…oh what the hell, I’ll take one of everything.” He signed his credit card and shared the delivery address.” In many ways the QVB has been a witness to the life of the city and remains a building unparalleled in Australia, in scale and architectural style. Its exuberant sandstone façade hasn’t changed much, even with the threat of demolition in 1959, its Romanesque style has since proven to stand the test of time.
*First published in SCN
TEN YEARS OF ROUSE HILL TOWN CENTRE
arch 2008 marked the opening of GTP Group’s Town Centre in Rouse Hill. For the past decade Rouse Hill Town Centre have been changing the face of retail and residential living in North Western Sydney. The Town Centre stands as a combination of traditional streetscapes of a contemporary market town mixed with the latest fashion, homeware, dining and lifestyle retailers. It was Rouse Hill that brought Toyota’s first dealership into a shopping centre in Australia late last year. “We are pleased to offer the first Toyota retail concept store in Australia which is both a first to market for Australia as well as a point of difference for Rouse Hill Town Centre,” comments Regional General Manager, Dave Moreton. Toyota have noted that trading has been extremely strong since it opened, with many shoppers liking the convenience of being able to browse and make purchases at the same place, as well as the unique experience that the Toyota dealership has to offer in a shopping centre. The store is much more customer service oriented, and invites shoppers to interact with technology and build their ideal car as well as browse demonstrator models. With more than 230 specialty retailers, the Vinegar Hill Memorial Library and community centre, Rouse Hill Town Centre has a focus of improving retail diversity and driving productivity in a booming environment.
OCTOBER 2018 | RETAILER 7
REGULARS | POLICY
A Political storm impacting retail
Government leadership and the effect on Australian business.
BY HEATH MICHAEL [ARA]
Retailers have, and will continue to advocate for further business tax cuts, however as the Government has backtracked on this policy already, we may see other tax measures put in place. While this is a refresh of the Government, the changes so late in a term are likely to lead to minimal action on major policy as the election approaches. In the last days of the last Labor Government we saw policy making and legislation stalled, as newMinisters simply did not have time to get on top of issues and make change before they themselves were changed. What we can hope for is that the Mid Year Fiscal Outlook statement in November might hold some Budget carrots. Retailers have, and will continue to advocate for further business tax cuts, however as the Government has backtracked on this policy already, we may see other tax measures put in place. An intelligent political move would be to use the reduced company tax cut savings to bring personal tax cuts forward. This would see an increase in disposable income which is always welcomed by retailers. In the existing climate, I do not think we will see significant policy outcomes. For this reason, retailers and the business community will need to work with all the main political groups to try and achieve sensible outcomes to grow the industry.
The Prime Minister is joined in the leadership team by the former Minister for Energy, the Hon Josh Frydenberg MP, who was elected Deputy Leader of the Liberal Party. Mr Frydenberg will assume the role of Treasurer. Mr Frydenberg has held the Ministries of Environment and Energy, Resources and Northern Australia and Assistant Treasurer. He was first elected to the safe Melbourne seat of Kooyong in 2010, a seat famously held by former Prime Minister, Sir Robert Menzies and former Liberal Opposition Leader, the Hon Andrew Peacock. In a notable shift for the Government, the energy and environment portfolios have been split, with the Hon Angus Taylor MP taking on the role of Minister for Energy. Mr Taylor is faced with significant expectations on lowering energy prices, which is expected to be a key policy issue for the upcoming Federal election, and with the Government last week announcing a number of changes to energy policy and the National Energy Guarantee. Both households and industry will be looking to the Minister to deliver on the Government’s promise of lower energy prices. Other reallocations of responsibilities within the Ministry saw the Hon Kelly O’Dwyer MP appointed Minister for Jobs, Industrial Relations and Women, Senator the Hon Michaelia Cash appointed Minister for Small and Family Business, Skills and Vocational Education. Both of these are significant for retail as they bring both Industrial Relations and Small Business back into Cabinet, a strong focus for the ARA as retailers were very disappointed when they had been previously dropped from the core decision- making group within our Government.
ollowing the recent eventful week in Canberra, the Liberal Party put an end to ongoing leadership speculation for
the time being by selecting both a new Leader (and therefore Prime Minister) and Deputy Leader of the Liberal Party. For Australian Retailers Association (ARA) members, some of whomwere in Canberra with me as Director of Policy during the leadership change, the impacts are very real. We as an association were close to finalising a number of pieces of legislation, from gift cards to modern slavery and consumer law. All the Ministers who were in the final stages of those areas were either moved or were replaced as Ministers. We now have to cover ground with new Ministers on areas we thought we had resolved with their predecessors before they go forward into possible introductions during the October sitting period. The Hon Scott Morrison MP has been selected by the Parliamentary Liberal Party as the 30th Prime Minister of Australia. Mr Morrison has been an influential member of the Coalition Government and a key member of the economic team having served as Treasurer since September 2015. He previously held the Social Services and Immigration portfolios and he was first elected to Parliament in the safe Sydney seat of Cook in 2007. Prior to his Parliamentary career, he was known for his work in the tourism sector and had also been involved in the Liberal Party as State Director. He is considered socially conservative, however, has generally taken a pragmatic approach to policy issues.
8 RETAILER | OCTOBER 2018
OCTOBER 2018 | RETAILER 9
FEATURE | CUSTOMER EXPERIENCE
Finding customer loyalty in the online age Although customer experience has become the new model to boosting customer loyalty, consumer data is still the key.
BY MICHEL VAN AALTEN [ADYEN]
n a retail environment influx, the need to retain existing customers is more important than ever. Studies show it costs between five and 25 times as much to acquire a new customer, than it does to retain an existing one. Whilst retaining a small percentage of your customers is known to boost profits by a much greater proportion, retailers need to focus on enhancing their customer experience in new and competitive ways to retain customers. The sixth annual loyalty research study For Love or Money 2018 highlighted a decline in desire for loyalty cards, but a willingness for consumers to give up their data in exchange for an enhanced experience. The study indicated over 50%were okay with giving up their data if it would enhance their
shopping experience and 46% said they would be mostly likely to do so if it would provide personalised offers and benefits. The study also found 44% of respondents were okay with giving up their data if location-based offers were sent to them and 41%were happy for them to use their data for re-purchase reminders. In the study, the identified areas for improvement revolved around moving away from the monetary incentives and providing more surprise and delight moments as well as innovative rewards. Gone are the days where a ‘thank you for shopping with us’ email is considered quality service. Today, retailers must navigate a much more complex network of online and offline touchpoints to meet the demands required to garner loyalty from customers.
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Adyen’s recent Australian Retail Payments Guide shows 65% of shoppers say that a personalised in-store offer is likely to make them spend more, while 66% say it would make themmore likely to recommend a brand to friends and family. Good examples of this kind of elevated customer experience can be found within a fewmajor retail brands. Nike recently identified an opportunity to cater to their demographic and revamped some of its flagship stores, turning them into state- of-the-art basketball courts. Online apparel brand Bonobos continues to offer coffee, beer and fashion advice to all in-store shoppers. While, home and cosmetics brand Rituals are delivering an experience reminiscent of a trip to a spa, with sounds and smells designed to excite the senses. These days, shoppers simply expect more. They expect to feel like VIPs and for their needs to be anticipated. Yet many retailers still miss the opportunity to use data they’re already generating to show how they understand customer priorities. The time is now to rethink loyalty programs and treat data as the powerful asset it is. For retailers looking into ways to keep their customers coming back, payments data can offer valuable insights to increase traditional loyalty initiatives. Taking advantage of payments data represents a significant opportunity in the current retail environment, allowing businesses to understand consumer behaviours and what drives profitability and what doesn’t.
Consider it high quality, fresh and complete behavioural data that can enable far more personalised and targeted customer experiences. If data is the oil and customer experience is the machine, driving loyalty is the big outcome. Retail giants like Amazon utilise payments data very well. The international company integrates payments data, browsing history and social data to construct precise profiles of their shoppers. These profiles in turn lend themselves to hyper-personalised communications, tailored offers, products and content that specifically cater to the consumer’s needs and interests. Armed with context of your customers’ preferences online, a shop assistant has a richer knowledge bank to tap into and can offer more tailored in-store conversations. Personal touch points like this can go a long way. Contemporary customer experiences can’t be mass produced. In the modern economy, consumers crave personalised interaction. Payments data can be a retailer’s greatest tool yet remains one of the more underutilised assets. It’s time loyalty was looked at from a new perspective, harnessing the power of payments data to deliver high quality and complete behavioural data that unlocks personalised and targeted customer experiences.
For retailers looking into ways to keep their customers coming back, payments data can offer valuable insights to increase traditional loyalty initiatives.
Michel van Aalten is the Country Manager of Australia and New Zealand for Adyen, a leading payments technology company that provides businesses with a single global platform to accept payments anywhere in the world. Working with retailers across Europe, the US and APAC, Michel has extensive experience in the global payments industry and has helped many leading omni-channel retailers roll out payments in new markets around the world. Learn more at Adyen.com
BUSINESS OPERATIONS | SUPPLY CHAIN
Navigating challenges in the retail sector How local retailers can mitigate the financial burden of political and economic disruption by using digital networks.
+ Digital networks enable local retailers to anticipate bottlenecks or many other risks to the supply chain.
BY HENRIK SMEDBERG [SAP ARIBA]
impact on local suppliers and retailers who count on exports, particularly to China, for a large share of their revenues. These new tariffs loom large over the retail sector, increasing uncertainty around consumer and business confidence. Many retailers are vulnerable to the steep costs that tariffs impose, forcing them to relocate their production and renegotiate their relationships with existing suppliers. For many, this poses a significant problem given retailers secure trading agreements months in advance of distribution, while others have multi-year contracts in place. Local retailers with global networks must assess their supply chains and develop strategies to ensure they can absorb the disruption. Joining a digital procurement network is one way that retailers can mitigate the financial blow associated with tariffs. By extending transparency into the operations of trading partners, digital networks enable local retailers to anticipate bottlenecks or many other risks to the supply chain - and remedy them long before they pose a problem. Equipped with Artificial Intelligence (AI) technologies, cloud-based networks can help businesses to arrive at the most efficient
supply chain possible, instantaneously. These networks propose alternate sources available to retailers for manufacturing their goods. Moreover, these alternate sources, perhaps previously unknown to a retailer, can evolve into preferred partners. In other words, the jolt of a trade war can inadvertently force a retailer to rethink its supply chain and, in the process, discover new suppliers that meet its needs even better than the preceding firms did. Unless averted soon, a trade war between China and the US could incur harmful outcomes for local retailers and suppliers in Australia. After all, these are two of Australia’s largest trading partners. To ensure that supply chains remain flexible to shifting trade policies, local retailers are wise to rely on a cloud-based procurement network for optimal outcomes whether in times of high trade barriers, low ones, or none at all.
ith many of its trading partners increasing tariffs or levying new ones, Australia is finding its
longstanding tradition of free trade tested like never before. Against this backdrop, retailers are becoming increasingly nimble in managing their supply chain to safeguard the continuity of raw materials and, to the extent possible, the stability of input costs. Meanwhile, online shopping has become a necessary offering for retailer success - so customers demand immediate fulfillment. To cope with the growing demand for rapid and convenient delivery worldwide, many local retailers have adopted complex supply chains extending far beyond Australian shores. Yet for online retailers in particular, this exposes them to additional costs imposed by tariffs in the countries to which they are delivering their goods. In one of the most pronounced examples, the United States (US) recently imposed tariffs on thousands of imported goods from China, triggering immediate retaliation with taxes implemented against a similar amount of imports from the US. Although Australia is exempt from these tariffs, the tit-for-tat could have a harsh
Henrik Smedberg is the regional vice president of SAP Ariba ANZ, the world’s largest business network, linking together buyers and suppliers from
3.4 million companies in 190 countries. Learn more at www.ariba.com/about
12 RETAILER | OCTOBER 2018
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FEATURE | CRYPTOCURRENCY
Driving consumer loyalty through cryptocurrency As competition increases locally and globally, retail brands are turning to innovative technologies to increase customer retention and sales performance.
BY GENNADY VOLCHEK [SHPING]
where it is from and product reviews. Not only that, there are also other crucial factors that play a part in the different stages of shopping before consumers make their final purchase decision. These factors include the overall shopping experience, price promotion, and the convenience of payment.
hopping has become a part of our everyday habits and a popular pastime that generates trillions of dollars for the global economy
annually. In fact, a recent PWC survey has shown that a majority of global consumers plan to shop and spend either more or the same amount in the near future. The same survey reveals that consumers are optimistic when it comes to shopping and are willing to spend on both experiences and products. When it comes to shopping, the mobile age has irrevocably changed our shopping habits. With one of the highest mobile penetration rates (78%) around the world. In We Are Social’s recent digital report, it was revealed that 73% of Australians have searched online for a product or service. Furthermore, our recent survey found 31% of consumers are also using a digital device to assist themwhile shopping in-store. Be it shopping online or from a physical store, our purchase decisions can either come on a whim, or after we’ve conducted extensive research– what’s in the product,
THE CHANGING SHAPE OF LOYALTY PROGRAMS
As competition increases locally and globally, brands are finding more ways to add customers to their loyalty programs – exclusive offers, discounts and rewards – to assist in customer retention and improve sales performance. Some of the more prominent loyalty programs in Australia include Coles' flybuys, Woolworths Rewards, Qantas Frequent Flyers and Virgin Velocity, where they have a combined number of 37 million memberships. However, a recent For Love or Money 2018 research study revealed that instead of loyalty points, which has traditionally been the case for most loyalty programs, there is an increasing number of Australian consumers, notably Millennials, who are interested in earning
14 RETAILER | OCTOBER 2018
cryptocurrency rewards. In fact, 36% of loyalty programmembers wished to be rewarded with cryptocurrency instead of points, and this interest increased to 55% for Millennials.
+ As cryptocurrencies continue to make its way into the retail industry in the form of loyalty rewards , companies are also exploring more ways to pivot their business to blockchain.
This change in loyalty rewards comes as no surprise, given that cryptocurrencies have been a topic of interest these days, starting fromwhen Bitcoin – the world’s first cryptocurrency, set a record high value of $20,000 USD in mid-December last year. Today, there are over 1,600 different crypto tokens out there, and brands are hoping to leverage this blockchain technology to differentiate themselves from others. For instance, Japanese e-commerce giant, Rakuten revealed its 'Rakuten Coin' initiative aimed at expanding its international customer base. This cryptocurrency will be used as part of the company's points-based loyalty rewards system. Further to this, American rental-car company EZ Rent-A-Car, has also started to offer cryptocurrencies as a reward option for consumers with the introduction of CryptoRewards Exchange (CRE). In Australia, Melbourne blockchain start-up, Shping – a global shopper-marketing and consumer engagement platform, uses Shping Coin ($SHPING), a cryptocurrency to reward consumers for actions such as writing a review or scanning an itemwithin the Shping app. This is a single universal rewards currency that any brand or retailer can take advantage of.
WHEN BLOCKCHAIN MEETS RETAIL As cryptocurrencies continue to make its way into the retail industry in the form of loyalty rewards, companies are also exploring more ways to pivot their business to blockchain. Notably, brands and retailers are using blockchain to incentivise interactions and activities amongst consumers where actions like writing a product review, referring a friend, or rating a product will earn them crypto coins that they can use in their next purchase – further simplifying the payment process. With blockchain, companies like Shping are also creating platforms built on the GS1 standard to allow consumers to scan barcodes that will reveal whether the items have been recalled and verify its authenticity; enabling more transparency between brands and consumers. Furthermore, incentives are also given when consumers are active on the app such as filling in a survey or watching a product video. The incentives do not just stop with consumers, but are also extended to brands where they get to communicate with their customers directly, obtain consumer and behavioural analytics, and personally market to identified consumer groups. As retailers and brands begin to leverage blockchain technology, they create a decentralised global marketplace that benefits everyone. Even though blockchain technology is still at its infancy, it is promising to see that it is now being utilised more in the retail industry, and within a short span of time, we will be able to see how blockchain will revolutionise retail. Gennady Volchek is the founder and CEO of Shping, a first of its kind, blockchain-based brand protection, traceability and shopper marketing platform. Shping recently added a revolutionary cryptocurrency-based reward system to allow product brands, retailers and related organisations to reward consumers who use the innovative Shping app to help them make smarter and safer shopping decisions. Learn more at shping.com
TECHNOLOGY | MOBILE
KEEPING UP WITH CONSUMERS: GO MOBILE OR GO OUT OF BUSINESS With the changing retail landscape, retailers must utilise in-store technology to stay competitive.
BY MICHAEL DYSON [SOTI]
obility is influencing customer behaviour and retailers are faced with embracing this change or becoming extinct. Mobility is integrated into our day to day lives and expanding
STAGNANT TECHNOLOGY While consumer technology advanced, in-store mobile technology inmany cases did not progress at the pace of new technology. Retailers were inmany cases sticking to more traditional technology from a small number of suppliers. Meanwhile, smart devices such as tablets have shown the world that mobile devices can be agile, easy to use and functional, while also being stylish. These new technologies have pushed the boundaries of mobile technology and disrupted the market. Yet, many retailers are still holding back. RETAILERS NEED TO TRANSFORM It is certainly not the technology that is holding retailers back. We now have agile mobile technology including phones, tablets, beacons and scanners that meet consumer demands. However, the one element that may be proving a challenge is the correct mindset.
the power it brings to the everyday shopping experience is now commonplace. Australian consumers want a faster in-store experience complimented by customer-service enhancing technologies. With recent SOTI research finding that 64% of consumers choose to visit a store to buy a product there and then, the importance of using technology to ensure ‘immediacy’ is critical to physical retail stores today. It is important to look at how the retail landscape has changed, so retailers can transform their business and meet customer demands.
In 2017, one in five online purchases were made from a mobile device . +
CHANGING LANDSCAPE The retail landscape has changed dramatically in the past 10 years, with the introduction of internet retailing followed by the revolution in smart devices including phones, tablets, beacons, scanners and more, continually changes our shopping habits. The pace of traction is highlighted by the fact that in 2017, one in five online purchases were made from a mobile device.
While retailers may want to embrace new technology, it seems they may fear that by implementing technology too quickly, customers may reject the change, resulting in lost sales. However, this mindset is what could be the actual cause of loss of sales, as consumers are more than ready for this new technology.
Above all, consumers desire in-store technology that saves them time. Retailers need to understand that consumers are shopping differently than before, and technology needs to be integrated to meet their needs and desires. Consumers clearly want the most convenient technology solutions in-store and may grow increasingly frustrated with retailers who don’t meet their needs in this way. To keep up with these technology movements, retailers need to still think bigger and not let traditional thinking hinder their innovation. They must follow the lead of industry pioneers, such as Amazon, and not take what they do daily for granted. They must look to disrupt the market, break down the barriers and take the next step.
Consumer demand for technology has also made its way in-store, with a recent SOTI consumer survey revealing that more than half of Australian consumers are more likely to shop in a store that integrates technical solutions into the overall shopping experience. Additionally, 45.5% of consumers believe that handheld mobile devices provided by store associates that can display stock balance, product pricing and stock levels both online and at other stores, provides themwith a better shopping experience. The research also showed that to make the acquisition of goods as efficient as possible, Australian consumers prefer stores that incorporate technologies that automate the purchasing process. More than half (52%) of respondents indicated a preference for retail stores that incorporated self-service technologies and made retail purchases faster and easier. A further 36.7% of consumers highlighted a preference for stores with queue-busting technologies like mobile payment devices, to avoid checkout congestion.
Michael Dyson is the Managing Director at SOTI, the world's most trusted provider of mobile and IoT device management solutions. SOTI's innovative portfolio of solutions and services provide the tools organisations need to truly mobilise their operations and optimise their mobility investments. Learn more at soti.net
16 RETAILER | OCTOBER 2018
FEATURE | UNIFIED COMMERCE
TRUE UNIFIED COMMERCE CHANGING THE RETAIL SPHERE With digital commerce revolutionising retail, unified commerce becomes a whole new ball game of opportunities for retailers.
BY MATT NEALE [ESTAR]
18 RETAILER | OCTOBER 2018
ccording to comScore, 40% of purchases are made from cross channel sales, either through searching in-store and purchasing online, or vice versa.
to adapt to rapidly evolving customer purchase journeys. E-commerce solutions have already leapfrogged POS. With the ability to perform everything that POS terminals do, providing richer data about customer journeys, faster updates to information, inventory and offer in near real-time, with generally higher levels of reliability thanks to distributed and highly resilient infrastructure. This opens up the almost limitless potential of integrated data and solution: • A single view of the customer’s interactions and purchases, whether in-store or online – allowing retailers to proactively help their purchase journey. • A unified system of managing a widely distributed fulfilment network through Unified commerce is not a goal in itself, instead it is the enabler for placing the customer experience front and centre to your strategy. One of the biggest roadblocks is disparate and disconnected technology and systems. By locating and processing data and transactions on one integrated platform, retailers gain a single source of truth that delivers accurate and up-to- date information, reducing the number of critical connections to inventory, sales management and fulfillment systems that are a necessary and critical point of failure in many retail architectures today. 4. HOW TRUE UNIFIED COMMERCE TECHNOLOGY CAN FIT YOUR STRATEGY Point of sale systems are becoming increasingly connected within the overall business system architecture. No longer do the in-store systems stand separate from the online systems. They must be integrated with, or to your e-commerce platform, providing a seamless customer experience, and create a competitive advantage - for example when a product is sold to a customer, whether it is in-store, Click & Collect from any store location, delivered or online only. The sale should be able to be paid through a multitude of payment methods such as eftpos optimal selection of store, distribution centres (DC) and third-party logistics (3PL) models. 3. OVERCOMING THE BARRIERS TO UNIFIED COMMERCE
Whilst e-commerce has grown to represent approximately 10% of all sales, 90% are still in-store. Withmultiple channels involved in the modern buying journey, there is opportunity for expotential growth using the best of all channels to close more sales. Unified commerce is about transforming the customer journey. It’s about removing the friction from shopping by giving the customer the information and support they need to make a buying decision. There are four major themes emerging across the current retailing landscape: 1. INCREASED CUSTOMER EXPECTATION AND SOPHISTICATION Customers have increasingly higher expectations of convenience and access to information, products and service. Customers want their loyalty recognised in tangible ways and they place a high premium on convenience and immediate service, irrespective of location. Retailers can utilise technology to gain a better view of the customer, their behaviours, and their buying journeys and opportunities to satisfy customer demands. Soon, ‘commerce systems’ will begin to supplement and replace the current separate point of sale (POS) and e-commerce systems, directing the future experience of shopping Whenmaking technology investment decisions, retailers need to focus on advancements that will improve the overall customer experience and remove friction from the buying journey. 2. UNIFIED COMMERCE IS HERE AND IT’S BEYOND THE OMNI-CHANNEL PROMISE An integrated in-store and online experience is no longer nice-to-have. It is now a matter of survival in the competitive retail landscape. The unforgiving retail environment leaves no room for businesses using systems that are isolated with limited integration capabilities, which struggle
providers, gift cards, layby or deferred payment solutions, or a combination of all. All customer transactions and sales should occur within the same ecosystem, so it becomes irrelevant if a sale has been made online or in-store, or a combination. Whether your customer starts their buying journey online or in-store, using the most convenient channel becomes irrelevant. Their entire sales history, and your entire fulfilment network is at their disposal to get the right product at the right time, for the right price. True unified commerce combines the rich content and user experience of online shopping with the functionality of in-store POS and operator-initiated orders and sales. Matt Neale is the Chief Technology Officer of eStar, Australasia's leading specialist e-commerce solutions provider, delivering outstanding experiences with some of the region's best brands, through a combination of thought leadership, user experience, development, design and partners. Learn more at estaronline.com + An integrated in-store and online experience is no longer nice-to-have. It is now a matter of survival.
OCTOBER 2018 | RETAILER 19
TECHNOLOGY | HUMAN RESOURCES
Mobile employee engagement solutions deliver positive results
How to transform the employee experience through mobile solutions.
BY GERALDINE OSMAN [STAFFCONNECT]
Retailers who don’t make employee engagement a priority risk losing talented employees.
KEYS TO THE KINGDOM Lack of engagement is a core driver that leads to poor attrition rates. Retailers who don’t make employee engagement a priority risk losing talented employees to their competitors and increasing recruitment costs. What’s really behind disengagement? Lack of effective communication plays a large part - between retail workers and their managers, and between peers - both of which can lead to employees feeling out of the loop and disconnected from the organisations goals and vision. There’s another key influence as well when it comes to these dynamics - remote working has become increasingly common in the retail sector. According to Gallup , the percentage of retail workers who spend at least some time working remotely has reached 30%. Distributed workforces can produce another layer of complication into internal communication, leading to morale dips paired with a negative impact on the customer experience and the retailer’s brand. Technology is critical to addressing this issue, as the retail industry continues its transformation to a business model that’s digitally driven and online. What would an
ant to harness the power of a virtuous cycle to ultimately improve profits for your retail organisation? Then implement a
mobile technology solution to create a positive employee experience and a positive retail brand to not only enhance the customer experience but also increase profitability. The fact is, the retail sector faces unique challenges in relation to engagement. A recent Hay Group study clocked median turnover rate for part-time retail workers at 67%. This high level of employee churn exacts a huge toll on retailers - in particular, it creates an ongoing challenge in attracting and keeping talent. This is why determining how to increase engagement is so critical from a bottom-line business perspective. If you can improve engagement amongst your retail staff, you will open communication channels, improve productivity, and retain talented employees.
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ideal engagement solution entail? For starters, it must address the sector’s specific communication challenges, particularly with employees increasingly likely to work in different locations. Another requirement in this scenario is effective workforce management technology - ideally in a single seamless platform. There are newmobile engagement platforms available to help navigate through and around the above challenges to drive positive engagement betweenmanagement and employees. WHAT ENGAGES THE ENTIRE SECTOR? Whether you’re a traditional retailer or an online retailer, your organisation stands to benefit fromutilising mobile technology solutions to address engagement, just as the industry as a whole has successfully incorporated innovative technologies into their business model. By drawing on the power of mobile technologies, you can ultimately deliver best-in- class customer experiences, while sharing a clear company ethos with employees across the organisation. This happens by building a bridge between different functions, geographies, and strata of workers. How can an employee app do this? By helping everyone see clearly what the organisation stands for and how it relates to their specific job, leads to increased employee engagement, resulting in better customer service and the cycle of virtue as described above. When choosing an employee engagement platform, not only do you need a mobile solution that can help create effective communication for both desk and non-desk employees (NDEs), but you also need one with analytics capability to measure success. Mobile tools are uniquely qualified to provide measurement functionality that can address needs and foster continued improvement in the employee experience (EX). In terms of communication, look for a mobile-enabled app that provides users with the ability to interact with and share information while working within defined communities from the store front to the warehouse. Your mobile engagement platform might even offer access to an instant messaging feature to let workers connect and engage with each other regardless of their location or job function. When it comes to measurement, you want a mobile app to help you untangle gathered employee data so that you can use this information to help define your ongoing internal comms strategy and further boost engagement. Only a comprehensive technology platform lets youmeasure and analyse engagement changes over time to understand how to increase engagement and business performance long-term. Seek an engagement platformwith access to real-time analytics. This is the only way to collect the information needed to constantly adapt and improve processes, meet the needs of your workforce, and achieve higher engagement levels while minimising turnover rates. When you have the technology in place to build an emotional, two-way connection with your retail staff, including NDEs, you can help your entire organisation feel closer to your brand. It’s only then that they will actively connect, engage, and positively promote your organisation, becoming brand advocates and helping retailers finally break the cycle of their current engagement woes.
Geraldine Osman is the Chief Marketing Officer for StaffConnect, a leading provider of mobile employee engagement solutions for the enterprise. She brings a wealth of global technology B2B marketing leadership in public and pre-IPO start-ups accelerating revenue growth through growth hacking, high conversion inbound marketing. Learn more at staffconnectapp.com
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