1. Multi Channel Retail Thinking 2. Project Management Thinking Rob Stone, Principal 11

1. Multi Channel Retail Thinking
2. Project Management Thinking
Rob Stone, Principal
11th April 2006
What is Multi Channel Retail (MCR)
Charteris defines MCR as:
One view of the customer
One supply chain
One service policy
One assortment/product range across multiple
channels
Background
Mail Order and
E-commerce
account for 11%
of total retail
sales
Record
Numbers via
Web and TV
Shopping
ICD Oct 05
Difficult retail environment
Internet shopping maturing
Retailers’ upgrading websites
Industry view is that successful retailers
providing integrated shopping
More customer information available
Technology costs falling
The Survey - Who we spoke to
Turnover above £200 million
40 blue chip, high street retailers
Senior Board, Middle Management
Anonymous
Questioned about Multi Channel
Retailing
Channel Penetration
Channel
100.0%
90.0%
80.0%
70.0%
60.0%
50.0%
YES
40.0%
30.0%
20.0%
10.0%
0.0%
Call Centres
Catalogues
Digital TV
In-store Kiosks
M-commerce
Stores
Web site
Key Findings
Multi Channel
Retailers
Best –
Argos & Next
♦
The most admired retailers were perceived to
have their full range of products and services
across all channels
♦
Retailers still focussed on battling for transactions
rather than winning the war for life time value
♦
Key issue – channels managed separately and
often at too low a level
♦
Level of service inconsistent across the channels
♦
Lack of integration is causing significant
“leakage”
Key Findings
♦
♦
Expansion Areas
♦
into m-commerce (30%)
♦
in-store kiosks (18%)
♦
and digital TV (15%)
Most admired multi channel model
♦
Argos… large range available
♦
Tesco… strong brand
♦
Amazon… dominant on web
What does it all mean?
4 key areas
Responsibility & Strategy
Cultural Change
Customer & Brand
Supply Chain
That if addressed will increase customer base.
These changes will be driven by significant
reduction in the cost of Technology
Responsibility & Strategy
How many would
you score?
The Multi Channel Retailer Test:
Q1 Who is responsible for sales through all your
channels?
Q2 Who champions the customer?
Q3 Is that person on the Board?
Q4 Can they set agendas for Technology, Logistics,
Customer Service, Product Assortment and developing
new customer services?
Q5 Have they summarised the vision for MCR in the
organisation and communicated it to all levels?
Q6 Can you see the MCR plan for 3 months, 6 months
3 years and 5 years?
Q7 What are the published KPI’s for MCR
Cultural Change
Does everyone understand what retailing will
look like in 3, 5 and 10 years time?
If selling to a customer is made up of many
touch points who gets the credit?
Do senior managers really understand the
recent technology changes and what it means
to retailing?
Do buyer, managers, merchandisers, stock
handlers, sales assistants, store designers,
customer service assistants and directors know
what will need to changes about their job for
MCR?
Customer & Brand
“We have a strong
information flow
within each channel
silo, rather than
across them”
“it’s difficult to
manage consistency
across the different
channels”
“lifetime value
measurement is a
key criterion that
we’ve started to
develop within
channels”
Who champions the customers?
How do your customers see your channels?
Do you want to drive sales to the shop or on line?
Which is more cost effective for your retail operation?
Do you treat the same customer in different ways in
different channels - price?
Do you have a 360 view of the customers wants and
needs?
Supply Chain - A Customers View
Since May 2005
Woolworth has
allowed customers to
buy over 300,000
products for home
delivery via its 824
stores EPoS
Can I get my goods when and where I want them – in
store or delivered?
How come you have run out of stock in store and why
didn’t you offer me a delivery from the web stock?
If my product is faulty can I take it back to a store or
send it back by post?
Is it the same price on line as in store and if not why
should I pay more in store?
Can I order it in store and have it delivered direct.
Can I order on line a collect it on Saturday when I am
shopping?
Can I have timed delivery slots?
The New Shopping Landscape
Retailing faces the convergence of influences
which are dramatically altering the landscape:
impact of change
24x7 culture
reducing cost of IT
The
PC + broadband penetration
e-commerce changing consumers’ behaviour
new
new retail formats
shopper
new channels (iTV)
new channel specialists (ebay, Amazon)
Specialist /mass market polarisation
no barriers from cost or age
Birth of the New Shopper
Behaviour polarisation:
loyal to strong brands,
disloyal to weak
Technically savvy, literate and competent with IT
All ages
All socio-economic groups
Sophisticated comparison shoppers
Speed of availability and delivery increasingly crucial:
“I want it now!”
Has eBay saved the Post Office?
Not a slave to a channel – ingenious users of channels
for their advantage
Convenience and certainty
Need for a New Retailer
Offer reasons for customers to come back
Consistency across channels of:
range
price
expert service
Mass market vs niche – which playing field?
Single view of customer
Weak brands won’t survive
Multi-Channel Retailing Journey
Project Management Thinking
Christmas Present?
Planning
Requirements Gathering
Tracking and Control
Look and Feel
Go-Live Migration
Christmas Present?
Business focus on 12 weeks to early January
50% revenue in Q4. 25% in December
Business drives a September / October launch
Still require stabilisation period
Still require business involvement
Still require Christmas Change Freeze
Initial Project Sign-off
Mid Q1 after January rush over
Business readiness
ITT / Review responses
Planning
Software development or Change programme?
Always listen to the team pessimist
Treat all channels alike
Web / Call Centre / Mail Order
Common catalogue
Customer-centric view
More marketing involvement = More time
Customer Conversion / Retention
Website tagging
Pricing feeds
Performance / Response Times
Design it in from beginning
Requirements Gathering
Business team needs deep business knowledge
Are they being taken out of the business to
support the change programme?
Do the requirements support the MCR model?
Difficult to break out of silo mindset
Single customer? Common catalogue?
Common prices?
Release Genie from IT Bottle
Gathering requirements versus wishes
Want versus Need. Expectation management
Tracking and Control
Project manger should own the plan
Do not detach yourself from planning and
reporting process
Track internal and external dependencies
Are you being challenged by the Project
Board?
Are benefits being delivered?
Management Reporting
Quality thinking time
Good …. and bad news
Planned activities in period …. Deviations…
Reasons… Actions
Look and Feel
Customer Journey
Consistency between channels
Basket / trolley / cart
Entering payment card details
Persona driven design?
Story Boards
Agree basic layout
Alignment problems on website
Anomalies from real data
Who will sign-off design?
Marketing manager / Sponsor / CEO
Time consuming
Go-Live Migration
Legacy data
Ditch or convert?
Data cleansing exercise
Data mapping issues
Separate domain knowledge
Misuse of fields
Customer name (title, forename, surname)
Migration Metrics
Go-live timings
Minimise system outage