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Economist, researcher and software exec, Ray Major, recently gave a presentation at Retail World 2013 in Melbourne, Australia where he discussed how the Internet of Everything is permanently changing retail cycles and consumer behavior.
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Retail at Hyperspeed
Ray MajorRetail World Conference + Tradeshow
13th-14th May 2013
Melbourne, Australia
How the Internet of Everything is
permanently changing consumer behavior in
turning the retail world upside down.
Adapt or Die
Long wave Economic Cycles
Railway, Steel
1830-1880
Electrification
1880-1930
Automobiles
Petrol
1930-1970
Tech
Info. / Comm
1970-2010 Bio/nano
tech
2010- 20xx
Impact on Retail:
• Gen. -> Dept. Store
• Mass Distribution
• Catalogs
Impact on Retail:
• National Brands
• Chain Stores
• Lights
• Refrigeration
Impact on Retail:
• Supermarkets
• Shopping Centers
• Indoor Mall
Impact on Retail:
• Scanners
• Analytics
• Category Killers
• Internet redefines
retail
• 70% on-liners
make purchase
Confluence of Technology• 2005 – Big Data• 2010 – HTML 5• 2010 – iPad• 2015-- Internet of
Everything
Today’s Priorities
84% of mobile users keep their device within 10 feetat all times.
“Phones” moved from discrete solution to an engrained part of daily life.
Stops being a technology --
becomes “embedded”
“assumed”
and “integrated”
99% of the physical world is
not connected to the internet
The internet of
EVERYTHING
The Internet of Everything
connects the Physical World
to the Internet
Using Microsensors,
everyday objects become
connected and intelligent
Decisions happen in
real time and in the
background
0
10
20
30
40
50
2002 2007 2012 2017
The Internet of Things
50,000,000,000
things connected by
2020
More connected devices
than people on earth
Big Data
o By 2015
o 1 Zettabyte of data will flow over the internet
o By 2020
oData Production up 44 fold
o B2B and B2C internet transactions = 450 billion per day
Earth
Pluto
Stack of books 20 times
“Real-time” becomes
“Real-time”
o There are more mobile devices than people on earth
o By 2016 –
oMobile Speed increases 9 fold
oMobile Traffic increases 18 fold
oHome Network speeds increase 20 fold
o video calling increases 25 fold
o By 2020, anyone can broadcast anywhere, to anybody – on any device.
Smart World 2023
What differentiates Best in Class
Companies from the rest?
“the ability to exploit the data
and transform it into useable
business insight”
Aberdeen Group 2011, survey of 370 executives
What type of advantage do Best in
Class Companies Enjoy?
Aberdeen, Harte/Hanks, 2011
• Missed or unidentified sales opportunities
• Inefficient geographic selling
• Inflexible product lines
• Lost sales due to shifting competitive pressures and poor
timing
• Little holistic assessment of a customers wants and needs
Today’s Retailing Challenges
Today - 2013
IoE Analytic Framework
Identify Design Inform Distribute
The Key to success is bringing together all
the disparate data and making sense of it in
real time
Comprehensive or Holistic Business Intelligence Solution
Identify at Hyperspeed
Identify
Massive amounts of new data
Consumer
are Empowered in Real Time
The power shifts from retailers to consumers
Data from Consumers impacts brand
awareness and cache’
1. Scan
2. Track
3. Rate
4. Review
Retailing occurs in real time
Design at Hyperspeed
Identify Design
Most companies BICRM
POS
CRM
POS
Not Easy
Your Business
Intelligence Assets
Cluster Analysis
Simulation Modeling
Regression Analysis
Descriptive Statistics
Prescriptive(what actions
should be taken)
Prediction
(What might happen)
Forecasting
(What might happen)
Monitoring (what’s
happening now)
Analysis
(why did it happen)
Analytic Continuum
High
Low
Co
mp
lexi
ty
Business Value
Reporting
(what happened)
OLAP and Visualization
Behavioral Questions “Who are my best customers?Where do they live?What is their most likely next purchase?
Quantity Questions How much inventory do we need to carry?What stock levels will be left at the EOM?What will Sales finish at this year?
Optimal Outcome Questions (potential outcomes based on complex interactions)How can we achieve the best outcome?What is the impact of a cold winter on our business?
Inform at Hyperspeed
Identify Design Inform
Business Intelligence (BI) is the ability of an organization to collect, maintain, and organize data.
Human Intelligence (HI)
the property of mind that encompasses the
capacities to reason, plan, problem
solve, think, comprehend ideas, use
languages, and learn.
Data are Dumb,
Humans are Smart
Business Intelligence
Systems
Distribute at Hyperspeed
Identify Design Inform Distribute
New Retailing - Big Data and
Personalization
• Bridge between online
and Brick-and mortar
• SEAMLESS
SHOPPING
EXPERIENCE
• Personalization
• Recognize who you are
• Personalized promotional offer
• Knows your favorite fit and size
• Match transaction to buying patterns
• Issue incentive
Personal Shopper
Hyperspeed Cross-sell
• Missed or unidentified sales
opportunities
• Inefficient geographic selling
• Inflexible product lines
• Lost sales due to shifting
competitive pressures and poor
timing
• Little holistic assessment of a
customers wants and needs
• Increased sales from real-time
market assessments and reactions
• Increased selling from location-
based selling
• Products are designed and built in
real time driven by consumer
• Increased sales by directly tying
pricing to current selling situations
to customer ability to pay
• Increased sales from improved
coordination with other products
and services
Potential of the Internet of
Everything
Today - 2013 Tomorrow - 2023
Which Retailers will be successful in
the coming decade?
“the ability to exploit the data
and transform it into useable
business insight”
Aberdeen Group 2011, survey of 370 executives
Those with:
Retail at Hyperspeed
Ray MajorRetail World Conference + Tradeshow
13th-14th May 2013
Melbourne, Australia
Thank You