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Digital retailing

6, October 2015

PROFESSOR OF MARKETING AND JOHN GARLICK CHAIR IN BUSINESS SCIENCEProfessor of Marketing (Specializing in digital business & marketing), Oulu Business School, FinlandAdjunct Professor (Digital marketing) at the Aalto University School of Business, FinlandMarketing SectionUniversity of Cape Town

Jari Salo (D.Sc. (Econ. & Bus. Adm.)

Outside

• Rotuaari field experiments• Mobile SMS

• Outside (not in proximity) displays• Outside smart displays in location (identify person, car,

facial recognition, gender, age etc.)

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Rotuaari field experiments - history

• University of Oulu’s multidisciplinary research project whichstudied mobile services

• 6 mobile services field trials implemented during 2003-2006SmartRotuaari1, 2 &3, TiernaJack, MobileKärpät,SmartCampus

• Almost 2000 consumers/end users surveyed• Hundreds of interviews• The main result - Consumers valued:

– Location-based, context-specific services– Multichannel services– Community services

Case Kärkkäinen•Campaign objectives

– To collect mobile marketing permissiondatabase

• Customer data• Interests• Customer satisfaction

•Campaign logic– Several advertisements in company’s own

magazine Isomagneetti during November-December 2004

– WWW-advertising and branch advertising

Mobile SMS

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Case: SK Restaurants

SKDatabase

Mobile SMS

• Menadesign

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Mobile mashups• Public and private (company) internal data mashups

(data and functionality integrated.

• Possibility to integrate different apps/functionalities,databases to present information in one seamlessservice to customer.

• E.g. single view Dominos Pizza (Pizza builder forcustomers + mobile apps, Pizza Tracker).

Elisavidera smart displays (Outside)

• Cavendish – Canal walk etc. similar but not samedisplays

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And others driving traffic

• SEA +SEO= SEM• Newsletters

Newsletter - Path to purchase example fromour research

• 9 companies provided access to their live e-newsletters account• Some companies had thousands of e-newsletters and majority have been

using service for several years• 6 months period was selected and the e-newsletters were analyzed• Four regions are used to depict the visual scene of e-newsletters

• The average click-through rate of email is 16% with an open rate of almost20%.

• The un-subscription rate is low at 0.22%.

• We analyzed number of links, number of words in subject line and body,number of pics etc. impact to CTR.

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Store

• Mobile,• Smart displays

• Real-time category management

Context / location awereness

• Apple's iBeacon technology - in-storeBluetooth location trackers designed tointeract with smartphones - enables retailersand app publishers to identify peopleindividually the moment they enter a shop

• iBeacon available with many vendors

• Similar to iJack service developed byTeliasonera in early 2000 which theyabandoned in 2004

Sales/deals80%

Content relevant tointerest/Location 62%

Swirl 2013

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•Some months ago, Urban Research, a fast-growing and popular fashion, home andlifestyle retailer, launched an experiment inTokyo’s Parco Ikebukuro.•Allows customers to stand in front of oneof two 60-inch screens, select clothing itemsthey want to try on and see themselvesdressed in the products within seconds.•Customers’ movements are representedfluidly on the screen in 3D and customerscan use an integrated iPad to take picturesof themselves and share them with friendson social networks.

Virtual changing booths

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Virtual changing booths benefits

• Virtual service allows companies to sell product without theburden of managing inventory, directly from their existing e-commerce back ends.

• In the Wearable Clothing pop-up, to purchase an item,customers need only scan a QR code and click ‘buy.’

• Virtual changing is also relatively effortless for customers,saving time and lowering resistance to trying on clothes —especially among men.

Elisavidera smart displays (Inside) +Samsung

• https://www.youtube.com/watch?v=70nI2b85r8Q

• https://www.youtube.com/watch?v=tDPD4NiQro0

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Real-time categorymanagement

• Lush sales team can change the layoutof their stores in response to real-time sales data.

"Not only has this helped to tap in to the ambitious spirit of staff -competing over which store can do best in terms of sales andperformance - but it also gives them information to improve thecustomer experience."

• For example, if staff notice a particular bath bomb is selling well witha certain shampoo, they can change the store layout so the items arecloser together. (Source BBC)

Online-store

E-salesNewsletters

SocialShopping cart abandonment

recovery

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E-sales• E-sales (person while in “physical” store if not busy handles

chat, social media store, online store, virtual world store atthe same time) – selling multiple channels

Created one for Mustaporssi -offline/online retailer of electronics in Finland

Social retail (as if the retail hasnt always beensocial...)

•Delta Air Lines has launched The Delta TicketWindow, a Facebook application that letsmembers find, book and share flights via the“Book a Trip” tab on the airline’s Facebook Page.

•The application was built to keep the user onDelta’s Facebook Page for the duration of thebooking process, as well as give them theopportunity to share their booked flight withfriends

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Social retail (as if the retail hasnt always beensocial...)

• Social login - Facebook or other SNS enabled social commercewith given retailer

• Authenticate identities• Pull customer information from particular SNS• Tailor / customize in real-time the retailers website• Social labs study showed that in 2012 only 6% of top 500 online

retailers used social login

Shopping cart abandonment recovery(triggered emails)• Nosto – or similar SW

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And others…

• Website morphing (design, analytics andautomated marketing)

Putting it all together – Omnichannel funnel

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Marketing, sales & money?

Outside non digital marketing efforts

Outside digital marketing efforts

Store marketing efforts

Online store marketing efforts

RevenueThe aim of marketing is to know and understand thecustomer so well the product or service fits him and sellsitself. (Peter Drucker)

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Data rich environment• Big data computing power & storage• Big data SW and experienced staff (data based programming

skills Python etc.)• Time-series analysis / econometric modelling researchers• Data visualization techniques• Data rich environment analytics SW (Campalyst, Klout, SAS,

SAP, IBM etc.)

• Managerially interesting and relevant questions? Who wantsto consumer what, where and when ?

Customer value / experiencemanagement

• Revenue performance management – marketing automation

• Big data, bigger customer data – new segments, price – dynamically

• From transactional data towards linking data towards more compellingcustomer experience based on customers behavior understanding (+socialbehavior data)

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Customer value / experiencemanagement

• Identifying relevant customer data from different channels (store visit,use of service, posting opinions, ordering, liking, commenting, uploading)and using that data to understand customers in order to systematicallyand continuously use data in advertising, sales and marketing, brandcreation and service experience creation while managing the overallcustomer experience chain and at the same time measuring andautomating this process. (Jari Salo)

Comments / questions?

Jari.salo@uct.ac.zajari.salo@oulu.fijari.salo@aalto.fi@digimgtwww.slideshare.net/jarisa...