RETAIL...Retail IQ Report Maturity Ladder is a diagnostic measurement tool for a retailer’s state of technology advancement in a specific category. There are four key phases: 1.Basic

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ADVANCED OMNICHANNEL: CONSTRUCTING THE

UNIFIED ENTERPRISE

PRESENTED BYSPONSORED BY

MATURITY LADDERRIS RETAIL

3. ADVANCED

· Retailers bring digital touch points down to the store-level.

· Retailers implement the cloud to manage evolving omnichannel operations and supportingplatforms.

· Brands partner with technology providers or third-party partners to streamline omnichannelefforts, and fill in skill sets that internal IT teams may be lacking. This also enables retailers toscale operations at a faster, more efficient pace.

2. INTERMEDIATE

· Disparate systems make it impossible for shoppers to interact directly with brands in-store.

· Retailers use enterprise resource planning systems to manage back-end operations from a common database. ERPsystems are not flexible enough to manage evolving digital operations, and connect newly-created digital touch points.

· Retailers approach the integration issue from a front-end perspective. In the end, this approach creates an additional silothat does not seamlessly flow with operating systems on the back-end of the omnichannel experience.

· Brands add point solutions in an effort to integrate operations, but instead create a tangle of systems that hijack data,incur extreme maintenance costs, and stymie integration efforts even further.

4. STATE-OF-THE-ART

· Retailers can seamlessly onboard additional solutions that support anomnichannel retail model experience thanks to an end-to-end cloudplatform.

· Brands add retail management solutions to replace enterpriseresource planning systems. Interconnected suites streamline dataflow between mission-critical back-end systems across POS, CRM,order management, inventory management, purchasing, receiving andanalytics.

· Retailers transition omnichannel strategies to a unified commerceplatform that delivers an experience that converges all touch pointsand merges all data from these customer-facing solutions.

Maturity Ladder: Constructing an Omnichannel Platform

The RIS News Retail IQ Report Maturity Ladder is a diagnostic measurement tool for a retailer’s state of technology advancement in a specific category. There are four key phases: 1. Basic – minimal capabilities, 2. Intermediate – mostly basic with some advanced capabilities, 3. Advanced – mostly advanced capabilities with some limitations, and 4. State-of-the-Art – comprehensive capabilitiesare fully integrated and up to date. Note that it ispossible to be on more than one step of the laddersimultaneously as specific technology componentsand processes are upgraded in phases.

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1. BASIC

· Multi-channel retailing models are supported by siloed channels and disparate, legacy systems-based operations that do not support a consistentbrand experience or image.

· Silos force retailers to store customer-specific and mission-critical business data within disparate data warehouses.

· Legacy-based or mainframe systems cannot access real-time information, making it difficult to get a single view of the customer, and to respond toconsumer and business trends.

· Information is often redundant, stale, and thus, error-prone, making it difficult to get a single view of the customer, and to respond to consumer andbusiness trends.

· Consumers cannot purchase an item in one channel and return it in another.

ADVANCED OMNICHANNEL: CONSTRUCTING THE UNIFIED ENTERPRISE

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Consumers are sending an important message to retailers: they want to shop

their favourite brands, and they are not concerned with channels. Realising

they need to run their businesses the same way, retailers are

defining the steps needed to construct a new omnichannel platform

that will meet customers’ expectations and streamline their shopping

journey.

Among retailers’ prerequisites are solutions that will keep them competitive

in the evolving landscape, and future-proof their business as a means of keep-

ing up with the industry’s increased pace of change. The top priorities

hitting retailers’ wish-lists include cloud computing, retail management

systems and unified commerce platforms.

In a digital world, consumers adopt new solutions at an incredible pace. In

fact, this is the underlying catalyst driving consumers’ high expectations

in a digitally-influenced shopping experience. Besides immediate brand

engagement, shoppers expect a seamless, linear path to purchase from

exploration and browsing through purchase and procurement — regardless

of the sequence of channels used from start to finish.

Similarly, they expect a consistent and personalised experience. This be-

comes more difficult as consumers channel-hop throughout the

shopping experience, but still expect the same superior service levels.

Retailers that can deliver the most captivating shopping experiences

will be rewarded with long-term loyalty that translates into revenue.

Brands are starting to get the message: 55% of companies are personal-

ising content, and another 39% are differentiating product and assortment

offerings based on individual shopper demand, according to “State of the

Industry Research Series: 2015 Customer Context Power — A Success

Imperative,” a report from EKN Research.

Just when retailers think they have a handle on how to engage the

omnichannel shopper however, new customer-facing touch points —

and consumer adoption — continue to change the game. The pace

shows no sign of slowing as “relentless technology innovation

underpins con-sumers’ participatory behaviour and expectations,” said

Leslie Hand, vice president of IDC Retail Insights in “IDC

FutureScape: Worldwide Retail Agenda 2015 Predictions.”

Whether it is smart devices; wearable technology; or gadgets, like the

Amazon Dash Button, customers are constantly attracted to newly emerg- 3

Companies that are personalising content.

Source: EKN Research, “State of the Industry Research Series: 2015 Customer Context Power — A Success Imperative”

55%

39%Retailers that are differentiating product and assortment offerings based on individual omnichannel shoppers.

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ing consumer technology. And as solutions continue to rely on the web to

connect with and share data between other WiFi- and Bluetooth-enabled

solutions, more sensitive information is created, and the existing infra-

structure is becoming further strained.

Retailers are feeling the pressure as their existing platforms struggle to

support these solutions. Fifty-three percent of in-store sales are influenced

by the Internet along the path to purchase, according to “Real-Time Data

Drives the Future of Retail,” a report from Forrester Research.

The Root of the ProblemRetailers are eager to service their fast-paced shoppers, but too often they

don’t know where to begin. With many companies supporting the same

decades-old legacy technology, they often find themselves in a game of

catch-up with nimble “pure-play retailers that have leveraged a data-driven

approach to operating their online stores,” as summarised in

Forrester’s report, “Real-Time Data Drives the Future of Retail.”

Eager to take advantage of emerging solutions, but still overwhelmed,

many companies feel it is easier to tackle one challenge at a time. While

this is a certainly an understandable approach, many retailers choose to

add solutions to solve challenges on a channel-by-channel basis — a pro-

cess that only creates new silos in an already disjointed infrastructure. Re-

tailers are racing to piece together customer information, browsing history,

purchases, real-time inventory visibility, and much more to understand and

personalise the experience for each customer.

While their focus on improved functionality may keep them in the

run-ning for the time being, a much different story is evolving

behind-the-scenes — one that is creating a domino-effect of

challenges. First, the more point solutions added to the mix incurs new

costs needed to manage and maintain these point solutions year-over-

year. For example, in addi-tion to hardware and software investments,

point solutions require monthly maintenance (and related fees),

electricity consumption, and in-house file storage space and capacity

for collected data. Not to mention, any down-time due to offline

networks contribute to further losses.

Disparate point solutions also cause a “hairball” of code and data that

occurs from stitching these contrasting solutions together. The end result

is multiple silos for multiple channels, which are not only expensive to

““

Relentless technology innovation underpins consumers’ participatory behaviour and expectations.

LESLIE HAND, VICE PRESIDENT OF IDC RETAIL INSIGHTS

Q: What do retailers struggle with most as they try and transition to an omnichannel platform?BRANDEN JENKINS: Retailers struggle to overcome past IT decisions of implementing multiple departmental solutions. Maintaining this labyrinth of disparate software drains significant resources that are better focused towards front-line efforts. Separate systems also create silos of business data, where front-end commerce remains disconnected from back-end op-erations. Retailers can’t achieve true omnichannel with just another upgrade to their e-commerce or POS, or through middleware technology that only provides a temporary patch. Instead, they must lay a cohesive foundation for their business data and stop buying departmental, point solutions.

For example, a supply chain not designed to support omnichannel fulfill-ment remains a retailer’s biggest roadblock to achieving omnichannel suc-cess. Vital processes remain disconnected from one another, resulting in inadequate inventory management, order fulfillment and marketing cam-paigns that ultimately erode margins and revenues. Retailers instead need one system that manages multiple channels to execute business operations efficiently and accurately.

Q: What trends are forcing retailers to revamp their retail platforms?JENKINS: The modern consumer is well-informed and empowered with readily available information. They research, benchmark and apply peer in-sights all while standing in your store. And thanks to mobile devices, they can also shop anywhere and at any time. By instantly locating the same product at a competitor, consumers can quickly take their business else-where, forcing retailers to adapt to this new landscape or lose out.

This is the course customers have set for retailers, urging them to revamp their retail systems. But retailers can only meet these needs if they first ad-dress the web of siloed, channel-specific solutions they’ve implemented over the years. These have become a tangled mess, generating islands of data that prevent a unified customer experience across all touch points.

Q: Retailers know they need a solution that can “future-proof” their business. What does that mean, and how can retailers be sure their platform can help them?JENKINS: Retailers can’t stomach the thought of investing in technology destined to become outdated in five to 10 years. Ripping and replacing entire systems this frequently is unsustainable and expensive. Innovative retailers instead look to the cloud and unified commerce platforms that can adapt and scale with the ever-changing landscape of retail. With cloud technology, the software upgrades happen often and effortlessly, helping retailers stay current despite changing market conditions and consumer behaviors. A uni-fied commerce platform means all data is housed in one, central location, preventing the potential of incompatible software integrations when these updates occur.

Becoming Omnipotent in Omnichannel

BRANDEN JENKINS

General Manager of Global Retail, NetSuite

INSIGHTSRETAIL

Retailers can only meet customer’s needs if they first address the web of siloed, channel-spe-cific solutions they’ve implemented over the years.

NetSuite is a leading end-to-end cloud commerce solution formulti-channel and multi-location retailers and is the only cloudsystem to unify in-store ande-commerce on a single plat-form with your core operational business systems — inventoryand order management, CRM,business intelligence and finan-cials. For more information visit www.netsuite.com/retail.

Continued

Q: What is the difference between an on-premise, hosted platform and a cloud-supported system? JENKINS: The cloud offers the flexibility r etailers n eed t o q uickly r eact to new and unforeseen changes in the market and consumer behavior. Cloud technology enables retailers to spend less time worrying about the costs and complexities associated with managing, patching and upgrad-ing on-premise software and hardware. No longer having to deal with the frustration of version lock, retailers are always using the latest version, providing shoppers with the best experiences. When updates do happen, a retailer’s customisations are automatically migrated.

Q: What role does a total retail management solution, or end-to-end solution that manages the entire retail business, play in the next-generation of omnichannel platforms?JENKINS: It’s everything. The only way to deliver a true omnichannel brand experience is to have a foundation in place which seamlessly uni-fies c ustomer, i nventory, fi nancial an d or der da ta, wi th cu stomer-facing systems such as POS and e-commerce. Some retailers have been con-vinced that deploying channel-specific solutions is a shortcut to becom-ing an omnichannel business. Unfortunately, this approach is too costly and far too labour intensive to maintain.

Q: How has the role of ERP changed in an omnichannel world?JENKINS: Retailers now realise that their front-end problem is really a back-end problem. A seamless, consistent and personalised experience is not about which customer-facing systems they deploy. Rather, a single foundation for your back-end ERP, CRM and order and inventory management creates a single source of customer, order and inventory data in real-time — across all existing and future, customer-facing systems. While we don’t traditionally view ERP as essential for delivering digital dressing room experiences, retailers can’t utilise technology effectively to support current and future customer demands if they don’t first have a solid ERP system in place. ERP truly is the foundation for innovation.

Q: How do these platforms tackle integration issues and ensure that all solutions, best-of-breed packages and point solutions, can all be connected to deliver a single version of the truth?JENKINS: Integration issues don’t exist with a unified commerce platform. Retailers must stop looking at “latest and greatest” point solutions to solve their problems. That approach only creates more complexity and cost, and ignores the fundamental issue: Everyone from the back office to the shop floor suffers, especially customers, when disparate systems make it difficult to piece together a single, cohesive view of the business and deliver on customer needs.

INSIGHTSRETAIL

Everyone from the back office to the shop floor suffers when disparate systems make it difficult to piece together a single, cohesive view of the business and deliver on customer needs.

Becoming Omnipotent in OmnichannelContinued from page 5

BRANDEN JENKINSGeneral Manager

of Global Retail, NetSuite


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establish and maintain, but also offer little in the way of data integrity

enterprise-wide. It is also next to impossible for disparate systems to sup-

port, or even keep up with evolving technology, which has become the

lifeline of the fast-paced and ever-changing omnichannel retailing model.

Retailers that can detangle systems and establish true cross-channel

integration can gain 10% revenue increases from a single view of items,

orders, inventory and customers, according to RIS News’ “Customer En-

gagement Tech Trends Study: The Personalisation Imperative.”

To solve the issue and determine how to re-platform their omnichannel

architecture as a means of meeting current and future business needs,

retailers need to step back and understand where their hurdles lie.

Finding Their FootingThe reason many brands struggle when developing new omnichannel plat-

forms is they work from a front-end perspective. The irony is this process

is reminiscent of how they historically solved challenges — by creating yet

another operational silo. Rather, they need a new approach — one that is

focused on integration and creation of a consolidated, holistic view of the

customer and item movement from an enterprise perspective.

Once this foundation is established, retailers will be able to collect data

from multiple customer touch points — and integrate that data — to gain

relevant insights into what customers want, when they want it, and how

they want it. Essentially, this is a prerequisite to delivering the right con-

tent and merchandise at the right time and place, and through the right

medium to drive a conversion, as summarised in EKN Research’s

report, “State of the Industry Research Series: 2015 Customer Context

Power — A Success Imperative.”

For many, this requires foundational changes. Those companies that

make a solid commitment however, will be setting the stage to take their

omnichannel operations well into the next decade.

The Adoption of CloudAs CIOs continue to invest in technology — especially customer-facing

solutions designed to boost the omnichannel experience — integration

issues will only intensify. To take advantage of these opportunities, and

still future-proof their business for tomorrow’s technology introductions,

In-store sales influenced by the Internet during the path to purchase.

Source: Forrester Research, “Real-Time Data Drives the Future of Retail: Store Must Embrace Digital Technologies to Win in the Age of the Customer”

53%


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retailers need a framework that provides the flexibility to meet or exceed

expectations. “They need to consider moving to a services-based architec-

ture that can allow them to reduce their cost of integration, and also be

future compatible by allowing new technologies to fit easier,” said Guarav

Pant, vice president of research at EKN Research.

For some, the ideal foundation stems from cloud computing. Instead of

relying on rigid mainframe- and legacy-based systems, cloud is an open,

scalable infrastructure based on a network of remote servers and business

services accessible via the web. A hosted environment eliminates the need

to buy, install or manage proprietary servers in-house, giving enterprises

more agility. Meanwhile, a “pay-per-use” fee structure requires lower in-

vestments — and total costs of ownership — than traditional IT software.

Based on the capacity of the cloud, not only can it future-proof an om-

nichannel operation, it is the foundation that can help retailers reinvent

their brand on the fly. The game-changer however, is that a cloud-based

platform can connect retailers to solutions that can be integrated, custom-

ised, tailored and automatically upgraded to meet the needs of their busi-

ness, without the intervention of IT or a technology vendor partner.

Moving to a Retail Management SystemThanks to the flexibility of the cloud, adopting an integrated set of mission-

critical operations has never been easier to achieve. That said, the value of

retail management systems (RMS) is increasing. An integrated set of ap-

plications required to operate a retail business, an RMS typically connects

point-of-sale (POS), customer relationship management (CRM), sales or-

der management, inventory management, purchasing and receiving, ana-

lytics and reporting, all under one umbrella. Its integrated nature enables

retailers to understand the lifecycle — from purchase order to tendering

at POS — of a specific item from every touch point between its movement

from supplier to customer, as well as affinities of merchandise purchased

at the same time.

Being a true back-end system, an RMS could be defined as the om-

nichannel generation’s enterprise resource planning (ERP) system. When

thinking back to the mid-1990s, ERP systems featured a suite of inte-

grated applications designed to manage the business and automate many

Revenue increases that can be gained by detangling systems and establishing true cross-channel integration.

Source: RIS News, “Customer Engagement Tech Trends Study: The Personalisation Imperative.”

10%

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back-office functions, most specifically financials, inventory and human

resources. In fact, the business process management software could unof-

ficially be credited for starting the “systems integration movement” that

the industry is striving for today.

And as the omnichannel retail model proliferates, the ERP-inspired

RMS is sparking the next level of systems integration, a move that is

paramount in the success of omnichannel retailing. Where the rubber

meets the road however, is in cloud-based RMS offerings that merge

current mission-critical, back-office operations with data filtering in from

other evolving solutions, such as connected devices and solutions fueled

by the Internet of Things.

Whole Foods is one company testing the RMS waters. Designing the

solution from the ground-up, Whole Foods is adopting RMS software

with a goal of operating faster and more efficiently, while enhancing the

customer experience. Specifically, the chain is using a combination of

cloud-based automation and advanced, efficient processes that support

strategic merchandising and supply chain management functions. And

advanced analytics provide insights that drive business performance and

operational efficiencies. The new platform’s advanced IT infrastructure

delivers more in-depth information and enhanced shopping experiences

for Whole Foods Market customers both in-store and online through the

chain’s digital channels.

“The new retail platform will better leverage major technology advanc-

es to deliver much more value at lower cost,” said Jason Buechel, execu-

tive vice president and chief information officer of Whole Foods Market.

“This new retail platform enables a more efficient, connected enterprise

with greater visibility, flexibility, insight, and ease-of-use for our team

members — all while delivering a better end-to-end shopping experience

for our customers.”

The Shift Toward Unified CommerceArmed with the flexibility of cloud and a back-end RMS in place, retailers

are ready to make the most important transition in the omnichannel journey

— adopting unified commerce. In most cases, omnichannel retailers are

operating multiple channels, yet still struggle with having that one common

platform that can create the highly-coveted single version of the truth.

““They need to consider

moving to a services-

based architecture

that can allow them

to reduce their cost of

integration, and also

be future compatible

by allowing new

technologies to fit

easier.

GUARAV PANT, VICE PRESIDENT OF RESEARCH, EKN RESEARCH

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Unified commerce is described as a means to truly converge touch points

— from traditional POS, call centers, e-commerce and mobile technolo-

gies. Platforms are designed to merge all data from these customer-facing

solutions to reduce complexity, and enable seamless consumer

engagements and transactions throughout the shopping journey, as

summarised in “Building the Business Case for Unified Commerce

Platform — Optimise the Consumer Experience,” a report

from E-Commerce Foundation, E-Commerce Europe and NRF Foundation.

By tightly integrating these touch points in a centralised way, retailers

not only have a single version of the truth, but are finally gaining their long-

awaited consolidated view of the customer. Twenty-nine percent of retailers

consider unified commerce a top commerce priority, according to Boston

Retail Partners’ report “E-Commerce Survey: Annual Survey 2015.” And

interest is likely to continue to rise.

In the near-term, 53% of retailers surveyed across markets plan to im-

plement a unified commerce platform to consolidate key data elements,

functionality and business rules historically housed in multiple systems

and channels, including the web, mobile and the store. Based on retailer

input, results reveal that there will be a nearly 50% increase in adoption

year-over-year, and over the next 10 years, 86% of surveyed companies

plan to leverage a unified commerce platform, making it the emerging

standard as technology matures, according to the NRF Foundation report,

“Building the Business Case for Unified Commerce Platform — Optimise

the Consumer Experience.”

It is an innovative and fundamental move among retailers that are fi-

nally approaching omnichannel from a unified approach versus a siloed,

front-end-only approach. One retailer leading the charge is Billabong In-

ternational.

By implemented a new global omnichannel platform, the chain is striv-

ing to transform customer interaction with its brands, regardless of wheth-

er they interact via wholesale, retail or e-commerce. The unified platform

supports a real-time flow of customer, order and inventory information

across all of its sales channels, which dramatically improves engagement

with online shoppers, retail operations and wholesale partners.

From a wholesale perspective, partners have their own password-

protected site to efficiently make purchases, review order history and

Source: Boston Retail Partners, “E-Commerce Survey: Annual Survey 2015”

29%Retailers that believe unified commerce is a top commerce priority.

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account details, speed repeat purchasing and manage payments and

credits. They can also access and download key content, assets, videos

and marketing collateral. The chain can monitor and manage each of its

branded global websites from one single platform that can support up to

190 currencies, 19 languages, and multi-country tax compliance.

Finally, the platform’s scalable order management solution allows

Billabong to utilise inventory more effectively. Swift updates also

allow the company to keep pace with the rapidly evolving retail

industry and consumer expectations.

“Creating a true omnichannel experience is one of the seven strategic

pillars in our transformation strategy,” Billabong CEO Neil Fiske said.

“We have high expectations of potential strategic partners in line with

our approach of undertaking major structural changes once and doing

them right. We look forward to building an industry-leading global plat-

form that creates a seamless customer experience across all of our chan-

nels, including wholesale.”

ConclusionShoppers are teaching their retailers a valuable lesson — they want to

shop brands, not channels. Taking this mantra to heart, retailers are tak-

ing a step back and re-evaluating how they can transition away from run-

ning their operations on a channel-by-channel basis, and instead create

a platform that drives seamless enterprise operation.

As shoppers make it clear that they not only expect, but demand a

unified, linear path of purchase, r etailers a re making the m ove to fl ex-

ible cloud-based infrastructures that can support more agile, integrated

back-office operations, as well as a unified shopping experience. The

result is an omnichannel platform that can meet consumers’ current ex-

pectations, as well as future-proof the brand for inevitable changes still

on the horizon.

Source: E-Commerce Foundation, E-Commerce Europe and NRF Foundation, “Building the Business Case for Unified Commerce Platform — Optimise the Consumer Experience”

53%Retailers that plan to implement a unified commerce platform to consolidate key data elements, business rules, and functionality historically housed in multiple systems and channels, including the web, mobile and the store.

RIS INFOGRAPHICCONSTRUCTING AN OMNICHANNEL PLATFORM

Companies that are personalising content.

Source: EKN Research, “State of the Industry Research Series: 2015 Customer Context Power — A Success Imperative”

55%

39%Retailers that are differentiating product and assortment offerings based on individual omnichannel shoppers.

&

““Relentless technology

innovation underpins

consumers’

participatory behavior

and expectations.

LESLIE HAND, VICE PRESIDENT OF IDC RETAIL INSIGHTS

In-store sales influenced by the Internet during the path to purchase.

Source: Forrester Research, “Real-Time Data Drives the Future of Retail: Store Must Embrace Digital Technologies to Win in the Age of the Customer”

53%

Revenue increases that can be gained by detangling systems and establishing true cross-channel integration.

Source: RIS News, “Customer Engagement Tech Trends Study: The Personalisation Imperative.”

10%““They need to consider

moving to a services-based architecture that can allow them to reduce their cost of integration, and also be future compatible by allowing new technologies to fit easier.GUARAV PANT, VICE PRESIDENT OF RESEARCH, EKN RESEARCH Source: Boston Retail Partners, “E-Commerce

Survey: Annual Survey 2015”

29%Retailers that believe unified commerce is a top commerce priority.

Source: E-Commerce Foundation, E-Commerce Europe and NRF Foundation, “Building the Business Case for Unified Commerce Platform — Optimise the Consumer Experience”

53%Retailers that plan to implement a unified commerce platform to consolidate key data elements, business rules, and functionality historically housed in multiple systems and channels, including the web, mobile and the store.

Documents

RETAIL...Retail IQ Report Maturity Ladder is a diagnostic measurement tool for a retailer’s state of technology advancement in a specific category. There are four key phases: 1.Basic