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OnWindows Issue 5: Winter 2015

The retail industry is in the midst of a significant transformation, with digital technologies at the heart of the change. We find out how Microsoft and its partners are supporting retailers as they look to reinvent themselves and meet the needs of the modern consumer

With digital technologies having a major impact on the daily lives of consumers across the world, there is a growing pressure on companies to reinvent themselves and make a digital transformation of their own.

“It’s a true revolution, not unlike the industrial revolution in its own way,” explains Tracy Issel, general manager of the worldwide retail industry at Microsoft. “The digital business is the reaction to the incredible amount of change that is happening around everything technical. But it’s not just technical – it’s actually about the way people work, the way people engage in their personal lives, and the way we use information to better understand the needs of people.”

Indeed, with their mobile devices never far away, the modern consumer is always connected – and the impact on retail is huge, as JustEnough’s Caroline Proctor explains: “To keep up with digital consumers, retailers have become digital by adding online and mobile channels and engaging through social media,” she says. “Digital businesses embrace everything today’s digital age offers to get closer to their customers and deliver what those customers want, when and where they want it.”

This requires retailers to expand their thinking across every channel. “The digital change has resulted in the merging of traditional commerce and e-commerce,” says K3 Retail’s Tony Bryant. “As consumers are now interacting across various channels, there is an expectation for a seamless and integrated experience throughout the entire purchase journey.”

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To achieve this, retailers need to better understand their customers – how they behave, what they buy and what makes them come back for more. This requires greater levels of insight. “Data is the new currency for business. It’s all about data and what we do with that data, in the planning on the frontline, at every step of a transaction or an engagement,” Issel says.

“Businesses today are able to create a more valuable in-store experience by starting with the customer’s viewpoint,” adds Scala’s Tom Nix. “By looking at data – website clicks, actions on a mobile app, purchase history – and bringing in digital, messaging is personalized, refined and rapidly adjustable.”

Wincor Nixdorf ’s Sabine Grün agrees, adding that digital data processing is ‘the most important economic growth driver of our time’. “As consumers are now interacting across various channels, there is an expectation for a seamless and integrated experience throughout the entire purchase journey,” she says.

“If you can make sense of your data, the sky’s the limit,” adds LiveTiles’ Nick Rameka. “Chief marketing officers are fast becoming the key decision maker in the purchase of business technology. Technology that details buyer behavior will always demand the attention of marketers and the boardroom.”

With the amount of data now available, the cloud also has a vital role to play. “The intelligent cloud helps users understand what to do with that insight. Without an intelligent cloud, the amount of data that exists would overwhelm a company,” Issel explains.

The cloud is enabling a more dynamic approach to data, as Simplement’s Robert Maclean testifies. “With the cloud, I’m able to build a value network that gets customer-facing information,” he says. “Furthermore, manufacturing processes and demand generators are becoming more closely coupled. The time is decreasing for that information to flow through, and thanks to the cloud, I can now plug in different applications against that stream of information and do different things with it. I am no longer tied to a monolithic system – I’m able to have an adaptable system. That was previously not possible.”

NEAL Analytics’ Greg Gomez agrees that both cloud computing and analytics in the cloud are having a transformative effect. “Platforms like Microsoft Azure and analytics suites like Cortana Analytics eliminate the barriers of entry and enable companies to scale these capabilities across a broader swath of business functions,” says Gomez. “As these technologies are being democratized, they fuel the transformation to a digital business.”

Issel believes that the ability to improve productivity is another very exciting space, and points to tools such as Yammer and Skype for Business as being able to enable greater collaboration, training and sharing. And while this internal element is vital, Issel explains that it is in the personal computing space that the information that is gathered and analyzed is then bred for action.

“Every professional that takes advantage of data and the intelligent cloud is also a personal computing consumer,” she says. “Therefore, making personal computing more personal, leveraging a more natural user interface, leveraging something like Cortana for an executive assistant for example, is massively important.”

Overall, Issel says that with the right combination of digital technologies retailers will create more productive business processes and enable the derivation of more outcome. “Then the intelligent cloud helps users understand what to do with that insight, and personal computing is where that information breeds action.”

Though times and technologies will continue to change and advance, one thing will remain continuous: the need to appeal to customers. Be it by reinventing internal processes to improve employee productivity, or rethinking the way they connect with customers, in a digital age such as this, retailers cannot afford to leave any stone unturned.

Vmob Profiled

New Zealand-based Vmob is using the internet of things to help transform McDonald’s customer engagement in the Netherlands, Sweden and Japan.

McDonald’s has expanded its mobile app with the support of Vmob, and builds on standard features such as product information, restaurant locator and mass offers for promotions and specials.

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Vmob’s platform pulls data from a vast number of digital touch points in addition to users’ devices, and analyses customer behavior patterns and responses to offers. This helps ensure that targeted promotions are the most relevant and desirable for each customer.

“Their engagement platform uses Azure and Microsoft’s database tools,” Issel says. “It takes all that contextual information about what that customer already buys, what they’re likely to buy and where they are physically. It puts all that together to deliver a personal offer to the personal device that that customer happens to be holding. Vmob is a great example of mobile engagement with customers, and then the Microsoft intelligent cloud being leveraged to make a real business difference.”

JJ Food Services Profiled

JJ Food Service is one of the UK’s largest independent delivery services to the food industry, within approximately 60,000 customers nationwide.

“What they did is say we know what our customers want, we know what’s happening in terms of local events and things that might drive traffic into a restaurant and may create more transactions and consumption of our goods,” explains Tracy Issel.

Harnessing the power of Microsoft Azure Machine Learning and Microsoft Dynamics AX, the company looked to prepopulate a shopping bag based on that customers’ shopping history. JJ Foods also analyzed what local events were coming up and then projected what customers were likely to need. Thanks to this insight, the company was able to make insightful recommendations to customers on the floor.

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“Everything’s automated, time to market is saved, and fewer items are out of stock,” Issel says. “They’ve had great success, and are proof that by having front of mind what it is you want to accomplish – which is essentially offering great products in the right place at the right time and then making it simple for that customer to access – you can adapt and make a real difference to your business.”

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