“If there’s one reason we have done better than of our peers in the Internet space over the last six years, it is because we have focused like a laser on customer experience, and that really does matter, I think, in any business. It certainly matters online, where word of mouth is so very, very powerful.”Jeff Bezos
In today’s business climate, any sector that has doubled revenues in the past five years is considered a wonderful outlier to the economic norm – particularly in an industry as big as fashion retailing. How are they doing it? By changing the business model and selling more on-line. In fact, according to the Telegraph, over one third of all consumers have purchased clothing over the Internet in the past year, a 26% increase over the previous one.
So how can savvy retailers build on this momentum and do it again? By taking the on-line experience to the next level. Here’s one likely future of shopping experience solution. And you can see it only at Cisco Live! July 10-14 in Las Vegas:
Imagine being able to shop virtually from anywhere much more quickly and efficiently. No more crowded, clunky dressing rooms, or trawling racks of jumbled clothes in a sprawling megastore. No more changing ten times to find the perfect color combination. Simply scroll through the menu to see an unlimited amount of inventory in one place, and see how it looks on you virtually using the latest augmented reality and network technology.
Recently there has been a series of news items as enterprises announce they have been breached and their sensitive customer and financial records compromised. According to Verizon 2011 Breach report 92% of the attacks were external and 76% of all data breached came from servers. The PCI Security Standards Council is an open global forum formed in 2006 that is responsible for the PCI Data Security Standard (PCI DSS), a standard that is designed to protect cardholder data.
I sat down with Lindsay Parker, Cisco global retail industry director about Cisco’s current investments and efforts to help retailers and merchants secure customer credit card data and maintain compliance with PCI DSS.
Thinking about the ICT future of the store with my colleague Bharat Popat. Doodling at the mental whiteboard.
Current state in the lower left. It’s client-server architecture. Three to six servers per store, depending upon segment and store size. Fat-client POS and desktops. Fans and hard drives. Ongoing break-fix maintenance contracts. A network pipe just big enough to each night send out batched transactions, inventory, and other performance data, and download the price-item files, promotions, and performance reports.
Now, a line from the lower left current state all the way to the upper right future. From the “as is” to the “will be.” Figuring three to five years. An assumption that a retailer will want to lead the segment and compete worldwide.
Hmmm.
Grab the pen and draw the line, and as you do so, calculate the evolution of technology and of consumer expectations. Calculate the impact of global e-commerce, of multi-channel and omni-channel, of smart phones and tablets, of social networks and social shopping.
Calculate the impact of content clouds and IP video, of augmented reality and “mashops” of virtual into the physical. Calculate the impact of right time data analysis. Calculate dynamic video messaging.
Calculate how to cut time-to-capability down to weeks, not years. Calculate how to do more and spend less.
Now multiply it all by the demographic weight of the tech-savvy Millennial generation.
Do the math. Yes, I’m prejudiced -- I’m a proud Cisco guy. But it’s the math (not the badge) that leads me to this future state: a retail store that’s a living, breathing website.
A retail store that’s built on a lean, network-based architecture and a significant increase in network capacity to and from the store.
Lean store and big pipe.
More about these calculations in weeks ahead.
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One of the areas Cisco contributes to the retail industry is in the participation in industry organizations and standards bodies to help broaden adoption and encourage interopability of technologies.
Cisco retail architects Christian Janoff and Bart McGlothin both contribute to industry organizations. Christian Janoff has just been re-elected to the Payment Card Industry board of advisors. Bart McGlothin current sits on the technical committee of National Retail Federation ARTS Group (Association of Retail Technology Standards ) as vice chair of the mobile integration workteam.
I sat down with Bart and talked about the role of Cisco at ARTS and retail industry standards contribution.
ARTS (Association of Retail Technology Standards ) is the technical arm for industry standards for National Retail Federation. ARTS develop white papers, best practices and standards used in in-house retail solutions as well as vendor products.
Thinking about the hiring of Apple’s Ron Johnson as the next CEO of J.C. Penney Co.
I think it’s a brilliant move. for these reasons:
Because – most of all – it signals that J.C. Penney has determined that its future will be more dependent upon its ability to create value through the delivery of a differentiating, sustainable, and omni-channel brand experience than by the differentiation of its products.
It signals an acknowledgement that apparel and domestic product is largely commoditized.
It signals an acceptance of Wall Street’s insistence that the same-old merchant prince approach to the business is not going to move the dial.
Bravo, Penney’s.
Johnson inherits a business that has declined some 11% in revenues since 2006, that doesn’t have iPhones and iPads to dazzle shoppers and drive traffic, and which has a brand aura more akin to Sears than to Apple.
He has huge challenges in front of him. Like – it should be said – most of US retailing.
But I like the odds.
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