Adam Silverman
Principal Analyst, Forrester Research, Inc.
The evolving digital
consumer and why the retail
store is changing into a
digital experience
Jason Wallis
Chief Technology Officer, Mozu
Critical considerations for a
responsive ecommerce
strategy that scales beyond
design and aligning
technology with digital
strategy

“The pace of change is accelerating
faster than anticipated a year ago.”
— Blake Nordstrom,
president of Nordstrom
April 2014
© 2014 Forrester Research, Inc. Reproduction Prohibited 3

No indoor malls built since 2006.
15% are going out of business.
Source: The Atlantic, Cities (theatlanticcities.com) and, Financial Times (www.ft.com)
Image source: Flickr (https://www.flickr.com/)
© 2014 Forrester Research, Inc. Reproduction Prohibited 4

Store experiences are antiquated . . .
Image source: Flickr (http://www.flickr.com/)

. . . but does this meet our customers’ needs?
6 6

Agenda
› The Evolving Digital Customer
› How retail is changing into digital
engagement
› New experiences require a modern
architecture
› Q&A
© 2014 Forrester Research, Inc. Reproduction Prohibited 7

Mobile connects us wherever we go
© 2014 Forrester Research, Inc. Reproduction Prohibited 8

Consumers have high expectations
when it comes to channel integration
“How important are the following capabilities while shopping online?”
Buy online and
pickup in store
61%
Buy online and ship
to my home
95%
View local store
inventory online
89%
Buy online and ship
to a third party
73%
Buy online and ship
my return back
80%
ETA for orders to
store or home
91%
Buy online and ship
to a local store
73%
Buy online and
return to a store
86%
Reserve online and
pickup in store
60%
60% of your customers expect omnichannel services.
Source: a commissioned Forrester study with Purolator, May 2014
© 2014 Forrester Research, Inc. Reproduction Prohibited 9

Performance Matters !
Conversion rate %
Data source: Walmart Labs
Load time
© 2014 Forrester Research, Inc. Reproduction Prohibited 10

Empowered customers give rise to a
new era.

Firms are NOT set up for success
74% …of businesses think they have a digital
strategy.
34% …of executives think their firm has the right
strategy.
16% …of executives believe their firm has the skills
and resources necessary to deliver.
© 2014 Forrester Research, Inc. Reproduction Prohibited 12

Agenda
› The Evolving Digital Customer
› How retail is changing into digital
engagement
› New experiences require a modern
architecture
› Q&A
© 2014 Forrester Research, Inc. Reproduction Prohibited 13

14
19%
70%
An Engaging Brand Is
Important To Me
The Store Associate
Is The Best Resource
For Information
Source: NA Technographics Customer Lifecycle Buy Phase Q1 2012 and NA Technographics Customer Lifecycle Discover Phase Q3 2102

Retail becomes connected

The store becomes social

Promises
delivery two full
days quicker
than before
The store drives service

52%
Digital creates influence
Source: Forrester Research Web-Influenced Retail Sales Forecast 2013 to 2018 (US)

Experience Engagement

Rock Star Retailers Drive Engagement By:
1. Aligning the organization
2. Investing in digital technology
3. Enabling the associate
4. Unifying the entire experience

1. Aligning your organization around
the customer.

Partnerships are getting better?!
Agree and strongly agree: “Marketing and IT select and deploy technologies jointly”
2011
2013
MKT
IT
MKT
IT
21%
37%
43%
59%
Base 185 US IT leaders and 118 US marketing leaders in large corporations
Source: Forrester/Forbes Insights Q3 2011 US Marketing And IT Alignment Online Survey and Forrester/Forbes Insights Q2 2013 US Marketing And IT Alignment Online Survey
© 2014 Forrester Research, Inc. Reproduction Prohibited 22

2. Investing in digital technology

Multichannel excellence requires
investment in multiple capabilities
“When, if at all, are you planning on implementing the
following multichannel capabilities?
Base: 49 eBusiness and channel strategy professionals; Source: Forrester’s May 2013 Global eBusiness And
Channel Strategy Professional Online Survey
© 2014 Forrester Research, Inc. Reproduction Prohibited 24

There is more to the business case for
ship from store than saving online sales
Why invest in a ship from store program?
1. Enable online to sell store-exclusive inventory
2. Meet missed demand
3. Reduce store markdowns
4. Optimize shipping costs
5. Reduce delivery time
6. Enable same-day delivery

High priority for responsive web design
Source: 2014 Global eBusiness And Channel Strategy Online Survey. Base: 32 eBusiness And Channel Strategy Professionals
© 2014 Forrester Research, Inc. Reproduction Prohibited 26

3. Enabling the associate

The associate facilitates engagement
Learn Assist
Buy Operate

66%
of luxury shoppers more likely to
shop or interact with sales
associates who are equipped with
mobile devices
Source: North American Technographics Retail Survey 2013

4. Unifying the experience

Customers want a single POV
“Which of the following do you expect when making a purchase?”
Source: North American Technographics Customer Life Cycle Survey, Q1 2013. Base: 4542 US Online Adults 18+

RWD helps drive a unified experience
© 2014 Forrester Research, Inc. Reproduction Prohibited 32

Commerce platform unifies enterprise apps
© 2014 Forrester Research, Inc. Reproduction Prohibited 33

What it means?
Omnichannel fulfillment efforts like endless
aisle, ship from store and ship-to-store are
essential for retailers and brands in the future
 Mobile will play a major role in retail – both for
customers and associates
 Engagement must be elevated, and cannot be
channel focused (must be customer focused)
 Agility is mandatory!

Agenda
› The Evolving Digital Customer
› How retail is changing into digital
engagement
› New experiences require a modern
architecture
› Q&A
© 2014 Forrester Research, Inc. Reproduction Prohibited 35

Thank you
Adam Silverman
+1 415.294.8177
asilverman@forrester.com
@AdamKSilverman

The Acceleration of Change
You are here

Legacy Technology Limits Change
Commerce
Platform
Inventory
POS
CRM
Website
ERP
Mobile Site
CMS
Stores, Sales Associates,
Kiosks, Call Centers
Mobile, Tablet, PC’s
Costly Not Responsive IT-Intensive Complex

The World Changed with the iPhone
1990s
ECOMMERCE
IS BORN
Early vendors
supplied the basics
of ecommerce:
listing products and
accepting payments
2000s
MOBILE RISES
Mobile devices
forced retailers to
maintain both
traditional and
mobile-friendly sites
2010s
MULTI-CHANNEL
EXPLODES
Proliferating sales
channels require
retailers to create a
seamless experience
both on- and offline
TODAY
LIMITLESS
COMMERCE
Today’s business is
truly omni-channel,
requiring a modern
platform that provides
limitless extensions
When was your commerce platform built?
2007
IPHONE ARRIVES
The invention of the
iPhone and rapid
adoption of mobile
devices transforms the
world of online shopping

Architecture for Modern Customer Journeys
Commerce Platform
Merchandising
Products & Catalog
Promotions & Discounts
Pricing
Checkout
Content Management
Customers & Segmentation
Navigation & Search
Order Management
Development
Environment
Open API Sandboxes Integrations
Custom
Experiences
Customer
Touchpoints
Inventory & Fulfillment
Distribution Centers
Retail Stores
Drop Ship
Direct Ship
Inventory

Responsive is Today’s Expectation
An optimized experience for
all digital touch points
Plus:
 A single code base to maintain
 Reduced maintenance
 Consolidated web team
 Optimized for SEO
Is your existing ecommerce architected to support Responsive?

Mobile Invades the Store

Digital Completed the New Customer Journey

Content is the Heart of Digital Experiences
Engaging customers consistently requires a unified content experience to multiple channels
Publish across multiple
touch points
Manage, develop content from a
single interface
Suppliers
Community
Partners
Internally Created
Web
Mobile
In-store application
Email
Social
Content received
from multiple sources
Customer Data
Product Catalog
Create consistent
Digital assets
Search
Reduce costs Increase revenue
experiences Engage customers

New Experiences Require Modern Architecture
In-store
Online
Faster time-to-market
Fosters innovation Rapid development Unified digital experience
with SaaS
Modern Technology
Stack
Native Mobile
Responsive Theme
REST API
SaaS
Business Critical
Applications
Commerce
Fulfillment
ERP
POS

Mozu: Commerce Platform Architected for Innovation
Experiences blending online and in-store
 Create unique digital brand
experiences
 Deliver experiences optomized
for mobile
 Shopping journeys moving
seamlessly from mobile to in-store
 Sales associate now part of the
digital experience
Designed for innovation
 Modern technology and design
philosophies
 Open API: Designed API-First
using REST API
 Multi-tenant SaaS deploys
quickly and reduces
maintenance
 Pricing that supports success