Capturing intelligence while managing relationships
Meeting the Customer Experience in New Age of Retail
1. Meeting Customer Expectations in the New Age of Retail
Dan Conway, Senior Product Manager
Kelly Goetsch, Senior Product Manager
Sanjeev Sharma, Principal Product Director
2. of consumers will
86% PAY MORE for a better
Customer Experience.*
*Source: Harris Interactive Customer Experience Impact (CEI) Survey, September 2011
3. CUSTOMER EXPERIENCE BOOSTS REVENUE
REVENUE
10% point increase in
Customer Experience Index = $2.2B
Source: Forrester Research, “Customer Experience Boosts Revenue”, Bruce Temkin, June 22, 2009
*The increase in revenue include that from Additional purchases, Churn reduction and Word-of-mouth advocacy
4. mobile
By 2014, the web will social
directly account for 8% of Mobile commerce will
U.S. retail sales and influence
local
reach $31 billion by 2016*
53% of consumer purchases*
Experiences happen anytime,
anywhere, all day, every day
*Source: Forrester Research, 2011
7. MUTI-CHANNEL CUSTOMER EXPERIENCE UTOPIA!
“Why can’t I order an item “Wouldn’t it be nice if they
online and pick it up at my rewarded me for my
local store?” business?”
Mobile Web
“When I clicked the “Chat Store Mail
“Why can’t I check my order
Now” the agent had no idea of
status from my phone?
what was in my shopping
Acme lets me.”
cart?”
Call Center Partner
“When I go online, I can’t easily
find what I need. Its too
complicated to find what’s best
@ “The promotions I receive are
relevant. Once they sent me a
Email Social coupon after my purchase?”
for me.”
8. Frustrated Customers Lead to Lost Revenue, Loyalty
and Share of Wallet
CUSTOMER FRUSTRATION LOST REVENUE
Percentage of customers dissatisfied with cross-
channel experience1
Revenue lost by enterprises in 16 key global
$338 Billion
economies due to customer defections and
Percentage of multi-channel customers that switch abandoned purchases 2
vendors after a single bad experience
Revenue lost by enterprises in 16 key global economies
due to customer defections and abandoned purchases 2
9. Website Performance Critical
to Customer Experience
33%
of dissatisfied online
shoppers attributed their
dissatisfaction to the Web
site being too slow
10. YOUR BUSINESS CAN’T AFFORD TO MISS A BEAT
CUSTOMER
SATISFACTION CONVERSIONS
1 second delay
in page load time = 16% 7%
15. ORACLE ENGINEERED SYSTEMS STRATEGY
Engineered to work together
• Tested together
• Certified together
• Packaged together
• Deployed together
• Upgraded together
• Supported together
• Managed together
Optimized Engineered
16. ORACLE EXADATA DATABASE MACHINE
FASTEST FOR OLTP, DATA WAREHOUSING & MIXED WORKLOADS
BEST COST/PERFORMANCE
BEST DATABASE CONSOLIDATION PLATFORM
SCALES FROM ¼ RACK TO 8 FULL RACKS
17. ORACLE EXALOGIC ELASTIC CLOUD
EXTREME PERFORMANCE FOR JAVA
APPLICATIONS
EXTREME PERFORMANCE FOR ORACLE
AND OTHER BUSINESS APPLICATIONS
SIMPLIFIED MAINTENANCE
BEST CONSOLIDATION PLATFORM
18. EXALOGIC AND EXADATA WORKING TOGETHER
Typical
5X
OTLP
Performance Gain
Exalogic Exadata
HIGHEST LEVEL OF SERVICE IN THE INDUSTRY WITH ORACLE PLATINUM SERVICES
19. ENGINEERED SYSTEMS IMPROVE TIME TO MARKET
Network
Do It Yourself Systems Integration Oracle Engineered Systems
Hundreds of components Single, optimized platform
10s of servers 2 servers
Months to deploy Weeks to deploy
Costly to integrate and test Pre-integrated, pretested
Unpredictable product lifecycles Oracle’s strategic development platform
20. ENGINEERED APPROACH TO CUSTOMER EXPERIENCE
Drive Up Revenue
Omni-Channel Support
Expedited Transaction Times
Connected Conversion Rates
Interactions Aligned Supply and Demand
PROFIT
Improved Inventory Management
Optimized Accurate Real-Time Sales
Operations Meet Peak Business Demand
Actionable
Insight Price and Promotion Execution
Drive Down Costs
21. ORACLE’S SOLUTION FOR CUSTOMER EXPERIENCE
Speed of Execution Highly Scalable Speed of Thought
Data Management for OLTP Transaction Management Analytics for OLAP
Big Data Appliance Exadata
FAST FAST
Infiniband
ATG – Web Commerce Infiniband
Retail Analytics
Retail Merchandising Suite Retail Data Model
EXADATA EXALOGIC EXADATA
Oracle RDBMS Weblogic - Coherence Oracle RDBMS,
Smart Flash Cache OBIEE, & HCC
22. ORACLE COMMERCE APPLICATIONS
Exalogic and Exadata
DIY Platform
Oracle Knowledge ATG Web Commerce WebCenter Sites
Knowledge Management Commerce Reference Store Web Experience Management
2x better Response Time 3x better Response Time 2x better Response Time
2x better Scalability 3x better Scalability 2x better Scalability
10
113 164
3.1 74
52
26. MEASURING BUSINESS VALUE OF CUSTOMER EXPERIENCE
ACQUISITION RETENTION EFFICIENCY
• Increase in Traffic • Increase in CSAT • Increase in SS%
• Increase in • Increase in CES • Reduce Cost / X
Conversion Rate
• Increase in NPS • Reduce SG&A%
• Increase in AOV
27. EXAMPLE: CALCULATING REVENUE IMPACT
Traffic x Conversion rate = # of Customers
# of Customers x Frequency = Purchases per Year
Units per Transaction Average Order Value
x Average Selling Price (ASP) =
(UPT) (AOV)
Purchases per Year x Average Order Value (AOV) = Gross Revenue
Returns+ Cost of Loyalty
Gross Revenue - = NET REVENUE
Program(Discount)
28. CASE STUDY: BRAZILIAN ONLINE RETAILER
COMPANY OVERVIEW
• Largest sporting goods retailer in Brazil, $500M+ revenues
• 100%+ YoY growth over the last decade
CHALLENGES / OPPORTUNITIES
• Frequent outages and poor response time for online commerce
application
Runs ATG and
• Rising datacenter costs due to ad-hoc and frequent hardware Weblogic Server on
refresh and management complexity
• Poor customer experience resulting in high order abandonment
Oracle Exalogic!
resulting in revenue loss
RESULTS
• 6x improvement in throughput
• 7X reduction in datacenter footprint
• Double-digit improvement in conversion rates
30. Business Results
• More revenue – able to run new campaigns
– Netshoes is now able to run campaigns that they otherwise wouldn’t have
been able to because the site can handle the traffic. For example, they drove
33% more traffic to the site (than their highest ever watermark) as the result
of a Facebook campaign that they previously could not have run
• More revenue – able to handle traffic from special events
– In 2012, the Champions of America Cup (the premier soccer championship in
Latin America) was held in Brazil. Netshoes manages the online stores for
both participating teams and sells merchandise on its own flagship website
too. After the hometown favorites won, record traffic was driven to Netshoes
with no downtime or performance degradation
• More revenue – higher conversion rates
– Better response times lead to higher customer satisfaction and conversions
– Able to employ more personalization without performance degradation
– Customers are happier because the site is always up
31. Customer Proof Points
Márcio Kumruian, CEO, Netshoes
“As the largest retailer of sporting goods in Latin America, we are achieving
very aggressive growth - over 100% per year. Running our ATG ecommerce
application on our previous JBoss infrastructure we had 30-40 different
machines. We were able to migrate to Oracle Exalogic Elastic Cloud in less than
3 weeks, without any downtime and have already seen impressive results.
With Oracle Exalogic, we have consolidated to 1 server, providing both cost
savings and increased business efficiency. Our ATG application performs 6x
greater than before and is fully synchronized with Oracle WebLogic Server. The
Netshoes brand means quality and value for our customers and we want their
online experience to be excellent. With Oracle Exalogic all the pieces work
together, so we can focus on customer service and expanding our business.”
Márcio Kumruian, CEO, Netshoes
33. THE PERFECT CUSTOMER EXPERIENCE
WHERE BRAND PROMISE MEETS BRAND EXECUTION
“The value of my brand, the fate of my enterprise, is in
their hands, driven by the quality of their experience”
34. JOIN THE COMMUNITY
Twitter Facebook Blogs LinkedIn YouTube
Visit us at:
oracle.com/us/products/engineered-systems
Notes de l'éditeur
CX is top of mind for retailer a the balance in the buyer-seller relationship has tilted in the favor of the former. In fact a research by Harris Interactive ha found that 86% of consumer are willing to pay more for a better customer experience.
Your business can’t afford to miss a beatA forrester study found that 10% point increase in CX translates into $2.2B in revenue across industries
The face of retail is changing driven by a nexus of trends mobile, social and cloud. Today experience happen anytime, anywhere, all day every day.The volume, variety and velocity of data is overwhelming retailers.
The challenge facing retailers today is to affect the moments of interaction across multiple channels
This fundamentally requires the ability to Market, interact, transact & service customer across online, mobile and in-store channels.
The pursuit of multi-channel customer experience is far from over.Cite the bubble that mentions “Click to Chat” and the bubble that mentions “promotions”.
50% of customers not satisfied with cross channel experience (Forrester)59% of multi-channel customers switch vendors after a single bad experience (Gartner)Poor customer experience results into revenue lost to defections and abandoned purchases$83 Billion for enterprises in the US annually$23 Billion for UK enterprises in the UK annually$338 Billion for enterprises in 16 key global economies
In a study conducted by Jupiter Research, nearly 1/3 of the dissatisfied online shoppers attributed their dissatisfaction to the website being too slow. Clearly website performance is a critical aspect of customer experience.
Your business can’t afford to miss a beat
So how are your business applications keeping up?Are you suffering from common problems like:Customers waiting for your Web site to respond?Orders fulfilled too slowly?Missed market opportunities?
So what does it take to deliver applications successfully?Our extensive experience with applications shows that it comes down to 3 things… (see slide)(runtime excellence means performance, scalability, availability)
Looking more deeply at the Oracle retail business solutions that contribute to your experience platform…Oracle offers best-in-class applications to power all customer touch points including your stores, your web site and your call center, …all core retail business processes such as merchandising, marketing, and supply chain, as well as corporate administrative processes such as HR, Finance, and Real Estate. We have taken these best-in-class applications and built into adaptable processes that are oriented towards serving the cross-channel consumerThese processes are enabled by a core retail foundation, e-commerce, and cross-channel management capabilities that ensure synchronization and one version of the truth……and they are infused with science and in-context business intelligence to enable better customer understanding, targeting, and operational decisions.We wrap these solutions in a compelling business user interface…and we can deliver them to retailers on a single technology stack. We’re the only company that provides end-to-end, apps to disk solution. Only Oracle provides the middleware layer.We have designed our solutions to span across consumer touchpoints, to power your all phases of the business process from planning to execution, and back through to corporate administrative processe. We have infused all our solutions with science and business intelligence, and built them in a way that lets them all inform each other,. We are able to help retailers scale modern retailing strategies and help connect functional areas in retailer organizations. As a result, data analysis and decision making all become much more manageable, accurate, and fast.We wrap all of our solutions in an intuitive business user experience, so employees are presented information and workflow in a manner that makes working with these complex processes more straightforward.And based on how we give the processes we power access to science and a core foundation of common data to work with, we are able to help retailers inform these processes and decisions with customer insight, and rapidly act on these insights…and by making this offering available on a single technology stack, we ensure that these solutions work togetherTransition to next slide: And we are constantly innovating and evolving our solutions with ongoing support and investment from the wider Oracle corporation.
The systems is fully integrated – which means all hardware and software components are:(see slide)
These are the goals that we set out to deliver with Exadata.(see slide)
These are the goals that we set out to deliver with Exalogic.(see slide)
What we’ve seen since the introduction of Exalogic, is that many of our initial customers were Exadata customers that loved the simplicity and performance of an Engineered System and were looking to use Exalogic and Exadata together. Even today, many of the customers that are interested in these systems buy them jointly for the superior results they can deliver together.These are some of the results we’ve seen: (see following slides)
Here we see a comparison of a Do It Yourself Integration versus Engineered SystemsIf you were to do this yourself it would require hundreds of components, tens of servers, months to deploy and costly to integrate and test and would likely have unpredictable results.On the other hand, engineered systems is a single optimized platform, 2 servers can be deployed in weeks and is pre-integrated and tested. Oracle Exadata and Exalogic is our strategic development platform. The Do It Yourself scenario has become very cumbersome and costly for many customers. Retailers want a platform that will grow with them.
At a high level Retailers challenges are like other businesses, drive revenue up and keep costs down. However, you have unique challenges which we have broken out into three areas; Connected Interactions – where conversion rates and providing and satisfying omni channel experience for your customer is critical to increasing revenue. As we all know, consumers are connected 24/7 and have high expectations and demand more from retailers.The next area is Optimized Operations where you can drive down costs by reducing stock, streamlining your return process and improving customer service.Lastly, you are challenged with analyzing massive amounts of data and turning this into Actionable Insight. We have organized this presentation into these 3 topic to highlight how Oracle’s engineered systems address these business challenges. Just as Retailers have unique business challenges you also have unique IT challenges.
Left Side:Exalogic features for highly scalable transaction management - Addresses retailer needs for seasonal peak processing loads.Exadata features for speed of execution data management - Handle volumes of transaction data (sales, shipments)Right side:Exadata features for speed of thought analytics - Deeper and broader use of analytics
Oracle is constantly running benchmarks for major business applications on ExalogicThese are scalability results – transactions per time unit (higher is better)
Oracle is constantly running benchmarks for major business applications on ExalogicThese are scalability results – transactions per time unit (higher is better)
To measure the business value of CX we need to measure the impact of CX in terms of Customer Acquisition, Retention and Efficiency.
For instance, we can measure the impact of improving CX on improving Customer Acquisition by measuring the increase in traffic, the increase in conversion rate and the increase in Average Order Value.Likewise, we can measure improvement in retention through increase in Customer Satisfaction index, Customer Experience scores and Net Promoter Score.
Let’s look at an approach to measuring the tangible business impact of running commerce applications on Oracle Engineered Systems.By embracing Oracle Engineered System the retailer decreases the online abandonment rate due to reduction in outages and faster application response-time.The decrease in online abandonment rate translates directly into an increase in the conversion rate.Note: If we do the math, follow each row from left to right.
Adoption of Exadata since 2008, and Exalogic since 2010, when these products were introduced, has simply been phenomenal.
Customers are in control of your – brand. Customer experience is more important now – since customers can endorse or defect with the click of a mouse.
For additional information, I recommend that you:Join the community on these social networks… (read from slide)And check for updates on the Engineered Systems web page.
