Clive Woodger July 2015

The Ultimate Retail Brand Experience...Transformation Challenges

The Ultimate Retail Brand Experience

The Empowered Consumer ...Transforming Retail

Retail Brand Experience ...Transforming Touchpoints

Changing Market Dynamics

Retail Transformations...Snapshot Transformation Challenges

Retail Branding and Design

London based, established 24 years

Strategy – Branding – Retail Design – Graphic Design Architecture - Visual Identity – Interiors

Digital Concepts - Point of Sale – Merchandising Design Implementation

We create great customer experiences...

...across a wide range of sectorsPharmacy

Footwear

Food

Banks Shopping Centres

Fashion/Accessories

DIY

Homing

Cash & Carry

Children

Electrical

Online Retail

Co!ee Shops/Restaurants

Sports

Duty Free

Automotive

Our clients include:

“In a world where screens are woven into our lives, there are more consumer-initiated touch points.”

Google

The Empowered Consumer... ...Transforming Retail

The balance of power has shifted to consumers - they are setting the agenda for retailers to follow”

The empowered consumer...

The impact of digital technology:

Changing consumer mindsets and behaviour

An age of constant connectivity... ... and instant gratification.

REPUTATIONRespect me: Focus on consumers, not on devices -

create a personalised experience

KNOWLEDGE Know me:

UNDERSTANDINGRecognise me:

ENGAGEMENTInterest me:

Appealing to the empowered consumer mindset

Key influence generation

“By 2015 Millenials will be 75% of the workforce and will influence 74% of buying decisions”

“Thanks to globalization, social media, the exporting of Western culture and the speed of change, Millenials worldwide are more similar to one another than to older generations within their nations.”

Ways to win the Millennials

HELP THEM DO SOMETHING MATCH THEIR LIFESTYLE

FEEL AUTHENTIC ENCOURAGE PARTICIPATION

DISRUPT THE STATUS QUO

ENGAGE INSTEAD OF ADVERTISE

“The emerging millennial generation in Colombia comprises over 16 million people who are changing the way businesses promote their brands”

Colombia’s Millennial Momentum

Internet Use in ColombiaRanks third in Latin American internet use Brazil - 118.6m, Mexico - 56.1m, Colombia - 31.6m (some sources say 28.6m)

Increased use of mobile internet24m Colombian users in 2014 58% increase compared to 2013.

Promoted by government “Widespread adoption of the internet and the development of a nationwide digital ecosystem.”

Sources: emarketeer and comScore

Higher than average monthly usage1,404 minutes a month online (Latin American average is 1,298, European average is 1,659).

No 2 in Latin American ‘page consumption’Per visit, Colombians consume 37 pages of Internet content (Brazil is no 1).

Online purchases 52% of Colombian Internet users made an online purchase of a good or service In 2014.

Social MediaPer day, Colombians spend 13 minutes on Facebook (over 93% of social media time is spent on Facebook with 54 million Facebook likes a day), 6 minutes on YouTube and 68% use Twitter at least every couple of days. Sources: emarketeer and comScore

Internet Use in Colombia

Retail Brand Experience......Transforming Touchpoints

Digital...Physical...People...

Brand Touch points

Awareness....Promise

Brand Synergy

Customer Visit....Journey Afterglow...Satisfaction

brand naming visual identity

signatures marketing communications

architecture exteriors

environments

planning

circulation zoning

merchandising

communication

signage

point of sale service

o!er...products...services...

attributes...’known for’

...added value

values....ethos

image...personality...profile

Touchpoint SynergyCreating positive market di!erentiation

ValueMore for LessBargain huntingA di!erent kind of “guilty pleasure”Price led but value drivenpragmatic .. careful… planned shopping“Constrained consumers”The best quality at the best priceA good ‘deal’ … every time you shopQuality …Choice …Experience … environment/service /process

Customer Mindsets, Motivations and Lifestyles

Customer Mindsets, Motivations and LifestylesConvenienceFast...Simple...Easy...AccessibleWhat I want When I want itHow to get it“Total convenience...to your door...to your store”I want it now!

Home FocusLiving..Entertaining...Relaxing...Working Creativity, Aspiration, Self ImageIndulgence at home‘Eating out at home’ New products for creative home cookingPremium ranges - gourmet and restaurant dishes

Customer Mindsets, Motivations and Lifestyles

SustainabilityEnvironmental...ethical...social...Consumers want to feel ‘good’ about what they buyHow was it procured, grown, reared, caught, manufactured, transported?People...Planet..ProfitEmergence of the ‘principled consumer’Did it harm the environment, people, communities?Was it ‘Fair Trade’? CSR industry - di!erentiated by values‘Look behind the label’ …. M&S

Customer Mindsets, Motivations and Lifestyles

Connectivity

Interactive engagement with customersCreating communitiesCooking clubs, fashion wardrobes, beauty ideas...Lessons, demonstrations, events...

Customer Mindsets, Motivations and Lifestyles

Supermarkets“making shopping a pleasure”

Sales densities vs better environments

Fresh… demand for freshness

Organic and Ethical label range opportunities

FreshBack to basics – Fruit & Vegetables

Less packaged / processed food

Smoothies / packaged fruit snacks

Multi Brand StrategyX5 Group: Creating a brand family/positionings

Discounters “quality repositioning”

Multi Brand StrategyX5 Group: Pyatyorochka Discounter.Creating clarity, making it easier and more e"cient

Hypermarkets Lifestyle pitstops / centres - “everything for your life”

More than functional warehousesProviding services and non food -as well as foodActing as community destinations

Retail theatre...events / workshops /parties

Multi Brand StrategyX5 Group:Karusel Hypermarket

Navigation, zoningDepartmental focus

Premium City Customer TargetAzbuka Vkusa:Contemporary brand identity

Premium City Customer TargetAzbuka Vkusa: Flexible store conceptsAuthoritative departmental worlds

Premium City Customer TargetAzbuka Vkusa: Quality service and merchandise presentation

Premium City Customer TargetAzbuka Vkusa: Quality implementation

Convenience Stores“my place”

ConvenienceAzbuka Vkusa Daily: Premium minimarketTargeted at city workers

Creating a Brand Personality...SignaturesBrand identity audit

- BRANDMARK CHARACTER NOT DESCRIPTIVE OF OFFER- NEEDS APPROPRIATE PERSONALITY - TYPEFACE SHOULD LOOK MORE FRIENDLY

Friendly, regional chainTabris: Local leader

Producer to RetailerVel & Co: Upmarket,local destination and meeting place

Shop, Eat, RelaxVel & Co: Cafe facility focus

Creating a distinctive personalityShokoladnitsa: Contemporary, social, distinctively Russian. Engaging customer graphics.

Bringing provenance into the retail environmentClover: Niche, direct from farm produce

Sustainable ‘green’ supermarketGrunwald: Ethically resourced organic retail

International Retail StrategyMetro Cash & Carry: Global brand guidelines, shared best practice

Contemporary value propositionWinelab: bold, stylish discount concept

Winelab: Accessible, fun, informative

Contemporary value proposition

DIY / Homing

Do it for me...the empowered customer...USA

“For every man that feels comfortable to leave DIY to someone else, there is a woman who wants to do it herself.”

“DIY is no longer about necessity, but more about the pleasure and pride someone gets from the creation of something new - a transition from fixer to maker.”

From DIY to CIY: ‘Create it yourself’

DIY...Homing Market Trends

SOFT/INSPIRATIONAL

HARD/FUNCTIONAL

EVERYONE IS SELLING HOME TO EVERYONE

STORES

‘Home and

Living’

DISCOUNTERS

FURNITURE STORES...lifestyle

DIY/PROFESSIONAL...multi-channelUK

International

Service Innovation

Soft meets hardHusamidjan: Creating a trade and consumer destination

Soft meets hardYuterra: Complicated, confused, frustrating home o!erOur challenge...

Creating clarity

departmental authority

Design developmentYuterra: Merchandising development - strategic and operational

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Yuterra: Department zoning...integrated graphics/merchandising2?@JCU?PC

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Yuterra: Merchandising diverse product groups - soft, hard, large, small......seasonal flexibility

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Yuterra: Bringing the physical environment in line with the digital social media experience

Clear, attractive product worlds, easy shopping

Interactive customer engagementYuterra Colors: A new digital brandProvides inspiration and invites customers to share ideas/solutions

Fashion - Apparel, Footwear, Accessories

Primark: fashion-forward designs, bargain prices

“It’s everyone’s fashionable guilty pleasure, a retailing powerhouse that’s perfected the art of mixing low prices with high fashion.”

“Stronger, on-trend ranges that have made it a clear winner in the ‘hauling’ trend, which sees customers sharing pictures and videos of their shopping sprees at value retailers.”

No digital channels but 278 branches

Budget Fashion...simple graphic led kit of partsConcept Club: 160 stores, romantic, classic, seasonal party zones

Budget Fashion...children Acoola: Value, fun, contemporary

Budget Fashion...repositioning focused o!erJeans Lab: New name -“research expertise” industrial environment

Budget Fashion...repositioning focused o!erJeans Lab: New name -“research expertise” industrial environment

Milavitsa: One of the largest European groups, complete new lookManufacturer retailer

Contemporary multibrand destinationFashion Galaxy: High fashion experience, inspirational graphics/media

Contemporary multibrand destinationFashion Galaxy: High fashion experience

Contemporary multibrand destinationFashion Galaxy: High fashion experience, inspirational collateral

Budget mass market footwearFLO: Largest store chain in Turkey, friendly service, simple, fun

Budget mass market footwearFLO: Emphasis on service desk to give store focus

Budget mass market footwearFLO: Fashionable fresh environment

Image di!erentiation, distinctive name and self service o!erSelect 25: High density, contemporary identity, packaging and point of sale

Image di!erentiation, distinctive name and self service o!erSelect 25: Memorable graphics, communication and packaging

Jewelry rebranding to update and repositionValtera: Contemporary new store concept with distinctive icon

Bronnitsky: Creating a strong brand signature and environmentJewelry rebranding to update and reposition

Lifestyle Health and Beauty, Pharmacy, Sports

Balancing pharmacy and health an beauty36.6: Emotive name, distinctive identity, store concept and communication

Contemporary beauty servicesMone: Emotive brand name, distinctive beauty services destination

Contemporary beauty servicesMone: Modern inspirational product packaging and environments

Mass market value sports o!erSportsmaster: Graphic led store environment upgrade kit of parts

Zenit: Retail store concept celebrating the club in partnership with NikeFootball club “world”

Zenit: Coordinated environment, merchandising and graphic conceptsFootball club “world”

Zenit: Coordinated environment, merchandising and graphic conceptsFootball club “world”

Changing Market Dynamics

Shopping Centre Market Dynamics

Destinations where people meet, eat, relax, indulge, work, rest, play... & shop...

A community venue to promote wellbeing & lifestyle activities

A place where people want to be!

Kaleidoscope, Moscow

Shopping Centres...Place brands

Digital & Physical Channel ConvergenceSeamless shopping experience...accessible, available and deliverable

Touchpoint Optimisation Multiple and consistent across key channels

End-to-End Brand ExperiencesMore emphasis on complete customer solutions...encompassing pre-purchase, point-of-purchase and after-purchase

Enabling Technology to Inspire and Captivate

messaging, iBeacons...social media, loyalty programs...

Physical/Digital

ExperienceExperiential Retail

Innovation and EnhancementInnovative ways to enhance the buying experience:

Engagement: tablet and interactive displays, social media campaigns, community eventsEntertainment - shows, festivals, celebrity visitsEducation - classes, demonstrations, product events

StoresDownsizing Large format stores investing in smaller, “bite size” footprints...showcasing

Modular Flexibility Large format stores targeting modular flexibility inside the box and multi-channel reach around the box.

Portfolio Focus

Proliferation of Distribution and Marketing ModelsPop-up stores, virtual stores, retailer partnering with service/experience providers...spas, cruises, hotels...

Niche Retailing

footprint, smaller store count, more narrowly focused concepts

GlobalGlobal Multiples Expansion Accelerated development into emerging markets to take advantage of rapid middle class growth and retail modernization

GlocalizationInternational companies aiming to combine global scale with excellence at local execution...and global market savvy and sourcing with local market delivery and know-how.

Product O!er

One-Stop Lifestyle ProvidersThe new one-stop shop will focus on customer segments with edited

Breaking the 80/20 Rule

more of what “suits me.”

No Limitations of Shelf Space An increasingly digital retail environment allows shoppers to have

PersonalizationMass CustomizationUnprecedented levels of customer connectivity—pre-manufacture, pre-shop, during shop, post-shop... engaging consumers in the development and customization of their own products, media and shopping experience.

Premium ServicesTreating customers as guests - not just top-end retailers. Personalized and exclusive events and services driving incremental purchases and building loyalty.

Personalized Shopping Technology

virtual try-on options, instore robots

Information SharingValue chain will become more intimate. Consumers will share information with retailers and suppliers but expect to get more value in return.

Move Away From Uniformity Retailers will expect to achieve more of their growth from new concepts than

Di!erentiation/ExclusivityPrivate/own brands satisfy niche opportunities, enable customization and keep pace with trends. Retailer umbrella brands allow ownership of an expanded range of products and services.

Interchanging ChannelsOnline only retailers are opening up physical stores

Manufacturer Brand PowerThrough the internet consumers have direct access to suppliers avoiding the retail/distributor

Growth

Total Convenience

Faster RetailingFast fashion, limited-time-only products, flash sales, pop-up stores, self-

Amazon and Google same day delivery, drones...

Services Expansion

Service

Retail Transformations

Argos...from catalogue showroom to multi-channel retailer

H&M

Homebase UK

Lord & Taylor (USA)

House of Fraser (UK)

Audi City (London)

North Face (International)

Nike (International)

Sony (International)

Dyson (UK)

House of Fraser (UK)

IKEA (International)

Customers want choice to be in control... speed... flexibility... convenience

Click & Collect

Transformation Challenges

The aim should be to achieve a more immersive, more personal and more seamless experience for the customer.

The Digital/Physical connection: The challenge for retail brands

Staying Relevant….

Creating Positive Di!erentiation

O!er Adaptability …to market … to location

Digital / Physical Synergies

Format Scalability… Roll out expansion…downsizing …. optimum ROI Flexible specification cost models …. flagship to basic graphic ‘dressing’ upgrade

Positive Brand Culture …our people make the di!erence … Internal communications …organisation … workplaces which inspire and engage...

Transformation Challenges

Customer Service...The ultimate di!erentiator

Transforming your people...attracting and retaining the best

Our people make the di!erence

Brand Synergy"

t: +44 (0)20 7371 7522 f: +44 (0)20 7371 8351 e: info@scg.international www.scg.international

Gracias!!