Yearly Archives: 2017

What does True “O2O” mean for Retailers in China?

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The term “O2O” is, of course, a buzzword. It has multiple applications in every industry, region and market. In China, O2O has transformed from being a “trend” to being the de-facto operating model for digitally-oriented businesses in China.

 

So, what does O2O really mean in the context of Retail business in China?

 

At a very basic-level, O2O brings a retail brand’s offline presence (customer experience and CRM Loyalty in Offline Stores) in sync with their digital presence i.e. WeChat.

 

Brands have been doing this in China for a while, with WeChat paving the way for deep (but controlled) customer engagement.

 

A simple H5 page, powered by WeChat can enable brands to:

 

  1. Register / Sign-up members via WeChat using QR Codes which can be augmented by showing Member Points / Coupons / Transaction history.
  2. Link Offline Stores’ POS systems with their WeChat presence to help proactively identify customers when they visit offline stores, using WiFi and multiple location-based techniques to offer better in-store experiences.
  3. Drive games and engagement-based campaigns to personalize the user journey and create “touchpoints” or “moments” to tell brand stories (and drive repeat purchases!)

 

Here is an example of how a WeChat H5 sign-up page might look on WeChat:

 

 

So, essentially, your OFFLINE + WeChat presence are linked. Looks like we’re all sorted, right? … Mmm.. Not Really!

 

All of this has been done and dusted in 2015-16-17. So, what does the future hold for us in 2018?

 

So far retail brands in China have been content with doing just this. But now, they want more. The share of 3rd party eCommerce platforms (a la TMALL, JD, etc) have been growing for almost every major Retail brand.

 

This is driving some key questions:

 

  • How can I combine data from transactions across Offline Retail stores as well as 3rd party marketplaces?
  • How can I get a SINGLE VIEW of all engagement touchpoints for deeper personalisation?
  • Is there a way for me to give consumers a seamless view of their”relationship” with me across all transaction and engagement channels in ONE place?

 

The answer to all these questions lie in tying the dots together across TMALL + WeChat + Offline Retail, all combined together with Loyalty.

 

Explore our completely integrated WeChat CRM platform to easily attract your brand-followers and convert them to brand-loyalists through highly personalized and relevant engagement on their favorite app.

 

We’ve done this already for a few of our customers in China, and the results are great!

 

Contact us for a demo, and see how we can enable True O2O for your brand in China!

 

Measuring Customer Engagement in Real-time with AI

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Singles Day, Black Friday, Cyber Monday, 12.12 sales, and what not! This is hands down the busiest time of the year for any retailer. Managing end of year sales and giveaways to customers high on festive mood is no child’s play.

 

The best time for retailers is when the streamers and the confetti settle down. The smell of sweet ROI and increased YoY sales is better than any pumpkin spiced lattes or roasted turkey, but here’s a secret, measuring your customer engagement and campaign performance at the end of the holiday period is so last season! With the power of AI and advanced reporting technology at your disposal, you can track, tweak and improve your campaigns in real-time, on the go to maximise your growth on every channel.

 

This holiday season, we thought of bringing your stores to the limelight. It is presumed that out of all the channels, this is the hardest one to measure and collate real time data for, however, with the right resources at hand, this can be a piece of cake. So here are the four top metrics that you definitely should be tracking if you want to be flying high at the end of it all.

 

1. Foot Traffic

This is the most crucial factor that can make or break the fate of your holiday campaigns.

 

What does it mean to me – Higher foot traffic translates to higher chances of sales. You need to track it on a real-time basis to know the right number of staff you need for each week of the month, day of the week, and hour of the day. Not just that, you can also correlate fluctuations in footfall traffic data with your marketing campaigns to find out if your campaigns are bringing consumers into stores. By tracking this in real-time you can optimize the campaigns effectively and maximize sales.

 

How do I track this – Most of the footfall counters out there are based on Infrared, Bluetooth beacons, thermal cameras and other camera based technologies that may or may not give you accurate results. AI and machine learning has made it possible to have advanced human detection algorithms that are very accurate. Products like Capillary VisitorMetrix are based on such algorithms and even have the capability to differentiate your staff from a genuine customer hence giving you an accurate count of foot traffic.

 

2. Sales and more

Don’t just track sales figures. Slice and dice it to reveal more about your customer’s purchase patterns.

 

What does it mean to me – Break down your sales figures and calculate the average transaction value, average basket size and the total number of sales made. These figures though basic, go a long way in analyzing campaign responsiveness. You can then work your magic to steer the promotions in the direction you initially wanted it to go. Courts Malaysia does this beautifully on a regular basis to get extremely high repeat sales percentages.

 

How do I track this – A centralized reporting tool will enable you to have a third eye into your campaign performance. Reports that automatically and at real-time pull data from all the touch points and crunch the data to present meaningful and actionable insights to you is the way to go here. Brands like KFC who have countless touch points and a mammoth amount of data have achieved this. Then what’s stopping you?

 

3. Conversion Rate

The mother of all metrics. You want to know how efficient your staff and promotions are? This is your go to KPI.

 

What does it mean to me – Want to know how your promotion did? Want to know if your store staff are actually ensuring they convert every customer that walks in the store? Want to ensure your store planning is perfect? Then this is the number you want to keep an eye on. Tracking this periodically – hourly, daily and weekly will help you identify and track trends that you wouldn’t have seen before.

 

How do I track this – You need connected devices at your store. By this I mean your people counter, your POS data and your reporting tool need to be integrated for you to be able to monitor this no matter where you are. Capillary VisitorMetrix, for example, uses AI algorithm to identify a customer entering the store accurately and then feeds this information along with the POS sales figures, at real-time to a reporting tool to give you hourly, daily, weekly and monthly conversion rates.

 

4. New vs returning customers

Common fact to all retailers: it’s 5 times more expensive to acquire a new customer than it is to retain an existing one. So it’s pretty clear why this is our last, but certainly not the least, point.

 

What does it mean to me – Apart from knowing how many new and old customers your promotions attracted, knowing instantly if a customer who walked into your store has purchased with you previously or not gives the stores the kind of power they never had before. Capillary Loyalty+ solutions have been adopted by world’s leading brands to track on a real-time basis if a customer visiting the store is a one-time, repeat or new customer and have setup practices to use this information to enhance the customer experience at the store.

 

How do I track this – Real-time reporting helps you analyze this easily no matter where you are. Solutions like Capillary Insight+ that has AI powered predictive models, you will be able to not only see the live numbers but also think and plan ahead of time so that you make most of the opportunity this festive season has to offer.

 

So there. Those were our four uber-important KPIs that you need track to ensure your stores perform the best this year. Reach out to us and let’s talk more on how you have been tracking your holiday season sales and how it has worked for you. We are all ears!

Humans are the Weakest Link in Information Security

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This article was originally published in the September 2017 issue of CIO Review Magazine

 

Consider the following:-

 

  • WannaCry Ransomware (2017) exploited a vulnerability in SMBv1 Protocol of Windows, was successful due to unpatched computers. Microsoft had released a patch two months before the ransomware hit the world but many systems were infected, putting the security of their information at risk.
  • Bangladesh Bank (2016) was hit by a cyber-heist after login details of an employee were discovered and used to install malware on the bank’s system. Total loss to the bank was estimated to be at around  $81 million USD.
  • PlayStation Network Attack (2011), resulted in hackers getting access to details of 77 million users ultimately leading to a fine of GBP 250,000 on Sony, which was attributed to “poor security measures” that didn’t comply with UK’s legal requirements.

 

Wannacry, Bangladesh Bank, and the PlayStation Network attack are only the tip of the iceberg. As a pattern, all the attacks are only aimed at one thing: information.

 

Why are Humans our Weakest Link?

 

Given that humans make so many mistakes, it is not surprising to suppose that in the great chain of machines, we are the weakest link. The defining qualities of our species are that we are unpredictable, often irrational, easily form poor habits, are emotionally driven and in general, behave far differently than any computer system. If our objective is to protect information, then instead of being seen as a strong tool against cybernetic attacks, our humanity is the very thing making us vulnerable.

 

On the other hand, a computer system or any automated system for that matter is capable of following set protocols and procedures to an exacting degree of precision, repeatedly, consistently, predictably and reliably; something that is a boon to IT security. It’s only natural that we would prefer computers over humans. Info-sec professionals have become so confident in the dependability of computers that they would gladly replace their human forces with a horde of machines. A machine would make no mistakes, would never tire, it would always respond in a manner that it has been designed to. Machines would adhere to their algorithms and will only ever do what they have been taught to do.

 

Can Humans be our Strongest Link?

 

It is common to use technology in information security systems. Heuristics-based systems are employed regularly in our protective perimeter, and with the advent of AI which applies machine-learning techniques, it is only logical to assume that the future of information security lies in fully automated systems, which are capable of responding to almost all kinds of threats.

 

While there is no doubt that recent advances in AI have been significant and impressive, there have been some major and risky incidents in the field of AI in 2016 alone:-

 

  • An AI designed to predict recidivism acted racist
  • AI NPCs (Non-Playable Characters) in AI infused video game “Elite Dangerous” designed unauthorized super weapons
  • A patrol robot collided with a child
  • A developing self-driving car was involved in a deadly accident
  • Microsoft’s Teen AI designed to converse with users on Twitter became verbally abusive

 

While automated systems, especially the “smarter” ones have come a long way, they still tend to lack refinement. They are designed and trained by programmers until now been unable to suitably, and comprehensively, define the  “universe” of information security to them. Without a complete understanding and knowledge of this Infosec universe, it is near-impossible for a computer to deal with new and unforeseen threats. While they may be able to deal well with predictable issues, in unanticipated circumstances, they require humans for taking qualitative decisions. This is analogous to the need for human pilots in aircraft even though most of the flying is done by computers today. Those same traits of humans, which create security vulnerabilities are often a crucial necessity in the field of security.

 

The Right Weapon for the Right Battles

 

While attacks are carried out using powerful computers racked with ingenious coding, a hacker is still nothing more a malicious human; one who can think, adapt, become excited, display initiative, and be emotionally invested, just like the people defending themselves from their attacks. Consequently, it is in our best interest to fight that human with a weapon which is equipped with similar traits & qualities, albeit one that has been made stronger with the help of training & technology.

 

In the face of machines, there is no doubt that humans fall short in many aspects. It would be unwise to dismiss their role altogether.the purpose of all security systems should be to strengthen security by helping humans make good decisions, including them as an asset to security.

 

Info-censured Sustained Businesses

 

The strength of a product lies in serving business objectives, which is provided by build stability along with reliable information security (both intellectual & data), and effective info-sec processes which are ultimately run by humans. Clients need these to rest assured that their business continues without having to constantly worry about the next cyber-attack.

 

The best way to execute information security is when it remains covert, stays one step ahead of these attacks, adheres to reliable and tested security frameworks, and employs technology in a manner that permits humans to become the strongest link in the information security chain; thus allowing client business to continue uninterrupted, and for business owners to focus on their growth strategy.

 

Why India is Reinventing its Traditional Distribution Networks

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This article originally appeared on 28th July 2017 issue of the Financial Chronicle

 

On the first of July, after a lot of excitement, confusion, and concerns, GST was rolled out all across India. The highly anticipated tax reform which had been in the works for at least a couple of decades is expected to greatly simplify the ease of conducting business across the federal nation. While the benefits and complications of GST have been debated at length, the important supply chain changes that it may cause have been sidelined and its importance overseen. If well used, the abilities of GST combined with omnichannel commerce can empower brands and manufacturers to finally reinvent their long-standing systems.

 

Traditional Distribution Structures

 

Indian FMCG and manufacturing industries have traditionally had multi-tier CFA, dealer/distributor, wholesaler, and retailer networks with the number of nodes increasing or decreasing depending on the size of the company and market presence in their particular geography. The previously existing excise and sales tax components meant that the supply chain network was mostly designed to optimize tax outflows and not really the core value drivers of any supply chain which, in an even playing field would be the cost of manufacturing, cost of procurement, labor, and logistics costs. Post GST, most companies could have a real opportunity to relook their supply chains with a critical eye and design networks and nodes (factories, stocking locations, regional distribution centers) based on fundamental supply chain principles and not mere tax evasion. Consequently, we can already see major automotive and FMCG companies investing in large automated warehouses that are much more sizeable and technically superior to their otherwise existing infrastructure.

 

The Omnichannel Disruption of the Marketplace

 

The last decade has seen massive growth in ecommerce and omnichannel marketing in India, both in urban and rural market spaces. Apart from the more famous ecommerce platforms such as Flipkart and Amazon, most retailers have their own ecommerce websites. Market spaces like Tata CliQ and  BigBasket are gaining increasing popularity in urban clusters. The ease of an omnichannel experience that a user expects by ordering on their mobile phones and similar processors translates into a redesigning of traditional distribution networks and fulfillment strategies. India’s largest FMCG multinational has been running a program where an end customer can order from their homes through an app while a neighborhood retailer can fulfill the order.

 

The Reinvention of Traditional Structures

 

A combination of the two above mentioned factors i.e. real supply chain optimization enabled by the GST reform and omnichannel commerce and fulfillment strategies mean that companies are thinking about reinventing their traditional structures, whether to keep up to customer demands or to invest more in their growth, now that their obligation to evade tax has eased. Traditional distribution management systems where sales and inventory details need to be synced at scheduled intervals are slowly being replaced by mobile apps, web-portals, and microsites. Retailers or distributors in the lower node of the supply chain can order from the CFAs or manufacturers directly. The manufacturers in turn gain clearer visibility, making them agile enough to pass on promotions and other schemes much quicker. This also leads to a more even battlefield for small local brands, allowing them to reach a pan India market, as they are no longer dependent on stocking locations in every state to reach their customers. In contrast, the multinational and Indian majors who controlled the channels on the virtue of their size (apart from brand pull) need to effectively nurture engagement and loyalty amongst their channel partners in order to retain as much monopoly as they can garner.

 

Business to business commerce in India is expected to get a serious facelift, and the customer-friendly aspects of business to customer marketing are expected to be incorporated into the systems and processes of B2B as well. Clunky software products, file transfer protocols at the end of a day’s business and month end pile up of invoices that need to be printed, will slowly give way to online ordering, mobile-based collaboration and replenishment mechanisms, as the millennial workforce will increasingly make up the employee numbers of India.