Competition Promises To Be Fierce For Brands This Holiday Season

Steve Olenski

Healthy competition is a good thing. I happen to believe that, for it is the spirit of competition that brings out the best in all of us. Or in Lance Armstrong’s case, the worst.

But I digress.

The holiday season is (a) upon us and (b) often the deciding factor in whether a given brand had a successful year or not. Not exactly the kind of information that makes one sit up and say “I did not know that.” Of course you know that.

In recent weeks I have told you how the Lack Of Mobile Integration Means Not So Happy Holidays For Brands and also How Retailers Can Make Their Email Marketing Glisten This Holiday Season.

The former article speak to the fact that more and more consumers are turning to their cell phones to shop this holiday season and more than half of America’s fastest growing retailers have yet to fully connect online and offline shopping experience, leaving shoppers unsatisfied with their shopping experience.

The latter piece tells you how you can make the most of your email marketing campaign this holiday season by downloading and reading the Retail Email Guide For the Holiday Season, put out by Responsys. Full disclosure: At the time I wrote the latter piece I was not employed by Responsys but have since taken the position of Sr. Content Strategist.

Ok, now that that’s out of the way, let’s get to why I think competition will be fierce this holiday season. The cold hard truth is of course it has to do with the economy as it was in years past. This year there is the added uncertainty of who will be in the White House as well. A good recipe for shopper weary which translates into major competition among brands.

Shoppers Remain Conservative With Holiday Gift Budgets

This was the headline of a press release on the website of the National Retail Federation. The headline spoke directly to the findings the NRF uncovered during a recent survey of consumers.

Logo of the National Retail Federation

From the release:

“According to the survey, the biggest portion of shoppers’ budget this year will go towards gifts for family members with the average person planning to spend $421.82 on children, parents, aunt, uncles and more. Additionally, people will spend $75.13 on friends, $23.48 on co-workers and $28.13 on others, such as pets and community members.

Consumers will also spend on food and candy ($100.76), greeting cards ($28.66) and flowers ($19.55.) When it comes to decorations, the average person will spend $51.99, up from $49.15 last year and the most in the survey’s history. Total spending on holiday décor will reach $6.9 billion.”

Wow, who knew holiday décor was so popular?

But I digress, again.

NRF President and CEO Matthew Shay says the competition will heat up and in fact, already has. “As the most promotional time of the year, retailers will continue to look for ways to  stand out, specifically with attractive deals on toys, electronics and apparel, even well before the ‘official’ start of the holiday shopping season – Black Friday and Cyber Monday.”

Judging by the survey results, I would say Shay is right as four in 10 (41.4%) of consumers say they will begin holiday shopping before Halloween.

So what this basically tells me and should tell all brand managers and brand marketers and ALL marketers that if they have not already started their holiday marketing and advertising push, they may in fact already be too late to the dance.

If The Price Is Right

Not surprisingly over one-third of respondents (36.6%) said the most important factor in deciding where to shop are offers for sales and discounts.

Source: National Retail Federation


Why 3D Printed Food Just Transformed Your Supply Chain

Hans Thalbauer

Numerous sectors are experimenting with 3D printing, which has the potential to disrupt many markets. One that’s already making progress is the food industry.

The U.S. Army hopes to use 3D printers to customize food for each soldier. NASA is exploring 3D printing of food in space. The technology could eventually even end hunger around the world.

What does that have to do with your supply chain? Quite a bit — because 3D printing does more than just revolutionize the production process. It also requires a complete realignment of the supply chain.

And the way 3D printing transforms the supply chain holds lessons for how organizations must reinvent themselves in the new era of the extended supply chain.

Supply chain spaghetti junction

The extended supply chain replaces the old linear chain with not just a network, but a network of networks. The need for this network of networks is being driven by four key factors: individualized products, the sharing economy, resource scarcity, and customer-centricity.

To understand these forces, imagine you operate a large restaurant chain, and you’re struggling to differentiate yourself against tough competition. You’ve decided you can stand out by delivering customized entrees. In fact, you’re going to leverage 3D printing to offer personalized pasta.

With 3D printing technology, you can make one-off pasta dishes on the fly. You can give customers a choice of ingredients (gluten-free!), flavors (salted caramel!), and shapes (Leaning Towers of Pisa!). You can offer the personalized pasta in your restaurants, in supermarkets, and on your ecommerce website.

You may think this initiative simply requires you to transform production. But that’s just the beginning. You also need to re-architect research and development, demand signals, asset management, logistics, partner management, and more.

First, you need to develop the matrix of ingredients, flavors, and shapes you’ll offer. As part of that effort, you’ll have to consider health and safety regulations.

Then, you need to shift some of your manufacturing directly into your kitchens. That will also affect packaging requirements. Logistics will change as well, because instead of full truckloads, you’ll be delivering more frequently, with more variety, and in smaller quantities.

Next, you need to perfect demand signals to anticipate which pasta variations in which quantities will come through which channels. You need to manage supply signals source more kinds of raw materials in closer to real time.

Last, the source of your signals will change. Some will continue to come from point of sale. But others, such as supplies replenishment and asset maintenance, can come direct from your 3D printers.

Four key ingredients of the extended supply chain

As with our pasta scenario, the drivers of the extended supply chain require transformation across business models and business processes. First, growing demand for individualized products calls for the same shifts in R&D, asset management, logistics, and more that 3D printed pasta requires.

Second, as with the personalized entrees, the sharing economy integrates a network of partners, from suppliers to equipment makers to outsourced manufacturing, all electronically and transparently interconnected, in real time and all the time.

Third, resource scarcity involves pressures not just on raw materials but also on full-time and contingent labor, with the necessary skills and flexibility to support new business models and processes.

And finally, for personalized pasta sellers and for your own business, it all comes down to customer-centricity. To compete in today’s business environment and to meet current and future customer expectations, all your operations must increasingly revolve around rapidly comprehending and responding to customer demand.

Want to learn more? Check out my recent video on digitalizing the extended supply chain.


Hans Thalbauer

About Hans Thalbauer

Hans Thalbauer is the Senior Vice President, Extended Supply Chain, at SAP. He is responsible for the strategic direction and the Go-To-Market of solutions for Supply Chain, Logistics, Engineering/R&D, Manufacturing, Asset Management and Sustainability at SAP.

How to Design a Flexible, Connected Workspace 

John Hack, Sam Yen, and Elana Varon

SAP_Digital_Workplace_BRIEF_image2400x1600_2The process of designing a new product starts with a question: what problem is the product supposed to solve? To get the right answer, designers prototype more than one solution and refine their ideas based on feedback.

Similarly, the spaces where people work and the tools they use are shaped by the tasks they have to accomplish to execute the business strategy. But when the business strategy and employees’ jobs change, the traditional workspace, with fixed walls and furniture, isn’t so easy to adapt. Companies today, under pressure to innovate quickly and create digital business models, need to develop a more flexible work environment, one in which office employees have the ability to choose how they work.

SAP_Digital_Emotion_BRIEF_image175pxWithin an office building, flexibility may constitute a variety of public and private spaces, geared for collaboration or concentration, explains Amanda Schneider, a consultant and workplace trends blogger. Or, she adds, companies may opt for customizable spaces, with moveable furniture, walls, and lighting that can be adjusted to suit the person using an unassigned desk for the day.

Flexibility may also encompass the amount of physical space the company maintains. Business leaders want to be able to set up operations quickly in new markets or in places where they can attract top talent, without investing heavily in real estate, says Sande Golgart, senior vice president of corporate accounts with Regus.

Thinking about the workspace like a designer elevates decisions about the office environment to a strategic level, Golgart says. “Real estate is beginning to be an integral part of the strategy, whether that strategy is for collaborating and innovating, driving efficiencies, attracting talent, maintaining higher levels of productivity, or just giving people more amenities to create a better, cohesive workplace,” he says. “You will see companies start to distance themselves from their competition because they figured out the role that real estate needs to play within the business strategy.”

The SAP Center for Business Insight program supports the discovery and development of  new research-­based thinking to address the challenges of business and technology executives.


Sam Yen

About Sam Yen

Sam Yen is the Chief Design Officer for SAP and the Managing Director of SAP Labs Silicon Valley. He is focused on driving a renewed commitment to design and user experience at SAP. Under his leadership, SAP further strengthens its mission of listening to customers´ needs leading to tangible results, including SAP Fiori, SAP Screen Personas and SAP´s UX design services.


Digital Connectivity: Reimagining Retail Business Models With Retail-As-A-Service

Tom Redd

In the ever-changing world of retail a fundamental shift is occurring. Retailers are moving away from a product-oriented world and toward an outcome-oriented one—a world that’s based more on experiences than products. Digital connectivity is a crucial player in this transition.

With digital playing a bigger role, newer business models must rethink the use of technology in creating and capturing value. This improves customer-centric merchandising. Retail-as-a-service (RaaS) is a primary example. Trends are developing around the convergence of business models. Ecommerce retailers such as Amazon and China’s Alibaba are redefining retail-as-a-service.

But what is retail-as-a-service? It is the bundling of payment processing, service and support, loyalty programs, and gift cards all in one package. Amazon is rolling out new tools that allow brands to own their presence on while providing these retail-as-a-service means.

Retailers understand that data-driven strategies are the keys to value creation. Those rising to this challenge are moving in three strategic areas:

Reimagine business models

Business models are evolving. The shift from product-based retail to a more customer-focused and experience-based strategy is driving this change. This evolution means more opportunity to find value.

Retail-as-a-service such as the men’s personal shopping service Trunk Club, focus on an outcome. Fashion rental service Rent the Runway offers another example. Under Armour’s new digital health platform has created a large community of users who share fitness data in real time. This data has many uses and is crucial to the future growth of the company. It also increases its ability to create alternate revenue streams.

Through business networks like Alibaba, eBay, and Amazon, retailers can to cut physical inventory. The shoppers need for thrill, speed, and instant gratification is giving rise to new retail-on-demand models. These models include flash sales designed to capture consumers at the moment of impulse.

Reimagine business processes

Retail companies are reinventing the process of buying, selling, fulfilling, and servicing merchandise. This occurs when consumers, sellers, and suppliers digitally connect. This is driving new insights from large volumes of data. Based on a shopper’s digital footprint, retailers can offer automated, dynamic, and contextual pricing.

The hyperconnectivity is bringing new meaning to retail. Through the collection of data, engaged vendors can see customer demand in real time. They can adjust production, shipments, and promotions to drive sales. This will improve merchandise planning and boost personalized shopping. Transparent supply networks enable short lead times and “make-to-order” assortments that reduce inventory. This also improves on-shelf availability and delights customers. Connected warehouses cut costs by tracking the supply chain from production to sale. For example, manufacturers can alert retailers of faulty or expired goods.

Flexible payment methods that enable wallet-less shopping aid anywhere, anytime consumption.

Reimagine shopper engagement

Retailers can engage customers by incorporating technology in a meaningful way. This happens across all touchpoints and will be at the heart of survival in the digital age.

Tailoring shopping experiences for a particular shopper lets retailers highlight “segment of one” loyalty, helping retailers alert consumers to designer pricing, promotions, and loyalty rewards in real time. Using interactive technology to boost in-store experiences is key. This not only improves satisfaction, but it also enriches the shopping experience.

Key to tailored shopping experiences is the education of both customers and employees. Knowledgeable staff will enhance the shopping experience. Social media is an important method to build brand loyalty and can be a powerful recruiting tool. It can help a business attract top talent. In-store technologies improve productivity by reducing tasks and maintaining compliance with pricing and displays.


The traditional business model involved selling products and services at a markup to cost. Newer models rethink the use of technology in creating and capturing sources of value. This will accelerates as digital plays a larger role in commerce.

Subscription-based companies can determine with high accuracy what consumers want and when they want it, which in turn enables retailers to deliver the right product at the right time and place. This focus on relationships over sales transactions is revolutionary. Services such as Amazon’s Subscribe & Save are already doing this. and fashion management retailers such as Nordstrom’s Trunk Club are on board as well.

Retail-as-a-service has set the foundation for the reawakening of the sharing economy. It has proved once again that consumers are much more comfortable renting and sharing products than buying them. The shift to retail-as-a-service -continues to revolutionize the industry, providing unique opportunities for retailers to attract and maintain new customers while also growing margins.

Learn more about digital transformation for retail at Retail. Reimagined for the new economy.


Tom Redd

About Tom Redd

Tom Redd drives strategic communications for the Retail Global Industry Business Unit for SAP. With over 32 years of experience in retail technology, Tom is focused on the latest action within the retail industry. He is also shared his knowledge with SAP communication teams, including analyst relations and public relations.

Data Lets Retailers Deliver Personalized Experiences To The "Segment Of One"

Kristin Howell

Rich data modeling and mining are driving retailers to embrace the “segment of one” and respond to shifting expectations to deliver what consumers want.

Consumers today shop differently than they did a generation ago. Connected users enter stores with their smartphones and tablets on and ready to provide product information, reviews, and price comparisons. This data offers retailers the ability to give consumers customized experiences and to deliver based on these experiences.

With shifting consumer expectations, these “segment of one” experiences in turn boost brand loyalty and broaden consumer relationships.

Shifting consumer expectations

For retailers, the power of data has created a dramatic change. Today’s savvy retailers are using data to connect with consumers everywhere. Whether in the store or after a sale, retailers are finding better ways to engage with the segment of one.

Meanwhile, consumers are providing a motherlode of data points about themselves. Companies today can collect valuable information about consumers’ gender, location, wealth, product preferences, shopping habits and patterns, and much more. Retailers then leverage this data to create new experiences for consumers and maintain deeper relationships with shoppers after a sale.

Getting personal

Consumers today want and expect to experience brands differently, so retailers are using technology to personalize their message to a segment of one. Consumers are more interested in outcomes from using products than in the products themselves. They care about the totality of the information, services, and advice retailers provide. They expect interactions to be personal, based on a company’s understanding of their needs. Consumers want a relationship.

For retailers, these expectations are everything. Consumers now have seemingly limitless choices and ample information, and costs are low enough to justify switching from one brand to another. Retailers that deliver the information and experience consumers want are best positioned for success.

Timing is everything

Marketing to the segment of one requires knowledge of individual tastes, preferences, and triggers. It also requires the right technology to measure, record, and send data.

When Big Data analytics programs can harness the data, retailers gain an edge. Retailers are leveraging data across channels, precise segmentation, and consumer insights. Retailers can provide the right message through the right channel at the right time. Brand loyalty grows as customers experience products, not just buy them.

Data in action

How are retailers using this data to personalize the shopping experience? There are many examples.

One cosmetics retailer gives consumers ID cards. When a customer shows the card in a store, a salesperson can call up a sales history and customize a conversation based on the consumer’s preferences. Compare that strategy to a scripted sales pitch.

Consider grocery stores that let consumers shop using a phone. The store can keep a record of previous purchases online and suggest shopping lists based on past behavior.

Shopper partnerships with other retailers allow the store to deliver coupons for items in a customer’s cart, and emailed reminders can encourage them to shop again based on the timing of previous trips.

Before the store

How do retailers approach a segment of one?

Personalized marketing uses purchase histories and predictive modeling. Outside the store, loyalty programs track consumer preferences, enabling retailers to deliver offers directly to customers’ devices. Ad campaigns move beyond price points and focus on consumer values.

In the store

At the store itself, the experience changes too. Mobile point-of-sale technologies let smartphones and tablets complete transactions. Retail space once used for large checkout stations can be re-purposed.

Smart screens offer promotions and advertisements at strategic locations. Touchscreens deliver information to consumers browsing or waiting for a salesperson. Smart screens also give consumers information about products they are interested in. Live data about inventory, time of day, and online trends drive promotions.

Shopping cart sensors allow automated carts or carriages to follow consumers at a safe distance. Bluetooth technology connected to apps deliver coupons based on cart contents.

Virtual reality mirrors let consumers see different versions of a product. Makeup applications can be applied virtually, for example, to see which tones work best.

Smart fitting rooms connect to store inventory to determine what’s in stock and suggest available items first. Consumers can “see” how a pair of shoes in the store matches a particular outfit.

New payment methods

Even the checkout experience is changing. Simple swipes have replaced PIN numbers and passwords. Iris scans replace IDs and driver’s licenses.

These technological, data-driven qualities create an experience for consumers that deepens brand loyalty, but they offer major benefits for retailers, too.

Retailer systems shifts

For retailers, the omnichannel era arrived some time ago. It is now going through a change involving data modeling. Data from online sales patterns inform in-store offers. Consumer behavior patterns drive automated and contextual pricing models.

Digital patterns “married into” inventory and financial models of the past. Predictive processes replace office functions. Pricing meets demand in real time. Connected warehouses and inventory systems let sales associates know about shipping schedules and availability.

Vendors with access to real-time data shift production schedules to align with consumer demand. Flexible supply networks let retailers offer “make-to-order” fulfillment options. Inventory spoilage drops.


Collecting consumer data gives retailers an incredible opportunity to offer shoppers customized experiences via new technologies. These segment of one experiences boost brand loyalty with consumers wanting experiences, not just products.

Learn more about digital transformation for retail at Retail. Reimagined for the new economy.


Kristin Howell

About Kristin Howell

Kristin Howell is global vice president within the Retail Industry Business Unit at SAP. She specializes in the areas of business-to-consumer marketing, loyalty management, pricing, promotions, and predictive analytics. Howell has 20 years of technology and retail experience, including leadership roles across management consulting, solution design, product marketing and software development organizations.