Forts de performances économiques et financières toujours plus impressionnantes, les Gafam s’attaquent à de nouvelles frontières.

Les arbres ne montent pas jus- qu’au ciel », selon le vieil adage boursier qui dissuade les investisseurs naïfs de penser que les actions peuvent battre record sur record. Pourtant, la vague de résultats financiers que viennent de publier Apple, Microsoft, Facebook, Amazon et Alphabet, la maison mère de Google, laisse songeur.

Source: Le Soir – Le Figaro

Les cinq géants technologiques américains ont tous affiché des taux de croissance de leurs revenus compris entre 14 et 27 % en 2019 et de confortables profits. Le chiffre d’affaires annuel de Google a dépassé les 161 mil- liards de dollars, celui de Microsoft 125milliards et celui d’Amazon 280,5milliards. Ces performances ont propulsé les capitalisations boursières d’Apple, Amazon et Microsoft à leur plus haut historique. À l’exception de Facebook, tous sont entrés dans le club fermé des 1.000 milliards de dollars de valeur en Bourse.

Screenshot 2020 02 14 at 22 21 10

Si chacun de ces groupes a ses particularités, son domaine d’activité dominant (publicité, e-commerce, smart- phones, etc.), ces résultats valident la puissance de leur modèle économique et de leurs écosystèmes respectifs, qui s’enrichissent et s’étendent avec l’exploitation de la matière brute et précieuse que sont les données. Leur capacité à innover sur un marché, avec des effets de réseaux très importants, et à dégager des marges importantes leur a permis d’investir massivement dans d’autres technologies et de pénétrer de nouveaux domaines.

Screenshot 2020 02 14 at 22 25 09

Un cercle vertueux
Apple a ainsi construit un système d’abonnements à des services de contenus vidéos, de jeux et d’applications aux détenteurs de produits Apple. Google, Amazon et Microsoft multiplient les services aux entreprises basés sur leurs capacités de stockage informatique de leurs données. « Nos investissements dans l’informatique profonde, y compris l’intelligence artificielle, l’informatique ambiante et le cloud computing, fournissent une base solide pour une croissance continue et de nouvelles opportunités à travers Alphabet», a ainsi expliqué le PDG de Google, Sundar Pichai, aux analystes financiers, évoquant ainsi les perspectives futures du groupe. Pour les géants de la tech, un cercle vertueux s’enclenche, que rien jusqu’ici ne semble pouvoir freiner.

Cette puissance financière et commerciale leur donne une certaine maîtrise de la concurrence sur leurs marchés, au travers de rachat de sociétés prometteuses ou de pratiques parfois dénoncées. En début d’année, le fabricant d’enceintes Sonos, qui a attaqué Google pour avoir violé des brevets, ra- contait, exemples à l’appui, comment certains géants utilisaient leur pouvoir de marché pour imposer leurs conditions ou tordre le bras de plus petits compétiteurs. «Aujourd’hui, les groupes dominants ont tellement de pouvoir sur un éventail si large de marchés et profitent tellement de ce pouvoir pour se développer sur de nouveaux marchés que nous avons be- soin de repenser les lois et réglementa- tions existantes», a témoigné Patrick Spence, le PDG de Sonos, lors d’une audition au Congrès américain le 17 janvier.

Fin des tabous
Car l’appétit des Gafam est loin d’être rassasié. Leur hyperpuissance leur per- met aussi de s’attaquer une à une à de nouvelles frontières. Champions dans leur domaine respectif, concurrents sur certaines plates-bandes, alliés
quand leur intérêt l’exige – ils travaillent ensemble à définir un standard de communication commun pour la maison connectée –, tous sont d’ores et déjà concentrés sur des gâteaux en- core plus grands : l’argent, la santé et la sécurité. La réaction vive et mondiale au projet de monnaie numérique Libra annoncé par Facebook en juin dernier a démontré la sensibilité du sujet pour les États, mais aussi qu’aucune frontière n’était plus taboue.

Jusqu’ici, les géants américains de la tech ont rencontré peu d’obstacles à leur expansion. Très présent dans les débats, l’appel à de nouvelles régulations tarde à se traduire dans les faits, aussi bien sur les questions de concurrence que d’éthique. Ces sujets n’ont pas été des thèmes forts de la cam- pagne américaine. Les différents manquements en matière de protection des données n’ont pas détourné les utilisateurs. Les plus importantes sanctions financières prononcées ont été rapide- ment absorbées. Et les multiples en- quêtes en cours peuvent encore prendre des années.
Aucune concurrence n’est aujourd’hui en capacité de les défier, si ce n’est celle d’autres géants technologiques en pleine expansion en Chine. Un chiffon rouge d’ailleurs régulièrement agité par les dirigeants des Gafam à quiconque souhaite les entraver.

FOCUS 1: RETAIL

De son nouvel entrepôt de Brétigny- sur-Orge, Amazon livre ses clients plus rapidement encore. En 24 heures, voire en 12 heures, ils peuvent réceptionner chez eux leurs commandes. Et pour livrer un nombre croissant de consommateurs dans les temps, Amazon ouvrira en mai un nouveau centre de distribution à Senlis, le 23e dans l’Hexagone.

En France comme ailleurs dans le monde, Amazon investit continuelle- ment pour améliorer l’expérience d’achat de ses clients… et conserver une longueur d’avance sur ses concurrents. Cette stratégie porte ses fruits : grâce à la multiplication des centres de stockage autour des métropoles, Amazon a multiplié par quatre, au dernier trimestre 2019, le nombre de ses livraisons en moins de 24 heures et conquis à ce jour
150 millions d’abonnés.

En habituant les consommateurs à être livrés dans ces délais, Amazon crée de nouveaux standards. Il contraint ses concurrents à lui emboîter le pas et à se lancer dans de lourds investissements, sans rentabilité immédiate. L’activité commerce d’Amazon n’est pour l’instant pas rentable en Europe, contrairement aux États-Unis. Lorsque ses clients européens se seront habitués à la livraison rapide, le géant américain relèvera probablement ses prix et parviendra à y gagner de l’argent. Le coût de l’abonnement prime a été relevé de 20 dollars en 2018 aux États-Unis, sans qu’Amazon ne constate d’hémorragie chez ses abonnés.

Un Golden Globe, davantage de chaussures
Mais « Amazon peut se permettre de perdre de l’argent à court terme, sur trois, quatre ou cinq ans, pour en gagner à long terme », explique Julien Dutreuil, associé chez Bartle. Ce luxe n’est pas à la portée de tous les distributeurs physiques, encombrés par de coûteux magasins en durs, et par ailleurs contraints de tenir leurs prix.
Amazon dame aussi le pion à la concurrence en incitant les clients à s’abonner à son offre prime. Lorsque celle-ci a été créée en 2005, le montant de l’abonnement a été fixé pour qu’il soit « engageant » : puisqu’ils paient une somme conséquente, les utilisateurs de prime ont intérêt à recourir largement à Amazon. Et de fait, ils dépensent 130 % de plus que les non-abonnés. Amazon offre désormais à ces clients privilégiés un accès à son catalogue de livres et de films en streaming. « Lorsque nous gagnons un Golden Globe, cela nous aide à vendre plus de chaussures », considère Jeff Bezos. Tout est fait pour que le consommateur vive dans l’écosystème Amazon, sans aller voir ailleurs.
Le livre a été le premier secteur secoué par le géant américain. « Les loisirs, les jouets et l’électronique restent les secteurs les plus touchés », relève la fédération du commerce spécialisé. Les distributeurs traditionnels ont d’abord été pris de court. Ils ont voulu croire que l’essor de l’e-commerce ne représentait pas un danger pour leur activité, avant de se rendre à l’évidence. Aujourd’hui, «ils peuvent tirer parti de leur spécificité, de leur connaissance produits pour conserver leur clientèle », estime Grégoire Beaudry, associé chez Bain.

La partie n’est pas perdue. Malgré l’excellence de l’expérience client d’Amazon, les enseignes physiques restent appréciées des clients. Amazon a été l’enseigne préférée des Français presque sans interruption de 2012 à 2016. L’entreprise est désormais reléguée à la 9e place du classement d’OC&C, tandis que Décathlon, Picard et Grand Frais sont en tête. Amazon lui-même, qui a racheté la chaîne Whole Food Market aux États-Unis et a ouvert des supérettes automatisées Amazon go, croit à l’avenir du magasin…

FOCUS 2: Les Banques

Longtemps redoutée, l’irruption des Gafam dans la banque est en train de devenir une réalité. Amazon serait ainsi sur le point de s’associer à Gold- man Sachs pour proposer aux États- Unis, sur sa plateforme, des prêts aux petites entreprises, selon le Financial Times. Seules les sociétés vendant leurs produits via son site d’e-commerce
pourraient en bénéficier.
Un moyen efficace pour trouver des
clients et limiter les risques, puisque Amazon dispose de beaucoup d’informations financières sur ses fournisseurs. Goldman Sachs, qui veut se dé- ployer dans la banque de détail, a déjà noué un partenariat avec Apple et lancé outre-Atlantique, l’été dernier, l’Apple Card. À l’automne, c’était au tour de Google de dévoiler un projet de compte courant pour les particuliers en 2020, en partenariat avec la banque Citigroup.
Jusqu’à présent, les Gafam ont poussé leurs pions dans le paiement avec des technologies embarquées dans les smartphones de leurs clients. À l’image d’Apple Pay ou de Google Pay, qui permettent de payer dans les commerces avec son téléphone portable. Cette offensive pourrait leur rapporter (ainsi qu’aux start-up de la finance) 280 mil- liards de dollars en 2025, selon une étude d’Accenture.

Nouveau canal de propagation d’une crise financière ?
« Il est logique qu’après le paiement, les géants de la tech se développent dans les services financiers », explique Thierry Mennesson, « partner » chez Oliver Wyman. C’est d’ailleurs ce qu’ont fait les géants chinois de la tech comme Tencent (avec WeChat Pay) ou Alibaba (Alipay), qui proposent désormais, en plus du paiement, de l’épargne ou du crédit à la consommation. «Ces groupes cherchent à entretenir une relation de plus en plus profonde avec leurs clients. Leur objectif est de récupérer leurs données sur les revenus, les dépenses ou les enseignes préférées, et de les monétiser », ajoute Thierry Mennesson.
Parce que s’attaquer au marché bancaire très réglementé est lourd aux États-Unis ou en Europe, les Gafam contournent – pour l’heure – l’obstacle en nouant de nouveaux types de partenariats avec des banques. Certains de ces établissements financiers sont peu présents dans la banque de détail, à l’image de Goldman Sachs. D’autres au contraire seraient prêts à se positionner comme fournisseurs de produits financiers à grande échelle. En prenant le risque de voir leurs offres cannibalisées par celle des géants de la tech.

« Les Gafam sont une menace très si- gnificative pour les banques aujour- d’hui », estime Bruno de Saint-Florent, associé chez Oliver Wyman. Une me- nace prise très au sérieux par les pou- voirs publics. En décembre, un rapport du Conseil de stabilité financière (FSB), émanant du G20, estimait que l’arrivée de ces nouveaux acteurs faisait peser un risque sur la stabilité du système financier. Le G20 s’inquiétait surtout du nouveau canal de propagation d’une crise financière.

How Aldi boosted retail traffic while reducing its flyer drops (‘Most effective use of Mobile’ / DADI Awards 2019 / Havas Media Group Danemark)

Havas Media Group won the ‘Most effective use of Mobile’ category at The DADI Awards 2019 with its ‘GPS data/customer mapping’ campaign for Aldi. Here, the agency reveals the challenges faced and the strategies used to deliver this successful project.

The challenge

In Denmark, the distribution of flyers was poised to be taken over by one single company, creating a monopolistic situation that would inevitably translate itself into a steep price increase, calculations put the increase at 40%.

source: https://www.thedrum.com/news/2019/12/17/how-aldi-boosted-retail-traffic-while-reducing-its-flyer-drops

Seeing that flyer distribution was a massive operation in which Aldi was ‘carpet flyering’ (dropping a flyer in every household in any given neighbourhood) in every city where there was an Aldi supermaket without any regard to targeting, the 40% increase would not be sustainable. Moreover, a recent survey in the country revealed that more than 80% of Danes don’t read Aldi’s weekly printed leaflet.

Closing the Flyer distribution operation was out of the question because despite a low share of readers, sales modelling demonstrated a positive ROI for Aldi and other discount / retail chains, despite the low share of readers.

Taking all of this into consideration, we came to the conclusion that we needed to develop a much more intelligent and cost reduced way to distribute our flyers, we needed to find a way to distribute the flyers in areas where we knew they would convert in business for Aldi, where people would read them and use them, we needed to pinpoint and target our distribution.

Moreover, we also needed to move Aldi into the 21st century with a digital flyer that would attract younger readers, reducing their dependence on printed flyers.

The strategy

We used data and technology to provide insight to optimize the distribution model for printed retail flyers. This optimization would in turn allow us to reinvest savings into the production of a digital flyer and its subsequent promotion.

This strategy would allow us to intelligently reduce the distribution of leaflets in areas with low or no potential/customers, or ad new area if relevant for each of the individual shops. The idea was to match the distribution area with the actual Aldi customers.

With the savings from reducing the printed leaflets, we initiated a digital transformation for Aldi to give them an online presence – specifically against a younger and more connected target group.

Along with increasing the number of digital readers, the online presence also had the objective of raising Aldi’s general awareness levels, and thereby also increase the number of readers of the printed version.

The campaign

We started by digitally mapping customers that shopped at each of Aldi’s 189 stores with the help of geo-data. We did this by using mobile app-data from those customers. Once they were mapped pinpointed where they lived thanks to a key insight: their night-time location – if you remained on the same location from 02-04 am, chances where that you were sleeping at home.

We were able to pinpoint where our customers lived, including at the granular level of distances from their closest ALDI Shops: :

Before the operation, the number of flyers that where being distributed numbered 1,227,656. In Q2 we reduced flyers by 310 000, this had such a minimal impact on sales that we could not really link it to the operation. In Q3, with the knowledge, experience and evaluation from the first reduction we applied a second reduction plan (we eliminated 175K) now bringing the distribution down to 742,922 households.

With close to a 50 % reduction in flyering compared to the previous year, some stores did however experience reduced turnover, so after a detailed evaluation of every single shop, including a competitive analysis and other local influential factors, the distribution was raised to approx. 860,087.

We also developed all digital assets for the digital flyer – And launched it all the while updating and optimizing products, visuals, animations etc. on a weekly basis.

The results

  • We dropped the number of flyers being distributed from 1,227,656 to 860,087, a 33% reduction.
  • We saved ALDI a significant amount of distribution budget.
  • The number of readers of the printed flyers increased for the first time in four years by 4.9%.
  • The number of readers of the digital version of ALDI’s leaflet increased by 24.1 pct. (9.1 pct. point above target/objective, 60 pct. above target).

Additionally, we managed to reach a totally new segment thanks to the digitalization of the flyer: a much more modern, younger, urban family segment that spends more than the traditional Aldi customer. In this process it instantly became very clear that urban areas had a much higher performance, when being targeted with Aldi’s digital leaflet.

This project was a winner at The DADIs 2019.

Retailers will demand practical examples of AI (Author: Kurt Heinemann)

By Kurt Heinemann, CMO, Reflektion

source: https://www.retailcustomerexperience.com/blogs/4-trends-retailers-should-be-prepared-for-this-year/

2017 was transformative for the retail industry. Brands that have been household names for decades closed their doors or filed for bankruptcy at a time when pure play e-commerce newcomers entered into the fray and found immense value in opening up their own physical stores.

The term “retail apocalypse” also became ubiquitous, and artificial intelligence was once again touted as everything from the savior of retail to the reason civilization will collapse.

As we hit mid year, some of these factors will influence what we expect will become important retail trends in 2018 and beyond.

Individualization will go from buzzword to urgent initiative

Apps and other cutting-edge technologies have engaged shoppers on a personal level for years. Comparatively, retailers have lagged behind. The cost for retailers is not only revenue, but also a widened gap between what they deliver and what consumers expect.

At the same time, individualization is increasingly expected. Whereas segmentation sought to lump individuals into segments (e.g. by age or gender) and engage accordingly, and personalization sought to get the right content to the right user, individualization seeks to understand the user and their context. It’s one thing to know a customer likes button ups, but displaying these when they’re shopping for their trip to the Bahamas isn’t helpful. The technology exists, as does the customer expectation, and the proof of greater revenue is clear; retailers have no excuse but to adapt and offer individualized experiences.

To succeed, retailers must embrace omnichannel. This means fully understanding the moment-to-moment experiences of the customer journey, and beginning to replace the segmentation they’re comfortable with for the individualization customers demand.

Retailers will demand practical examples of AI

ai-in-retail-key-themes-aug-2017-final-21-638

One of the most important factors is retailers’ interest in AI, which peaked in 2017. In fact, a Forrester study from last year found that more than half (51 percent) of brands are implementing, have implemented, or are expanding their use of AI.

In the emerging technology hype cycle of 2018, we will discover whether or not artificial intelligence is at the peak of inflated expectations, the slope of enlightenment, or both. We’ll also learn if the available AI-powered solutions are blowing smoke or actually solving retailers’ personalization challenges.

We can expect that the companies shouting the loudest about AI will be forced by retailers to put up or shut up. They’ll need to show accessible and transparent examples of how AI is driving revenue, stronger customer engagement, and better customer experiences on-site and off.

For many reasons, this is why practical AI — i.e. the valuable application of intelligence rendered by machines and rooted in present-day use cases — is so important; it breaks free from the fun-to-discuss future manifestations to offer an immediate look at what can help the public (including consumers and vendors) right now.

The battle between Amazon and Walmart will continue

Throughout this year, both retailers will continue to play their advantages and likely acquire more companies — or expand in new ways — that shore up gaps in their weaknesses.

Take for instance, the spread of Amazon Go. With the wealth of customer data Amazon has access to, Amazon is able to provide a fully integrated and engaging experience for the customer — engaging them online, offline and in-person using this data. Other retailers should take note and ask themselves questions rooted around the customer experience — such as “what other customer pain points exist?” and “how can I try to solve them?” To get to this point, retailers will need to think empathetically from the perspective of their customers. Collecting customer data will be invaluable to this process.

Similarly, we also expect that both behemoths will redefine the concept of an all-encompassing department store in the digital era, and in doing so, they’ll set new customer experience bars that retailers will be forced to compete with. These changes won’t happen in silos. Every punch the other retailer throws will ripple through the entire industry. Instead of just tuning in, retailers should be taking notes.

Direct-to-consumer strategies will insulate established brands and launch new capabilities

Department stores will likely continue to close retail locations in 2018 and beyond. Most recently Toys R Us announced plans to shutter all stores — causing established brands to quickly realize they need more direct relationships with customers to protect themselves from the potential lost revenue of closed stores.

This desire for retailers to own more of their destiny by not building their house on fragile land will cause the industry to invest heavily in direct-to-consumer strategies. This will drive customer engagement innovation and will continue to upset the brand/wholesale relationship.

At the same time, we expect new direct-to-consumer brands to launch, which will only further disrupt the retail industry. Brands entering the space, such as Allbirds, Casper, Warby Parker and others, will disrupt retail brand verticals through their unique product offerings and expanded footprint of well-executed stores.

In this highly digital and social-media driven product world, this new era of brands will continue to redefine both what it means to be a consumer brand and how brick-and-mortar stores should operate.

Retail Revolution: Inside Amazon Go, a Store of the Future

The technology inside Amazon’s new convenience store, opening Monday in downtown Seattle, enables a shopping experience like no other — including no checkout lines.

Source: https://www.nytimes.com/2018/01/21/technology/inside-amazon-go-a-store-of-the-future.html?partner=IFTTT
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A row of gates guards the entrance to Amazon Go.CreditKyle Johnson for The New York Times

SEATTLE — The first clue that there’s something unusual about Amazon’s store of the future hits you right at the front door. It feels as if you are entering a subway station. A row of gates guard the entrance to the store, known as Amazon Go, allowing in only people with the store’s smartphone app.

Inside is an 1,800-square foot mini-market packed with shelves of food that you can find in a lot of other convenience stores — soda, potato chips, ketchup. It also has some food usually found at Whole Foods, the supermarket chain that Amazon owns.

But the technology that is also inside, mostly tucked away out of sight, enables a shopping experience like no other. There are no cashiers or registers anywhere. Shoppers leave the store through those same gates, without pausing to pull out a credit card. Their Amazon account automatically gets charged for what they take out the door.

On Monday, the store will open to the public for the first time. Gianna Puerini, the executive in charge of Amazon Go, recently gave tours of the store, in downtown Seattle. This is a look at what shoppers will encounter.

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CreditKyle Johnson for The New York Times
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CreditKyle Johnson for The New York Times
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There is no need for a shopping cart. Products can go straight into a shopping bag.CreditKyle Johnson for The New York Times

There are no shopping carts or baskets inside Amazon Go. Since the checkout process is automated, what would be the point of them anyway? Instead, customers put items directly into the shopping bag they’ll walk out with.

Every time customers grab an item off a shelf, Amazon says the product is automatically put into the shopping cart of their online account. If customers put the item back on the shelf, Amazon removes it from their virtual basket.

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The only sign of the technology that makes this possible floats above the store shelves — arrays of small cameras, hundreds of them throughout the store. Amazon won’t say much about how the system works, other than to say it involves sophisticated computer vision and machine learning software. Translation: Amazon’s technology can see and identify every item in the store, without attaching a special chip to every can of soup and bag of trail mix.

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CreditKyle Johnson for The New York Times

There were a little over 3.5 million cashiers in the United States in 2016 — and some of their jobs may be in jeopardy if the technology behind Amazon Go eventually spreads. For now, Amazon says its technology simply changes the role of employees — the same way it describes the impact of automation on its warehouse workers.

“We’ve just put associates on different kinds of tasks where we think it adds to the customer experience,” Ms. Puerini said.

Those tasks include restocking shelves and helping customers troubleshoot any technical problems. Store employees mill about ready to help customers find items, and there is a kitchen next door with chefs preparing meals for sale in the store. Because there are no cashiers, an employee sits in the wine and beer section of the store, checking I.D.s before customers can take alcohol off the shelves.

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CreditKyle Johnson for The New York Times
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CreditKyle Johnson for The New York Times
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CreditKyle Johnson for The New York Times

Most people who spend any time in a supermarket understand how vexing the checkout process can be, with clogged lines for cashiers and customers who fumble with self-checkout kiosks.

At Amazon Go, checking out feels like — there’s no other way to put it — shoplifting. It is only a few minutes after walking out of the store, when Amazon sends an electronic receipt for purchases, that the feeling goes away.

Actual shoplifting is not easy at Amazon Go. With permission from Amazon, I tried to trick the store’s camera system by wrapping a shopping bag around a $4.35 four-pack of vanilla soda while it was still on a shelf, tucking it under my arm and walking out of the store. Amazon charged me for it.

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CreditKyle Johnson for The New York Times
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CreditKyle Johnson for The New York Times

A big unanswered question is where Amazon plans to take the technology. It won’t say whether it plans to open more Amazon Go stores, or leave this as a one-of-a-kind novelty. A more intriguing possibility is that it could use the technology inside Whole Foods stores, though Ms. Puerini said Amazon has “no plans” to do so.

There’s even speculation that Amazon could sell the system to other retailers, much as it sells its cloud computing services to other companies. For now, visitors to Amazon Go may want to watch their purchases: Without a register staring them in the face at checkout, it’s easy to overspend.

Nick Wingfield is a technology correspondent based in Seattle. He covers Amazon, Microsoft and emerging technologies and has written on technology’s impact on economies in the Pacific Northwest. He was previously a reporter at The Wall Street Journal. @nickwingfield

A version of this article appears in print on , on Page B1 of the New York edition with the headline: Inside Amazon’s Store of the Future. Order Reprints | Today’s Paper | Subscribe

Americans go to buy products from Amazon before Google online (Business Insider)

Source: Americans go to buy products from Amazon before Google online: CHART – Business Insider

If you’re an American buying a product online, you’re probably going through Amazon.

Online marketplaces, a category that includes everything from eBay to Amazon, are the first stop for 38% of online shoppers in the US when they search for a product, according to a recent UPS survey charted for us by Statista. And Amazon itself is by far the most popular such destination, with 29% of the 5,000 shoppers surveyed heading to Amazon first.

That’s nearly twice as many as those who use search engines like Google, and equal to the total number of those who said they use specific retailers’ various channels.

The figure is yet another reminder of how much of a necessity Amazon, a  data-drivencompany, is becoming for companies who want their products to reach consumers.

That growing dependence creates a convenient all-in-one marketplace for consumers, but given Amazon’s ability to make and heavily promote its own versions of popular products, the ongoing shift toward online shopping, the ever-increasing number of Amazon Prime members, and Prime members’ tendency to only shop on Amazon, it’s also raised questions of how healthy the trend would be for consumers if it were to keep up in the coming years.

COTD_7.6

 Here’s How 5 Tech Giants Make Their Billions – Alphabet & Facebook: Advertising

Source: Chart: Here’s How 5 Tech Giants Make Their Billions

on May 12, 2017 at 1:03 pm

Chart: How 5 Tech Giants Make Their Billions

The Revenue Streams of the Five Largest Tech Companies

The Chart of the Week is a weekly Visual Capitalist feature on Fridays.

Last year, we published a chart showing that tech companies have displaced traditional blue chip companies like Exxon Mobil and Walmart as the most valuable companies in the world.

Here are the latest market valuations for those same five companies:

Rank Company Market Cap (Billions, as of May 11, 2017) Primary Revenue Driver
#1 Apple $804 Hardware
#2 Alphabet $651 Advertising
#3 Microsoft $536 Software
#4 Amazon $455 Online Retail
#5 Facebook $434 Advertising
TOTAL $2,880

Together, they are worth $2.9 trillion in market capitalization – and they combined in FY2016 for revenues of $555 billion with a $94 billion bottom line.

BRINGING HOME THE BACON?

Despite all being at the top of the stock market food chain, the companies are at very different stages.

In 2016, Apple experienced its first annual revenue decline since 2001, but the company brought home a profit equal to that of all other four companies combined.

On the other hand, Amazon is becoming a revenue machine with very little margin, while Facebook generates 5x more profit despite far smaller top line numbers.

Company 2016 Revenue (Billions) 2016 Net Income (Billions) Margin
Apple $216 $46 21%
Alphabet $90 $19 21%
Microsoft $85 $17 20%
Amazon $136 $2 2%
Facebook $28 $10 36%

HOW THEY MAKE THEIR BILLIONS

Each of these companies is pretty unique in how they generate revenue, though there is some overlap:

  • Facebook and Alphabet each make the vast majority of their revenues from advertising (97% and 88%, respectively)
  • Apple makes 63% of their revenue from the iPhone, and another 21% coming from the iPad and Mac lines
  • Amazon makes 90% from its “Product” and “Media” categories, and 9% from AWS
  • Microsoft is diverse: Office (28%), servers (22%), Xbox (11%), Windows (9%), ads (7%), Surface (5%), and other (18%)

Lastly, for fun, what if we added all these companies’ revenues together, and categorized them by source?

Category 2016 Revenue (Millions) % Total Description
Hardware $197,020 36% iPhone, iPad, Mac, Xbox, Surface
Online Retail $122,205 22% Amazon (Product and Media Categories)
Advertising $112,366 20% Google, Facebook, YouTube, Bing ads
Software $31,692 6% Office, Windows
Cloud/Server $31,396 6% AWS, Microsoft Server, Azure
Other $60,177 11% Consulting, other services (iTunes, Google Play), etc.
$554,856 100%

Note: this isn’t perfect. As an example, Amazon’s fast-growing advertising business gets lumped into their “Other” category.

Hardware, e-commerce, and and advertising make up 76% of all revenues.

Meanwhile, software isn’t the cash cow it used to be, but it does help serve as a means to an end for some companies. For example, Android doesn’t generate any revenue directly, but it does allow more users to buy apps in the Play Store and to search Google via their mobile devices. Likewise, Apple bundles in operating systems with each hardware purchase.

The Future of Data Analytics for Retail

Source: The Future of Data Analytics for Retail

Late last year, Amazon premiered a system that may well be the future of shopping. Nicknamed Amazon Go, it looks just like a regular brick and mortar store, except there are no lines, no self-checking machines, and no cashiers. The items you buy are checked by sensors, your account is charged through your mobile Amazon Go app, and you can just walk out of the store whenever you please.

Amazon Go is a revolutionary spin on retail, commerce, and the experience of going to a store. What’s really special about Amazon Go, however, is what it represents in terms of data.

All across the retail universe, the rapidly widening Internet of Things is becoming equipped for high-frequency event analytics. Across the board, that means faster decision-making, more helpful data, and smarter, more cost-efficient businesses.

The Future of Data Analytics for RetailCLICK TO TWEET

Retail and event-driven analytics

The “event-driven” company, according to VC Tom Tunguz, is one that consumes events as they occur, in real-time, from whatever data sources are available.

Rather than record data manually—making all your data liable to corruption—event-driven companies have set up the pipelines they need to always be collecting up-to-date, quality information.
event-driven saas

(Source: Tom Tunguz)

The first stage in this process—“events occur”—is the most important one to consider in the retail context.

On a website, those events are fairly easy to understand. They might be clicks, button-presses, or scrolling behavior. We’ve been trained to think about the web in terms of events—not so with brick and mortar. And yet, the amount of events that could conceivably be collected as data from a single retail experience is tremendous.

When people enter the store, what items they pick up, which they take with them and which they put down, what order they shop in, even how they navigate the store down to the most infinitesimal of details—all of this is information that could help companies increase revenues, lower costs, and build more efficient businesses. That’s also just the front-end of the retail experience.

The new retail Nervous System

The Internet of Things has spread rapidly up and down the production supply chain, laying the foundation for the future of retail.

RFID chips on products allow companies to track their inventory with an unprecedented degree of precision, even as their shipments rattle around in shipping containers, cargo ships move in and out of port, and trucks travel across the country.

Companies like Flexport make it possible to manage and visualize those complex supply chains, many of which were barely even digitized years ago. Others help optimize last-mile delivery, manage the capacities of warehouses, and plan out routes for truck drivers bringing goods to market.

In stores, the same tags that help track goods as they move around the world can be used to optimize pricing given alterations in local conditions or sudden surges of demand.

This network of physical/digital infrastructure is just the substratum, however, of the true analytics-enabled future of retail.

When data analytics meets retail

Event data is the foundation of all behavioral analytics.

When you’re tracking every discrete click, scroll, or other web action, you can start to look for patterns in the data that you’re collecting. You can see which pieces of content on your blog engage the most users, which version of your checkout flow is the best for conversions, and so on.

There’s already technology out there to help investors like those at CircleUp analyze data around small businesses and predict those that will succeed based on a large corpus of historical data.

With the infrastructure of the Internet of Things in place, the same kind of analysis becomes possible on a physical scale. You can start to find patterns in what people buy, when people order, and how to build a more efficient goods-delivery system.

The possibilities are extensive and powerful. In Amazon’s concept store, you can easily imagine sensors that take notice whenever your gaze rests on a particular item for longer than usual, or when you pick something up only to put it back down afterwards.

The decision to not purchase an item would be just as important for Amazon’s recommendation engine as a confirmed sale—that data could even be fed back to the supplier for their marketing team to analyze the lost sale. Visual recognition systems could be used to show you an ad in the evening for that dress you were eyeing at the store in the afternoon.

That’s just scratching the surface of an extensive universe of possibilities. Already today, IoT-enabled retail is allowing companies to:

  • identify fraud before anyone from Loss Prevention even notices it’s happening
  • systematically reduce shrinkage by analyzing exactly where it’s coming from
  • give estimated delivery times in as small as 10-minute windows

A few years ago, Amazon patented the idea of “anticipatory shipping”—moving goods around based on their predictive analysis of likely consumer behavior. Because of your history, in other words, Amazon could predict that you were about to order a pack of toilet paper—and make sure it was in stock at the closest distributor well before you even clicked on the order button.

In the retail world of the future, innovations like these won’t be cutting-edge. In the age of data analytics, they’ll be little more than table stakes.

The data analytics long tail

The free flow of event data in retail depends on the proliferation of data sources. The more sources of data that can be cross-referenced, the more patterns that can be found and the more intelligence that can be produced.

Fortunately, the retail space is in a great position for data sources. There are not only a massive number of in-store sources of data, from sensors to registers to RFID tags, but there are complementary online sources as well.

big data sources

(Source: IBM)

For businesses that exist only as brick and mortar, the proliferation of IoT components and data analysis will mean a massive step forward in terms of business intelligence.

For those that are both brick and mortar stores and online, the confluence of the IoT and traditional behavioral analytics will mean an unprecedented wealth of data and an unprecedented set of options for customer engagement.

For those of us who have thrown in our lot with data, it is an exciting and fascinating time to be around.

Omnichannel – The more channels customers use, the more valuable they are (source: HBR)

Source: A Study of 46,000 Shoppers Shows That Omnichannel Retailing Works

Traditional retailers are feeling the heat. Even as competition intensifies, shoppers’ visits to retail stores are declining every year, leading one industry veteran to ominously ask his peers, “Is anyone not seeing large traffic declines?”

Online retail, on the other hand, is thriving. Retail sales through digital channels (including mobile sales) increased by a massive 23% in 2015. Much of these gains have gone to online retailers. Amazon is the biggest beneficiary, now accounting for 26% of all online retail sales. What is more, as it continues to expand aggressively into new categories like grocery and fashion, Amazon’s existential threat to traditional retailers is greater than ever. Just ask Alexa.

Omnichannel strategy is a panacea for a difficult environment

Under these hostile conditions, traditional retailers have staked their futures on omnichannel retailing. The omnichannel strategy hinges on the idea that providing a seamless shopping experience in brick-and-mortar stores and through a variety of digital channels not only differentiates retailers from their peers, but also gives them a competitive edge over online-only retailers by leveraging their store assets.

Such thinking assumes that despite its costs, there is significant economic value to be gained from providing digital channels to traditional store shoppers, and fusing the shopping experience across channels. Retailers are counting on an omnichannel strategy to be their “killer app.” But is this true? Are omnichannel shoppers more valuable to retailers?

We set out to answer this question by collaborating with a major U.S. company, which operates hundreds of retail stores across the country. We studied the shopping behavior of just over 46,000 customers who made a purchase during the 14-month period from June 2015 to August 2016. Customers were asked about every aspect of their shopping journey with the retailer, focusing on which channels they used and why. And they were also asked to evaluate their shopping experience. Of the study participants, only 7% were online-only shoppers and 20% were store-only shoppers. The remaining majority, or 73%, used multiple channels during their shopping journey. We call them omnichannel customers.

Omnichannel customers are avid users of retailer touchpoints

Our findings showed that omnichannel customers loved using the retailer’s touchpoints, in all sorts of combinations and places. Not only did they use smartphone apps to compare prices or download a coupon, but they were also avid users of in-store digital tools such as an interactive catalog, a price-checker, or a tablet. They bought online and picked-up in store, or bought in the store and got their purchases shipped.  In what follows, we count each app, digital tool, and shopping venue provided by the retailer as a separate channel. 

The more channels customers use, the more valuable they are

Our study’s results are revealing. They show that the retailer’s omnichannel customers are more valuable on multiple counts. After controlling for shopping experience, they spent an average of 4% more on every shopping occasion in the store and 10% more online than single-channel customers. Even more compelling, with every additional channel they used, the shoppers spent more money in the store. For example, customers who used 4+ channels spent 9% more in the store, on average, when compared to those who used just one channel.

Surprisingly, conducting prior online research on the retailer’s own site or sites of other retailers led to 13% greater in-store spending among omnichannel shoppers. This finding goes against the grain of the conventional wisdom that spur-of-the-moment, impulsive shopping bulks up the topline of traditional retailers. Instead, our findings suggest that deliberate searching beforehand led customers to greater in-store purchases. And it also flies in the face of conventional thinking about showrooming, which is that traditional shoppers conduct their research in the store and then buy online. Instead, we find that this retailer’s omnichannel shoppers are engaging in webrooming behavior, which has become especially prevalent among Millennial shoppers.

In addition to having bigger shopping baskets, omnichannel shoppers were also more loyal. Within six months after an omnichannel shopping experience, these customers had logged 23% more repeat shopping trips to the retailer’s stores and were more likely to recommend the brand to family and friends than those who used a single channel.

There is one important caveat to our findings. The correlations we report here shouldn’t be confused with causation. We can say from our study that omnichannel shoppers are more valuable to the retailer with confidence. But whether such customers were loyal and engaged with the retailer to begin with or whether the richer, multi-touchpoint shopping experiences of its omnichannels led them to spend, return, and advocate more remains an open question. Regardless, our study firmly endorses traditional retailers’ logic of embracing an omnichannel strategy and using it as a differentiator to fight the online retail onslaught.

In today’s channel-rich environment, omnichannel capabilities drive the engagement of core shoppers with the retail brand and ultimately draw them to the physical store. Traditional retailers with physical stores will do better not only by leveraging the power of the online world, but by synchronizing the physical and the digital worlds to provide shoppers with a seamless, multi-channel experience that online pure plays simply cannot match.


Emma Sopadjieva is a research and analytics manager at Medallia, a global provider of SaaS-based customer experience management systems.


Utpal M. Dholakia is the George R. Brown Professor of Marketing at Rice University’s Jesse H. Jones Graduate School of Business.


Beth Benjamin is senior director of research at Medallia, a global provider of customer experience management software. She applies organizational science to real-world problems, helping companies to adapt to the challenges of growth and market change.

Comment le Big Data a envahi les hypermarchés, High tech

Source: Comment le Big Data a envahi les hypermarchés, High tech

Les grandes enseignes multiplient les expérimentations entre rachats de start-up et créations d’incubateurs. De nombreuses start-up de la tech se spécialisent dans l’analyse de données pour les hypermarchés.

Carte de fidélité, paiement mobile, chariot connecté… Souriez, vous êtes fichés ! Depuis toujours, les hypermarchés collectent et traitent des données. Mais aujourd’hui, celles qu’ils recueillent sur les consommateurs sont de plus en plus précises et leur analyse devient une arme stratégique majeure pour donner la réplique aux Amazon et autres géants de l’e-commerce dont, on leur annonce tous les jours qu’ils vont leur tailler des croupières.

C’est évident : l’avenir des hypers passe par le Big Data (mégadonnées). « Amazon vient concurrencer Auchan et Carrefour avec de nouvelles armes, comme le traitement des données, que ces enseignes traditionnelles doivent s’approprier », clame Yves Marin, directeur chez Wavestone.

Campagnes publicitaires plus efficaces

La route est longue. Un seul chiffre : l’américain Walmart, numéro un mondial de la distribution, a généré l’an dernier un chiffre d’affaires de 13,7 milliards de dollars sur Internet, contre… 107 milliards pour Amazon, dont l’un des points forts réside aussi dans son système de recommandation. Ce n’est pas pour rien que Walmart a annoncé mardi mettre 3 milliards de dollars sur la table pour racheter Jet.com , un concurrent de la firme de Jeff Bezos.

La grande distribution a commencé à se mettre au pas. Les expérimentations se multiplient : rachats de start-up, créations d’incubateurs ou investissements en matériels et logiciels… Walmart s’est ainsi offert la société Kosmix pour monter sa propre infrastructure d’étude en temps réel des données.

Auchan Retail Data, l’entité du français Auchan qui gère les données, a quadruplé ses effectifs en un an (40 personnes). « La nouveauté avec le Big Data, c’est que l’on peut personnaliser la relation client à une très grande échelle. Avant, on s’adressait à un segment de clientèle. On est aujourd’hui dans une relation de one-to-one grâce aux capacités de calcul », affirme Olivier Girard, son directeur. Ainsi les bons de réduction susceptibles de vous faire craquer arrivent par miracle sur votre page de navigation et dans votre boîte aux lettres ou mails. Les campagnes publicitaires deviennent plus efficaces. « On constate jusqu’à 40 % d’augmentation des ventes avec notre régie Imédiacenter », note-t-il.

Un terrain fertile pour les start-up

Certains, comme Leclerc font appel à des « data scientists », très en vogue chez les géants du Web. L’enseigne fait aussi appel aux start-up, sans forcément les racheter. « Il suffit qu’un acteur de type Amazon sorte une innovation pour que des technologies qui ont à peine quelques mois deviennent obsolètes. Dans ce cadre, investir ses propres billes à long terme est une prise de risques beaucoup trop importante ! » justifiait l’an dernier Michel-Edouard Leclerc, patron du groupe, dans « L’Usine digitale ».

Des jeunes pousses ont ainsi fleuri dans des domaines très pointus. « Il n’y avait aucun moyen de mettre en relation les données d’une personne à la fois cliente en magasin et en ligne. Notre société est capable de les associer pour améliorer les interactions avec les clients », explique Vihan Sharma, directeur général de Liveramp, une entreprise américaine qui a Carrefour pour client et qui s’est lancée dans l’Hexagone il y a un an. Elle traite 20 milliards de profils par mois environ en France, au Royaume-Uni et aux Etats-Unis.

« Le temps, c’est de l’argent »

A terme se profile la possibilité de monétiser les données aux clients : c’est déjà une source essentielle de revenus chez Cdiscount. C’est un enjeu pour les grandes surfaces. Pour l’heure, elles cherchent surtout à affiner le data. « Auchan commence à utiliser des données issues de l’open data, c’est-à-dire celles ouvertes et accessibles à tous sur Internet comme la météo et le trafic routier », pointe Olivier Girard. Quant aux données des réseaux sociaux : « Nous les utilisons peu par peur de se disperser. Ce n’est pas notre priorité aujourd’hui. » Le temps, c’est de l’argent.

« La clef est de nous adapter au gros volume de données qui va nous arriver. Il faut être sûr que ce ne soit pas une source de perte de temps et d’inintelligence, expliquait récemment Georges Plassat, PDG de Carrefour, au Salon Viva Technology. « Nous évoluons vers une manière plus prédictive de servir le consommateur mais honnêtement si nos clients ont besoin, dans le futur, d’un indicateur sur leur réfrigérateur indiquant qu’ils ont besoin de lait, il faut que l’on s’inquiète. »
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