The client has changed. This is the observation made by, among others, IBM. An observation that primarily affects mass distribution, forced to adapt to societal changes and counter new entrants, 100% digital, who have almost no barriers to entry to resell products.

More connected, the customer is better informed (sometimes more than the seller himself). He asks that the offers be personalized ("the Mass Market is perceived as an intrusion", analyzes Henri Thouvenin, Big Data director at IBM France) and he no longer hesitates to give certain information, if he considers that the consideration is worth the sadness.

"A customer is no longer shocked when he is congratulated on being the happy father of a 54 cm boy and offered a check for 20 euros", notes Henri Thouvenin. Information that a brand can obtain today by combining different sources of information, such as the list of previous purchases and listening to social networks.

Above all, the customer expresses himself (Tweet, Facebook, Blogs, opinions on the sites) which obliges us to design an offer no longer as a simple product, but as an end-to-end service (going up to the installation and support) or risk receiving negative feedback.

To meet these challenges, Big Blue obviously has its own idea. During a demonstration day, the editor unveiled some of them and returned to the analysis he made of several developments. Developments (and solutions) that could well, according to IBM, disrupt Retail in the next five years.

360° profiling, hyper-personalization and “employee experience”

The challenges for large retailers are therefore of a new kind.

First with 360° profiling, mentioned above... but which does not really exist yet. “Many retailers are still unaware of social networks”, regrets Henri Thouvenin – recalling in passing that IBM has made agreements with Twitter and Facebook.

Then with mobility, which is not fully exploited commercially. “Mobile sales have increased by 50%,” says Mickael Miramond, Retail Director at IBM France, based on an in-house study. “But they still only represent 12% of online sales… a far cry from what you see in markets like the UK.”

Generally, French customers have become accustomed to doing research on their smartphones. But they buy on their tablets and computers.

The personalization of communication is another major aspect of retail transformation. “Customers no longer like being spoken to as if they were a segment. I become a brand lawyer if you interact with me in a personalized way”, analyzes Mickaël Miramond. A Gartner report goes in this direction by pointing out that companies that do personalization (message and offer) would do 30% more business than their competitors.

This personalization is facilitated today by another observation. Customers are less and less reluctant to give personal information.

“We are now ready to spend 20 minutes in store to provide information (Editor’s note: registration for a loyalty program for example) if we know that we are going to have a particular offer in exchange. The customer easily gives his contact details, his email, his mobile number and his Facebook. More and more, he also agrees to share his location”, notes the Retail Director.

Only the medical and financial data still resist… But the latter can be extrapolated from the previous data with statistical methods.

So the data is more and more there. It is still necessary to know how to aggregate and analyze them. Hence a massive move by marketing departments to analytics, Machine Learning and predictive algorithms to draw out the substantial marrow for operational staff: "80% of Retailers today use analytics to have a real 360 vision °”.

In-house, faced with over-informed customers (or who can be informed at a moment's notice with mobile Internet), distributors also find themselves obliged to democratize information by giving tools to their field teams ( smartphones, tablets, home applications) and train them. "The department manager needs to have access to information in real time, the era of the grand master of strategic data in his ivory tower is a thing of the past", summarizes Henri Thouvenin.

Omnichannelality, 360° logistics

The supply chain is no exception to this revolution, which is rooted in the profound transformation of the modern customer, who is increasingly tech-savvy.

“There has to be omnichannel coverage,” continues Mickaël Miramond. This “omnichannel” (support for all supply channels) has several consequences.

It allows you to query stocks, store by store, warehouse by warehouse. Whether from a shop by a seller – to redirect a customer in the event of a product shortage or to bring the reference (or even have it delivered to the home). Or whether by a customer on the Web (to know availability and not to travel for nothing).

"Omni-channel" also helps to better allocate inventory and avoid over-stocking in one channel while orders are unfilled in another - as may be the case when each warehouse/store is independently managed.

More than 30 publishers acquired by IBM in Retail solutions

All these challenges (mobility, 360° profiling, hyper-personalization and “employee experience”) directly concern IT. This explains why the publishers, Big Blue at the head of the gondola, have devoted a very large part of their investments to it.

"Retail is IBM's second largest investment in the world", confirms Henry Thouvenin. “We have spent 45 billion dollars on the acquisition of 130 publishers in recent years. A quarter of them concerned distribution”.

The agreement with Apple also affects this sector. He pushed IBM to completely rethink the UIs of its business apps. “With Apple we were challenged. We used to do lots of screens in our apps. They told us: "if we don't get here in two clicks, it's not good"... and we started again", laughs Mickaël Miramond.

These investments have resulted in several prototypes (PoC) at IBM – some of which are already in production or in advanced testing. PoCs which should, according to IBM, be democratized within five years.

Better store mapping thanks to Wi-Fi and MAC addresses

Among these technical projects by Big Blue, the monitoring of customers at the point of sale (tracking) could well be refined thanks to to the use of smartphone data.

Until now, it was possible to determine customer journeys with cameras placed in the store and with crowd recognition or modeling software. The smartphone makes it possible to refine this method. In two ways.

The first is based on the MAC address of the device. By connecting to Wi-Fi spots, a device declares a set of information, including its unique "license plate" attached to its hardware, which is the MAC (Media Access Control) address.

An administrator can therefore follow a customer – anonymously – from one room to another with this address. Anonymously, because it is not possible, ex-nihilo, to link an identity to this MAC number. On the other hand, it is possible to create a history of the movements and visits of this specific number.

And also

By using this method, a supermarket will therefore be able to analyze the frequency of visits by the owner of a particular phone, as well as their successive visits to the store.

The second innovation consists in linking – with the customer’s agreement and voluntarily – this location to an identity.

This identification can be done in two ways. Either by asking for consent when connecting to the store's hotspot. Or thanks to a dedicated application of the brand.

These technologies will complement the highly publicized beacons, these small terminals that communicate via Bluetooth.

The limit of these advances for mapping a store is that they rely on the fact that the customer's Wi-Fi (or Bluetooth) is "always on". A practice that is not recommended for security (with Bluetooth) or autonomy (for Wi-Fi). IBM nevertheless did its little survey and found that 50% of smartphone owners always leave their Wi-Fi on.

If we look at the glass half empty, we will say that Wi-Fi mapping leaves half of the customers in its blind spot. “We prefer to say that yesterday you had no data at all. And that today you have a more precise follow-up of half of your customers”, answers Odille Peraudin, Business Development Executive Mobile at IBM France.

Data that can then be analyzed – in batch or in real time.

Futuristic? Not really. Because these technologies are already in production in France. IBM refuses to give the names of the brands but today there are about ten stores, in food and specialized distribution, to use these technologies.

Augmented reality at the service of the planogram

Another project: the use of augmented reality, always with a phone or a tablet (IBM does not think that devices such as smart glasses are yet mature ).

Developed by an Israeli company acquired by Big Blue, the solution is already deployed at Tesco to check the realization of its shelves and facilitate restocking.

Planograms meet very specific requirements (number of packages per floor, position, shelving determined to the nearest centimetre, etc.).

Usually, this set-up is done with paper documents that draw each finished gondola. With pattern recognition, the process is greatly accelerated. It allows you to see at a glance if the facing of the shelf corresponds to the planogram. And if not, what modification should be made.

Another advantage, checking the prices of an entire department is done in a few seconds.

And in the middle, the quality of the data

Among the other innovative uses, the publisher is working on the identification of customers when they arrive near a store (still with Wi-Fi -Fi or bluetooth but not GPS, he assures), to push recommendations to sellers or issue coupons in real time (a practice that should also be generalized in stores with tracking techniques). An area in which MicrosStrategy is also positioned with Usher.

But all these solutions, attractive in absolute terms, are ultimately based on actionable data. In other words, on quality, consistent, unique (MDM) and integrated (ETL) data.

This is not always the case with traditional information silos. It is, for example, not uncommon to find price discrepancies between what is advertised on the Internet and what is seen in stores (apart from differentiated pricing strategies, which are also less and less accepted by customers who may check and question these discrepancies).

Henri Thouvenin and Mickael Miramond concede this. “In this kind of project, you first have to understand the business, then propose solutions and then you go down to the underlying issues right up to the infrastructure,” they explain.

This data work, which increases the transformation budget, could be a major drag. It would be nothing. “On the contrary,” replies the director in charge of Big Data at IBM France. “French distributors are also very demanding of this”. And would see it more as a way to kill two birds with one stone.