Multichannel – future of retailing

Multichannel Framework A multi-channel retailer faces a diversity of customer interactions, with customers expecting a seamless experience throughout Learn / Research Order / Choose Purchase / Pay Pickup / Deliver Learn / Install Return / Service Customer visits store to pick up the item  Customer sees a TV in-store      Customer goes to retailers site @ home and purchases item In-Store       Online / Home Customer returns home and decides to buy installation service      Customer checks the internet on iPad to find the best price Online / Mobile      Customer calls to setup repair / cleaning service On the Phone

Recent and future developments of online commerce Clothing, home and electrical transactions, are growingly influenced by online or multiple channels Electricals is most multi-channel, in almost two-thirds of purchases Multi-channel customers spend more than per store only transaction Smartphones, tablets as new and easy to use devices are reinforcing the breakthrough of E-commerce In a recent survey of US mobile device users 70 % have made at least one online purchase during the last 12 months 40% had used their mobile device to buy consumer products at least once One third have used their mobile at least once for grocery shopping related activities in store ? Sources: Deloitte Multichannel survey, 2010; Deloitte 2011 Consumer Food and Product Insights Survey , May 2011, n=705 (Respondents who own smartphones or web-enabled mobile devices)

Recent and future developments of online commerce Critical online capabilities Must-haves, e.g. product assortment and pricing Tickets to the game are capabilities such as order tracking, credit card support, layout and performance Room to grow in globalization, social networking and shopping cart Emerging trends are mobile commerce, and purchasing convenience & security Some capabilities are great opportunities to stand out Source: Deloitte : 2011 eCommerce Assessment: What are digital retail leaders up to

Individuals having ordered/bought goods or services for private use over the Internet in the last three months Source: Eurostat

Nordic countries are in different stages of online adoption Denmark leads the way followed by Sweden and Norway. Finland is a few years behind, but growing fastest Norway buys most (14%) from foreign sites, with Sweden trailing (2%). In Finland payments occur mostly via online banks. Finns are least likely to increase buying. Overall, online purchases between Nordic countries occur mostly from online shops in Sweden, and least from Finland How often do you purchase products from home, e.g. via internet? Source: Posten Norden, HUI [The Swedish Retail Institute], 2010-2011

Sustainability – Primary lens of innovation

Mainstreaming sustainable consumption Sustainability is driving to the heart of business strategy and is the primary lens for innovation Sustainable food production practices increasingly important to consumers Organic private label products and private label families emerge New neighborhood stores with organic, local products - not only luxury of city centers but also entering the suburbs and chain management All major companies and brands need testimonies of their efforts to support sustainability Source: Deloitte survey 2011: Consumer Food and Product Insights

Local challenges global Globalization and concentration will give room for niche-companies also in Nordics as consumers want to have alternatives Local products and production increasingly popular E-commerce of local food develops new supply chains and even; grow your own food, city gardens, buying circles, rent your own field, what next? Green consumers are becoming mainstream and the economic uncertainty is not going to stop them They shop more, often pay more They are more loyal Increased consumer engagement and spending on green products calls for a refreshed marketing and brand strategy to woo the green consumers in the current economic environment

Summary

Future success … it all comes back to the consumer European retailers will become competitors on the Nordic market and our target markets Understanding the consumers new priorities and needs forms the basis for innovations and future competitiveness Being a partner in clients everyday needs and chosen ways of interacting with the retailer Decide what you want to stand for in the mind of the consumer and align everything behind it Use sustainability as a primary lens to drive product and business model innovation Transform how you engage consumers and shoppers in every channel and at every point in the path to purchase

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