1. Technology, Disruption & The Digital Enterprise
What Does it Mean for the Retail Industry?
David Cox – Digital Futurist

2. Basic Principles

3. We Are Rapidly Approaching a 5th Industrial Revolution
Steam, Water, Mechanical Production
Division of Labor, Electricity, Mass Production
Electronics, IT, Automation
Blurring the Lines Between Physical & Digital
Artificial Intelligence, Exponential Growth in Compute
18th Century
19th/20th Century
20th Century
Early 21st Century
Mid 21st Century
Rate of Technological Change
We Live in a More Connected World

4. New Technologies – Changing the Way We Work & Play
Machine Learning
Bots
Internet of Things
Virtual Reality
Unified Communication
Cloud
Personalization & Customer Intimacy
Digital Assistants
Sensing & Tracking
Richer Experiences
Increased Productivity & Collaboration
Level Playing
Field
Fundamentally Changing the Rules of the Game

5. New World – New Enterprise – New Expectations
Connected
Collaborative
Insightful
Mobile
Digital Employee
Digital Enterprise
Digital Operations
Digital Consumer
Lean
Agile
Adaptive
Elastic
Empowered
Informed
Impatient
Connected
Virtual, Flat, Datacentric
Digital Distribution
Digital Products
Faster
Cheaper
Automated
Wearable
Fashionable
Personal

6. New Markets – Massive Disruption
New Trends Emerge
Innovative Start-Ups Create Disruptive Business Models
Early Adopters start embracing the new models
Advanced Incumbents start adapting to the new model
Mainstream Customers Adopt
Laggard incumbents die
Tipping Point
Advanced Incumbents and established start-ups constitute the new normal
Margin Compression
Flow of Value to adjacent industries
Industry revenue rapidly compressing and shifting away from incumbents
Digital Media
Consumer/Retail
Retail Banking
Traditional Media
Time
Herald Tribune absorbed by NY Times
Macy’s displaced by Amazon
Blockbuster displaced by Netflix
Banks displaced by Google?
Digital Predators are Everywhere

7. Flourishing in the Digital Jungle
PRISM FY16
5/21/2018 9:27 PM
Flourishing in the Digital Jungle
Leadership Capability
Digital Capability
Source: MIT/Sloan “How digital leaders outperform their peers in every industry”
FASHIONISTAS
Revenue: +6%
Profitability: -11%
Market Value: -12%
DIGITAL MASTERS
Revenue: +9%
Profitability: +26%
Market Value: +12%
Revenue: -4%
Market Value: -7%
BEGINNER
Revenue: -10%
Profitability: +9%
Market Value: +7%
CONSERVATIVE
+9%
Revenue Creation
+12%
Market Valuation
+26%
Profitability
Digital business transformation to date has largely focused on operational efficiency. The potential is much greater. Gartner defines digital business “the creation of new business designs by blurring the digital and physical worlds.” ( Digital business leaders are now thinking about how they will reinvent their vision based on technology. And when companies fully embrace technology as a way to transform their business, they outperform their peers in every industry.
How Do You Become a Digital Master?
© 2014 Microsoft Corporation. All rights reserved. MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS PRESENTATION.

8. Developing a Winning Digital Strategy
Well Protected from Disruption
Gradual Change
Customers
Services
New Value Added Services
Scalable Platforms
New Methods of Consuming
New Ways of Connecting Buyers & Sellers
New Methods of Distribution
New Sources of Supply
Facing Massive Disruption
Massive Change
More Than One Way to Succeed
Source: McKinsey

9. Retail Implications

10. Online is fastest growing 10X more than retail stores
The Retailers Dilemma
In 2020 more than 80% of U.S. retail sales will still happen within the four walls of a store
Online is fastest growing 10X more than retail stores
Where Do We Go From Here?
Source: McKinsey

11. New Consumer – Living Longer, More Colorful Lives
Birth of the New Millennials

12. We Must Reinvent What We Mean by Store

13. Think Differently How We Gain New Customers

14. Use Technology in More Creative Ways
The Chatbots Are Coming to Retail

15. Embrace New Methods of Distribution

16. And New Ways of Doing Business
JC Penney’s web sales rise 26%
Web sales grow 46% for Lightinthebox

17. Thankyou