2 Agenda Company Introduction E-Commerce Market The New Shop Manager E-Commerce Trends & Visions
3 Intershop – The E-Commerce Company Corporate Data:Software- and Solution Vendor for E-CommerceFounded 1992 in JenaHeadquarter in Germany; Offices in Australia, USA, BulgariaOver 300 international CustomersCa PartnerCa Employees worldwideIntroduction:Let me briefly introduce myself and my company Intershop.My name is …And now some key figures about IntershopIntershop is the E-Commerce CompanyWe are providing software and solution for the complete E-Commerce process chain.Starting with the “shop software” through “technical” and “business consulting” services up tp “Full Service E-Commerce” including “Online Marketing” and “Long Tail Retail”.Intershop is an international operating company with offices around the world, serving with app. 300 employees - and of course with our Partners - more than 300 customers.Bridge: As you might imagine, Intershop has gone through changeful times in the last 18 years. Interestingly Intershops development can be mapped very well to the Gartner Hype Cycle.3
4 Intershop – Development Dot Com2008€IPOVisibilityToday(Sweet Spot)Rock bottomFounding IntershopIntroduction:You all know the Gartner Hype Cycle a graphic representation of the maturity, adoption and business application of specific technologies. This hype cycle can be perfectly mapped to the development of Intershop:Dates:1992: Founded1994: First E-Commerce Product1998: IPO2000: Dot Com Crisis2005: Reached bottom line2007: Initiated Turnaround2008: First positive year in history of Intershop2009: Stabalised turnaround and sustainable growthToday: we are in the “sweet spot” of the sizzling market E-CommerceBridge: Lets zoom into this sweet spot and take a short closer look at Intershops performance.19902000200520102015TechnologyTriggerPeak ofExpectationsTrough ofDisillusionmentSlope ofEnlightenmentPlateau ofProductivity
5 Intershop – Positive and Stable after Turnaround Introduction:What you see here is the revenue and EBITDA development of Intershop in the last four years.Background Info:2005: 17,8 (revenue); -2,9 (EBITDA)2006: Negative results2007: Start of the turnaround ( higher revenue and better EBITDA)2008: Successful turnaround and first positive year in the history of Intershop2009: Stabalised turnaround and sustainable growthBridge: As I mentioned the turnaround was supported by the sizzling E-Commerce Market. So lets have a short look at this specific market and the competitive environment.Net RevenueEBITDA
6 Agenda Company Introduction E-Commerce Market The New Shop Manager E-Commerce Trends & Visions6
7 E-Commerce Market – Development in Europe Commerce Sales in € bnCAGR: 13%Introduction:Lets start with some interesting market figures first.The Western European e-commerce market will continue to grow strongly – with an average of 13%Comparing the leading e-commerce markets, Germans have spend most online on a per capita basis compared to consumers in the other leading e-commerce countriesWe are to the right time in the right marketBackground Info:This pile chart only refers to B2C sales, not to B2B sales, which have a multiple of 10 compared to the B2C market.GermanySource: TNS Infratest, Bundesministerium für Wirtschaft und Technologie
8 E-Commerce Market – Booming and Changing 34,2Mrd. €29,4Mrd. €21,2Mrd. €Introduction:Looking at the evolution of the three areas „Online – E-Commerce“, „Mail Order“ and „Catalog selling“, we see an interesting development.2000: Huge market for catalog selling and the beginning of mail order and e-commerce2010: More than 1/3 of the market is already e-commerce. Mail order hat also a significant growth, but not that huge as e-commerce!2020: Looking further into the future, e-commerce is taking over more than 2/3 of the market. Mail order will stagnate, catalog selling will vanish.As I said before: We are to the right time in the right market – e-commerce is the place to beBridge:Even if we were the first mover in this prospering market, we are not alone;-)E-CommerceMail OrderCatalog selling200020102020Quelle: bvh, Werte 2009 Quelle:http://www.excitingcommerce.de/
9 E-Commerce Landscape Introduction: POSRichMediaPay-mentCRMFinanceCreditControlPIM /PDMLogisticServiceHostingMarket-placesE-Marekt-ingStat-isticsIntroduction:E-Commerce is much more than a web-shop.It is crucial to understand the customers needs and more than that, have answers and solutions to solve their problemsYou have to act along the complete and complex e-commerce process chain.A short example of the scope:The best web-shop is not worth nothing, if none can find it – you need online marketingYou can buy online with a few clicks, but it takes weeks to ship the parcel – you need good logisticsTo manage all this – you need e-commerce know-how end skillsBridge:The extension of the skill set on the one hand and the changing e-commerce environment on the other hand needs to be adopted within the online business. Companies need a new online managers, who orchestrate the complex E-Commerce eco-system. We made a survey amongst customers to find out how they handle this.
10 Agenda Company Introduction E-Commerce Market The New Shop Manager E-Commerce Trends & Visions10
11 Changing Markets – New Job Description E-commerce is managementProductsMarketsTraget GroupsCompetitionPartnersMarketingProcessesSuppliersIntroduction:One of our key findings was that E-commerce is all about management, with running an online store increasingly requiring business expertise alongside technical skills.Background Info:And as the “Business Process Management” wave came up with new job descriptions like an “CPO” or an “Process Architect”, the same is happening in the E-Commerce environment as well.The new (and or extended) job description of the person who is responsible for the e-commerce initiatives is “Shop Manager”. The Shop Manager is not only an IT guy, coding the web-shop. He is much more than that.The new Shop Manager has to manage:ProductsMarketCompetitionTarget groupsMarketing strategiesSuppliersPartnersLogistic providersBusiness ProcessesShopBride:And besides that, he has to take care of the CORE – the revenue of the web-shop.Press Release :Intershop Survey: Shop Managers Now Need a Broader Skill setToday’s e-commerce managers require both technical and business skillsTools for analyzing and managing online sales neededShop Managers are key to e-commerce successJena, Germany, February 9, 2010 – E-commerce is all about management, with running an online store increasingly requiring business expertise alongside technical skills. That’s the key finding of a recent survey by e-commerce provider Intershop. As well as being fully conversant with the product range, market, and the competition, today’s online store managers need to know where their target groups are and which marketing strategies will reach them. They must establish relationships with suppliers, partners, and logistics providers and negotiate terms. Analyzing and optimizing processes is also part of the job.According to the online sellers surveyed, the management information and tools needed to perform these tasks are often lacking. For example, fashion retailers cannot maximize sales by simply presenting a new collection four times a year, from spring through to winter. They need to encourage customers to make purchases via up-to-the-minute offers on the homepage or in newsletters, themed pages that are changed regularly, or specials for loyal customers. This can be a daunting task if managing or updating product data is complicated and the approval procedure is lengthy. Few Shop Managers can create themselves new Web pages or their components in a comfortable manner, preferably in real-time.Online success is measured by factors, such as response to marketing activities, the level of returns, the conversion rate for recommendations, individual customer value, and delivery performance. The companies surveyed expressed a wish for intuitive tools that continuously evaluate and improve these criteria by enabling shop managers to take corrective action themselves. Peter Mark Droste, Management Board member of Intershop Communications AG: “Shop Managers are crucial to a retailer’s image and success. Many companies recognize this by not only investing in qualified staff, but also by providing an appropriate work environment that supports their demanding role.”
12 Changing E-Commerce Challenges Initial CostsOperational CostsError RatioHandling DurationReturn RatioReachConversion RateAttractivenessLevel of AutomationBasket ValueThe new Shop Managerdrives e-commerceinitiativesIntroduction:The Shop Manager drives all e-commerce initiatives and therefore needs expertise in several areas, e.g. IT, business, retail, sales, marketing, logistics, etc.Of course the main focus of the Shop Manger is still to leverage the online shop and generate more revenue. That means, he has to achieve the following goals:Sink:Initial CostsOperational CostsError ratioHandling durationReturn RatioLeverage:ReachConversation RateAttractivenessLevel of automationBasket valueBridge:As you see, to be a Shop Manager is much more than just driving the web-shop – and it is even more complex.
13 Strategic Key Factors for Success in E-Commerce Corporate IdentityProduct mixMarketing budget# ProductsCollectionsRevenueMarket segmentsPricingLicensingProduct groupsBrand valueCognitionReturn reasonsStrategyReturnsTarget groupBasic / trend productsProcess flexibilityBrandAssortmentNewsletterChannelsCapacityLead timeStrategic Key Factors for Success in E-CommerceLoyalty ProgramCountriesTVPaymentsAffiliate programService qualityLogisticsReachPrintSponsoringDebt collectionSubsidiariesCarriers360° viewsCall CenterLanguagesCatwalk videosCustomerServiceInnovationWeb 2.0Pick & ship lead timeePaymentDelivery timesRecommendationsVirtual fitting roomIntroduction:To make an e-commerce initiative successful, several thinks have to be taken into account. This map shows the strategic key success factors for e-commerce.The interesting part is, that only a few factors belong to IT (lower left corner), the rest is more or less dedicated to the business.Bridge:The aim of each e-commerce software or solution vendor should be to checkmark each of the items of this map to optimise the Shop Manager support.PaymentRefundsReturn timeMobileUsabilityPersonalizationTechnologySelf-servicesMaintenanceStabilityUsability testsNavigationBusiness PlanInterfacesFeaturesScalabilityAbandoned basketsCustomer retentionPerformancePublishing lead timeCall Center complaintsConversion rate13
14 Optimal Shop Manager Support E-Commerce Solutionsenable the Shop Managerto optimise theE-Commerce processesin all stages of theE-Business life cycle.Introduction:If such a vendor would create a mission statement, it could look like this:“E-Commerce Solutions enable the Shop Manager to optimise the E-Commerce processes in all stages of the E-Business life cycle.”You can imagine, that the Intershop mission statement goes into this direction ;-)Bridge:We now have seen, what the challenges and the tasks of the “new Shop Manager” are. In addition to that, he has to scan the market, look into the future and find visions and trends in e-commerce.
15 Tailored Solutions for Shop Managers Business Requirements:Business focus (for Shop Managers)Business and Technical Reporting Tools (CIC)Usability enhancements (e.g. CMS, Storefront Editing)Business Process Optimisation (e.g. Check Out)Interoperability & IntegrationPayment FrameworkSCOOBOX – Social Commerce Out Of the BoxSearch EnginesAdvanced Marketing ToolsetOnline Marketing (SEO/SEM)Merchandising / PromotionsAdvanced RecommendationsWeb 2.0PersonalisationSocial MediaMobileNEW6.41515
16 Agenda Company Introduction E-Commere Market The New Shop Manager E-Commerce Trends & Visions16
17 Trend – Cloud Computing Feed EngineE-Commerce SearchSEO/SEM-MarketingOrder ManagementCouponingMerchandizingEnfinity SuiteFull ServiceEnfinity Suite Managed ServiceEnfinity Suite on-premiseIntroduction:Many IT-trends are adaptable to e-commerce as well. We had the “SOA” and the “BPM” Hype after that we had “SaaS”.Lets look at the tend we are facing at the moment - “Cloud Computing”.Cloud Computing – as well as the other trends – also appears in e-commerce environment.All features and functions of state of the art web-shops are nowadays available in the cloud.No IT-infrastructure is neededPick and choose only what you want and need – no coding, only configurationAvailable “on-demand” - everywhere and any timeBridge:Along with that trend comes another trend, e-commerce everywhere and any time – m-commerce.1717
18 Trend – Mobile Commerce Omni-presentMass MediaIdentifiedPerson-alisedRealtimeLocalisedInteractiveMulti-fuctionalIntroduction:E-commerce everywhere means e-commerce in your pocket.Smart phones are the devices of the future:Smart phones are everywhere – everyone has oneSmart phones are multifunctional and they make internet mobileYou can interact in real timeBackup Info:Mass MediumOmnipresentIdentifiableReal TimeInteractiveMultifunctionalLocalizablePersonalizeableBridge:So, if this is the device of the future, what are the figures of mobile internet usage?1818
19 Trend – Mobile Commerce European mobile Internet users (millions)Introduction:Forrester did a research on that and found out, that the internet usage on mobile devices will tipple till 2014.Bridge:So, it could be a wise move for e-commerce vendors to go mobile ;-)Forecast: Western European Mobile Internet Penetration, 2009 To 2014August 2009 “Western European Mobile Forecast, 2009 To 2014”1919
21 Trend – Social Commerce CommunityRecommen-dationBlogComparisonsTwitterReviewsFacebookTell a friendIntroduction:Web 2.0 is one of the “more mature trends”, but nevertheless a trend. We are only at the beginning.“Make users / customers to supporters or even salesmen”Examples for Instruments for more user / customer interaction are:CommunityBlogTwitterFacebookTell a friendRecommendationComparisonsReviewsBridge:But these “common” features are only the beginning…2121
22 Trend – Social Commerce CommunityRecommen-dationBlogComparisonsTwitterReviewsFacebookTell a friendIntroduction:What you see here is the complete Social Commerce landscape (for Germany 2009), so you see, there is a lot more to come…Bridge:What we will experience is that all these services are parts of the puzzle e-commerce. And if they are all put together you see a new and compelling picture of E-Business.2222
23 Emotional Shopping Introduction: All these bits and pieces brought together and merged into one storefront, flexibly handled, controlled and monitored lead to a new customer experience – emotional shopping. What we see here is an example of how a new shop could look like.Several thinks are integrated here:Intuitive and easy to navigate (zoom & price selection via slider)Several product views (incl. detailed zooms and user generated content – videos)gimmicks like animated icons and button (“put into basket” put something into basket )Integration of Web 2.0 functionalities like communityUser customizable look and feelIntegrated video shopping
25 DisclaimerTHIS IS NOT A PRODUCT SPECIFICATION The information contained in this document represents the current view of Intershop Communications AG on the issues discussed as of the date of publication. Because Intershop must respond to changing market conditions, it should not be interpreted to be a commitment on the part of Intershop, and Intershop cannot guarantee the accuracy of any information presented. This document is for informational purposes only. Intershop MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS DOCUMENT.Intershop Communications AG may have patents or pending patent applications, trademarks, copyrights, or other intellectual property rights covering subject matter in this document. The furnishing of this document does not give you any license to the patents, trademarks, copyrights, or other intellectual property rights except as expressly provided in any written license agreement from Intershop Communications.Intershop does not make any representation or warranty regarding specifications in this document or any product or item developed based on these specifications. Intershop disclaims all express and implied warranties, including but not limited to the implied warranties or merchantability, fitness for a particular purpose and freedom from infringement. Without limiting the generality of the foregoing, Intershop does not make any warranty of any kind that any item developed based on these specifications, or any portion of a specification, will not infringe any copyright, patent, trade secret or other intellectual property right of any person or entity in any country. It is your responsibility to seek licenses for such intellectual property rights where appropriate. Intershop shall not be liable for any damages arising out of or in connection with the use of these specifications, including liability for lost profit, business interruption, or any other damages whatsoever. Some states do not allow the exclusion or limitation of liability or consequential or incidental damages; the above limitation may not apply to you.