To keep their promise, they pursue In the experience economy, intelligent retail enterprises consistently deliver on their promise

s consistently deliver on their promise to stay relevant and run a profitable retail operation:
five key initiatives that require
new business capabilities along ▪ They turn insight into action across the business, to close the experience gap, unlock ▪ They spearhead innovative processes, leveraging digital capabilities to simplify
the value chain. new sources of growth, and create next-generation shopping experiences. and automate processes – and achieve bottom-line cost savings.

Omnichannel marketing Customer-centric merchandising Procurement excellence Digital supply chain Omnichannel customer experience Human resources Finance

Use sophisticated algorithms and machine learning to Create product offerings that are based on customer Ensure product origins meet customer expectations Enable customers to find what they want, when they Establish a consistent flow of digital information across Increase employee engagement and commitment to Create end-to-end visibility of financial performance of
segment customers preferences, historical sales, and other real-world and brand promise – that is, sourcing is transparent, want, by helping ensure retailer has full understanding devices and customer touch points customers by soliciting and acting upon real-time all areas of the business in real time
Enable real-time customer loyalty and incentive demand insights ethical, and sustainable of demand and temporary demand-influencing factors Provide 360-degree insight into the customer lifecycle employee sentiments on training, career planning, and Simulate and analyze scenarios to evaluate business
programs across all channels Use merchandising intelligence to track category trends Address immediate consumer needs with responsive Process orders and offer delivery options based on to enable store clienteling working conditions choices and their financial implications
Be customer centric Constantly monitor brand performance in the market and performance procurement and manufacturing networks customer priorities Manage customer complaints with quick sentiment Allow associates to interact effectively with customers Analyze profitability by considering different views such
across the value chain Leverage experience management data to optimize Provide pricing and promotions that the customer Track and trace product orders down to the individual Track and trace products and batches for end-to-end surveys to get a pulse and take immediate action before, during, and after purchases as merchandise categories, customers, profit centers,
customer buying experiences perceives as fair and valuable and that also drive level supply-chain transparency Meet service levels and revenue goals with optimum and stores
Help ensure effectiveness of new ad campaigns profitable growth for the retailer staffing levels and effective total rewards programs
through regular testing and refining

Identify unique customers across all channels and Tailor merchandise and assortment plans based on Direct vertical integration of individual consumer wishes Optimize asset utilization and accelerate setup times of Create 360-degree customer profile with identity, Train and enable staff to provide personalized shopping Gain a 360-degree view of customer financial data and

* Benefits are based on early adopters of SAP S/4HANA, or conservative outside-in benefits due to moving from a traditional ERP system to SAP S/4HANA, SAP Leonardo® technologies, and other relevant SAP® solutions.
understand customer behavior, sentiment, and buying customer trends and preferences into the private label single-unit pick, pack, and ship processes access, and consent management experiences profitability
trends in real time Integrate product design and development for Set up private label production to cater to a lot size of Track and trace individual shipments Personalize shopper engagement through real-time Onboard and train employees quickly Provide personalized payment options for smooth use
Serve the “segment Contextualize and personalize marketing campaigns customer-specific product offerings one Fulfill orders instantly across geographies through customer identification and localization Leverage onboarding and new-hire feedback in the across all sales channels
and offers in real time
of one” Focus on leads with the highest propensity to convert
Personalize prices and promotional offers based on
individual loyalty schemes
Create a flexible supplier network for instant order
fulfillment across geographies
a flexible transportation network Individualize product and offer recommendations moment to help ensure that employees are highly
passionate and motivated
Maintain ongoing conversational interaction for high
Identify customers at risk and the key factors that retention and loyalty with optimum cost to serve Identify and forecast skills gaps and address them
influence customer churn Follow-up on lost sales with surveys and targeted offers

Apply social listening, sentiment surveys, and machine Use demand signals and POS insights to drive Enable lower lead times and reduce inventory by Support consumer-determined fulfillment strategies Allow in-store replenishment with smart shelves Empower employees to make profitable decisions in Optimize working capital across multiple channels, and
learning to forecast demand optimized allocation and replenishment plans directly connecting suppliers and co-manufacturers including click and reserve, click and collect, click and Control store and floor inventory with sensors real time extend endless aisle portfolios
Incorporate store-level sales trends, localized Apply sophisticated distribution profiles for optimal Drive smart supply chain tracking for accurate planning ship, and drop shipping Enable the store to trigger fulfillment for models such as Procure and optimize contingent labor and services and Mitigate financial risks associated with highly flexible
assortments, and personalized offers ordering and on-time delivery Establish procurement for 3D-printed products click and collect and buy online and return in store service delivery across regions supply chains
Digital supply chain Optimize campaigns with a real-time view of inventory Use advanced algorithms to detect product similarity Personalize product creation with 3D printing and the Help ensure agile sales, supply chain, and product Increase employee retention and protect know-how and
Pinpoint delivery issues with sentiment surveys
across channels and cannibalization schemes for optimized like response through quicker analysis of the product skills with regular pulse checks and immediate action
replenishment acceptance or rejection

Identify customers with smart devices, and tailor Optimize promotions and assortments with insights Increase service levels and reduce cycle times and on- Integrate robotics, sensors, and AR/VR solutions in Innovate the store experience with smart mirrors and Provide a superior in-store experience enhanced by Use smart devices for user identification and individual
product, location, availability, and offer information from smart shelves, heat maps, and shopper insights hand stock with digitally transparent supply networks warehouse processes fitting rooms linked to product and inventory data knowledgeable sales associates and personalized credit check
Manage shelf availability with sensors from virtual stores Record product use with smart products equipped with Personalize product and shipment tracking Provide real-time access to product information and service based on knowledge of the customer Improve customer services in receivables management
Integrate price changes and time-of-day offers through Make store the executor of central planning with sensors Enable order distribution with drones availability to store associates and customers Provide intuitive mobile apps for schedule changes, with machine learning
Run smart stores electronic shelf labels and kiosks aligned layouts and floor plans Manage and execute in-store value-added services Integrate store into supply network to mobilize inventory Facilitate a pick-up-and-go experience in stores with a requesting time off, and clocking in and out
FEEDBACK

Optimize store assortments based on smart store Provide in-store replenishment with smart shelves fully automated point of exit Provide guided support through smart devices
clustering Create selling opportunities in store with surveys and Monitor staff engagement and loyalty with immediate
experience feedback action to help ensure compelling customer service

Leverage deep customer insights for cross-offers such Enable curated shopping, leading to subscription and Sell with no physical stock with business networks and Enable lot size of one production with immediacy, Transform stores to experience centers around Attract sales and marketing talent and skills to drive Enable subscription-based business models
as travel, entertainment, and financial services to sharing models brokerage models driving upstream supply and customer delivery customer outcomes and needs versus products customer outcomes Involve customers and different partners in multisided
Sell outcomes support individual customer lifestyles Engage suppliers digitally and use consumer insights to Foster cross-company collaboration to cover complex Support subscription models, automated repurchase, business models
predict demand and adjust production fulfillment, transport, and storage needs and replenishment
beyond products
Enable logistics and inventory processes that support Use predictive services to drive new up-sell offerings
the sharing economy Deliver digital value-added services

▪ Return on marketing investment: ▪ Promotion revenue: +5% ▪ Cost of merchandise: -10%–15% ▪ On-shelf availability : +20%–25% ▪ Conversion rates: +5–10 percentage points ▪ Employee productivity: +10% ▪ Days to close annual books: -40–50 days
+5–10 percentage points ▪ Reduction in markdown: -46% ▪ Days payable outstanding on merchandise spend: ▪ Inventory turnover: +10%–12% ▪ Increased customer revenue and profitability ▪ Revenue per associate: +15% ▪ Budgeting and forecasting cost: -25%–50%
Typical business benefits* ▪ Campaign effectiveness: +30% ▪ Sales increase: +5%–10% -2–5 days ▪ Total logistics cost: -10%–12% ▪ Improved customer loyalty ▪ Audit cost: -20%–40%
▪ Trade fund effectiveness: +25% ▪ Procurement function cost: -15%–20%

Experience

Analytics: Augmented business intelligence Collaborative planning Predictive analytics Data warehousing

Intelligent technologies: Data-driven insights Intelligent robotic process automation Conversational AI Internet of Things, cloud and edge

Database and data management: Data pipelining Data virtualization Data governance Storage and processing Connection management Data orchestration Metadata management
Application development and
Intelligence Integration suite Intelligent business process management Enterprise extensions Digital experience
integration:

Retail for merchandise management – retail end-to-end

▪ Master data management ▪ Merchandise buying ▪ Inventory management and valuation ▪ Sales order management ▪ Core accounting
▪ Assortment management ▪ Sourcing and contract management ▪ Delivery management ▪ Retail store management ▪ Basic financial operations
▪ Pricing and promotions ▪ Supplier management ▪ Basic warehouse management ▪ Profitability analysis and cost management
▪ Invoice and payables management ▪ Allocation execution
SAP S/4HANA®
▪ Product data governance ▪ Agreement profitability and negotiation ▪ Extended warehouse management ▪ Financial planning and analysis
▪ Product design and development ▪ Transportation management ▪ Accounting and financial close
▪ Yard logistics ▪ Treasury management
▪ Accounts payable and receivables
SAP Customer Activity Repository

Operations ▪ Marketing cloud ▪ Merchandise planning ▪ Indirect buying ▪ Forecasting ▪ Customer data ▪ Core human resources and payroll ▪ Business planning and consolidation
▪ Customer data ▪ Assortment planning ▪ Strategic sourcing ▪ Replenishment ▪ Commerce cloud ▪ Talent management ▪ Governance, risk, and compliance
▪ Promotion planning ▪ Allocation planning ▪ Sales cloud ▪ Payroll and time and attendance management ▪ Shared service framework
Business areas ▪ Consumer sales intelligence ▪ Logistics business network ▪ Service cloud ▪ Human capital analytics ▪ Digital payments add-on
▪ Dynamic pricing ▪ Consumer sales intelligence
▪ Omnichannel point of sale
▪ Loss prevention

(20/01) © 2020 SAP SE or an SAP affiliate company. All rights reserved. Core solution capabilities delivered as part of the SAP S/4HANA Enterprise Management solution Solution capabilities that are part of SAP S/4HANA but need to be licensed additionally