Retail

FLAIR B’N’B The husband and wife team behind Mr & Mrs Smith.com

REINVENT YOUR WHEELS Taking a look at the next public transport revolution: scooters!

THE RENÉ CARAYOL COLUMN Kim Winser proves that today’s retailers have to be brilliant to thrive

Pages 6-7

Page 12

Page 2

AWARD-WINNING BUSINESS JOURNALISM • FEBRUARY 2016

Save our soles John Timpson talks about his upside-down company

KEEPING THE FANS ONSIDE: The online retail revolution that’s making Arsenal a major player both on and off the pitch DISTRIBUTED WITHIN THE SUNDAY TELEGRAPH, PRODUCED AND PUBLISHED BY LYONSDOWN WHICH TAKES SOLE RESPONSIBILITY FOR THE CONTENTS

BUSINESS-REPORTER.CO.UK

February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

2

Opening shots René Carayol

K

IM WINSER OBE is one of the most successful women in British fashion retail. Aquascutum, Pringle of Scotland and Agent Provocateur were all transformed by her leadership, so when she launched her own label it was always going to be special.

I had the privilege of working for Kim while we were both at Marks & Spencer; she was brilliant then and has only blossomed since.

Winser said: “We’ve just opened in California, which is very exciting, a whole new level of business. And we took over a townhouse in Mayfair during London Fashion Week.”

This was straight after the arrival of Winser London’s bold and innovative pop-up store at Fenwick in Bond Street last summer. She adds: “There are still a lot of companies stuck in a period where everything is very bureaucratic, which is a great shame as the young talent kicking around in the business don’t get their say.”

And this philosophy is at the heart of her latest business, Winser London – an online venture selling high-quality women’s clothing at affordable prices. “We’re in the Primark generation, where people want three items for the price of one. It’s shocking how much the quality of clothing has deteriorated since I was at Marks & Spencer.”

Publisher Bradley Scheffer | Editor Daniel Evans | Production editor Dan Geary

As Kim Winser proves, today’s retailers have to be brilliant to thrive But while she fuels her own brand with an agile strategy, she has doubts for those who struggle to adapt to today’s tough and unforgiving environment. The downturn has decimated the likes of Peacocks, La Senza and her former company, Aquascutum. All have fallen into administration, although Aquascutum was later saved.

The conventional wisdom has been that an increasing volume of business will inevitably be done online, and so bricks-and-mortar shops are surplus to requirements. The desperate and decrepit remains of out-of-town supermarkets, from the video and book stores to the white goods shops, are testimony to the scorched earth that the internet has left in its wake as it has cut through Britain’s retail sector.

But it’s not all one-way traffic. Some new and mature retailers are fighting back. Businesses that were originally online-only are now rediscovering the old-fashioned virtues of the

high street. Boden, one of Britain’s most successful fashion retailers with annual sales of about £280million, has been mail-order and online-only (except for one store) since it was founded in 1991.

It is now planning to open several actual shops in Britain.

But it’s no longer about either online or bricks and mortar, it’s increasingly about both.

Rapha, which sells high-end gear for well-heeled cyclists, was founded online in 2004, but now has a physical outlet in central London. And it’s more than just a traditional shop. Cyclists meet to start rides together, watch the Tour de France over cappuccinos or buy

specially designed cycling snacks. It is particularly important for businesses whose customers would like to feel the products.

The recent trend for pop-up shops has helped these brave businesses to navigate their way offline. Pop-ups hire spaces for just a few months to test the local demand, and then move on if it’s not working. The Rapha clubs started as pop-ups.

A survey by the telecoms company EE estimates that one third of all new retail businesses will soon be pop-ups. These may not save the high street but they have a part to play.

Back to Kim Winser. “I think business was easier up until the past five years. You could have really good people and you could have average people, but because there was so much money out there, lots of companies that should have been in more difficulty weren’t. What’s happening now is you have to be better than average, and those who aren’t are struggling and falling into administration. You can’t be just average any more. That, in a way, is quite exciting because it’s ma k i ng people work harder and think differently, and I think there are going to be some brands that develop well.”

T he t h reat of losing our shops just might have made us start to value them again – but they must be different from before.

February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

3

Client manager Michele Taylor: production@business-reporter.co.uk | Contact us: info@lyonsdown.co.uk

Hammerson to acquire Birmingham Grand Central PROPERTY DEVELOPER Hammerson has exchanged contracts with Birmingham City Council to acquire Birmingham’s new Grand Central shopping centre for £335million.

Hammerson is also in advanced discussions with an existing joint venture partner on other assets about entering into a 50:50 joint venture for the future ownership of Grand Central.

Grand Central, which opened last September, provides 435,000 sq ft of highquality prime retail space, anchored by a 250,000 sq ft John Lewis store. The project was developed by Network Rail and Birmingham City Council as part of the £750million New Street Station regeneration project.

The centre provides an attractive retail setting for 40 premium stores including Monsoon, Fat Face, Hobbs, The White

Company, Cath Kidston, Joules, Kiehls, Jo Malone, L’Occitane and MAC. A significant space is dedicated to restaurants and cafés, including Carluccio’s, Yo Sushi, Pho, Ed’s Easy Diner, Caffe Concerto, Giraffe, Handmade Burger Co and Tapas Revolution, many opening in Birmingham for the first time.

Andy Street, managing director at John Lewis Partnership, says: “The development of

Grand Central is great news for Birmingham and it cements Birmingham’s position as a retail destination of choice. Our new shop has enjoyed a wonderful reception in the city, and given Hammerson’s proven expertise in managing shopping centres it can only go from strength to strength.”

The centre has demonstrated strong performance since opening, attracting average footfall of 62,000 per day in its first three months of trading with up to 105,000 per day over the Christmas period. Many retailers have reported trading well ahead of budget since opening.

Significant public sector infrastructure investment in Birmingham, including the future HS2, has supported a surge in business investment and a record level of office take-up as an increasing number of international firms choose to locate in the city.

Bridging the gap between online and in-store

By Joanne Frearson RETAILERS ARE facing challenges when it comes to implementing new technology systems to improve the customer experience.

Speaking at the Rethinking Retail Technology panel debate hosted by Rackspace, Oliver White, e-commerce director at high-end homeware retailer Heal’s, says: “We’re at a very early stage of understanding the relationship between online and offline and where we’ll go. For Heal’s, it’s a high-end product and an emotionally tactile decision.

“Expectations are being set by market leaders where customers are being used to get things when and how they want it. Even the bigger retailers haven’t got it right. Customers are coming in two hours after clicking online to collect. That’s what they expect. It is the same with furniture. It’s a bit of a waiting game to choose fabric, get specifications and so on, but people expect to get it in two days.”

At GAME, Dave Perry, UK IT director, says: “The key challenge for customers is that many are adopting different strategies at different rates.

That’s confusing. For click and collect, are you going to collect it in two hours or three days? If there’s a disparity, and it’s the latter, they might show up in two hours and expect something.”

The inner geek

Moz & Bradders

According to Mike Bainbridge, chief digital technologist at Rackspace, the biggest worry for clients was that there is always some sort of new technology around the corner, which can potentially disrupt the market. “We have to be right at the forefront in understanding what technology is,” he says. “It is about understandin when to adopt a new technology. The retailers often follow the trend set by Amazon or ASOS. Taking the big leap differentiates the key brands.”

Many retailers also have old legacy systems to deal with, which can make it difficult to implement new technology. White says: “Retail businesses are quite siloed. They’ve got customer service, retail departments, e-commerce. We’ve got to evolve that for it to work. We’ve gone past the stage of looking at customers as online and offline. All are multi-channel customers. Not many businesses

are multi-channel. Most retailers have a long way to go to embrace that multi-channel experience.”

At Heal’s it is about using technology to help the user experience. White says: “People come into the store to touch products and speak to experts.”

He explains that the retailer is also experimenting with smart glasses technology, where members of staff will wear the glasses to show the customers online the products in the store.

“Straight away there can be a one-to-one interaction,” White says. “It’s as close as a one-toone interaction without being there. It’s something we can use to reduce returns. It’s about optimising the experience to the individual user.

“That’s where things like content delivery networks come up. It’s about delivering the right content to the right users. If it’s a mobile with either 3G or 4G it’s a different experience. If it’s a desktop with a better connection, you provide something else. That’s the direction we’ll go in. It’s about delivering slightly different tailored experiences.”

Business Reporter’s future video campaigns

RISK MANAGEMENT The need to assess and understand: by working with the right partner, organisations can implement a proportionate response to cyber-risk.

PERFORMANCE IMPROVEMENT The competitive environment: there is a strong link between outperforming companies and sustainably engaged employees.

RETAIL Trends that will change the way we shop: consumers are in control and the UK has the best contactless infrastructure in the world.

For more information go to business-reporter.co.uk/video

February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

4

business-reporter.co.uk

Business Reporter UK

@biznessreporter

Working together to create a superior omni-channel experience for everyone

P

opping to the shops used to involve leaving your house. These days, you can shop online wherever you are and however you want.

You can also have your order delivered straight to your door. Ease, convenience, speed and a seamless shopping experience which takes you from browsing to delivery are what matters to consumers.

When shopping most consumers use multiple touch-points, from tablets, apps and online to in-store.

Many don’t see the distinction between channels.

To the customer, they are all part of the same brand, and what they expect is a seamless omni-channel experience. However, the majority of retailers don’t have a comprehensive view of their customers across product, department or channel.

This in turn directly impacts on their ability to offer the personalised experience most consumers want, and a level of customer service that will encourage brand loyalty and repeat visits. At BT Expedite we’ve been working for more than a decade to help our clients create satisfying shopping experiences that drive sales and loyalty. For us, it begins and ends with building a seamless, superior omni-channel experience – one that offers retailers a comprehensive single snapshot of every customer interaction across every channel.

Consumer preference for multiple channels is a real benefit to retailers, as consumers are providing retailers with more data than ever before. This can be used to

derive a single view of the customer and then used to create the intensely personal, hyper-tailored shopping experience that consumers now expect, and that retailers will benefit from providing. However, while consumers are always connected, retailers need to ensure that their in-store staff are also connected with the right technology and have access to the right information.

This is one way in which better in-store technology is already increasing sales, enhancing customer engagement and boosting loyalty by improving speed and service. By having a truly omni-channel approach, retailers will continually improve their ability to provide personalised customer service, facilitated both by mobile technology and in-store analytics. Personalised recommendations, customised journeys through the checkout, reviews, receipts and coupons mean that customers will experience bespoke and unique shopping journeys built around their individual preferences and shopping styles.

To deliver an enhanced customer experience across multiple touch-points, you need a reliable and trusted partner, one that’s already working with the world’s biggest brands, retailers, restaurants and services to optimise sales online and off, and create a superior omni-channel experience for all.

Mark Denton is head of retail propositions, BT Expedite btexpedite@bt.com www.btexpedite.com

February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

facebook.com/biznessreporter

5

info@lyonsdown.co.uk

By Joanne Frearson

T

HIS AFTERNOON, ARSENAL – currently sitting third in the Premier League table – go head-to-head with Manchester United at Old Trafford. The Gunners fans will be out in full force to support them in this crunch tie – a pivotal game in their bid to win the Premier League title for the first time in a decade.

The club has a huge fan base and has a combined Facebook and Twitter following of 39 million. Although the Gunners will not be playing at their home stadium, on its busiest weekend Arsenal’s flagship store The Armoury at Emirates Stadium does more international card transactions than the whole of Marks & Spencer, Gap and Argos.

For many Arsenal fans, visiting the home club is a once-ina-lifetime opportunity. In 2014 The Armoury underwent a revamp to ensure fans got a suitably world-class experience.

There is now an extensive personalisation area which allows fans to create bespoke items, as well as a multimedia interactive offering that shows exclusive video footage of the team.

The club has also been investing in e-commerce technology to help make buying goods and services easier. “We have invested significantly in the physical retail, buying and merchandising processes,” Hywel Sloman, CIO at Arsenal FC tells me after coming off stage at the Microsoft Decoded event in London. “We are now in a good place and have started a significant overhaul of our e-commerce platform. The logic being, we should be providing a much better service to our international fans and customers.”

When Sloman first joined the club in 2011, he says there was “no integration between the e-commerce platforms and

MAKING IT EASY FOR THE FANS Business Reporter investigates the retail revolution quietly underway at Arsenal

“It’s a simple equation: the more we make, the more there is to invest in football and the development of young players.” the core retail systems.” Although fans could buy a shirt, scarf, stadium tour, ticket or have a premium-tier dining experience, none of these transactions was ever joined up.

Sloman says: “We had 27 different systems for customers.

Fans would receive up to four different emails a day from the club with different offers and different information.”

The system looked like it needed an upgrade – there was one person whose job was to re-key every single order to the retail system. Says Sloman: “You as a customer would get not what you ordered, but what that person was re-keying on a Friday afternoon, when they frankly wanted to get away from the office.”

The first part of the overhaul involved implementing a new CRM system that reduced the 27 pools of customer data to just one. He says: “We have been on a three-year journey to transform our processes in technology. We now have a single view of the customer that captures every transaction the fan has had with us since 2006. This has transformed our relationship with fans.

We can target communications in the medium they prefer and deliver the message relevant to them. We know who has been on a stadium tour, who has bought a shirt, who has been to the games – when you actually go onto the website we can do some quite clever things.”

The transformation in Arsenal’s technology systems has also helped the team renegotiate their shirt partnership with Emirates. “A big factor for them in re-doing the deal was the fact they could target better communications to Arsenal’s global fanbase, as opposed to before, when the communication tended to be about particular availability,” says Sloman. “If you are a 15-year-old fan in Bangalore, you will no longer get an email from us about tickets – you’ll get fewer communications, but they are appropriately targeted.”

A major element to Arsenal’s technology e-commerce overhaul has been to help engage international fans and grow

the club’s commercial revenues through its global fan base. Below: Hywel Sloman says: “In north London, everyone who wants to Sloman, CIO of Arsenal FC own an Arsenal shirt does so already – our growth in merchandise has to be through international and through e-commerce, which is pretty much impossible without technology. We need to truly tailor to our global fan base by using language, products and payments methods they are familiar with. With our CRM knowledge, we should be able to tailor what we offer online.”

For example, thanks to seasonal differences, the British consumer is buying scarves, hats and coats right now, whereas the Australian consumer is buying T-shirts and flip flops. It is about tailoring to those needs accordingly.

Through improving the customer experience, the new e-commerce platform also allows Arsenal to be more competitive against their peers. Sloman says: “We compete with Sports Direct and JD Sports. They are our competition if you want to buy an Arsenal shirt. Delivering a high-quality experience means people want to come and buy from Arsenal online or in our stores.”

As a result of this revamp the average transaction time has been reduced by 50 per cent at The Armoury store.

Sloman says: “It may seem trivial – a 30-second reduction in transaction time – but on a match day the queue in-store goes out the door. So that 30 seconds is absolutely essential. It is evolving how we do business and growing as an organisation.”

By improving the consumer experience, the commercial revenue has increased for the club which in turn helps the performance of the club. “It is a simple equation – the more money we make, the more there is to invest in football, in terms of wages, transfer fees, identification and development of young players, sports science and analytics,” he says. “Ultimately this translates into winning more matches, more trophies, which gives us more happy fans.”

Besides football and selling shirts, the club also runs a ticketing business, a hospitality business, a media business, a retail business, a stadium tour business, a concert business and museum, a leisure centre, international tours, meetings and event businesses, and community outreach programmes.

And implementing a new e-commerce platform has helped the club be more competitive against its peers. And with fans more engaged with the club’s commercial revenues, the performance of the club on the pitch could improve as well.

February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

6

Making sure you aren’t derailed by an electricity supply crisis

O

ne of the greatest threats to the UK in terms of its competitiveness and its ability to operate is an electricity supply crisis. The need to integrate greater quantities of renewable energy sources into electricity grids, coupled with the challenges of controlling grid stability in real-time, presents distinct challenges at a policy level. However, these challenges also offer a significant commercial opportunity.

The solution lies with frequency response. In simple terms, this means sufficient load can be generated or removed from the National Grid to stabilise frequency.

Endeco Technologies works with intensive energy users across a range of sectors to help them participate in frequency response schemes that deliver generous financial incentives in return for changes in the way they use electricity.

These schemes offer multi-layered benefits. For grid operators, adding stability to the system reduces

the need for coal and gas-fired reserves to be ready to supply power at short notice. For the end-user, these mechanisms provide a generous income from National Grid; the ability to avoid price peaks plus the cost benefits of load flexibility when renewable sources are available.

The demand-balancing market is still emerging – and end-users are often unclear about what is involved. As a leader in this sector, we see it as our role to educate and inform. Our message is therefore very simple.

Participation is neither onerous nor disruptive to operations and the commercial arguments are sound.

Our customers, household names such as Brakes Group and retailers like Spar Group, can testify that frequency response contributes to the bottom line. At £70K per MW, this is something businesses cannot afford to ignore.

Michael Phelan (inset) is CEO, Endeco Technologies 01923 431638 michael.phelan @endeco-technologies.com

F

RUSTRATED WITH the lack of guides on boutique hotels, one day Tamara and James Lohan decided to take a month off work, jump in their car and visit as many hotels as they could to make their own black book of great places to stay.

Finding 41 hotels they liked, they initially wanted to publish a guide, but found there was demand for a website, so decided to set up Mr & Mrs Smith in 2003. The firm now has offices in London and Los Angeles, with a 24-hour sales team. Each boutique hotel on the Mr & Mrs Smith website has been visited and hand-picked by the Lohans personally.

The website aims to give people interested in staying at boutique hotels recommendations as if they were talking to their friends. What is helping Mr & Mrs Smith to be able to provide that personal touch is technology.

Tamara Lohan, the co-founder and CTO of Mr & Mrs Smith with husband James, tells me they have always been on the forefront of implementing new technology systems.

She says: “We were one of the first companies in the UK to go with Apple Pay. They invited us ahead of the game to go through it with them and implement it.

“We have seen an increase in people using those kinds of options. People just want it to be quick and fast – giving your credit card number several times over is dull. We will also be rolling out Amazon Pay. People want choice and the ability to use whichever payment system that suits them best. We are seeing quite a few Android users as well.

“There is so much going into fintech right now to help people be able to pay with their phones and tablets. The winners will emerge, and it is up to us as an e-commerce player to make sure we are offering customers the options they want to use, and making it a bit easier if possible.”

Another way the Lohans are helping the firm provide that personal touch is through online chat. Tamara says: “I have been really surprised that our online chat functionality converts bookings in quite an incredible way.

People want that interaction.

“I have a travel consultant in the Smith 24 team who, after a chat, can put together a quick wish-list for a customer. The person can view the list and book one of those hotels.

It has been a personal experience – even though that person did not actually pick up a phone they have had that human interaction.

“It is all about personalisation – everybody wants to feel like they have a good deal. The more you can get to know the customer, the more likely they are to be loyal to you. It is that intuitive merge between online and offline. Being hi-tech, but high-touch is what we are aiming to do.”

Mr & Mrs Smith also uses data to help see patterns and recognise customer behaviour.

The travel site has been working with a company called SaleCycle to work out why people abandon shopping baskets. “It has massively increased the number of people com i ng bac k a nd booking after Tamara Lohan with abandoning,” she says. husband “It is nothing new – just James

business-reporter.co.uk

Business Reporter UK

@biznessreporter

JOANNE FREARSON TALKS TO TAMARA LOHAN, CO-FOUNDER OF BOUTIQUE HOTEL BOOKINGS WEBSITE MR & MRS SMITH better understanding of the data. We have always had an abandoned basket email that goes out, but what SaleCycle has been able to do is really hone that down with the messaging and get a lot more personal about it.”

One area Lohan is unsure about when it comes to booking systems is artificial intelligence (AI). She says: “In travel, talking to somebody who has actually been to the place you want to go, there is just no substitute for that personal touch. If you want to take a multi-stop to Vietnam, with complicated transfers, then you may need to talk to someone because the technology is not quite there yet for this packaging of all these different suppliers together.

“That is why we invested heavily in our Smith 24 team, who are experts in putting more complicated packages together while we continue to make sure the technology keeps up to date and pushes the boundaries in terms of making it easier and easier.”

The Mr & Mrs Smith website is undergoing some changes to make it easier for customers to be able to book complicated packages.

Lohan explains that what can be difficult when booking a hotel online is getting the exact room you want. A lot of hotels will only allocate rooms at the point of check-in, and cannot always guarantee which one the customer gets. For example, someone might want a room with a view, but it might not be available on arrival.

One of Lohan’s 2016 goals is for her customers to be able to book rooms as individual products. She says: “One of the projects I am working on this year is a shift from looking at hotels as individual products to looking at rooms like this. That is a real shift in understanding how the consumer books rooms.”

Lohan wants to be able to offer someone who asks for a villa in the Maldives or the Seychelles that is over the water for their honeymoon just that. The same goes for

“It is that intuitive merging of being online and offline.

Being hi-tech but high-touch is what we are aiming to do” families – if they want a separate room for their children then they should be able to provide rooms which have interconnectivity.

“For most bookings I cannot do that for you, I want to be able to bring that search right up front and treat the rooms themselves as individual products,” she says.

In the next three to four months, Lohan hopes to be able to offer hotel rooms as individual products and tick more of the boxes that customers want to fill when finding a room.

She says: “It will hopefully help inspire people in their hotel room research. When you are travelling, you have lots of criteria that you want to tick and people are very different in what they want.”

February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

facebook.com/biznessreporter

7

info@lyonsdown.co.uk Below: Amangiri Resort in Utah, USA, winner of Best Pool in last year’s Mr & Mrs Smith Awards; The company’s website enables customers to chat personally to booking staff

Retail heavyweights join forces for new digital stores ARGOS AND Sainsbury have teamed up to open 10 new Argos digital stores within existing Sainsbury branches by this summer.

These new-format Argos digital stores will provide customers with a choice of over 20,000 non-grocery products, which they can either buy instantly in-store via tablets, or reserve online for easy collection within hours, the same or the following day.

John Walden, chief executive of Home Retail Group, said: “This has opened up options for a variety of new Argos stores and formats, and we can now cost-effectively reach more customers and neighbourhoods with an Argos presence.

Mike Coupe, chief executive of Sainsbury, said: “They will bring something new and different to our customers, and fit well with our strategy of making our supermarkets more convenient. We continue to roll out our ranges of own brand merchandise to give customers even more choice and value.”

February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

8

business-reporter.co.uk

Business Reporter UK

@biznessreporter

The big interview John Timpson

28

NUMBER OF KEYNOTES

Number of countries in European Union

73

TOTAL HOURS OF CONTENT ON AGENDA

The rhythmic clapping at sporting events that precedes “Let’s Go!” is Morse code for “73”, an abbreviation meaning “best regards”

Eu

THE ATOMIC NUMBER OF EUROPIUM

63

Days till Money20/20 Europe Begins!

153 NUMBER OF SPONSORS TO DATE

The code for “mental processes & intelligence” in the Dewey Decimal Classification

2000+

THE NUMBER OF ATTENDEES ALREADY REGISTERED FOR MONEY20/20 EUROPE (AND STILL GROWING)

An American old-time radio series that ran on the Mutual Broadcasting System from March 15, 1950 to January 2, 1952 in various 30-minute time slots

:3498

C:_ Nights booked in the Money20/20 Europe Hotel room block D:// Error Code in IBM i 6.1 Operating System: ENOTENROLL 3498 User not enrolled in system distribution directory.

GET INVOLVED NOW Interested in speaking, sponsoring or becoming a media partner?

Email us at europe@money2020.com to get involved

EXCLUSIVE Joanne Frearson

I

F YOU EVER GO for a job interview at Timpson, best known for shoe repairs and key cutting, you will be greeted with a form to fill out full of cartoons of little businessmen and women.

There is Mr Happy, Mrs Keen, Mrs Smart and Mrs Helpful, as well as others like Mr Scruffy, Mr Dull, Mr Late and Mr Dubious. Under each character will be a box and the interviewee will be asked to tick the boxes that most resemble the people in front of them.

John Timpson, chairman of Timpson, who was recently shortlisted for the UCL/Business Reporter Medal for Entrepreneurship, tells me: “If the person ticks the right boxes then we ask them to work in one of our shops for a day. That tells us all we need to know. It works out those who can recognise who are the good people and who are not the right people.

“You pick the one personality as far as our main high-street business is concerned. We don’t recruit any managers from outside – everyone starts as an apprentice. We don’t look for shoe repairers or key cutters, we want people with personality. We want people that have a great personality and great in our terms is nine or 10 out of 10. We want the business full of really buzzy people.”

The Timpson business is run on an upside-down management system, which means the firm trusts its branch colleagues to serve customers in their own way.

“About 20 years ago we suddenly realised what makes the secret behind great customer service, and that realisation has transformed everything we have done,” he says. “The secret is to trust the people that serve the customers to get on and do it the way they want. Ever since then, our business has been turned upside-down.

“Everyone in the business is there to help the people find the customers to do a great job. No one issues any orders, everyone can do their job the way they want and it works and it only works if you pick the right people.”

This strategy has proved very successful for the company, and Timpson has grown into something more than just a shoe repair business. “We have gone into key cutting, engraving, watch repairs – and now the biggest part of our business is photo,” says Timpson. “All our growth now is in the supermarkets, where we are putting up little pods in the car parks.”

Timpson believes that by putting in people with personality in a firm you can turn around a business which is not doing that well – he bought photoprinting firm Max Spielmann after it went into administration in 2008. He says: “The business went into administration because it was based on developing rolls of film and they were disappearing very quickly. Also it was 2008 – the recession. It was losing money.

“We changed the look of the shops and put more emphasis on passport photos. We do portraits. We have kit in there that takes the photos from your mobile phone. But the most important thing is those shops are full of nines and 10s. We now have sparkling personalities who help customers. We

You can never sit back and think your work is done. Every year you need to start off with more ideas than the years before have been making £3-4million out of that business ever since.

“We work very hard on the culture – you can never sit back and think your job is done. I visit about 800 shops a year because the only way to run a business is to meet the business. Every year you need to feel like you are starting off with more ideas than the years before.”

Another key part of Timpson’s business strategy is giving back to its workers. Timpson believes the

Below: Timpson is recognised for its work in providing opportunities for ex-prisoners

number-one source of a company’s generosity should be towards its employees. At Timpson, this includes helping them not just in their job, but also to solve the problems they have outside of work.

He says: “For instance, we have a hardship fund – we probably have half a million pounds on loan to our people. If they get really in debt we will help them go through bankruptcy, but if it is only £2,000 to £3,000 it is so much better for us to just lend them the money. By lending them the money, it stops them taking it out of the till. It puts a really good person back on track.

“Everyone gets their birthday off, and we have a number of holiday homes,” adds Timpson. And every month, the company rewards at least one employee via its Dreams Come True programme.

“It quite often involves travel,” Timpson says. “Last month an employee travelled to South Africa to meet her half sister, who she had last seen 45 years ago when they were two months old.

“Then there was another girl who had not seen her father for 15 years – he had lived in Barbados.

Another person needed an enormous amount of dental treatment, so we paid for that. We’ve also paid for IVF treatment. It is not about taking the

February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

facebook.com/biznessreporter

9

info@lyonsdown.co.uk

Timpson’s top tips for creating a great work environment 1.

Win hearts and minds 2.

Upside-down management 3.

Amaze our customers 4. Pick great people 5.

Support people in trouble 6. Charity 7.

Celebrate success 8.

Have fun John Timpson was nominated for the 2016 UCL/Business Reporter Medal for Entrepreneurship at the end of last year

kids to Disney – it is about things that really matter in people’s lives.”

Timpson was shortlisted for the UCL/Business Reporter Medal for Entrepreneurship partly because his company uses its business skills to give back to society. Presently, the firm runs an exoffender scheme. “That happened by chance,” says Timpson. “My son James was fixing an event at a prison near Warrington and the guy who showed him around impressed him so much that James said, here is my card – when you get out give me a ring and I will find you a job. Then we thought if we could do it for him, we could do it for others.

“Ten per cent of our workforce have joined us from prison. We employ at least one person from prison every week and the most successful are those who start with us before they have left. They leave the prison in the morning and come and work for us during the day – about nine or 10 of them are managing shops. They lock the shop up, drop the money off at the bank and go back to prison. We also have a number of workshops inside prisons.”

Giving back is an important part of the culture at Timpson. By picking the people with personality (the nines and 10s), Timpson has created a staff culture that does this readily. It looks like the test of choosing who is Mr Happy, Mrs Keen, Mrs Smart and the rest of the characters makes for a pretty good judge of character.

Creating a unique experience for your online consumers

I

t’s difficult to predict the future, especially in a fast-paced industry like e-commerce.

The dynamic online environment means that retailers can never ignore what’s going on around them – competitor activity, consumer behaviour, search engine algorithms and omnichannel retail, make e-commerce a difficult field to future-proof.

It is often forgotten that online retail accounts for only 15.2 per cent of overall retail in the UK. This means there is huge scope for

greater future growth online, and plenty of opportunity for savvy retailers to join this vibrant marketplace. This is exemplified with Visualsoft – an award-winning e-commerce agency – with growth of 300 per cent last year being self-evident of the demand for retailers to play an active part online.

There are likely to be a few key trends that emerge over the coming years, predominantly with personalisation and crossdevice advancements. There is an increasing need to create more personalised experiences for

consumers as they browse online.

This is further enhanced by the huge shift in consumer behaviour as people move their browsing and shopping activity to personal devices like tablets and mobile phones.

Unfortunately, many retailers have been too slow to adapt to changing consumer behaviour.

This is reinforced by VS Insights (Visualsoft’s own proprietary industry data) showing that around 85 per cent of e-tailers do not have fully responsive websites – which allows them to scale to the size of the viewing device – and only a fraction

of websites employ technology to personalise the experience to consumers’ individual preferences.

Consumers are likely to continue demanding ever more from retailers in future. Simplifying shopping experiences on mobile devices will be crucial and will help differentiate your business from competitors plus help drive sales growth.

Personalisation of a website will

create better, more engaging, unique customer experiences, going some distance to futureproof your online business.

Read more about realising the future of your e-commerce activities today at visualsoft. co.uk/future or get in touch with Ed Harries on 01642 633 604 or at ed.harries@visualsoft.co.uk

10 · Business Reporter · February 2016

10

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

Three steps to a better connected world 2 business-reporter.co.uk

1Home and

around the house THE CONNECTED KITCHEN WILL CONTRIBUTE AT LEAST 15 PER CENT SAVINGS IN THE FOOD AND BEVERAGE INDUSTRY BY 2020.

Business Reporter UK

@biznessreporter

downtown retail and businesses MOST IoT SMART DEVICES AREN’T IN YOUR HOME OR PHONE – THEY ARE IN FACTORIES, BUSINESSES AND HEALTHCARE.

Lightbulbs can be embedded with Bluetooth speakers that can boost a Wi-Fi signal

M2M sensors in cars and on the roads spot congestion and send information to a central control system which imposes variable speed limits that improve traffic flow

Smart thermostats are expected to have 43 per cent adoption in the next five years

Cameras inside the fridge so you can see what you are missing when you are out shopping

The smart grid can anticipate energy consumption in real time to adapt production as required

By installing sensors in street lights and making them motion-sensitive, towns and cities can dim lights to save energy

By 2020, 90 per cent of cars will be connected to the internet, compared with 10 per cent in 2012

Business Reporter · February 2016 · 11

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

facebook.com/biznessreporter

info@lyonsdown.co.uk

Megacites taking over the world

By 2020, the amount of internetconnected things will reach 50 billion, with $19trillion in profits and cost savings coming from IoT over the next decade

According to the UN, 180,000 people move to cities every day – that is TWO PEOPLE a second

2 sec

Globally,

1.5bn

people live in 600 cities.

That figure will rise to

2000 By 2019, companies will ship 1.9 billion connected home devices, bringing in about $490billion in revenue

2bn

by 2025

2015

The urban population in AFRICA and ASIA is expected to double between 2000 and 2030

2025

2030

By 2030, INDIA will have six megacities

By 2025, CHINA’S CITIES will have grown by 350 million people – more than the current population of the US

By 2025, the total global worth of IoT technology could be as much as $6.2trillion – most of that value coming from devices in healthcare ($2.5trillion) and manufacturing ($2.3trillion)

India

China

Pakistan

• With a population of 14m, London is 24th on the list

United States

SÃO PAULO 21.2m

KARACHI 24.3m

South Korea

BEIJING 21.6m

SHANGHAI 25.4m

Indonesia

MEXICO CITY 22.2m

DELHI 25.7m

Japan

NEW YORK CITY 23.6m

SEOUL 26.1m

3

A MEGACITY IS A METROPOLITAN AREA WITH A POPULATION OF MORE THAN 10 MILLION. IT CAN BE A SINGLE METROPOLITAN AREA OR TWO AREAS WHICH HAVE COME TOGETHER.

JAKARTA 30m

Megacity

TOKYO-YOKOHAMA 37.9m

top 10 megacities

Mexico

China

Brazil

11

February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

12

business-reporter.co.uk

Business Reporter UK

@biznessreporter

Reinventing your wheels…

Joanne Frearson talks to Floatility founder and CEO Oliver Risse about how his electric 3D-printable scooters could revolutionise city transport as we know it

T

RAVELLING FROM A to B in some major capital cities without a car can be extremely challenging.

Although there’s always the option of public transport, there is also the question of how to get to train stations without using a car. To get around these issues, a company called Floatility has started to use the internet of things (IoT) to make it easier to go car-free.

Oliver Risse, CEO and founder of Floatility, says: “I have been living in Singapore for almost 10 years now, and mobility is one of the biggest issues in all of the Asian cities. If you go to Singapore, Beijing or Jakarta, transport is a really big challenge for people to overcome especially if you want to go car-free or car-light.”

Risse wanted to find a new way to travel which would make leaving the car at home an attractive option for people. Questioning why people might shy away from using alternative modes of travelling such as public transport to get to work

US intelligence: we could use the IoT to spy on you US intelligence chief James Clapper has acknowledged for the first time that agencies might use a new generation of smart household devices to increase their surveillance capabilities. Clapper, the US director of national intelligence, said: “In the future, intelligence services might use the [internet of things] for identification, surveillance, monitoring, location tracking, and targeting for recruitment, or to gain access to networks or user credentials.”

According to a study by Harvard’s Berkman Center for Internet and Society, connected household devices are a potential treasure trove to intelligence agencies seeking unobtrusive ways to listen and watch a target.

or go out and about, he came to the conclusion that often it was not convenient to get to the train station, so people took their cars instead. And after watching his three-year-old daughter use a kick scooter in Singapore, he thought an electric scooter could be an ideal solution for that last mile.

To get started, Floatility partnered with software firm Autodesk in its Cleantech Program, which supports entrepreneurs developing sustainable products that help the environment, while Singapore car-sharing company Smove helped Risse with the IoT application for the product.

Says Risse: “It is a very similar approach to what you have in London with the Boris bikes, but it is what I call the next generation of vehicles.

It gives you, in real-time, information about the location of the vehicle and the state of the charge – because with electric vehicles the biggest challenge is always that you have a battery that needs to be recharged. So someone goes around on a cargo bicycle and replaces the batteries. We also have developed solar charging stations for the vehicles, which is an add-on to optimise services.”

By using an IoT application in the scooters, it can also determine where the most dema nd i s for t he vehicles. “There are around 1,000 bicycle sharing systems on the market right now – small ones and big ones,” says Risse. “There is a massive trend. One of the biggest challenges for those systems is always the rebalancing. In the morning

Right: the e-floater, Floatility’s IoT-enabled smart scooter, is currently being trialled in Hamburg and Singapore; below: founder and CEO Oliver Risse

everybody goes to the city centre and in the evening everyone goes out. How can you redistribute them so they are in better use?”

This is where the scooter has some advantages over a bike, as it is made out of a superlight material that is easy to pick up and redistribute, while the IoT application can tell you where the greatest demand is.

“You receive a lot of data about patterns,” Risse says. “Where do people go? Where do they like to go? Where are the areas that are not highly frequented? You can optimise the system as you go, but you can also do predictive analytics.

“You can say, I know already that I need 50 vehicles in this area, or 20 or five there. You can optimise the system. It is a learning organism that tells you at the end how you can optimise transportation in cities.”

As the scooter can be locked to any given bike rack, and released by the user scanning a code, it is very easy to place around a city. The scooter is presently being tested in Singapore and Hamburg, and Risse has seen it being used by three major demographics. “Obviously, one is commuters who go to work – wherever you have public transport you have a strong demand to use the product,” says Risse. “The second is on a big manufacturing site, where people are going from one place to another. The third is on the tourist side – people using the electric vehicle to go around the city.

There is a lot of interest from the tourist area.”

Risse believes the scooter will make it more convenient for people to get from A to B, and more likely to leave their car at home as a result. Through the IoT, Floatility can determine where the demand is and whether or not the vehicle needs recharging, making it easy to use instead of a car.

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

facebook.com/biznessreporter

13

info@lyonsdown.co.uk

Keil Hubert

W

February 2016

HEN I BOUGHT my A5 two years ago, one of its flashy options was an in-car network service. The sales fellow said I could activate a cellular modem built into the dash and connect all of my devices to it as if it were a home broadband router. Just connect everyone’s phone or tablet or laptop to my car over Wi-Fi, and blam! Super-cheap connectivity. All this, he schmoozed, for £8 a month.

I had AT&T for my mobile service at the time, and they’d been throttling my bandwidth something fierce – slowing down access speeds for users with “unlimited” bandwidth plans. I needed a reliable way to stay connected while running around Dallas, and I figured that T-Mobile’s in-car service had to be better than relying on my dodgy, wheezing phone.

To be fair, it was better service than I was getting on my mobile… so long as my car sat perfectly still in front of my house (exactly where I didn’t need supplementary connectivity).

Everywhere else, my car’s puny 3G service couldn’t maintain a connection. I couldn’t get any connectivity outside of the city limits. After months of struggling to make the solution work, I switched phone carriers and gave up.

In a similar vein, the satnav in my car supposedly worked on a similar model: instead of reading routes and addresses off an

I like my car, but when it comes to the internet of things, it’s in the wrong lane optical disk in the glovebox, my car gets all of its maps and directions from Google Maps over its cellular data connection.

This was supposed to guarantee that I’d always have the latest information about real-time traffic conditions, detours, and so on. In practice, my satnav never worked any better than the in-car network feature. Half the time, my satnav refuses to admit that the destination I’d entered exists on Earth. Other times, it stubbornly insists that the road that I’m currently on doesn’t exist. On one trip, my car earnestly insisted that I was off-roading through a field – in the middle of the suburbs. Eventually, I gave up and went back to human navigators with paper maps.

I adore my A5. It’s gorgeous and it drives like a dream; it’s just as dumb as a bag of hammers. I rely on it for transportation, so I don’t bother trying to make the flash bits work anymore.

This is why I’m sceptical about the internet of things; I’m afraid that we’re going to be stuck with the internet of bloody stupid things for foreseeable future, while designers’ grand visions smash headlong into unsympathetic pedestrian reality.

We’re throwing embedded applications and connectivity into anything that can hold the parts, whether there’s a reasonable use-case for it or not. Internet-connected refrigerator? Why not?

Networked living room lights? Why not? Globally-addressable smart bidet? Why not? What could go wrong?

Except… we know what could go wrong. The smarter that devices get, the more fragile and temperamental they become.

Code fails. Logic gets confused. Elements conflict. Every new complicating factor introduced into a complex system increases the probability that a glitch will cascade into a system-wide snarl.

I just don’t have the time or energy for this. Fun as it is to play with all the advanced features, I need my tools to reliably deliver the core services they were originally designed for. I need my oven to heat, my kettle to boil, my lights to illuminate, and my toilet to flush. Anything that threatens those core capabilities is unacceptable.

February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

14

W

ith the advent of the internet of things (IoT), today’s world is one of connected things and connected people. While such a connected world leads to better organisation and co-ordination of our lives, it also means that loads of disparate companies are gaining access to personal data about the way we live.

This is often not intentional but it does create a side effect – what economists call an externality – of the digital economy. Such an externality can be positive in that companies are better able to understand their customers.

It can also be negative in that individuals become increasingly concerned about the security and confidentiality of their own data.

Contending that companies do not have a mandate to hold personal data securely, individuals seek greater safeguards and regulation but often governments are reluctant to legislate on personal data security for fear of being seen as anti-markets and anti-innovation. This gives rise to a tension between personal data privacy concerns and our abilities to tap into innovative services and products in an era of the internet of

business-reporter.co.uk things. Or so many would like us to think. I believe, however, that this tension is false: there is a better way.

How about every person having a secure platform/server enabling us to use the data for ourselves, giving us the computational ability to organise our inventory, lifestyles, calendar – our digital assets – to help us make better decisions in our lives? How about enabling every person to retain control of how they share their data with whomever they choose, and synchronise across all IoT firms and internet services in a secure and privacy-preserving manner? Would this not create a win-win situation?

These and other questions on the market for personal data and its externalities have been addressed by the Hub-of-all-Things (HAT multidisciplinary research project led by WMG at the University of Warwick. http://hubofallthings.com). Over the past two and a half years, researchers from six universities funded by the Research Councils UK (RCUK) Digital Economy Programme have built the HAT, a multi-sided platform for personal data created to enable individuals to collect their own data through IoT-enabled objects, and to control, recombine and be creative with mixing up data and then sharing it

Business Reporter UK

@biznessreporter

Creating new markets with the Hub-of-all-Things in a privacy-preserving manner.

This not only helps us make better and more informed decisions in our lives, but also allows companies to offer us more personalised and customised offerings.

The HAT Foundation will take forward the next phase of the technology, taking over from the HAT research project team in WMG to roll out the HAT globally in 2016 (http://

hubofallthings.com). An entirely new social and business contract is forged between individuals and firms in the context of the IoT, one that potentially spurs even more innovation because individuals could be private and secure and firms can offer more innovative services around a mix of all sorts of data.

By respecting privacy and the ownership of personal data in this era

of the IoT through HATs, we can see new ways to create new markets and in doing so, help spur greater growth in the digital economy.

Professor Irene Ng (left) is director of the International Institute for Product and Service Innovation at WMG, University of Warwick Irene.Ng@warwick.ac.uk go.warwick.ac.uk/sswmg

An insurer’s perspective: less risk, more uncertainty

M

inimising risk is often one of the desired outcomes of an internet of things (IoT) application. For example, the developers of a smart home may claim it is less likely to catch fire and burn down. IoT solutions in heavy manufacturing industries such as energy and chemicals could help prevent environmental spills.

And energy usage in smart cities may become more efficient.

However, many IoT applications involve new technologies, and the ways they could fail – and the consequences – are uncertain. Which prompts a series of questions: “Who is liable when a wearable device is hacked? Or when software errors compromise performance?

Or when a control system is hacked?”

Tough questions, especially when one study has found that 60 to 90 per cent of IoT applications come with security vulnerabilities.

And while the answers to these and related questions are only starting to emerge, the continued evolution of the IoT shouldn’t depend on pre-emptively resolving all of the possible risks.

In the meantime, developers should proactively confront potential liability risks in any event. For companies involved in translating innovative ideas into appealing solutions, it’s important to identify and plan for possible failure scenarios before launching the application, and consider the potential liability issues associated with different scenarios.

Given the complex interdependencies between different entities involved in an application, IoT developers should also look carefully at the service agreements they enter into. For the manufacturer offering the application, it’s particularly important that service agreements with third-party suppliers – sensor makers, software developers, data centres – clearly delineate the risks each is prepared to assume, as well as how other risks accrue to other participants in the application.

In addition, nobody benefits if the companies developing an application assume that insurance markets will invariably cover everything that could possibly go wrong. With IoT applications, the risks are not always readily apparent, and most insurers are going

to be cautious in providing broad coverage for risks that are hard to quantify.

Today XL Catlin and other major insurers are keenly interested in the questions raised by these new technologies, and understanding how different risks are likely to evolve. That involves working closely with clients, legal professionals and academic researchers to investigate potential issues and solutions – for example, how liability coverages need to be reconsidered when automated controls supplant a person making decisions in real-time. That is the approach we’re following in the UK, where XL Catlin has partnered with Oxbotica, a spin-out from Oxford University’s internationally acclaimed

Mobile Robotics Group, to support the adoption of mobile robotic applications, and examine their potential impact on risk management and insurance solutions.

The contours of the “smart world” the IoT could make possible are just starting to come into focus. And while numerous questions remain, we are ready to support and enable innovations in technology by helping identify risks and developing solutions to protect companies when the unexpected occurs.

Lisa Hansford-Smith is senior underwriter, cyber, tech and media, XL Catlin lisa.hansford-smith@xlcatlin.com www.xlcatlin.com

February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

facebook.com/biznessreporter

15

info@lyonsdown.co.uk

Inspector Dogberry BOSCH HAS introduced Pebble Smartwatches to its US plant

retailtechnologytrends.com This beautifully presented blog is run by retail technology specialist Tim Dickey and features long articles tackling the key technology issues facing retailers today. Recent posts focus on the ways self-service checkouts can benefit businesses, including the unique opportunities they present for point-of-sale design.

By using the smartwatches, Bosch has been able to eliminate

better operator efficiency and

machine stoppages due to

productivity on its manufacturing

feeder jams and other specific

line.

faults at the Anderson plant.

The smartwatches have also

sorts of smart devices, Dogberry

improved operator response time

was extremely interested to

to general machine faults, which

learn that the systems within a

results in significant savings

manufacturing plant themselves

of time and money.

can become interconnected and

Retail Technology Trends

through a device.

in Anderson, South Carolina for

Being a keen early adopter of all

By Matt Smith, web editor

A message is immediately

talk to each other via the internet

received by the

Smartwatches help employees at Bosch’s Anderson plant monitor the production line more efficiently

K3 Retail k3retail.com/blog

operator when a problem or jam

alerted once the machine had

is about to occur. The operators

stopped and needed attention.

can then act swiftly to correct

At Bosch there are currently

the fault or jam, usually before

three smartwatch systems

the line even stops, improving

running on three individual

productivity and reducing

assembly lines. Bosch Anderson

downtime. The smartwatch

is already planning future

system runs 24/7 and for every

expansion possibilities of the

three production days, the

smartwatch system on more

system eliminates approximately

assembly lines throughout

one hour of downtime, based on

the plant.

Retail technology provider K3 Retail posts regularly to this blog, which takes a look at the different ways technology can make life easier for retailers. As well as examining new devices and techniques, articles bring you updates from some of the biggest events in the industry, including NRF 2016 in New York.

Cisco Retail blogs.cisco.com/retail Does your business know how to get the most from digital? How should you design a roadmap for digital transformation? And how do you keep all this new technology secure? Experts from technology giant Cisco give their thoughts on the important dilemmas facing retail businesses in this section of its blog.

Payments Views paymentsviews.com

time studies and the average frequency of feeder jams. This equates to 122 hours of additional production per year.

Before the smartwatch system, buzzers and red lights informed the operators of problems on the line, but this meant the team lost valuable

Twitter: @dogberryTweets

time as the operators were only

Barclays Mobile Banking (Free – iOS, Android) A masterclass in what a modern banking app can do.

Features include the ability to pay a phone number and cloud storage for important documents.

idealo Price Comparison (Free – Android) Make sure you’re paying the best price around with this app, which compares offers at stores across the web simply by scanning barcodes.

The trust equation: integrating privacy and security by design

W

ith a projected value of $2trillion by 2022, the global internet of things (IoT) promises to deliver a new wave of innovation that will change the way we live, work and play.

As developers compete to bring new IoT applications to market, forward-looking developers are addressing privacy and cyber-security risks during the design process, and for good business reasons.

A design-stage focus on data privacy and security makes good commercial sense. It is also a legal obligation. The recently approved EU General Data Protection Regulation (GDPR) will fortify

existing privacy and data protection rules when it formally takes effect in two years’ time. Companies providing services to EU consumers will be subject to the principle of “privacy by design” and new accountability requirements. In addition, the recently approved EU Network and Information Security (NIS) Directive, which must be transposed into national law by 2018, will impact many IoT deployments.

These regulatory developments will bring about substantial changes in the way that businesses deal with cybersecurity and data privacy. Increased cyber-insurance premiums and liability risks will further add to the pressures on

IoT developers to build in appropriate safeguards well before the new regulations come into force.

The bottom line is this: as the internet matures, trust is becoming an increasingly important factor in the digital ecosystem.

IoT providers that fail to address these concerns before commercial launch may jeopardise the value of their businesses and run substantial legal and regulatory risks.

Ann LaFrance is global co-chair of data privacy and cyber-security; Aline Doussin is senior associate in regulated industries at law firm Squire Patton Boggs ann.lafrance@squirepb.com www.squirepattonboggs.com

You may be keeping up with the latest payments news, but reading different perspectives on developments can really help when thinking things over. Here, the views come from consultancy Glenbrook, whose experts discuss everything from the impact of the internet of things to whether Bitcoin is just a buzzword or the future of money.

16 · Business Reporter · February 2016

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

INSIDE TRACK Loyalty yes, patience no

S

o how many brands were out there with Valentine’s promotions this year? And how many promotion ideas and loyalty programmes, like Valentine’s aspirations, have fallen by the wayside?

Don’t offers still work?

Of course they do! Loyal customers even wait and expect to be rewarded for their loyalty – provided we can reach them with “relevant”, “targeted” offers for instant gratification.

Why no retailer can stand still in this dynamic environment

R

etailers are in the eye of the storm of change, challenge and innovation. In this state of flux it is crucial for retailers to try to keep up with their customers’ constantly changing shopping habits and demands across all channels, and those that don’t will fail.

With this whirlwind of change retailers are being bombarded with a huge range of innovations, from i-beacons, RFID and other locationbased marketing tools, a raft of loyalty solutions to the mind-boggling number of mobile payment initiatives, one-hour delivery, international ecommerce, social media, AR and VR, click-andcollect, big data and analytics and more! They are all being driven by the consumer, and finding the right partners to work with is business critical to helping them survive and flourish.

Retail is now what it should have always been – totally customer focused.

Customers have the money, they have the power of online, smartphones and the transparency this gives them, and they like to shop where, when and how they choose to across all the channels

– physical and digital. They are fickle and impatient – they don’t like to wait.

Who wants to stand in a queue? They want the best deals, and armed with smartphones are able to compare prices as they shop. They want it now, and they don’t want to pay for delivery.

They like to click and collect and return goods to the store – they don’t care what channel they use – they expect the same service and for retailers to recognise them, they still like trips to the shop but want better service and entertainment, and they have a voice as they praise and complain on social media and other channels.

Retail is undergoing the greatest change and challenge it has ever faced. It has never been so competitive.

Retailers need to listen to customers and get smart. They need to invest in the total range of solutions that will win and retain customers. Some 80 per cent of sales still take place in-store, so make them nicer – easier to navigate, better looking, with fewer queues, more smiling and more knowledgeable staff.

All this is good news for the better retailers and those that are well funded.

More good news is that the suppliers

of technology and design solutions are innovating like never before to come up with clever products and services to help the retailer win. No retailer can stand still for a moment in this dynamic environment and has to keep abreast of developments – customers will be shopping tomorrow and what their demands will be.

That’s why RBTE (technology) and Retail Design Expo (design) and the newly launched Retail Digital Signage Expo are essential for retailers. In one place for two days they will find out what’s new and what is around the corner: 650 exhibitors, more than 290 speakers in the conference sessions, bootcamps, innovation trails and awards, workshops, networking and more.

RBTE, Retail Digital Signage Expo and Retail Design Expo is on March 9 and 10 at London’s Olympia. For enquiries call +44 (0)20 8874 2728.

For free registration visit www.rbtexpo.com www.retaildesignexpo.com www.retaildigitalsignageexpo.com

The era of the instant Traditional loyalty programmes that were designed to drive loyalty by accumulating points do not work in the era of the instant. In fact, today’s customers are not motivated by accumulating points for intangible benefits, as the very idea of accumulation does not resonate with the instant generation.

And this, coupled with channel pervasiveness, has led to the emergence of the promiscuous customer, who has different ideas about shopping, brand affinity and loyalty.

The customer has been completely empowered.

She has price and product discovery in the palm of her hand, she makes informed choices. And when the controls are in

her hands, I believe the marketer has the opportunity to do more.

You let me do more Today, the what, why, when, where and how of each customers shopping behaviour is being communicated in real time to the marketer. Marketers can study which aspects of the brand resonate most with the customer and use that information to create promotions, offers and bundles that customers appreciate.

And marketers can make targeted promotions even more powerful when they can deliver them in real time via smart devices at the most opportune time.

The customer is ready – are we?

Today retailers that I work with have recognised that the customer is ready for their brand to deliver real engagement and relevance.

And they are leveraging advanced analytics and personalisation to do that consistently.

Nick Cole, VP, Manthan +44 7770 535311 nick.cole@manthan.com

Business Reporter · February 2016 · 17

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

Getting started in IoT: enabling connected retail

Y

ou may have seen that the internet of things (IoT) is rapidly expanding with 25 billion connected devices by 2020. IoT describes a world of connected devices that operate and transfer information independently without human interaction. IoT is about connecting everyday physical objects to the internet, communicating among each other creating a network of smart devices.

The IoT can present a wealth of business opportunities and has the potential to create a massive impact on daily activities and overall business models. By harnessing the power of the IoT, businesses will have the ability to create operational efficiencies today and in the future create innovative value-added services.

Adoption of IoT within respective

industries will have different priorities.

Within retail uptime is critical.

If you’ve already felt the pain of having your POS system down and business come to a standstill, you’ll know that when outages occur, applications become useless. This can then result in lost productivity, damaged reputations and, most of

White label crossborder payments AEVI provides a white-label, hardware-independent and fully integrated end-to-end solution portfolio which extends merchants’ cross-border capabilities to accept and process F2F payment transactions by any acquirer.

The product portfolio is completely white-labelled and meets customers’ demands to keep their brand at the centre of attention. Transaction data will be consolidated and is more easily accessible, as AEVI routes transactions through a single gateway which brings together all data in one place, putting the merchant back in control. By being connected to AEVI’s central platform, which ensures the seamless processing of F2F payment transactions, loyalty transactions and value-added services using vendorindependent EFT-POS, mPOS and also ATMs, it has created a strong value proposition for market participants to overcome the barriers

Email us to receive your copy of Getting Started In The Unfamiliar World Of IoT at marketing@wyless.com

Emerging payments technology is giving consumers the choice they want

T

he payments industry is in the process of a revolutionary journey.

Technology, devices and consumer behaviour have all advanced at a significant pace, and many suppliers and traditional market leaders – such as banks, merchants and acquirers – are struggling to keep up. In order to fulfil consumers’ expectations and offer up-to-date solutions in payments and value-added services, we need to collaborate and be open and flexible to the market needs instead of driving a closed business approach.

AEVI has built an open ecosystem in order to provide choice, flexibility and strategic value. One solution which brings banks and acquirers closer to their merchants and merchants closer to their consumers, opening up new business opportunities for payments, value-added services and beyond.

all, a loss of revenue.

Be prepared, be safeguarded. At Wyless, our goal is to help businesses realise the full potential of the internet of things.

C

Opening up business opportunities for payments, value-added services and beyond of complex integrations, regulation and certifications.

Create new revenue streams Merchants need a futureproof solution, enriching payments with value-added apps and services to turn challenges into strategic upside potential with real endconsumer interaction. That’s why AEVI has created the first white-label B2B appstore and cloud platform linking banks, acquirers and app solution providers to deliver valueadded services to merchants and consumers through its innovative all-in-one POS, Albert. Albert is an androidbased tablet with an integrated encrypted PIN pad, card reader and receipt printer, capable of accepting secure

payments (PCI certified).

AEVI is offering with its B2B marketplace a brand new channel for app solution provider to develop and distribute high-quality apps for the next generation of payment devices.Merchants can download apps from an associated app store in order to customise their devices and create their own operational environment to their needs.

Standard “pinch and swipe” gestures make the apps easy for merchants to use, and improve the quality of interactions with consumers by turning transactions into enriched interactions. In addition to regular app stores, AEVI offers a full device life-cycle management, from provisioning a device to a merchant through to final

decommissioning and monitoring in the field.

Acquirers and banks are able to increase merchant retention and generate new revenue streams and business models to go beyond payments with their own unique branded experience.

Through its open ecosystem AEVI is providing new opportunities for all businesses to grow, develop and be brave in their ventures by embracing collaboration and linking the traditional and new market players to drive innovation even faster to market and the chance to truly revolutionise the payment industry.

Hans Langenhuizen is chief commerical officer +49 5251 693 3630 info@aevi.com

ashless payments overtook the use of notes and coins in 2014, according to the Payments Council. A year later, the Sage Pay Payments Landscape Report found that 44 per cent of consumers consider a tailored payments process to be very important, yet less than one in six thought UK businesses were leading the way on payment innovation.

Clearly there’s a disconnect here.

So what can the UK’s businesses do to effectively manage their money and grow their enterprises?

Consumers are increasingly seeing drawbacks to cash transactions. In our survey, business-owners predicted that cash will be only the fifth most popular payment type in 2020 – after debit/credit cards, contactless payment, PayPal and mobile apps.

Our research shows this trend is fuelled by four things: convenience, security, ubiquity (the same way of paying for things in different scenarios) and a trusted partner. Business owners know they need to

catch up with technology, and the people who use it.

What happens next?

The payments industry is incredibly fast-moving thanks to the proliferation of consumer-friendly technology.

The customer journey consists of more touchpoints than ever; people check prices online before they visit stores, price compare via mobile when they’re shopping, and seek out reviews on social media. There are increasing demands from customers, and it’s up to businesses to give them what they want. With £1 in every £4 spent online and 37 per cent of online sales being made on a mobile device, businesses are expected to enable a seamless payment experience.

Our report found that more than one in four consumers say they are more likely to shop somewhere that offers a greater range of payment methods.

The future of payments – both online and offline – is choice.

Seamus Smith (inset) is CEO of Sage Pay 0845 485 7898 www.sagepay.co.uk

Business Zone

18 · Business Reporter · February 2016

The future

How analytics is changing the way retailers operate

R

etail analytics technology is changing the way bricks and mortar retailers engage with their customers. Modern consumers demand more and more in terms of service, choice and convenience. But today’s best retailers are up to the challenge and are using data and technology to deliver the best possible customer experience, while also delivering a profit. Technology that helps them to understand what their customers want, and where and when they want it, is key to getting this right.

Despite the growth of e-commerce, 90 per cent of all purchases are still made in the bricks and mortar store.

But competition for each sale is fierce so the customer’s experience in-store has to be perfect to guarantee a conversion.

That’s why it’s crucial that retailers understand how their customers interact with the store. From how they move around the sales floor when they arrive to what products they’re drawn to, it’s all about gaining a complete picture of what drives them to make that final purchase.

Success hinges on the retailer’s ability to harness that in-store behavioural data and use it to their advantage – by finding opportunities to delight, engage and entertain customers. This behaviour-led approach is made possible by retail analytics. The technology anonymously gathers information about customers as soon as they approach the store, and throughout their journey. With this real-time insight at their fingertip, retailers are empowered to make rapid

“Success hinges on the retailer’s ability to harness in-store behavioural data and find opportunities to delight, engage and entertain customers” decisions that can be acted on immediately. The implementation of operational initiatives around flash promotions, staff scheduling and store layouts, for example, can all be measured by analysing their effect on factors like abandonment rates, conversions and repeat visits.

Retail analytics brings the retailer closer to the customer – placing the most popular promotions in the most prominent positions, making sure the right products are always available and

ensuring that the most experienced staff are on hand at peak times.

Shopping centres can make huge gains from retail analytics. Through one simple dashboard they can analyse the performance of the entire centre, measuring marketing initiatives and evaluating the positioning of each retailer. All with the aim of increasing visitor numbers and dwell times, and again, improving the overall customer experience.

In a world where retailers need to work harder to win and keep every customer, retail analytics helps brands to be more proactive in their decision making, responding to customer behaviour to continually improve store performance. info.emea@shoppertrak.com www.shoppertrak.eu

In focus: Digital in the store

T

he shopping experience has undergone massive changes over the past two decades, especially as e-commerce has won over consumers, and smartphones have become the must-have accessory. While consumers have increased their demands for seamless experiences and personalised touches, wherever and however they shop, companies like Smart Engine have developed advanced technology that enables retailers to navigate a digital world that continues to evolve at a dizzying pace.

Smart Engine leverages a wide array of in-store technologies meant to draw

consumers through the door and to provide a seamless omni-channel experience.

It is all about serving the customer from the online experience out of the store all the way through the store.

Smart Engine’s leading digital loyalty marketing platform enables retailers to evaluate customer data from multiple data sources to provide the highest

offer conversion through personalised targeting.

Predictive analytics identify the most profitable customer segments for target marketing campaigns. Breakthrough innovations of proximity marketing, through the use of location-based technologies such as Bluetooth-connected beacons, accelerate ways to provide more personalised, real-time messages, offers and

promotions. Specific shoppers unaware of sales or promotions will see relevant product information and targeted advertisements, and can pick a discount on the spot by scanning a code at checkout – all done via their smartphone.

One of Smart Engine’s European customers is a large department store.

This particular customer issues 10,000 highly targeted coupons through the platform, with a 79 per cent activation conversion and a 27 per cent rate of conversion into redemption. office@smartengine.solutions www.smartengine.solutions

Cash isn’t dead for consumers

S

eemingly every other day we see yet another article forecasting the death of cash and telling us that we will soon be making everyday transactions with wearable payment technology. Of course, the more tech-savvy of us probably will be, and many already are, but is the general UK consumer really ready and willing to adopt this electronic method of payment alone?

The 2015 Ipsos Mori Lloyds Bank survey showed that 48 per cent of UK respondents believe they will use contactless payments every day by 2025, but, with 52 per cent saying that cash will still be used as a day-today method of payment in 2025, it is unlikely that we will be living in a cashless Britain any time soon.

Cultural anthropologist Bill Maurer, whose research focuses on the relationship between currency and technology, recently confirmed that, while studies show that the use of cash is declining, it is declining a lot more slowly than people predicted. We have an emotional connection with cash, he says. Its simplicity and privacy are not shared by any other form of payment.

The only reasonable conclusion to all the hype is that we will find ourselves being offered more diverse and advanced forms of payment but that having a choice of payment methods, cash included, will be crucial.

Until a form of payment is introduced that provides all the tried and trusted characteristics of cash, society will not accept its demise.

Sion Roberts (below) is executive vice president, global retail, Glory Global Solutions. Visit www. cashinfinity.net or follow us on http://twitter.com/ glory_global

Business Reporter · February 2016 · 19

AN INDEPENDENT REPORT FROM LYONSDOWN, DISTRIBUTED WITH THE SUNDAY TELEGRAPH

The debate What is the key ingredient of omni-channel excellence?

Tom Fischer Sales and marketing director, Tryzens

Sion Roberts Executive vice president Glory Global Solutions

Seamus Smith CEO Sage Pay

Justin Payne Campaign director Business Reporter

The key to successful retailing has long been recognised as having the right product, in the right place, at the right time and at the right price. While omni-channel adds opportunity and complexity for retailers, the essence of successful retailing remains the same.

The most critical factor to achieve omnichannel success is presenting a consistent identity to customers across all channels.

While incredibly useful, technology can also be the biggest barrier to success if it doesn’t create a consistent experience to customers across every channel. Delivering a great experience online that is unavailable via mobile may end up disappointing as many customers as it delights.

Achieving a consistent identity relies upon synchronised front and back-offices across all channels. Our focus at Tryzens is to ensure that a retailer’s chosen technologies run in harmony, ensuring the customer has a seamless experience no matter which channel they choose.

Omni-channel excellence is often claimed when retailers exploit the most innovative technology, especially in the payment space.

Consumer innovation does give rise to some obvious enablers of omni-channel transactions but tends to be grounded on a degree of investment and commitment on the part of the customer. For example, mobile payments require expensive smartphone technology, online generally requires a line of credit (ie, a bank account), and consumers have to be confident that transactions are secure.

Cash payment gives more consumer choice – particularly for those with no accounts, online security concerns, no access to credit, or with limited access to technology. The numbers and types of customers in these categories can be surprising, and not just low-potential.

Cash is therefore a key ingredient to omni-channel excellence. Successful inclusion requires the right combination of process optimisation and technology application and can form part of an overall cash-chain strategy.

Stop thinking in terms of channels and start thinking in terms of experience. As customers, we now have one constantly evolving experience of a brand and, such is our familiarity with technology, we’ve stopped registering how that experience is delivered, unless it disappoints or frustrates.

Retailers need to provide a consistent shopping experience that intuitively takes into account how customers behave and interact with technology.

In practical terms, customers must be able to engage with the retailer through a variety of channels, regardless of what stage they are at. This could mean browsing your product on websites, in a shop or in a catalogue. It could also mean allowing them to ask your team questions about the product and your service in store, via Twitter or on the phone.

Whether we’re online, on our mobiles, or in store, it should all feel like one consistent and seamless experience, rather than different stages in a purchase cycle.

For a retailer to achieve omni-channel excellence, they need to embrace the key difference between their online customers and their in-store customers, and deliver the correct experience.

If I go to a shop, I want to leave with a product with minimal fuss. If I am shopping online, I want a frictionless experience from browsing to checkout. An enjoyable customer experience is where the excellence lies here, so retailers need to deliver the appropriate experience as per the customer’s approach.

The online aspect has now become the backbone of all retailing, including bricks and mortar, so delivering a seamless experience to customers on prices, offers and stock availability has now become expected.

With digital wallets and payment apps becoming more widely used, it will be great to see these payment methods accepted both online and in store so we can move one step closer to the true essence of the seamless omni-channel experience.

020 7264 5900 tom.fischer@tryzens.com

Visit www.cashinfinity.net or follow us on http://twitter.com/glory_global

0845 485 7898 www.sagepay.co.uk

+44 (0)20 8349 6488 j.payne@business-reporter.co.uk

Spotlight How automated solutions can provide greater accountability, productivity and savings

T

oday’s retail organisations depend on hundreds of sophisticated handheld electronics, such as voice and hands-free scanners, mobile computers, headsets, RFID readers, and POS scanners. These devices are incredibly powerful, versatile – and expensive. In fact, the typical RFID reader can easily cost £750 or more. Multiply this by hundreds of devices per location, and the investment is significant.

However, many retailers do not have an effective or efficient way to manage these devices. Instead, they rely on manual systems that seem to do the trick. Yet, according to Kent Savage, founder and CEO of Apex Supply Chain Technologies®, these systems often have gaping holes. “It’s not uncommon for distribution centres to lose 15 to 20 per cent of their handheld electronic assets each year to, damage, theft and loss,” he said.

Traditional manual systems often end up distracting managers who should be focused on more value-add work. They frequently have to stop what they are doing to seek out and distribute handheld devices, then collect them again when the shift ends. Other systems may simply involve keeping equipment on open shelves

or in unlocked cabinets, and rely on the responsibility and discipline of those using them.

Overall, there is little control or accountability, which is why retailers frequently find thousands of pounds’ worth of high-cost devices in abandoned shopping trolleys or hidden away on shelves in their distribution centres – or even on eBay.

Getting serious about handheld device management “Today’s retailers need to automate wherever they can, control wherever they can, and eliminate inefficient manual processes as much as they can,” said Savage.

Not surprisingly, many of the UK’s top retailers are already leading the way, implementing cloud-based, self-serve automated locker solutions to manage their DC and POS technology.

These systems provide 24/7 automated management, tracking and control for handheld electronics and other high-value

assets. They provide self-serve, automated check-out and check-in, eliminating unproductive manual processes. They give managers visibility into who is using each device, and send automated alerts if anything is not returned on time. They also capture data from every check-out and check-in in a powerful, PCI-compliant data platform that can connect with existing POS, e-commerce and ERP systems.

Immediately, a valuable transformation takes place. First, employees become more accountable for handheld devices.

This effortlessly reduces replacement costs, misplaced or missing equipment and employee downtime. Shops no longer find scanners abandoned in their aisles, and distribution centre handhelds are always charged and ready to work.

Next, productivity goes up. With these self-serve solutions, employees simply use a badge or PIN to check-out or check-in devices, while managers get back valuable hours every day for more productive work.

More importantly, by gaining visibility into their operations through real-time information, retailers obtain valuable insights for improving workflow processes and productivity throughout their DC and POS environments.

Automating handheld device management is just one piece of the puzzle, but it provides an immediate and important competitive advantage by achieving the speed, efficiency and service levels required by today’s demanding shoppers.

See Apex at RBTE, Stand #694, and visit www.apexsupplychain.com/gb/retail-dc-assetmanagement-3 or call 0800 840 4776 to visit the Customer Experience Centre in Worcester