Take a look at how digital transformation is helping leading retailers all over Canada. This includes Canadian Tire’s $400 million drive to shift gears as a clicks-and-bricks retailer. Loblaws PC Plus program and much more.
Ask Rick Neuman, executive vice-president of technology and ecommerce at Walmart Canada what his favourite feature of the retailer’s new mobile app is, and he’ll tell you it’s the “favourites list.”
At one point in the process, beta testers felt the feature was too overcomplicated. But after simplifying it, the experience really shines, he says.
“The other day I made a favourites list, handed it to my wife and she was able to get a $120 basket together in four minutes for a great camping weekend with my girls,” he says.
Released on Wednesday for iOS and Android, Walmart’s Online Shopping app was built through a collaboration with Razorfish Canada. It was developed based on a Canada-wide survey probing what people wanted from a Walmart app. It was also beta-tested by hand-picked customers and the retailer’s employee base as the final version was ironed out.
But perhaps most notably, it comes at a time when Walmart’s reached a tipping point. Up until last month, most web traffic was coming from desktop users, Neuman says. But in June, mobile-based traffic overtook it.
“That’s a huge shift for us,” he says. “Naturally, the dollars side is growing as well… we see massive potential.”
With more than 400 stores across Canada, the bulk of Walmart’s sales are still taking place at bricks-and-mortar locations. But offering a digital option to consumers is just part of doing business in today’s marketplace.
“The whole definition of omnichannel is the realization that you can no longer, as the retailer, ask the customer to shop in one particular way,” Neuman says.
The app also complements the website, which supports a responsive design for mobile users, by offering a more convenient channel to loyal customers, he adds. “The importance of mobile is becoming higher on our priority list,” he says.
Aside from the favourites list, the app features weekly “flyer features” that are geo-located to the app user. If a favourite item goes on sale, the user can be notified with a Rollback Alert. In the Toronto area and Ottawa, customers can complete a shopping list on their app and book a time to pick it up in-store.
A barcode scanning app works in store to provide shoppers with more product information and user reviews and provides a price check. But even outside of the store, it has its applications, Neuman says. If you empty that box of Cheerios, scanning the bar code is a fast way to add it to your next shopping basket.
“We envision our customers using that to replenish products they use up in their home,” he says. “It allows for incredibly quick interaction and takes searching and browsing out of the equation.”
Walmart developed the application with an agile methodology. While Razorfish focused on the front end, Walmart’s own in-house technology team did the work on the backend, leveraging the same infrastructure used to run Walmart.ca.
Walmart has a technology team both in California that focuses on the Canadian market, as well as a local group that is based in Canada and identifies the features customers want to see.
When it came time to beta test the app, many Walmart associates volunteered to help.
“They were not shy with their feedback,” Neuman says. “One of the things they told us was on the product pages, some of the information was hidden behind these ‘accordions’ and that made it hard to understand exactly what you were buying.”
As a result, the ‘accordion’ user experience aspect was cut in favour of a cleaner approach.
Walmart.ca has become one of the top-trafficked retail sites in Canada, Neuman says, and its numbers compare well against even major media brands. The site services the same needs as a physical store, and in some cases even more – for example a store can only put five different patio sets on display, while there’s no limit to the number of sets shown online.
While the retailer’s focus remains on setting low prices, digital convenience also ranks highly on Neuman’s list of favourite priorities.
“As more Canadians move into the digital space, the demands on IT become higher,” he says. “My goal is to be able to step into that, to provide customers the style of life they’re looking for.”
This is not your grandfather’s Canadian Tire.
An augmented reality catalogue. Virtual reality store displays. A gaming lab. And a fitness obsessed tech genius based in the Ukraine.
They’re all part of a push to transform the 94-year-old seller of hockey sticks, patio sets – and yes, tires – from a bricks-and-mortar historical icon into a global retail innovator.
In a presentation at the CIO Peer Forum in Toronto on Thursday, chief technology officer Eugene Roman made it clear he’s not just playing catch up; he wants to make Canadian Tire a digital leader the rest of the pack will have to keep up with.
“We aren’t interested in best practices. That’s for our competitors. What we’re looking at is next practices,” said Roman.
Hence the three digital innovation centres Canadian Tire has opened since 2013 in Calgary, Winnipeg, and Kitchener-Waterloo. There’s a lot going on, including app development and testing, a cloud computing facility, a high-performance data centre and a digital content warehouse.
Roman has certainly kept those facilities busy since he became CTO in 2012. The company’s Fast Find technology, which took three years to develop, can provide an almost real-time view of any product’s availability anywhere in the retailer’s inventory and distribution chain.
Recently, Canadian Tire also created its own point-of-sale system. It is cloud-based, 50 per cent cheaper to run than its predecessor, modifiable on demand and, in Roman’s estimation, four to six times faster than most POS solutions.
“We were behind”
The CTO mentioned that some of this innovation involves dabbling in the Internet of Things, bots, 3D printing, the neuroscience of shopping behaviour and even gaming. (“We have a gaming lab,” he revealed, and it’s in Winnipeg.)
Roman didn’t drop any hints about how gaming technology could fit into Canadian Tire’s future. But he did acknowledge the company has dropped a fair amount of money on its digital efforts over the past three or four years.
“We spent $400 million because we were behind,” he said matter-of-factly.
While many retailers are shutting stores to go completely digital, Canadian Tire – which also owns the Sport Chek and Mark’s chains – is sticking with a bricks-and-clicks model.
“Stores matter. Online matters. It all matters. Companies that do not figure that out will not survive, I guarantee that,” Roman said.
He calls Canadian Tire’s approach ‘phygital’, a strategy that emphasizes both physical stores and digital channels. One example is the chain’s 140,000 square foot Edmonton store that opened last June. It features huge interactive video screens shoppers can use to design their patio or backyard with help from Oculus Rift virtual reality headsets.
The recently released Wow Guide similarly bridges augmented reality with more traditional customer channels. Twelve million copies of the catalogue were produced in paper form. But readers who use the retailer’s mobile app can also get clickable details or video links about certain products when they hover over the catalogue with their smartphone or tablet.
Roman’s quest for digital innovation also bridges international borders. He said his firm holds regular “tech jams” with developers in Ukraine to brainstorm and run test demos. That’s where one eccentric tech genius named Misha is based.
“He’s the Steve Jobs of Ukraine,” Roman said. “He didn’t own a shirt, just tank tops, so we got him some Mark’s shirts. He exercises three hours a day – at work. He says he needs it to cool his brain down.” (No word on whether Misha uses a Canadian Tire treadmill in the office.)
Here in Canada, the chain’s IT team has seen some big turnover since Roman joined the company.
“Forty per cent were let go within 90 days because they said ‘I can’t work this way, I want to work in my cubicle,’” Roman recalled.
He said about 120 new people (also Canadians) have since been hired, however, to replace that talent.
The digital transformation journey is still unfolding at Canadian Tire. Although Roman declared on Thursday that “the two major competitors are Amazon and Walmart,” his own company has yet to provide something offered by both U.S. giants: home delivery for online purchases.
There have been a few bumps along the way as well. Sport Chek recently emailed customers promoting a new feature to rate and review past purchases on its website. When the link to the feature didn’t work, the merchant sent another email (titled ‘Well, this embarrassing’) to apologize for the error.
At Canadian Tire Corp. there are 2,500 employees that are logging into Facebook on a regular basis to post, comment, like, and share while they’re on the clock – and their employer is encouraging them to do so.
That’s because Canadian Tire is the first company in Canada to implement Facebook at Work, the new collaboration offering from the world’s largest social network that provides companies with a separate internal network.
Just six weeks after being rolled out at the retailer, Facebook at Work is already providing a single place of collaboration for employees, says Bonnie Agostinho, vice-president of corporate at CTFS delivery, IT at Canadian Tire. Previously, the firm had multiple intranets for exchanging communication and relied on Microsoft Lync for some collaboration tasks.
“Nothing is as easy to use as Facebook,” Agostinho says. “Our employees are familiar with it from personal use. You don’t need training.”
Unveiled in early January, Facebook at Work still isn’t generally available. But it’s been working with select customers on pilot projects. Though many employers discourage their employees from using the social network to look at their friend’s cat photos during work hours – or even block it with a firewall – the Silicon Valley-based firm is hoping its social networking solution can catch on for collaboration in the enterprise.
Interest in the product has been significant so far with 70,000 requests for access, according to Julien Codorniou, Facebook’s director of platform partnerships and Facebook at Work. Canadian Tire was among the first to reach out, with Duncan Fulton, president at FGL Sports Ltd. (a subsidiary of Canadian Tire) reaching out after working with Facebook on its social flyer offering and video ads.
Eventually, all of Canadian Tire’s 85,000 employees across its multiple divisions and brands (including Sports Chek and Mark’s) will be able to access Facebook at work, Cordorniou says, from entry-level workers right up to the C-suite.
“The CEO of Canadian Tire isn’t a big Facebook user, but he was addicted to Facebook at Work,” he says. “We try to create the feeling that you all work for the same company with the same culture.”
So far Canadian Tire has on-boarded about 5,000 active users to Facebook at Work, Agostinho says. But the benefits of executive adoption is already being seen. When one call centre rep posted a question about why a certain function couldn’t be done online, a vice-president responded saying online support had just been added and it could, in fact, be accomplished online.
“Before, the call centre rep probably would have struggled with that for weeks, gone to a manager, and that manager may not have known who to go to for the answer,” she says.
Other examples of executive participation include the chief technology officer ranking as a top influencer, and the CEO posting pictures from the executive meeting. The chief operating officer from SportChek is also on every day, posting about his business.
“We like to think of it as the primary way we’ll communicate with our employees,” Agoostinho says. “The hope is that it reduces some of the email traffic.”
Canadian Tire held a big launch event for Facebook at Work to encourage its employees to adopt it. (It’s said that certain hockey player celebrities were in attendance.) It worked. As soon as the first email about the initiative was sent out, employees were claiming their own accounts whether they had received an invitation or not.
One challenge the roll out is facing right now is that a Canadian Tire email address is required to register. Most store-based employees don’t have a corporate email address, so the team is looking into other ways to provide accounts.
Just like its consumer counterpart, Facebook at Work is available as a mobile app via Google Play or the App Store. But Codorniou stresses again that there’s no connection to the social network for the masses. There are no ads, no games, and all of the data generated belongs to the company that operates it.
“This is a place where work happens and you get the job done,” he says.
Of course, Facebook is a cloud service and that means corporate data is stored on Facebook’s servers. Currently the data is replicated across four data centres – one in Sweden and three in the U.S., according to Codorniou.
There’s no price tag on Facebook at Work yet. Beta testers like Canadian Tire are using it free of charge right now, and Cordorniou says a freemium business model will eventually be put in place. That would mean that Facebook at Work could be free to use for its social networking features, but a few dollars a month would give access to added support, analytics, and third-party integrations.
How much would Agostinho pay for the solution, given her experience so far?
“If it becomes the best, easiest way to collaborate across the organization, that’s worth a whole bunch of money,” she says.
It can be hard to put a dollar value on productivity, she says. Also, she expects that the younger generation of workers just expect to have access to tools like the ones offered through Facebook.
Then there are the unexpected uses.
True to the platform, employees at Canadian Tire Financial Services started a group to share photos of their pets. Before long, the person responsible for buying pet supplies for Canadian Tire started using the group as a focus group, gathering reactions to new products that could potentially be added to store shelves.
“If you’re going to be the most innovative retailer in the world, you want your employees all over this technology,” Agostinho says.
Using Facebook at work may never be the same again.
Canadian Tire Corp. announced its second product launched to the mobile apps market and this time the effort supports its financial services division with the release of mPay & Play.
The app, available on Google Play and Apple’s App Store as of today, targets the 2 million Canadians carrying a Canadian Tire Options Mastercard in their wallet. It facilitates the ability to pay with your smartphone at Canadian Tire store tills, collect and spend Canadian Tire money, and earn badges that can unlock more loyalty rewards. As a bonus, there’s a sharp shooter hockey game built into the app.
The new mobile offering – a successor to the Canadian Tire Retail app launched last year, which digitized Canadian Tire money for the first time – was described as the next step in the company’s digital journey by Eugene Roman, chief technology officer at Canadian Tire. He pointed to the Digital Garage that Canadian Tire opened up at Waterloo, Ont.’s Communitech Hub in May, and a gaming lab the company has in Winnipeg.
“This is something we believe sets a whole new direction for our customers and how we interact with our customers,” he said. “Digital disruption is here, it’s been with us for a long time. We as a company and a group of dealers and operators of stores embrace that.”
The app is secured through end-to-end encryption, he said. Rather than store the customer’s credit card information on the smartphone, a one-time bar code is issued to the device when a customer is ready to pay. That bar code is then scanned by the cashier.
After use, the bar code is virtually shredded so it can’t be applied to a second transaction. While Roman didn’t detail the exact process used to issue the token for payment, he described it as a nine-step process that is completed in 0.2 seconds and invisible to the user.
“We’ve seen too many companies struggle with security around everything digital,” he says. “We’ve very sensitive to security at Canadian Tire.”
The app extends to other stores owned by Canadian Tire, SportChek and Mark’s. Those brands will be able to accept payments from the app soon, according to Cam Thompson, digital marketing manager at Canadian Tire. But this app offers more than just payments.
“It’s a way we can offer customers to interact with the financial services side of the company,” he said. “We heard loud and clear they wanted to see account information on an app. So we built our version of a banking app into this solution.”
mPay & Play is complementary to the retail app, Thomson says, and there are some linkages between the two – such as the ability to collect and spend Canadian Tire money.
The gamification aspect of the app is centered around earning badges for different activities. Your first online purchase with Canadian Tire, your first time buying gas from them, or using the pharmacy, etc. all earn you a badge. After earning 10 badges, customers can earn 10x the amount of Canadian Tire money on their next purchase at the store.
The hockey sharp shooter game is just for fun, and Thomspon says they’d like to add more games in the sporting vein. That may not be the only update in store for the up, as Thompson also didn’t rule out extending the app’s capability to pay with at more stores beyond the Canadian Tire family.
It’s on the “potential roadmap,” he said.
Canadian Tire released this video that demonstrates the app’s features:
It’s time for Canadian businesses to really get personal, according to the head of one of Canada’s best-known loyalty programs.
Although many companies are using analytics for marketing, not all are truly harnessing the power of personalization, said Peter Danforth, senior director of loyalty and customer analytics at Loblaw Companies Ltd.
His role includes overseeing PC Plus, the loyalty program where shoppers can earn points and receive offers for brands such as PC Financial banking and the Loblaws, No Frills and Zehrs grocery chains.
Many businesses still use data to merely divide their existing customer base into more defined segments, Danforth told the Canadian Marketing Association’s Insights analytics conference, held in Toronto on Thursday.
Instead, businesses accustomed to simply targeting market segments – like moms of babies vs. moms of teens, for example – should use today’s analytics and data processing power to tailor marketing to each individual customer, he suggested.
“Stop looking to segmentations to help define your customer strategies. No two customers are the same,” he said, adding that success is more likely “the closer you can get to dealing with (a customer) on a one-to-one level.”
Danforth told the audience that back in 2011, Loblaw tried to rethink the marketing strategy for its PC Plus loyalty plan. It was a tall order, considering that over 30 Loblaw-owned brands are included in that program.
Loblaw looked to the airline industry for inspiration, specifically U.S. carrier Delta Airlines. As Danforth explained, the airline sector often lost out on potential revenue when seats went empty or too many tickets were sold at deep discounts. Using digital data about the behaviour and transactions of individual customers, Delta was one of the first airlines to adjust seat pricing for optimal revenue potential in near real time – “and it saved their business,” Danforth said.
Encouraged by Delta’s success, Loblaw shifted its own marketing focus from customer segments to specific shoppers.
“What we asked when we started this is ‘what do individual customers do?’” said Danforth.
The ability of newer technologies to collect, process, analyze and aggregate huge amounts of data allows Loblaw to “make 10 million promotional decisions on a weekly basis” in almost real time, he said.
Paper vs. personalization
“We said you can build a (paper advertising) flyer and you’re going to be wrong 95 per cent of the time or you can let us build you 10 million digital flyers” personalized for each shopper, Danforth recalled.
(Loblaw is consistently tight-lipped about the impact of PC Plus on its overall revenue stream; the company includes results for PC Plus within those for its financial services division instead of breaking them down separately. But Danforth did reveal that the loyalty program now has 10 million active members, up from 6 million in 2014.)
He urged retailers to always base marketing on customer needs rather than on their own business needs. At PC Plus, that means sending each customer offers on specific items they actually buy, not sending them coupons for products they never buy just so Loblaws can shift certain inventory, he said.
“The second you decide what the customer should be seeing instead of relying on the data (about what they really want) is when you’re not doing personalization, you’re imposing your will on them … It’s direct marketing but it’s not personalization.”
A global survey released last September appears to bolster Danforth’s argument that consumers prefer marketing that is personalized for them. The Aimia poll of 20,000 consumers in 11 countries found that only eight per cent feel they receive better offers from companies in exchange for sharing their data.
The study’s authors concluded that “businesses are not using customer data to personalize and tailor customer experiences effectively,” with only 23 per cent of consumers saying they receive communications from businesses that are “highly relevant to them.”
We’ve all dropped in to Home Depot to pick up something for a DIY project at some point. But with the release of a new line of mobile app-enabled products, you might start thinking of it as the Smart Home Depot.
The retailer is partnering with Wink to provide one mobile app that can control all the smart devices that you buy here. That way consumers won’t suffer from app fatigue, installing one app to control your thermostat, another for your coffee maker, another for your rooftop hot tub, and so on.
From a consumer perspective, the cost is as invisible as the wireless network that connects your appliances. The one thing you will have to buy is the Wink Hub to bring it all together.
“With the Wink Hub, we’ve got all the technologies built and baked inside. So it doesn’t matter what you buy, whether it’s Z-Wave, or zigby, or WiFi, or Bluetooth, you don’t need to know as a consumer what the product is, you just take it home and it’s going to work automatically,” says Ron Cleary, senior electrical merchant, Home Depot Canada.
Home Depot is betting that with people so connect to their mobile devices today, they will want to connect to their homes through their devices. Not only can you control your appliances, but you can set up automated sequences with a “Robots” feature. Want soothing classical music to great you when you get home? Have your stereo turn on as soon as you unlock the front door.
Home Depot’s partner in this, Wink, is a spin off company from Quirky. It’s also partnered with GE to control its line of connected products.
“The time is now because you can get things at the right price point. More people have cell phone penetration so that’s a big part of it, and there’s more great vendors out there offering solutions. So bringing these products together and having them interoperate together through the hub, it’s a really great time to bring them together,” says Garret van der Boom, director of business development at Wink.
The idea is that you don’t have to undertake a major renovation project to turn your humble adobe into a futuristic techno-palace. You just upgrade to a connected home by buying one compatible product at a time, connecting it all through your home network and controlling it from the Wink app. That also means Wink has a growing list of connected products. You’ll see them hit Home Depot shelves in the weeks ahead.
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