Jayant Chhallani

Atos Real-time Retailing powered by SAP HANA and HDS UCP

Blog Post created by Jayant Chhallani on Apr 27, 2015

Recently, Atos launched state of the art solution for retailers. These solutions will help retailer to increase customer footfalls across channels, build intimate customer experience, improve supply chain and reduce technology cost.

Atos retail solutions leverage SAP HANA and the Hitachi Data Systems Unified Compute Platform (UCP) which is optimized for SAP HANA® deployments.  HDS UCP solutions simplify the deployment of SAP HANA while also helping  accelerate the time to value of Atos retail solutions.  

Some of these solutions are detailed below:

Atos Advanced Market Basket Analysis powered by SAP HANA

For retailers & wholesalers, inventory is usually the largest single asset on the balance sheet and the cost of that inventory is the single largest expense item on the income statement. As per Ted Hurlbut, inventory carrying costs are estimated to often represent 25 - 30% [4] of the value of inventory on hand. And for an average Fortune 1000 company, a modest 5% decrease in inventory cost translates into a $20 million increase in profits [5]. Traditionally, retailer has been using different processes such as Vendor Managed Inventories (VMI) etc. to get rid of the burden of inventory carry cost. Although innovations and solutions such as VMI enable organizations to view historical sales, they have minimal to no capabilities for predicting future sales.

With the help of predictive analytics, the assortments can be planned more efficiently, so that best performing articles/products are identified and sufficient stock made available to meet demand, while a lower priority is placed on slower moving items.

Customers who buy one product may typically purchase another product at the same time for any number of reasons — bread & butter, for example. With predictive analytics, once purchasing patterns are identified, an increase in the sales of the first product can trigger an automated decision to increase the inventory of both the first product and its complementary product, helping to maximize total sales volume and customer satisfaction.

Atos Advance Market Basket Analysis (A-MBA) powered by SAP HANA, uses Apriori algorithms to analyze huge amounts of POS TLOG data in order to identify and quantify customer buying patterns, preferences and behaviors. These patterns helps retailers to sell larger basket sizes by identifying products that drive drag-along sales by identifying geographic trends, local demand and performance. These patterns will also help plan & optimize assortments to help drive higher sales & profits across channels.

With the help of massive parallel processing and in-memory computing of SAP HANA, the data can be analyzed at the store level; specific offers can be formulated and rolled out at a local level.

Atos STORe (Strategic, Tactical & Operational analytics for Retail)

As per RSR [0], winning retailers (74%) consistently put more emphasis on making decisions using experience/intuition AND data when compared to laggards (50%) [1]. Winning retailers are moving on to be able to execute with more precision, based on what they learn from customer insights, and to react more quickly to shifts in demand. Specifically, that means improved inventory effectiveness and improved Marketing effectiveness.

Data visualization and predictive modeling are becoming important to retailers’ “basic” BI & Analytical capabilities. Winners are moving faster to deliver insights for operational use through mobile access, alerts, web browser access, and scorecards & dashboards. Key to analytics strategy for “operationalizing” insights is a mobile technology strategy for store employees, and particularly store managers. Today’s most successful retailers really do empower their employees with information and decision-making authority, and customers notice. Both Apple and Amazon.com Customer Service Representatives are empowered to make very high-value customer-related decisions. Today, this solution is under development.

Atos STORe (Strategic, Tactical & Operational analytics for Retail) will help retailers become winners. Atos STORe is powered by SAP HANA, which has pre-built content of more than 200+ KPI across merchandising, supply chain, store operations & multi-channel retailing. Atos STORe is also mobile enabled across platforms with real-time dashboards & reports.

This will help retailer take informed decisions at the moment of truth. This will not only empower the frontline store associate serve the customer better but will also help the senior management take real-time decision on the move.

Location based Personalized Promotions for Retailers powered by SAP HANA

eCommerce (or etailing as it is called) has already cross $1 Trillion ceiling in 2013[3] worldwide & expected to grow at a CAGR of 18.3%. Yet, as per Forrester survey, a whopping 52% of the customers are willing to pay 1-5% more to purchase a product in a physical store rather than buying it online & wait for the product to be shipped [2]. David Geisinger, head of retail business strategy for eBay said, "Physical stores just aren't going away".

Today, retailers are facing two major challenges with respect to the stores. First, increase foot falls into the stores i.e. how to achieve faster ROI on the investments done in the stores i.e. and second, how to increase the wallet share of the customers.

Few interesting examples used around the globe:

Meatpack – (Shoe store in Guatemala) Hijack: It used GPS technology to detect customers of its app when they are in competitor stores, before sending them a message with a discount. It would start at 99% and drop by 1% every second. So, the faster users got to a store, the better the discount.

B&Q App: An excellent response to the growing use of mobiles in stores and the 'threat' of show rooming. Rather than rewarding purchases with loyalty points, the B&Q Club app gives customers a reason to go in-store by offering exclusive discounts on various products.

Carrefour Smart Shopper: A mobile app designed to enhance the in-store experience for the Chinese market. The app uses location sensing technology, a social shopping list, and an ad system that enables retailers to engage with their customers while in store. Customers can also use the app to navigate to the product they want while in store.

And this is where, Atos Location based Personalized Promotions (LbPP) powered by SAP HANA can help retailers enable real time data analysis on billions of POS TLog line items. Atos LbPP will help retailer push right offers & promotions to the right customer in a geo-fenced area derived based on the demographic, preferences, historical purchases etc. Atos LbPP will help the retailers increase the foot fall to the stores as well as increase the wallet share by pushing the right offers & promotions to the customer.

This will help retailers improve the ROI on the marketing spend as well as provide a unified customer experience across channels. This solution is available for co-innovation with customer.

SAP Forecasting & Replenishment powered by SAP HANA

Omni-channel is evolving and maturing. Order anywhere & collect anywhere is now a new de-facto of retailing. The U.S. Department of Commerce estimates that 94.5% of all retail sales still happen in a store but that’s down from 98% just a few years ago. And that doesn’t gauge activities like buy online/return in-store. As the shift piles up, fulfilling online demand moves from a rounding error in store plans to something that must be forecasted and managed on its own. And forecasting demand for online is not as simple as treating the channel as a flagship or extra-large store - demand comes from a much larger base of consumers spread across a much larger geography than any store ever must accommodate. Planning merchandise in that situation is far more complex than the already complex requirements for planning at individual store levels. SAP F&R is available for demo with vanilla scenarios in sapCC landscape.

SAP Forecasting & Replenishment application enables retailers to accurately understand, predicts, and manages the balance between inventory and customer service. The software helps them to increase productivity while reducing order and delivery costs. It includes various aspects in its analysis, such as inventory and delivery data and improves on-shelf availability. Improved fill rates of shelves, Improved shelf turnaround, improved on-time delivery, better store-in-stock rates & reduced inventory because forecast is accurate.

It can help retailers reduced inventory levels up to 15+% with increased service levels up to 98.5%