Sync

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Sync

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Alice Walker N0673122

Stage 2 Project Declaration This submission is the result of my own work. All help and advice other than that received from tutors has been acknowledged and primary and secondary sources of information have been properly attributed. Should this statement prove to be untrue I recognise the right and duty of the board of examiners to recommend what action should be taken in line with the University’s regulations on assessment contained in its handbook.

Signed: Date: Ethics Clause I confirm that this work has gained ethical approval and that I have faithfully observed the terms of approval in the conduct of this project.

Signed: Date: Word Count: 7985

Contents

1 2 3 4 5

Introduction

1.1 Report Introduction.............................................................................1 1.2 Rationale................................................................................................1 1.3 Aims and Objectives...........................................................................2 1.4 Methodology....................................................................................3-5

The Opportunity

2.1 Stage 1 Reflection................................................................................7 2.2 Insights...................................................................................................7 2.3 The Problem.........................................................................................8 2.4 STEEPLE................................................................................................9 2.5 Macro/Micro Trends....................................................................10-11 2.6 Market Drivers....................................................................................12 2.7 The Opportunity................................................................................13

The Big Idea

3.1 The Big Idea.......................................................................................15 3.2 Brand Summary.................................................................................15 3.3 User Journey.................................................................................16-18 3.4 Business Model............................................................................19-20 3.5 Business Objectives..........................................................................21 3.6 Brand DNA.........................................................................................22 3.7 Value Proposition...............................................................................23 3.8 Brand Guidelines............................................................................ .24 3.9 IDEER Model.....................................................................................25

The Market

4.1 Retail Market.......................................................................................27 4.2 The CEM Market................................................................................28 4.3 Market Readiness..............................................................................29 4.4 Ansoff Matrix.......................................................................................29 4.5 SWOT Analysis...................................................................................30

Positioning

5.1 Competitor Analysis....................................................................32-35 5.2 Brand Positioning........................................................................36-37 5.3 Price Point Analysis............................................................................38 5.4 Porters Five Forces............................................................................39

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Consumer Segmentation

6.1 B2B Consumer Segmentation.......................................................41 6.2 B2C Consumer Segmentation ......................................................42 6.3 User Testing.......................................................................................43 6.4 Industry Feedback............................................................................44

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Marketing strategy

8

Communication Plan

9 10 11

7.1 Marketing Objectives.......................................................................46 7.2 Strategy Overview.............................................................................47 7.3 The 7 P’s .............................................................................................48

8.1 AIDA and DRIP Model......................................................................50 8.2 B2B Objectives...................................................................................51 8.3 B2B Strategy.................................................................................51-55 8.4 B2C Objectives..................................................................................56 8.5 B2C Strategy.................................................................................56-57 8.6 Time Plan......................................................................................58-59 8.7 Communication Overview y2&3....................................................60

Brand Management

9.1 Initial funding......................................................................................62 9.2 Start Up Costs....................................................................................63 9.3 Marketing budget ...........................................................................64 9.4 Pricing Architecture...........................................................................65 9.5 Financial Objectives..........................................................................66 9.6 Sales Forecast.....................................................................................66 9.7 Profit and Loss....................................................................................6 9.8 Cash Flow............................................................................................6 9.9 Sensitivity Analysis.............................................................................70 9.10 Measures of Success......................................................................71 9.11 Risk Assessment........................................................................72-74 9.12 Future Growth.................................................................................75

Evaluation

10.1 Objective Review.............................................................................77 10.2 Conclusion.......................................................................................78

References

11.1 References..................................................................................80-82 11.2 Bibliography...............................................................................83-87 11.3 List of Illustrations......................................................................88-92 11.4 Appendix.................................................................................93-119

1

Introduction

1.1 Report Introduction

1.2 Rationale

This report will present the insight to implementation journey used to create the narrative behind Sync, a retail solution offering an integrated digital to physical world of fashion for optimal customer experience. Key insights and consumer frustrations raised in stage 1 will firstly be assessed to discover maximised opportunities for online to offline strategy. Analysis of the external environment will then be evaluated to provide a coherent and achievable business plan.

Subsequently, the remainder of the report will showcase how Sync will fill the consumer desire for in store individualisation and how the brand will be successfully launched in the UK. Future review on how the brand can grow will lastly be presented to showcase the potential of how the business can exceedingly expand.

E-commerce has had a tremendous impact on consumer behaviour, driving proliferation of choice and putting the power in the hands of the consumer. In 1995, Before this technological advancement, the retail landscape looked extremely different as consumers had limited choice of where to buy their goods meaning reaching potential customers was easy (Ungerman, 2019). More than two decades later, there have been many casualties from the dramatic shift from offline to online retail.

The customer journey is rapidly changing and consumers are becoming omni-channel shoppers who are engaging across multiple platforms, often simultaneously rather than sequentially. It is therefore critical for omni-channel retailers to have a detailed understanding of the interplay between online and offline touchpoints. Those willing to respond and technologically transform their in-store offering will succeed in meeting the desires of their consumer and survive the digital revolution.

“It is not the strongest of species that survive, not the most intelligent, but the ones that are most responsive to change” (Darwin, 1859)

In the near future, there will be fewer stores with improved customer services and with less stores, retailers will be able to invest more into ensuring their physical space meets the needs of their consumers (Deloitte, 2019). During this period of disruption in retail, innovation has continued to spark discussion, with many retailers taking the opportunity to reconsider the role their physical stores play in delivering the overall customer experience. New technological solutions can be used to increase engagement both in and out of store, therefore, technology is not a replacement for the physical, rather an enhancement. Brick-and-mortar stores still serve a vital purpose in conveying the brand message in a tactile environment, however they must adapt to rising consumer expectations. Ultimately, this business strategy is critical in determining an effective solution to blur the boundaries between the online and offline shopping experience, providing valuable benefits to both businesses and consumers.

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1.3 Aims and Objectives Aim: To create and launch a successful business that will meet the consumer desire for a seamless and meaningful online to offline shopping experience.

The following objectives have guided the research to accordingly achieve the overall aim of this project.

1) To critically analyse the insights found from stage 1 and transform them into innovative business solutions 2) To evaluate the current retail and customer experience landscape, assessing the external environmental impacts that will affect the launch of a new business concept 3) To strategically position the new business in the market place whilst segmenting the B2B and B2C consumer 4) To produce a clear communication strategy that creates high awareness of the brand through strategic and impactful marketing methods 5) To present a feasible financial plan and generate commercial success that considers possible risks that the business could face

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1.4 Methodology To build on the extensive research attained from stage 1, a range of further research was carried out in order to clarify the insights found and implement the opportunity for Sync Solutions.

Both primary and secondary research was conducted to critically examine the viability of a new brand launch. The mixed research method approach was needed to achieve the objectives as stated previously, and provide a strong foundation of knowledge behind the brand. Due to the technology within the retail market advancing at an extremely fast rate, an overall limitation of the research could include the possibility of it becoming outdated. Therefore, constant audit on changing market conditions and monitored consumer testing must be consistently provided to stay relevant and up to date.

Selecting a sample size is crucial as it would be impractical to collect data from the entire population (Saunders et al, 2009). The methods used in this report focuses more on industry experts as consumer insights have already been discovered in stage 1. However, the sample size when conducting consumer testing reflected the potential age demographic that the business would target. This includes primarily female millennials, aged 23-38. Mintel states that 2534 year olds are the most likely to engage with multichannel retailing (Dover, 2018) making them the perfect fit for what Sync can provide.

Secondary sources were utilised to provide justification behind the viability of the business and provide evidence to support research found in primary methods. Advantages of this method included saving resources like time and money (Ghauri and Gronhaug, 2005). It also presented far larger data sets that are higherquality than personal primary research (Stewart and Kamins, 1993) meaning that a wide scope of professional ideologies was identified efficiently.

A vast amount of secondary sources including academic journals, books, case studies, news articles, videos, industry/trend reports, online articles and magazines were critically analysed.

Various online articles offered free business startup information, statistical market research and in-depth trend analysis. Journal articles on SaaS business models, particularly “SAAS Business Model, How SAAS Works?” (Pahwa, 2016) was extremely valuable in creating a feasible business plan and strategy that would succeed in the real world. In order to gain extensive data from online resources, reports such as MINTEL, Trend Monitor, LSN Global and Trendone were used to offer trustworthy insights and measurable figures in the global market.

A limitation for secondary research includes the process being very time consuming and therefore not leaving a lot of time to conduct primary research due to the time constraints of the project.

Thus, the use of precise criteria and aims were vital in gathering the data in a small time frame as shown in the primary methodology table on the next page. Deliberate distortion could also occur from research found from organisations who may have unreliable intentions, this was then taken into consideration when using this research. Online websites and reports showed different interpretations of the same data, making the interpretations inconsistent and conflicting.

However, these interpretations were analysed and critically evaluated.

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Research

Aim

Reason For Using

Online Survey

To collect quantitative data surrounding consumer buying habits that can be easily presented and interpreted

Online surveys allow for a large collection of data from a sizeable population in a highly economical way (Saunders et al, 2009). It also provides easy to compare results in a visual way from graphs or percentages to meet the aim of easily presenting the findings.

To gain professional first hand opinions on the business idea and highlight any improvements that could be made

The question of feasible probability was answered and with the respondent being an expert within the premium/mid-market fashion industry, it offered valuable insight into their target market.

To explore the consumer attitudes surrounding the new business concept and gain feedback on their thoughts around the idea

Carson et al (2001) refers to the term “group interviews” where the topic is clearly defined and there is a focus to enable interactive discussion. They are more time efficient than 1 to 1s as the interviewee can address a larger number of individuals at once and it offers more complex behaviour and attitudes as participants can interact with each other. “Members interactions are both encouraged and more closely controlled to maintain focus” (Saunders et al, 2009, p.347).

To determine technical and commercial feasibility of the business and understand potential pricing of the product

Contacting a technology retail provider was crucial in meeting this aim and professional knowledge was needed in order to understand how pricing would work in the UK market.

To investigate the consumer attitudes towards the new business concept and gain valuable feedback on how to improve the product

“Interviews gather valid reliable data that are relevant to your research question” (Saunders et al, 2009, p.318). The interview allowed for a detailed understanding on how the consumer felt about the business idea. The concept could also be explained in depth on a 1 to 1 level, leaving plenty of time to discuss how the interviewee felt towards the product and any improvements that could be made.

To receive professional insight into software development and gain advice on how to be a successful start-up SaaS company

Due to the lack of knowledge relating to starting a software business, an expert in the field was necessary in order to gain knowledge, asses the feasibility and minimise risk.

To receive consumer opinion on branding and colour schemes

An Instagram poll is an appropriate method of research to be reached globally and generate a quick and easy response. It is also a highly visual platform so worked well in gaining feedback on preferences like branding and colour schemes.

Expert Email Interview

Focus Group

Expert Phone Call Interview In-depth Interview

Expert LinkedIn Interview

Instagram Poll

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Execution

Limitations

The sample of the survey was a total of 53 respondents, both male and female aged 1850. It included questions about their shopping preferences and uncovered what frustrates them the most in relation to online and in store purchasing. The idea of offering personalisation in store was asked to gain an immediate understanding of consumer interest.

“There is a limit to the number of questions that any questionnaire can contain” (Saunders et al, 2009, p.144). Due to this, most of the questions were yes or no answers which limited the depth of understanding. These findings will therefore be corroborated with a focus group. It was also challenging to receive a high number of respondents due to limited reach online. This resulted in the sample being untargeted in order to get as many respondents as possible. Although they still offer first hand evidence when supporting a claim.

Joshua Edgington, the marketing coordinator for the premium shopping centre, Victoria Leeds was interviewed over email. The business idea was first explained, followed by 5 questions relating to the concept.

The method of communicating the business concept over email proved difficult as it had to be concisely explain and some of the features became misunderstood by the reciprocate. Due to this, a phone call interview was made with another industry expert to combat the restriction of email. Also, the research process had to be delayed due to dependence on others for information as there is a time delay between a question being asked and it being answered, however, this can be advantageous as it “allows both the interviewer and the interviewee to reflect on the questions and responses prior to providing a considered response” (Saunders et al, 2009, p.351).

The focus group included 6 females aged 21-24 who all enjoy shopping both online and in store.

The business idea was first explained, followed by visual stimulus to create a more interactive environment. Feedback on the business idea was achieved along with positive reassurance that the concept was meeting their needs.

A common limitation in a focus group is that people can often dominate the conversation, leading to insightful responses sometimes being missed from quieter members in the group. This was controlled when undergoing the focus group research by using audio recording to then give more opportunity to manage and control the process rather than writing down the responses. “It is difficult to manage the process and note key points as well. (Saunders et al, 2009, p.346).

Graeme Derby, the UK manager of Polytouch, took part in an in-depth phone call interview.

Polytouch provides retailers with interactive touchpoints in store, meaning he was able to answer questions surrounding how the software would work on their technology to achieve the optimal customer experience.

The possibility of answers being biased had to be considered as the interviewee is an owner of a technology provider. Thus, their responses could have unreliable intentions and be biased to make their service appear better.

A 1 to 1 in depth interview was conducted with a 26-year-old female. She would be targeted as a consumer of the new business as a fashion conscious customer who is a multichannel shopper. The business idea was first explained, followed by flexible questions relating to the participants opinions.

The participant sometimes was only willing to give monosyllabic answers like yes or no, although, this was controlled by asking open-ended questions. Another limitation is that the process is very time consuming and a lot of explanation of technical meaning had to be stated for the participant to understand. however, the depth of data received from the interview makes it worthwhile.

Alistair Guthrie, a software developer was contacted through LinkedIn for guidance relating to the business. The business idea was first explained, followed by broad questions relating to the feasibility, costing and implications of the software. The participant replied very positively to the idea and offered valuable responses to the questions.

Due to the interview not being face to face, similarly to the expert email interview, the method of communicating the business concept by typing proved difficult as it had to be concisely explained and some of the features became misunderstood by the reciprocate. However, the valuable knowledge gained from a professional software developer was crucial even if there was some miscommunication relating to specific features.

2 different logos were presented to the respondents and it was only available for 24 hours. The poll received 68 responses from both male and female participants who voted for their preferred choice of logo.

Due to the fast-paced environment of Instagram the poll was only available for 24 hours which limited the number of respondents.

Although, this meant the research could be completed quickly and efficiently with more time to analyse the results. It also limited the demographic able to take part as not everyone has access to Instagram and the people who did take part couldn’t be controlled to a specific sample size as it was available to everyone. This resulted in the responses not being very specific or relating to a controlled demographic.

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2

The Opportunity

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2.1 Stage 1 Reflection

2.2 Insights

A thorough exploration into how brands can use intelligent technologies to bring their customer relationships to life was conducted in stage 1.

Evaluation of primary research, supported with academic secondary research highlighted that the future of intelligent technologies shows personalisation being fundamental in capturing brand loyalty but personalisation alone will not suffice. It must be complimented with quality, transparency, privacy and respect. Therefore, there was an opportunity for future platforms to combat the consumer frustration of wanting to enjoy the benefits of creative AI, offering personalised experiences whilst providing the correct use of data sharing. This can then result in constant interactivity and innovative, individualised customer relationships. Stage 1 therefore uncovered possible direction for stage 2 and sparked inspiration on how to implement these findings to create a coherent and meaningful service to benefit both businesses and customers.

• Consumers are more aware of the value of their private information and how it can be misused.

Although, they face the dilemma of still enjoying personalised recommendations and tailored experiences from brands.

• There is uncertainty relating to the future of intelligent technologies and the rate at which they are advancing is causing society to feel apprehensive of what lies ahead, resulting in a pessimistic outlook of the future.

Stage 1 research resulted in these insights which clearly express a need to promote the positive possibilities this technology can achieve to create an optimistic outlook on the future. It is crucial that the consumer understands clearly how they personally can benefit from acceptance in this technology.

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2.3 The Problem The digital revolution has resulted in many casualties for stores in the UK as almost 1,195 have shut or are expected to close in 2018, compared to the 1,012 that closed in 2017 (Clark, 2018). It has also led to higher consumer expectations as 92% of primary research survey respondents are frustrated when they go into store and they cannot find what they were looking at online (see Appendix 1). This highlights a clear consumer frustration between the detachment from online to offline shopping, creating friction and disruption for the customer. Therefore, there is a need for in store personalisation that reflects the online shopping experience to improve customer engagement and create a seamless path to purchase.

92% 67% 8

Loyal customers also feel unrecognised by brands as the online survey presented 67% of respondents answered no when asked if they feel recognised by brands that they are a loyal customer to (see Appendix.1). This also resonates from a retailer’s perspective as only 37% of retailers are able to identify their customers before checkout, and 20% can’t identify customers until after checkout, or not at all (Houghton, 2019) supporting the problem that there is a missing critical engagement opportunity needed in store. This identification and much needed personalised experience in store is difficult to attain when insights from stage 1 showcase an apprehensive consumer that is increasingly aware of the value of their private information.

Thus, a solution to the problem has to prioritise stamping out consumer’s reluctance to complex technology by being transparent, meaningful and beneficial to the consumer.

Are frustrated when they go into store and cannot find what they were looking at online

Do not feel recognised by brands that they are loyal customers to

2.4 External Environment

S T E E P L E

The clothing market is being seriously affected due to online retailers capturing a greater share of consumer spending and influencing what they choose to buy. Online-only retailers are surpassing offline because they have a better understanding of their customers and respond faster to changing demand. Consumers shopping in-store will still have been influenced in their purchasing decision from online channels. The best responding retailers are utilising this and using in-store technology to strengthen the customer journey (King, 2018). Consumers also crave individualised experiences from brands which must be relevant whilst also offering surprising and complementary items. (Business of Fashion, 2018).

Technology is changing the way people shop and AI can already recommend online purchases. In the near future buying and shopping will be very different activities, AI will curate and buy for consumers and shopping will only be for the few products that expresses their unique style (Wired, 2018). However, tailored recommendations need data and consumers still do not fully understand their rights. Therefore, companies must be transparent over usage if they are to maintain access and the most successful retailers will leverage data and technology to provide cutting-edge individualised experiences (Business of Fashion, 2018).

As the Pound remains weak, it has resulted in volatility with uncertainty and shifts in the global economy being a primary concern for retailers. “Risks of trade disruptions and slowing economic growth, could undermine global growth prospects, as could uncertainty over other major events such as Brexit or the possible onset of a global economic slowdown” (Business of Fashion, 2018). Therefore, retailers will need to minimise any financial risk in the future whilst keeping ahead of competition. They also need to prioritise offering a high standard of customer experience to result in profitable returning purchases.

Mintel’s consumer research suggests there has been a decline in the percentage of people buying clothes every two to three months, alongside an uplift in the percentage of people shopping just once a year (Mintel, 2018). This is due to environmental concerns, a lack of compelling products and unseasonal weather. Sustainability is an ongoing concern in the fashion industry and retailers are almost constantly unveiling new initiatives to offset their footprint.

Although, environmental concerns are not a top priority for technology start-ups, there are ways that businesses can ensure their software consumes low levels of energy, reducing the impact on climate change. Bicknell encourages software developers to delete unused data, limit the use of unnecessary features and avoid using extremely highresolution images, these small changes can significantly lower energy consumption of applications (2012).

Investment in the high street has become almost impossible due to rising public policy costs increasing business rates. Politicians criticise the struggling high streets yet have created a tax system which discourages retailers from taking them over (Raconteur, 2019). Therefore, retailers that can successfully reinvent themselves will reap the rewards through more customers and higher sales. The UK’s decision to leave the EU is also likely to have implications for the retail industry. Many are already facing difficulties including reduced profit, lower footfall in stores and a battle to save costs. The uncertainty impact of Brexit may encourage retailers to examine their business models and reinvent, as there is a growing consumer demand for retailers who offer experiences in their stores, rather than simply a place to buy (CMC, 2018).

Specific regulations and laws are yet to be implemented in terms of guiding the adoption of AI in the most safe, and beneficial way. Laws must be amended to protect companies that produce advanced technology and the people that buy and use them (Weaver, 2014). Also, the General Data Protection Regulation (GDPR) have overhauled how businesses process and handle data. It was designed to modernise laws that protect the personal information of individuals (Burgess, 2018). This is a step in the right direction to keep a user’s personal data safe and protected which new business start-ups must abide by.

User data profiling refers to the capture and storage of large amounts about users and their usage behaviours for the purpose of offering personalised experiences based on predictions (Saqr, 2017). This, however, raises ethical implications relating to current methods of privacy and consent. The rapid pace of development in data science is not met with due understanding of these ethical impacts. Technologies taking part in data capture must explicitly share how it is collected, stored, transferred or processed. They should also inform the user about the way their data will be analysed if any third parties or companies will participate in data processing.

The STEEPLE analysis examines the macro environment that could impact the retail and technology industry. The social factors affecting consumer behaviour have the highest risk to the retail market as customers increasingly are choosing to shop online. However, the majority of purchases are still made in store but they will have been influenced by online channels. This is putting pressure on retailers to blur the online to offline shopping experience.

Consumers also crave individualised experiences but due to ethical implications, they also want reassurance that their data is being ethically stored and utilised.

This needs to be made more explicit to the user as most data capturing is unknown and misunderstood.

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2.5 Macro/Micro Trends The macro trend of Individualisation has moved away from personalisation in aid of the data era with companies using context and data to assemble a unique customised experience.

Consumers no longer want to be part of a mass market and crave recognition of having unique needs and desires for individualised experiences.

Due to this, consumers are becoming more comfortable with the idea of giving up personal information in exchange for knowledge and convenience (Trendwatching, 2017). This has resulted in higher consumer expectations and desire for individualised brand experiences due to this willing to trade in exchange for highly individualised and more bespoke content.

Although, renewed emphasis on data security has impacted the need for clear communication and transparency (Reynolds, 2018). As consumers hand over more control to algorithms or they become increasingly aware of just how much their lives are already being shaped by data, the urge to step outside and break out to explore without constraints will only grow. Therefore, tailored recommendations in the future needs to include a hint of spontaneity to offer freedom and excitement to consumers. Brands must also have a commitment to becoming a consumer centric organisation to meet the individualisation desire.

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The micro trend of consumer profiling has led retailers to source more data about shoppers and their habits than ever before and the offline world is being optimised by the online world (Strumpf, 2018). People constantly leave a data trail behind them, which leads to a greater understanding of individuals including demographic information, location details and personal preferences. In turn, this allows retailers to get to know their users well, target them in a more specific way and customise their user experience. Users are increasingly willing to make their profile data available and expect, in return, a greater degree of individualisation and performance (Trendone, 2019). Forward thinking bricks-and-mortar brands are personalising the store experience using consumer data profiles (LSN, 2019). The end-goal is to get the customer profile to be as close as possible to the internal mind-set of the consumer, as new customers are unlikely to become regular buyers if they have a bad experience with a brand. Research

by Raconteur (2019) found that 75 per cent of consumers do not feel brands fully understand their interests meaning retailers need to utilise innovative technologies to bridge this gap. The same research also indicated that customers are happy to see what improvements AI can bring to their shopping experience, with 62 per cent of consumers comfortable with the prospect of brands using AI to make marketing better.

The outernet is another micro trend that has resulted in mobile technologies letting the internet jump out into the street and become the outernet (Trendone, 2019). It has now reached the point where almost every step people take leaves behind two prints: one can be seen in the real world, while the other is made in the digital realm.

Sitting at desktop computers, people used to be separated from their immediate surroundings as they explored the depths of the World Wide Web. The internet was more like a temporary alternative to the real world. Today, people have constant access to the internet through their smartphones and wearables, while their direct surroundings are also full of instant connections to the web.

This means that humans are “always on” and the state of being online and offline at the same time can be described by the adjective phygital. The outernet integrates seamlessly into all devices and every aspect of consumers lives. The aim for the future is to be able to provide optimal phygital experiences. This can be achieved by digital tailored touchpoints to enabled innovative retail concepts. Connected to the internet and fitted with numerous sensors, branded touchpoints are context-sensitive and can adapt their content and activities (Trendone, 2019).

“It all starts from understanding the customer.

Without this, you can’t create a great experience for them or establish a long-term relationship” (Raconteur, 2019, p.19).

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2.6 Market Drivers With Amazon recently acquiring Whole Foods for a staggering $13.7 billion, the market driver of online to offline (O2O) commerce exploded.

Even though consumers are used to purchasing online, 82.5% of all retail sales will still happen inside physical stores as late as 2021. (Orrendorff, 2018). The vast majority of those sales, however, will be influenced by digital touchpoints. This driver has been labelled as the “Trillion Dollar Opportunity” by the Wallstreet Journal, Forbes, and more. O2O commerce is a business strategy designed to bring online customers to brick and mortar locations as well as create a seamless digital experience before, during, and after. The strategy lets companies treat online and offline channels as complementary rather than competitive. As shoppers become more tech savvy, they expect retailers to provide better shopping experiences that integrate the online and offline worlds. One of the most desired services is a personalised shopping experience and many retailers have acknowledged this demand and are starting to use customer data gathered online to improve their offline shopping experience (Orrendorff, 2018).

“In most cases, the economics of physical stores are superior to those of e-commerce. We know that the combination of digital and physical is most often what customers want and what yields the best overall financial results.” (Forbes, 2016) Globally, brands are reconsidering the purpose of bricks-and-mortar stores, combining physical touchpoints and digital technology to make the retail experience more intuitive, meaningful and compelling (LSN, 2019). In order to compete, retailers must think about the software that runs their stores and sometimes that means opening up their infrastructure to potential partners from the online world.

O2O Commerce Consumer Centric Technology Digital Touchpoints Consumer Data

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Consumer centric technology is also a key driver in offering the need for personalisation not only online but now in-store. A recent survey revealing that 66% of consumers are likely to switch brands if they feel treated like a number rather than an individual (Salesforce, 2018). Machine-learning technologies and AI tools are playing a key role in the drive for more personalised customer communications. As the number of ecommerce customers around the world grows past two billion, the data points created by these shoppers will become even more difficult to manage and effectively analyse. Over the next couple of years, AI will continue to improve how retailers understand their customer’s interests and work in unison with machines to ensure the most individualised messages are being promoted (Raconteur, 2019).

Consumers relish the speed, convenience and value that the web and technology have delivered. The marriage of data and increasingly sophisticated artificial intelligence will deliver hyper-personalisation. This will enable brands finally to get close to the fabled single-customer view, permitting them to fine tune their goods and services. In its 2018 Global Retail Trends report, KPMG warns that digital advances had now fed through to customer expectations and retailers that don’t respond will be vulnerable.

New technologies have put customers in the driver’s seat. The natural outcome is that people want that instant gratification which has had a deep impact on customer expectation.

“The need for speed will only increase as technology enables and advances. The point of engagement and the point of transaction are converging, meaning brands that can offer immediacy, personalisation and accessibility will win.” (KPMG, 2018, p.20)

User Profiling Retail Reinvention External Solution Provider

Market Drivers

Seeking Individualisation Phygital Unrecognised Loyalty Webrooming

Consumer Behaviour

2.7 The Opportunity “74% of females aged 18-35 have researched a product online then bought it in store” (Ypulse, 2019). This is a consumer shopping behaviour that starts online and ends in-store, commonly known as webrooming. It has resulted in an opportunity for consumer’s online profile to be translated into store and bridge the gap between the online and offline shopping experience.

Consumer’s need for individualisation must be reciprocated the minute they walk into store and this can be achieved through user profiling to offer a personal experience, reflecting that of online to help customers seamlessly shop.

The opportunity platforms as shown on page 12 present a clear and innovative direction on how to understand new consumer behaviours with advancing market drivers. Sync will combine the platforms of user profiling and retail reinvention in the form as an external solution provider. The opportunity risk matrix below also shows a sizable opportunity for Sync. The ease of execution will be relatively difficult as the technology will be challenging to perfect although, the risk versus reward ratio will be outweighed by the size of opportunity.

“I don’t believe our high streets are dying; I believe they are evolving.” (Raconteur, 2019, p.4) As retailers embrace the future, it is vital to utilise technology to support their in-store experience, adapting to better meet customer needs. Many retailers are striving towards this reinvention and goal to integrate the retail journey from online to offline in a seamless way. However, there is a lack of availability of in-house resources within organisations to implement technologies and provide optimum customer experience management (CEM) implementation. Most of the organisations turn to an external service provider such as solution providers, consultants, and digital agencies at initial stages for implementation of CEM (Grand View Research, 2018). Therefore, this creates the opportunity for Sync, a business solution provider which will be further explained in the next section of this report.

Size of Opportunity

O2O SaaS provider to retailers, meets the growing desire for individualisation in store that reflects the online shopping experience.

Ease of Execution

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3

The Big Idea

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3.1 The Big Idea

3.2 Brand Summary

Sync is a B2B solution provider that offers shoppers a seamless user experience by blurring the line between online to offline retail. Personalisation doesn’t have to end online, as Sync provides interactive in store touchpoints to unlock individualised profiles linking to the customers online shopping habits. Users opt in to create a profile and through facial recognition log in they will receive tailored information about their past purchases and style preferences. The technology will combine AI and user data profiling to provide situation-relevant information including any products left in their online basket that are in store, style suggestions that are available, online reviews or correct sizing that is in stock. Loyal customers are instantly recognised and rewarded with special offers and sneak previews, developing innovative customer relationships and resulting in valuable in-store experiences.

Syncing the online to offline retail experience, Sync offers the solution of an integrated digital to physical world of fashion. Both retailers and consumers receive clear benefits through the application of Sync, providing the correct use of data sharing in return for a higher degree of individualisation. Sync Solutions allows for a simple execution in implementing innovative technologies to bring the convenience of online to a physical setting, resulting in optimised omnichannel retailing.

The opportunity leading to the creation of Sync was identified through the reflection of stage 1 insights, evaluation of the macro environment and analysis of industry trends. The research highlighted a strong consumer demand for in store personalisation that reflects the online shopping experience with 76% of respondents saying they would be interested in having personal style recommendations in store (see Appendix 1) Consumers also feel a detachment from the digital to physical realms of shopping with 92% of respondents agreeing that it frustrates them when they go into store and can not find what they were looking at online (see Appendix 1) Therefore, Sync aims to meet these new consumer expectations by offering a meaningful and seamless path to purchase, enhancing the instore customer experience.

Sync SY NC Sync

76% 92% Would be interested in having personal style recommendations in store

Get frustrated when they can not find what they were looking at online

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3.3 User Journey Profiling 1) As users first come into contact with the Sync touchpoint in-store they have will have the choice to either log in or create a profile. To create a profile the user will undergo a quick style quiz relating their personal characteristics to make the experience as individualised as possible. This will include their age, gender, clothing size and fit, style inspiration and personal preferences. After completing the quiz, users complete a facial scan and enter their email to create their profile.

Log in Create profile

Hello Amy, how can we help you today...

Quick Search

Wish List

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Loyalty

Discover

2) If the user already has a profile, users will press log in and facial recognition will take them immediately to their homepage with no hassle of typing in emails or passwords.

3) Users are then greeted on a personal level and brought to their interactive homepage that is split into 4 sections including: quick search, loyalty, wish list and discover.

Head here to pick up Or why not try...

Loyalty 5) A loyalty points system will be used to provide clear benefits to the user as a result of data sharing with Sync. This was raised as a consumer insight in the reflection from stage 1, therefore the loyalty feature will provide a clear personal benefit.

The loyalty page will showcase the user’s online interaction with the brand in a visual dash board aesthetic, showing the amount of online visits, previous purchases and the amount of points they have accumulated whilst creating a profile with Sync. Refer a friend will also be an option in this feature by entering a friend’s email with a code attachment. The email will give information on how to set up a Sync profile with a link to the website. In return the sender will gain more loyalty points and the friend also will if they decide to use the code when creating a profile.

Quick Search 4) The quick search section allows users to pick up a collection they have ordered online into store with no ID due to the facial recognition technology. “Your collection is available for pick up” will appear on screen and they will be directed to a sales assistant ready to collect. If the user has already a specific product in mind, they can also use the quick search feature that will give them a precise location of where the item is in store and if it is available in their size. Suggestions for quick searches will also appear on screen that reflects specific items that have been saved in the user’s basket online or any other products they have been browsing.

Online Activity

Search Your collection is available

30% browsing dresses

70% browsing tops 1550

Refer a friend to get 300 points XYbe3-2nyJ-17 Copy

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Your wish is our command, these are in your size!

Wish List 6) The wish list feature seamlessly integrates the users online shopping activity into store. Any items saved online in the users liked section or wish list of the website will be mirrored into store.

This will be complimented with machine learning and AI to create other tailored recommendations that are a similar style to the user’s wish list. All products that are available in-store and in the users preferred size will be clearly shown and where they can be found will be highlighted. Each item offers online reviews from the website so the user has the same experience as they would when looking online to blur the boundaries between the digital and physical experience.

Find your style Discover 7) The final feature of Sync utilises the possibilities of AI and user data profiling to recommend products tailored to the user’s individual style. This will reflect how the user answered the questions in their style quiz, combined with their online browsing activity to offer personalisation instore. The user then has the option to browse by “finding their style” “top trends” or “try something new” depending on what their intentions are for that particular visit. When browsing each category, the same options will be available that were in the wish list segment so the user can look at reviews of products, see if they are in-store in their size and where they can find them.

Top trends

Feeling brave? Try something new

When the user is finished interacting with Sync they can log out and their activity whilst using the touchpoint will be recorded and saved to improve their experience going forward.

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3.4 Business Model Key Partners • Mid-market retailers wanting to enhance their in-store customer experience • Consumer (brand advocates) • Technology supplier (Polytouch) • Investors Key Activities • Selling software to retailers • Software updates and maintenance • User profiling service • Improved customer experience • Competitive advantage Key Resources • People (staff/users) • Consumer data • Investment funding • Digital touchpoint technology (Polytouch) • Software development • Physical retail space Cost Structure • Retailers pay £500 monthly license fee • Free for users Value Proposition B2B • Higher customer engagement and satisfaction • Customer data and profiling • Competitive advantage B2C • Personalisation and style discovery • Loyalty benefits • Intuitive shopping experience • More valuable customer experience • Seamless online to offline shopping Customer Relationships • Privacy, transparency and trust to the consumer • Solution provider to businesses • Improved customer experience solution

B2C • Fashion conscious • the “always on” consumer and early adopter of technology • those wanting frictionless commerce and personalisation The business model works on a SaaS basis with an on-going monthly license fee payment for the service. Sync will partner with hardware provider, Polytouch to offer cutting edge technology with a simple execution. Due to the segmentation of the mid-market retail market, Sync will receive large revenue streams in return for the costly software development needed in resources. The brand promotes data sharing that in turn improves the overall experience for the consumer building a better relationship with the retailer. Retailers that do not want to invest huge sums of capital in creating IT infrastructures will find this business model attractive and they can turn to Sync for the solution. This will become an integral part of their retail experience meaning retailers will become extremely loyal to Sync as it will play a vital role in the success of their business. Each customer is also paying a monthly licensing fee instead of owning it with a one-time purchase, resulting in recurring income. However, this leads to a large sum of investment being needed to start the business. Therefore, the value propositions as explained on page 23 will need to be promoted clearly to investors.

S o

l

Sync

o n t i

nc

Consumer Segments B2B • Mid-market retailers willing to invest and enhance their customer engagement from online to offline

u

Channels • Website • Networking Events • Trade shows • Press coverage • Social Media

Revenue Stream • Monthly payment from retailers

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This diagram shows how Sync would partner with Polytouch to offer retailers the improved customer retail experience which will then feed through to the consumer. Sync will be the lead contractor with the retailer and Polytouch is the sub-contractor. Polytouch offers the hardware and would require a separate fee for retailers.

Sync provides the software to be used on the Polytouch hardware as well as offering installation and software maintenance services. The monthly membership to Sync allows retailers to implement the solution in store effectively with Sync being committed in offering a highly professional service with constant updates.

Graeme Derby, the UK manager of Polytouch, took part in an in-depth phone call interview which supported how this partnership would work at industry standard. He said: “you would be the lead contractor with the retailer and we would effectively be the subcontractor, so your business (Sync) promotes the software that works on this piece of hardware” (see appendix 4). He also supports the claim that licensing the software on a monthly basis would generate on going income and limit financial risk.

Sync SY NC Sync

sells Company B SSync y n c product to SY company B Sync Solution S y n c NC which adds their white label company

own branding

The diagram above showcases how Sync would follow a white label implementation into store.

The white labelling strategy allows retailers to promote the software but keep within their branding guidelines with a range of options in colour ways, text and icons. This will allow retailers to improve their brand image by offering innovative technologies into store. This will also reflect on the seamless experience available to consumers as the online branding of the retailers will be mirrored in store. It will allow Sync to sell the product to a broad range of businesses with the possibility of customising the software.

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Company B offers the product to their customer

3.5 Business Objectives Aim: Establish a profitable business that integrates online to offline retail by offering personalisation in store, creating a seamless user experience Short Term Objectives (within 1st year after launch) •

Successfully launch the innovative business solution into the mid-market fashion industry and partner with 1 retailer

•

Sell a minimum of 20 Sync touchpoints to a mid-market retailer

Medium Term Objective (Year 1-3) •

Achieve on going monthly revenue by partnering with 2 more mid-market retailers by the end of 2020

•

Increase the number of Sync touchpoints implemented into mid-market retailers to 150 by 2023

Long Term Objective (Year 3-5) •

Expand the business to become the UK market leader in retail solutions by continuing to adopt innovative technologies to drive optimal online to offline user experience

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S o l u

3.6 Brand DNA

t i o n

Sync

Aaker Model

Brand as Experience • • •

nc

•

Seamless online to offline Meaningful and valuable Enhanced, personalised path to purchase Optimal customer Brand as Symbol experience • Clean and contemporary • • • •

Brand as Product • • • •

Integrated retail solution User data profiling Individualised touchpoint highly advanced, cuttingedge technology

c

Forward thinking Intelligent and intuitive Supportive and welcoming

Brand as Organisation • • • •

Tone of Voice Engaging Inspiring Effortless

Mission Individualisation Loyalty Experience

• • •

Fashion specific Seamless solution Muted digital colours Syncing the online to offline

SY NC

Benefits

Brand as Person

Integrate the digital to physical world of fashion

Innovative Dedicated in providing optimal customer experience Transparent and trusting Solution provider

Promise

Ease of execution Correct use of data capture

Vision

Pioneer optimal online to offline user experience

Language Clear Simplistic Polished

Sync SY NC Sync Values

Meaningful and valuable Rewarding to the user Transparent and trustworthy

USP

Integrated consumer centric experience

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Strap Line

Syncing the online to offline retail experience

Brand Essence Model

3.7 Value Proposition Sync will provide clear benefits to both retailers and consumers as a win win scenario. This was highlighted in the insight findings as it is crucial that the consumer understand how they can personally benefit from acceptance in this new technology.

Customers see the value of the software reflected in their path to purchase and retailers provide an improved user journey resulting in an optimal customer experience end value. This value creation of the user’s needs that builds loyalty is what is so attractive about Sync’s offering.

Functional Benefit • •

Increased data capture Enhanced business operation, bringing convenience of online to a physical setting

End Value

Optimal customer experience

Shared Benefit

Emotional Benefit

•

• •

•

•

Building stronger brand relationships Retailers offer a seamless in store experience Brands understand their customers, offering a fully integrated experience

•

Eradicated detachment from digital to physical retail Rewarding individualisation Loyal customers feel recognised

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Official Logo

S o

Font Avenir Next Ultra Light:

ABCDEFGHIJKLM NOPQRSTUVWXYZ

l

u

Sync

o n t i

Colour Palette

Alternative Logo

Style Inspiration

Sync

Y NC

Sub Mark

SY S y n c NC 3.8 Brand Guidelines

SY NC

Technology brands are increasingly trying to blend in to integrate into everyday life.

Branding is moving away from harsh, corporate connotations but towards services that are made smoothly and reassuringly reconcile themselves to the user (Future 100, 2019). Sync’s branding is presented in a contemporary, non-threatening way in a muted digital palette. The sophisticated, clean typography reflects the simplistic branding in order to convey the ease of execution that Sync can offer. The circle pattern and line drawing hanger represents the circular, frictionless experience that Sync provides to retailers.

Sync 24

An Instagram poll was conducted in order to determine user preference of the official logo (see Appendix 7). The option chosen gained 59% of the vote compared to the other option of logo. The official logo will be used primarily on Sync’s website, LinkedIn profile and promotional material, however due to the brand being a white label company, retailers own branding will be mirrored into store on the software. The Sub mark will also be used to add depth and dimension to the brand, continuing the brand message across multiple platforms.

3.9 IDEER Model Is it a compelling idea?

Is it easy to understand?

The idea for Sync was stemmed from evoking consumer insights found in Stage 1. Therefore, it meets an unmet consumer need in an innovative and compelling way. It is highly attractive to the retail market as it provides meaningful in-store experiences and brings personalisation into a physical setting.

The value proposition model shows clearly how Sync can benefit both retailers and customers.

The step by step user journey presented on pages 16-18 show the simplistic 4 features available on Sync touchpoints. Although the technology behind Sync is extremely advanced, it is communicated to the user in a way that is easy to understand.

Is it distinctive?

The positioning segment of this report confirms that Sync is distinctive. The brand’s USP of offering an integrated consumer centric solution is highly unique to the physical retail landscape.

Is it engaging?

Is it rooted in product reason?

Sync Solution has taken into consideration the external environment, filtering its way down into a justified product reasoning. It also holds key consumer insights and frustrations at the core of the brand.

Sync is extremely engaging as it utilises the positive potential that new technologies can achieve. This includes individualised tailored experiences, facial recognition, user data profiling and online monitored activity mirrored into store. Retailers can identify their most valuable customers and users feel recognised with loyalty rewards. Therefore, the new business proposal offers an engaging solution for both retailers and consumers, resulting in brand loyalty.

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4

The Market

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4.1 The Retail Market By the end of 2018, worldwide ecommerce sales are expected to surpass $2.8 trillion, yet online sales only represent 11.9% of the global retail market (Orrendorff, 2018), proving physical stores still play a crucial role. Despite falling instore sales, 2019 will not mark the death of the physical store as both realms will coexist happily with a digital ecosystem, serving as an addition and extension to services (Pavlova, 2019). According to UPS’s “Pulse of the Online Shopper”, 84% of customer still consider shopping in store a major part of their shopping experience (2017). Brands having their own store enables them to control the conversation with the customer and therefore new retail experiences and digital innovation will only make them more relevant (Newman, 2018). Even if consumers are shopping in-store, the online channel will have influenced their purchasing decisions in some way, therefore, the role of a store is to support the digital experience, which is what Sync can achieve. Customers are also more intentional in their store visits as they have done their research first meaning the best responding retailers are utilising this and using in-store technology to strengthen the customer journey.

Mintel estimates that consumer spending on clothing and accessories will rise 5.3% to £60.8 billion in 2018 (2018) however, growth is expected to slow as consumers are adopting more cautious spending habits as stated in the STEEPLE analysis (p9) which will inevitably have a negative effect on discretionary categories like clothing and accessories. This also will affect mid-market retailers that are struggling to maintain growth as they battle to define their USP (Unique Selling Point) in an increasingly crowded UK retail sector (Mintel, 2018). Therefore, Sync can provide these brands a new innovative customer experience that adds value to their shopping experience.

Consumer Spending on Clothes and Accessories 2013-23 (Mintel, 2018)

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4.2 The CEM Market There has been a growing focus within businesses on retaining customers by providing consistent and enhanced customer experience across multiple channels which has stimulated growth in the customer experience management market (CEM) (Prnewswire, 2018). The global CEM market size was estimated at $5.18 billion in 2016 and the retail sector is one of the largest end-users segment of customer experience management software, as shown in the graph below (Grand View Research, 2018). This is due to customers relying on technology for tailored recommendations aiding their purchase decision and retailers are using CEM technology to attain detailed customer profiles. By collecting this data, businesses have understood the importance of customer experience as it helps them strengthen their brand presence, customer loyalty, and in turn boost business revenue.

The graph bellows reveals that consumers are not very satisfied with in-store environments (Mintel, 2018), meaning that retailers should look to prioritise this going forward to increase customer experience. This dissatisfaction supports the ever growing need for consumer data to create value for customers. Multichannel retailers are looking to leverage the abundance of customer data they hold from online transactions in order to deliver more relevant and effective offline experiences and deliver personalisation through all channels and touchpoints (Mckinsey&Company, 2017).

However, retailers may find that the most innovative solutions can best be sourced externally, by partnering with others in the software industry. As previously stated in the opportunity section of this report, businesses turn to an external service provider to implement CEM due to a lack of in-house resources (Grand View Research, 2018). This can then supplement the organisation’s existing capabilities with platform providers that offer solutions which Sync can successfully implement.

U.S. customer experience management market share, by end-user, 2014-2025 ($ Billion) (Grand view Research, 2018)

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Key drivers of overall satisfaction with clothing retailers (Mintel, 2018)

4.3 Market Readiness 49% of consumers said they are willing to shop more frequently with a brand that uses AI to offer faster and easier-to-use customer service capabilities, and 34% said they would be willing to spend more money on a brand where AI offered the same benefits (Pointsource, 2018). The role of physical and digital stores are changing meaning retailers must roll out new technology and bring in new expertise. Many stores across the UK are working towards this reinvention whilst others continue to struggle with 2018 seeing a large amount of retailers going into administration.

This calls for an urgent evolution of the in-store experience, proving Sync’s market readiness.

In terms of consumer acceptance, primary research was carried out in order to test and determine the attitudes towards Sync launching in a store near them. Both the focus group and in-depth interview received extremely positive feedback on the new business concept. There was a demanding need for in store availability that reflected their online experience as participant 3 stated: “The wish list is good and knowing what you’ve searched before would be useful. The reason I don’t shop that well in store is because I can’t always find something I like, it’s not always there if I search on my own...it would just make life a lot easier” (see Appendix 3).

The feedback showed strong acceptance in the fact that it would guide the shopping experience in a more effective way. Overall, the analysis proves that the market is ready for Sync and therefore the service can be launched as soon as possible.

4.4 Ansoff Matrix

Market Development

Diversification

Existing

Markets

New

With Sync using new technologies to provide solutions for the retail market, it falls under the category of product development. Existing retailers will implement the new product into stores with white labelling therefore acting as a new product development. This allows for the excitement of a new innovative launch but lowers the risk with it being in an existing retail landscape.

Market Penetration

Product Development

Existing

New Products

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4.5 SWOT Analysis The SWOT analysis presents the clear strengths that Sync has in order to differentiate from competitors. The opportunity that shows strong likelihood of success is that there are few competitors specific to the fashion industry. Sync can benefit from this opportunity by offering highly industry specific solutions, unique to other software providers. Advancing technologies also proves an attractive opportunity for Sync in delivering the most efficient and innovative solutions, although, due to the rate of advancement, Sync will have to prioritise staying ahead with adoption. The main threat of already established competitors could persuade big retailers to partner with them instead of Sync due to higher reputation. Therefore, Sync will have to utilise their partnership with the established brand Polytouch in order to make connections and build up reputation.

Strengths:

Weaknesses:

• •

• • •

• • •

•

No corporate financial backing New business so lack of expertise Limited connections and small network Will need a high volume of communication to reach businesses

Opportunities:

Threats:

•

• •

• •

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Meets an unmet consumer need Innovative concept, not currently available on the market Provides clear benefits for both consumers and businesses Professional branding with clear missions Backed by an established brand (Polytouch)

Opportunity to further utilise advancements in technology Few competitors specific to the fashion industry so opportunity to become a key market player Opportunity to expand into every retail market segment to meet the need of every shopper

•

Already established competitors Reliant on suppliers for in-store technology Negative media coverage relating to lack of trust in technology companies

5

Positioning

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5.1 Competitor Analysis The technology provider industry is extremely competitive with frequent new products, evolving industry standards and rapidly changing technologies. The retail market also is continuously striving to enhance the overall consumer experience and keep up with market demands like price and cost reductions. Therefore, a competitor analysis is required in order for Sync to position themselves effectively and be retailers first choice in providing a solution.

Primary Competitors Brand

Overview

Strengths

Mercaux

A mobile platform created for retailers by unifying the shopping experience across online and in-store (Mercaux. com, 2019)

Offers a range of cutting-edge technology to empower sales assistants to provide staff with real-time product/stock information, AI driven alternative products and styling suggestions. It also provides retailers information about in-store activity to paint a full picture and build communication between headquarters and the sales force. Marcaux recently worked with Karen Millen and achieved a 7% uplift in sales following the adoption of the salespeople app (Racounteur, 2019) and has other mid-market to luxury client brands globally.

NCR

NCR offers hardware, software, and services retailers need to deliver on what customers want with the use of data, insight, and experience to create powerful interactions (NCR, 2019).

NCR’s inventory is extremely varied with a wide offering of products. They cover every industry, improving how people bank, shop, eat, and travel. For more than 130 years, NCR has helped companies better connect, interact and transact with customers so have built a highly credible and reliable point of difference.

Detego

Detego develops and distributed highly innovative software for the fashion retail industry. Their software provides real-time actionable in-store insights, enabling its customers to understand their shoppers’ behaviour and how they interact with items inside the store (Detego, 2019).

Detego has worked with global clients such as REISS, Levis and many more proving that even though they are a relatively new business, their software solution is needed in the retail environment. The company is comprised of Detego InStore, Detego InWarehouse, Detego InReports and Detego InChannels, meaning that they offer a well-rounded solution to retailers to provide a highly successful customer experience.

Alibaba

Alibaba Group is a Chinese multinational conglomerate specialising in e-commerce, retail, Internet and technology.

They enable businesses to transform the way they market, sell, operate and improve their efficiencies (Alibabgroup.com).

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The company has developed an O2O plan for “new retail,” which involves using technology to upgrade China’s retail sector, using customer data, Alibaba hopes to be able to adjust and personalise product offerings, create tailored marketing campaigns, and streamline supply chains.

Weaknesses

Impact

Marcaux primarily specialises in providing solutiuons to the sales assistants and some customers may find salespeople analysing their data invading and less personal to them.

Primary research also found that 75% of customers would prefer to shop independently in-store rather than having help from sales assistants (see Appendix 1),

This reflects well on Sync’s USP of being customer focused and allowing users to interact with the technology on their own accord without interference from sales assistants. However, Mercaux’s global reach and good reputation in the market makes their threat level high. Sync will have to clearly communicate its key benefits of customer experience to retailers in order to compete.

Due to the company being established a long time ago it can come across as slightly outdated from their website and products available. Therefore, new entrants come as a threat to NCR, especially in niche market categories that are industry specific.

Sync will need to target a specific market segment, specialised to fashion in order to offer highly compatible products that meet the needs of the retailer. This can be communicated effectively by confidently reassuring retailers that they will benefit greatly from Sync Solutions. To differentiate from NCR Sync will only provide the latest technology to promote innovation and future thinking.

In terms of customer facing technology, Detego only provide smart fitting rooms that lots of other brands specify in. Their main priority is focused on stockroom analytics and actionable insights for retailers, not the consumer. Therefore, there is confusion surrounding their key benefit and USP of the business.

Detego and Sync are similar in terms of being new companies, offering software solutions to fashion retailers. Detego also has worked with similar retailers that Sync will wish to target like REISS. However, Sync focuses on the consumer online to offline interaction while Detego looks at data management and stock optimisation, a feature that Sync will venture into in coming years but to differentiate Sync will focus on promoting the optimised customer experience that it offers.

Alibaba specialises in so many industries with a vast amount of services available, resulting in their website being difficult to navigate, making their B2B communication challenging.

They also primarily offer solutions in the Chinese market making it less accessible to UK businesses.

With the reach Alibaba has, retailers may prefer to partner with them as they will be seen as more reliable than a new start-up business. However, Sync can promote the brand being targeted within the UK retail industry and provide clear, simple offerings to their B2B customers.

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Secondary Competitors

Brand

Overview

Strengths

Black&White Solutions

Offers a suite of white-label solutions for luxury fashion brands and retailers. They deliver a global, multi-channel ecommerce that enables retailers and brands to seamlessly interact with their consumers (Aboutfarfetch.com).

Partnering with Farfetch opens up a range of brand partnerships and connections within the luxury retail market.

They also have access to a vast amount of consumer data making their services highly intelligent and seamless.

Facenote

Using facial recognition to help companies recognise their most valuable customers. Improves customer engagement as well as equipping store associates with information on their purchasing behaviour and style preferences (Facenote.me, 2019).

The brand has a strong message around privacy and trust that they aim to convey to the customer. They also have a strong USP of using the facial recognition technology to create innovative and exciting experiences in store.

Monetate

Monetate empowers brands to interact uniquely with each customer at scale to deliver engaging experiences (Monetate, 2019). Their products include personalisation engine, test and segment and intelligent recommendations.

After starting in 2008, Monetate has worked with a variety of high profile clients in every industry, such as: Waitrose, Jack Wills and Eurostar. Monetate supports their B2B customers from implementation to training and technical support, making it tailored and strategic to each business.

Wunderman Thompson

Wunderman Thompson creates multichannel customer journeys and helps brands optimise their digital commerce across B2B and B2C channels. They are built around developing a customerfirst view point, with the creation of personalised, integrated experiences at every touchpoint.

The company has over 1500 commerce experts who help clients win through ecommerce. They have lots of world leading partnerships such as IBM Watson, SAP and Salesforce to offer their clients the best customer experience through their online channels.

The primary competitors shown specialise in the fashion industry which is a threat to Sync being only retail based. This poses the risk of retailers choosing these competitors over Sync as they have experience and a reputation to uphold.

However, Sync differentiates itself by offering experiences with customer facing technology.

Most of the primary competitors offer in store strategy and technology to sales assistants. NCR is the only brand focusing on consumer experience, however their services can seem outdated and difficult to navigate with it being such a big company. This is where Sync can outer perform its competitors with its specialised offering of the optimal customer centric experience.

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Secondary competitors compete across a wide variety of industries, meaning they wouldn’t be first choice to fashion retailers. They also focus on offering a seamless online customer experience whereas Sync takes it a step further and provides offline individualised experiences. However, technology is always advancing so Sync needs to be transformative and adaptable to limit the risk of falling behind. The retailers themselves could also be seen as a secondary competitor as they could set out to achieve the solution Sync offers by themselves. Although, there has been a lot of research presented in the market research segment of this report, showing that retailers feel incapable of offering this solution at a high-performance level from in house resources, therefore, prefer to turn to other businesses to create an optimised experience for their consumer.

Weaknesses

Impact

Black&White Solutions hold a tight partnership with Farfetch meaning they are less likely to venture out and market themselves to other retailers. This is shown through their lack of B2B communication and packages that they offer.

Due to the brand not wanting to promote themselves to other retailers, their threat level is relatively low in relation to Sync. However, if Black&White Solutions were to expand and target other retailers, this would be a high threat in the future, therefore, Sync will need to track the brand going forward.

Facenote is still relatively new to the retail market and is yet to venture out of the US as stated in the Facenote case study in stage 1 (see p.25). Their product is purely customer focused with no data analytics involved, meaning retailers may look elsewhere to gain more insights on their customers.

Due to the brand only operating in America, threat levels are low towards Sync being a UK business.

Although, if Facenote decides to expand into the UK market this would be a big threat to Sync. Therefore, Sync in the near future can provide retailers with insightful data analytics about their customers in order to compete and offer higher benefits to B2B customers.

Although Monetate offers 3 different products for optimal personalisation online, they don’t offer any packages that fulfils the need for personalisation in store. They also work within a variety of different industries making their offering less specific.

Sync is different to Monetate as it offers the same personalisation technology with intelligent recommendations but offers it in offline formats. Sync is also industry specific to the fashion market meaning that Sync has a deeper understanding of what solutions customers want when shopping. Therefore, Monetate is a secondary competitor and poses a low threat level towards Sync.

Similar to Monetate, Wunderman Thompson does not act offline but only offers customer experience management online. They also provide an overall optimised customer experience without offering innovative in-store solutions to support their services.

Sync aims to bridge this gap between exceptional, personalisation customer experience online and offer that in-store. Due to Wunderman Thompson focusing more on the customer experience management market, they raise low threat levels as Sync is competing in the SAAS market.

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5.2 Brand Positioning The positioning map below shows the gap in the market for customer focused experiences that are tailored specifically to the fashion industry.

Sync offers in store customer facing technology which is unique to its competitors as they focus on solutions within the business. Although, Sync provides the unmet need to customers of personalisation in store, this in turn improves brand engagement and loyalty, resulting in beneficial business solutions. Therefore, even if Sync is not directly focusing on business solutions, the result from the customer experience will improve the overall business.

Industry Specific

Sync

Sync Business Focused

Sync

SY NC

Industry Range

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Customer Focused

This positioning map shows a lack of offline solution companies available to retailers. This is where Sync can excel in the industry and offer valuable in store experiences that reflects the online world of shopping. However, other competitors offer highly innovative solutions in terms of customer experience, therefore, these brands need to be constantly monitored in case they expand and start to offer offline solutions and become a higher threat to Sync. Mercaux in particular already offers offline solutions, however, as shown in the previous positioning map, it is not customer focused.

High Innovation

Sync

Sync Online Solutions

Sync

SY NC

Offline Solutions

Low Innovation

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5.3 Price Point Analysis “SaaS companies who rely on pricing to be competitive aren’t confident in their products.

They think that the only way they can become viable is by devaluing their solution” (Efti, 2018 p.1). Therefore, Sync’s price point will reflect the value of their solution, which is high. The rewards gained from the implementation of Sync will coinside with a relatively high price point in order to provide a highly professional and seamless customer experience. The next section of this report will justify how the B2B target of mid-market retailers will be segmented to accommodate the high price point.

Sync

High

Sync Mid

Sync

Low

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SY NC

5.4 Porter’s Five Forces Competitive Rivalry

Threat of Substitution

There is little competitive rivalry as most primary competitors offer in store technology to sales assistants rather than customers. There are no direct competitors due to Sync’s offering being a completely new concept in the retail market.

However, the CEM market is highly competitive especially when introducing new technologies is required. Therefore, to combat competitive rivalry, Sync will be committed in providing an optimal customer experience through innovative technologies.

Threat levels are relatively high in terms of substitution as retailers may decide to use in house resources to achieve a similar solution that Sync offers by themselves. However, research found in the CEM market showed that retailers feel incapable of offering this solution at a highperformance level, therefore prefer to turn to other businesses like Sync. This suggests that it is likely that mid-market retailers will invest in out of house software solutions to meet the needs of their consumers, limiting the threat of substitution.

Supplier Power Sync is reliant on the hardware supplier, Polytouch, to offer the software on their in-store touch points. It would be extremely problematic if this agreement in supplies were to stop as it could cause issues in reprogramming the software onto other hardwares. Therefore, there must be a strong relationship between Sync and Polytouch to mitigate this risk. If this was to arise, it would set back the company in finding a new hardware provider with the risk of technological issues occurring.

Buyer Power Sync is a high priced solution making it likely that retailers will try to drive down monthly licence fees. However, Sync’s clear value proposition, as recently explained, will combat this issue. The retailer is then tied to the monthly subscription, making it highly unlikely that they will switch to another service due to ease.

Threat of New Entry In terms of the rate at which technology is advancing, there is a high threat of new entrants, especially in the saturated retail industry. There are multiple big name technology companies that operate in other industries, unrelated to fashion.

Therefore, these brands need to be constantly monitored in case they decide to venture out into the retail landscape. Sync’s relationship with the retailer must be strong and successful in order to build brand loyalty and limit the risk of new entrants.

This model helps to understand the strength of Sync’s competitive position and diagnose possible pressures in the market. It shows Sync’s high competitive advantage due to its USP and lack of similar online experiences on the market. This creates a highly attractive offering to buyers to offer their customers a new and innovative in store experience. However, new entrants and substitution poses possible threats to Sync whilst operating in the rapidly advancing technology market. This presents a challenge to Sync in staying ahead of competitors with regular updates and adoption in new technologies.

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6

Consumer Segmentation

40

6.1 B2B Consumer Segmentation Sync is a B2B company that will operate as a white label solution provider to fashion retailers. It will market to the UK retail industry within the first 3 years of launching. This industry includes many market segments meaning a consumer market segmentation evaluation is needed to allow for successful and accurate targeting.

After assessing the retail landscape, the most suitable market segment to target is mid-market retailers with an omni-channel strategy.

“A number of mid-market players have struggled to maintain growth as they battle to define their USP in an increasingly crowded retail sector” (Dover, 2018, p.3).

The innovation that Sync provides would help mid-market players to differentiate and offer an exciting new customer experience. A few examples of what specific retailers that will be targeted include: COS, Reiss, French Connection, Whistles, & Other Stories and many more. Omnichannel retailers have the capital to invest in innovative technologies and they constantly want to improve their customer experience (Wallace, 2018). Mid-market retailers also have a smaller portfolio of stores, meaning they will be able to invest more into ensuring they meet the needs of their consumers. This justifies the high price point as explained previously in this report.

More affordable market segments typically rely on volume sales, whereas mid-market brands strive to provide a positive customer experience and meet their consumer’s needs. The price of their products must reflect the overall customer experience to justify purchases and increase satisfaction. Brand equity is extremely important in the mid-market segment to achieve assured consumer perceptions and lead to brand loyalty.

They also want to be perceived as technologically advanced in comparison to other market segments like the mass market and high street.

This requires individualised experiences and exciting innovations that Sync can provide. The personalised touchpoints will offer an experience that is exclusive and modernised, therefore resulting in brand engagement. The consumer to brand interaction will be highly personal to create a trusting and recognised relationship with the retailer.

Aspirational goals going forward would be to clearly target the mid-market segment but also leave potential growth to expand into the more premium/luxury market when established as shown in the market segment pyramid (see Appenidx 14). The mass market/high street retailers would be currently unsuited for Sync’s services as they are often overcrowded meaning the space and time for interacting with the in-store touchpoints would be limited. However, there is space for Sync in the future to become more mainstream and be a key step in the consumer shopping journey.

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6.2 B2C Consumer Segmentation The overall B2C consumer segmentation will reflect those who are targeted by the midmarket retailers as shown on the previous page.

Joshua Edington, the marketing manager for the premium shopping centre, Victoria Leeds, stated in an email interview that these retailers market to the ABC1 consumer (see Appendix 2). This group is defined as a consumer from one of three higher social and economic groups, consisting of people who have more education and higherpaid jobs than those in other groups (Cambridge Dictionary, n.d). Consequently, they choose to shop at mid-market retailers as they want high quality products and to portray a sophisticated self-image all whilst experiencing exceptional customer service. Therefore, Sync must promote its highly professional service through cuttingedge technology and ease of execution.

These retailers also target female millennials and Mintel states that 25-34 year olds are the most likely to engage with multichannel retailing (Dover, 2018), making them the perfect fit for what Sync can provide. Millennials have grown accustomed to speed, convenience and a personalised online experience which has resulted in a new desire to have that experience in a physical retail setting.

They have become unfaithful to brands and very weary of brand promises, therefore to win them over it’s extremely important to personalise their experience and acknowledge their individuality.

The profiling solution that Sync offers will allow the consumer to feel recognised and therefore improve brand loyalty with a points scheme.

Consumer will also be segmented into early adopters in the innovation of adoption lifecycle (see Appendix 14) as they will be more likely to be attracted to the service Sync provides as it is extremely new to market and unique. They will get a sense of exclusivity and excitement in being one of the first to try the product.

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6.3 User Testing The business proposal was tested amongst consumers to explore their attitudes towards the concept and gain valuable feedback. Both the focus group and in-depth interview received an overwhelmingly positive responsive with clear acceptance and understanding of how Sync would add value to their path to purchase. There was to start, some hesitation in terms of what the facial recognition would be doing, although once understanding the benefit of fast and easy log in, participants preferred this feature instead of email, scan or finger print.

It was clear that Sync would eliminate key consumer tensions found in the current offline shopping experience. This included clearer searching accessibility in order to never miss an item when shopping. Participant 4 explained: “You (i store)…

“Youdon’t don’tknow know where everything isis(in store)… I don’t know where I don’t know wheretotostart startand andI I hate hate knowing knowing I could’ve missed something that Ithat would’ve loved” I could’ve missed something I would’ve (see Appendix .) . loved” (see Appendix 3).

The feeling of being overwhelmed in store was also clear throughout the focus group, meaning Sync would ease this pain of bringing the convenience of online to a physical setting and eliminate any potential missed purchases.

The feature of having items saved, reflected into store was also highly attractive to the consumer in saving time and achieving an overall more seamless shopping experience. Participant 3 raised an issue that if she had something saved online and had to get it up on her phone, she may be out of data, creating friction along the consumer journey. “Just knowing what you’ve searched before would be useful…it would make life a lot easier” (see Appendix 3).

The only possible unappealing aspect of the service raised was people finding it intrusive due to the highly personal nature of the product.

However, participant 6 said “I would like it just because it’s more tailored to what you like”(see Appendix 3). This corresponds to the finding from stage 1 that consumers are aware of the value of their data but face the dilemma of still enjoying personalised recommendations and tailored experiences from brands. Participant 5 also supported this claim happens anyway to honest, be honest, they’re “it“ithappens anyway to be they’re always always what tracking whatdoing you’reso doing not it tracking you’re why so notwhy make make it more(see useful?” (see Appendix 3). more useful?”

Appendix .)

The focus on “useful” is what Sync aims to achieve in offering a more meaningful experience through the use of innovative technologies. The loyalty points in exchange for data is crucial in presenting clearly how the consumer will personally benefit from acceptance in this technology. This feature received high appraisal in both the focus group and in-depth interview. Therefore, it must be complimented with quality, transparency, privacy and respect to achieve a valuable service that isn’t intrusive.

“It would be really useful because I feel like there’s a lot of hassle between being online versus not “ (Participant 3, see Appendix 3)

“It would let me enjoy shopping again“ (Participant 2, see Appendix 3)

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6.4 Industry Feedback Feedback from industry professionals was crucial in determining product feasibility and a successful launch. Joshua Edington, marketing manager at premium shopping centre, Victoria Leeds, gave insights into implementation into the retail market.

He approved the idea and said there is “definite market for innovation in making in-store more valuable & unique vs online” (see Appendix 2).

He also explained that there is scope in enriching the in-store experience & providing additional information to link shopping habits online, proving the market opportunity for the concept.

Graeme Derby, UK manager of Polytouch, supported this consumer need that Sync will fill. difficultto to offer that “It“Itisisdifficult that experience experienceand andthere there aren’tmany, many, if any that doing if you aren’t if any that areare doing it, it, soso if you can cantoget to point that point would be fantastic” get that that that would be fantastic” (see (see Appendix 4).

Appendix .).

Coming from someone who operates in retail technology, this information was extremely supportive. Alistair Guthrie, a software developer, was then contacted who gave reassurance that the service “is definitely feasible” (see Appendix 6) with not many companies embracing the online to in store link.

“Facial recognition is actually a great idea“ (Guthrie, see Appendix 6)

“There’s scope in enriching the in-store experience & providing additional information to link their shopping habits on line“ (Edgington, see Appendix 2)

“That sort of area of online and offline is the holy grail at the moment in creating a seamless transition “ (Derby, see Appendix 4)

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7

Marketing Strategy

44

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7.1 Marketing Objectives Aim: To promote Sync’s highly beneficial service through an efficient marketing strategy, establishing B2B connections and ensuring the business objectives are met Objectives:

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•

Obtain 50,000 profiles on Sync within the 1st year after launch with high customer satisfaction

•

Triple the number of users to 150,000 by the end of year 2

•

Establish position recognition and acceptance in the mid-market fashion landscape by achieving 20% of UK market share in retail customer experience by 2023

7.2 Strategy Overview Year 1: Establish The first year will be crucial in establishing permeant recognition and acceptance in the midmarket retail landscape. One retailer in particular will be targeted to create a lasting partnership to then be used as a case study for promotional material in year 2. Prior to launch will all be about focusing on producing a highly successful and profitable product. Any internal issues relating to the software will be identified and fixed to then lead to external user testing to eliminate any complications.

Raising awareness of the service will be the central strategy in meeting the short-term objective.

With the business being a start-up, promotional communication must reach a wide audience in order to get conversation following about Sync. Specific communication strategies can be found in the communication plan segment of this report. Going to market will acquire the first few customers and Sync must maintain a healthy and personal relationship with the client through well set up customer relationship management, including constant and frequent exchanges of knowledge and new developments. This works well in combination with the business model as Sync is an on-going monthly service, providing a strong, frequent relationship with the retailer and therefore resulting in high satisfaction. This high satisfaction will then be emulated into positive brand reputation going forward.

Year 2: Promote With proof of success attained from year 1, year 2 will prioritise keeping the momentum and promoting the service to other mid-market retailers. This will be achieved through marketing campaigns and a case study showcasing the success of how Sync can improve retailer’s engagement. Year 2 will see Sync aim to partner with 2 other retailers as well as keeping customer retention with the first partnering in year 1.

This will allow for recurring revenue and allow Sync to keep affording valuable marketing and communication methods to continue to the grow the company.

When the market sees the potential that Sync can offer, it is likely the brand will experience an immense amount of growth very quickly. The launch of the service will prove the model’s value and Sync will have to reinvest all of the profits to scale the business. While this is extremely positive, it will cost Sync more money to rapidly expand in resources to support the newly acquired customers. This hyper growth phase has been analysed in the brand management segment of this report which highlights controlled outcomes to overcome the risk possibility.

Year 3: Expand By year 3 Sync will aim to have levelled out and created a strong presence in the retail industry.

The brand will start to turn out healthy profit and acquire new customers at a rapid rate which will test the infrastructure of the business.

Internal strategy of business must continue to be controlled to meet the long-term objective to continue to expand and scale the business.

By the time Sync is in their 3rd year of business, competition of other software brands replicating the same service will be a risk. Marketing must focus on keeping strong connections with previous partnering’s as well as promoting the brands USP. Sync has an advantage of being first to market with the service, therefore, marketing material must convey a strong message of reliable innovation by the third year. This will be achieved by utilising new advancements in technology and building on previous case studies to convey a successful brand story.

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7.3 The 7 Ps Product

Sync offers the most cutting-edge technology in a form of digital touchpoints for a physical retail setting.

The software provides user data profiling, available on interactive tablets through facial recognition.

The profile consists of 4 touchpoints for the user to provide an individualised and seamless path to purchase which includes quick search, loyalty, wish list and discover. The product can be used on Polytouch hardware for an easy to use, accessible experience.

Place

The place that Sync will operate in will be mid-market retailers. This reflects the sophisticated and contemporary aesthetic of the brand by being placed in a modern retail setting. The place online to communicate with the brand will be the company’s website and LinkedIn profile which will lead to direct sales.

Price

Price point was analysed in the positioning segment of this report which explained that Sync will market themselves with a with a relatively high price point in order to provide a highly professional and seamless customer experience. The price point also reflects the high value of their solution and the rewards gained from the implementation of Sync. The monthly cost for retailers totals at £500p/m.

However, there would be a separate transaction for the Polytouch Hardware that cost £3,000 each.

Promotion

Promotional special offers to the consumer will derive from the loyalty points scheme that customers can track on their profile. Other B2C promotions that will be executed through the retailer’s channels will be social media campaigns, direct email marketing and a launch party to entice customers into store. B2B promotion includes a website, LinkedIn profile, case studies, PR, QR code business cards, networking events, and a promotional video.

People

There will be a small amount of employees within the Sync company with the brand being a startup. Most of the work will be the founder’s responsibility with help from technological professionals to provide optimal customer service. The people within the company have a passion for O2O retail strategy and offering customers a service that meets their desires for individualisation.

Process

Sync is the lead contractor with the retailer and Polytouch is the sub-contractor. Due to Sync operating on a monthly service fee payment, the brands process is dedicated in providing constant updates and software maintenance to make sure the product is working to a high standard. Sync follows a white label implementation allowing retailers to promote the software but keep within their branding guidelines by customising a range of options in colour ways, text and icons.

Physical Evidence

Interaction between Sync and retailers will consist of face to face marketing, business cards, company website and other promotional material as stated in promotion. Between the consumer, the experience will be highly individualised, using user data and AI to target the customer directly.

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8

Communication Plan

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8.1 AIDA and DRIP Model Utilising AIDA and DRIP models allow Sync to focus on ensuring that communication messages are clear, persuasive and effective to their audience, resulting in successful sales and adoption to meet the communication objectives.

Attention

Provide intelligence for the need of O2O strategy due to serious consumer detachment from physical retail.

Interest

Sustain interest with a teasing social media campaign to entice the audience into store and create a buzz.

Desire

Promotion through case studies on how Sync can dramatically improve customer satisfaction.

Action

Businesses receive an advantage of being first to market and offering innovative retail solutions which create actionable adoption.

Differentiate

Distinguish Sync from competitors by emphasising the consumer centric technology specialising in creating optimal customer experience.

Reinforce

Reinforce the message by promoting clear benefits for both the retailers and consumers through the application of Sync.

Inform

Inform businesses through high coverage B2B promotion and inform consumers through retailer’s channels, explaining how Sync will enhance their customer O2O journey.

Persuade

Persuade adoption by communicating the correct use of data sharing in return for a higher degree of individualisation.

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8.2 B2B Objectives

8.3 B2B Strategy

Aim: To increase awareness of the brand and acquire new B2B customers with a convincing communication strategy in order to meet the marketing objectives

Due to Sync pioneering the O2O business strategy, this must be reciprocated into their communication plan by creating online to offline promotion to keep within the brands ethos.

Integrated marketing communication (IMC) techniques will be applied to reach an effective communication strategy across all platforms.

The B2B strategy follows a highly professional approach as buyers are likely to do a google search to evaluate Sync’s offering. Therefore, online communication will provide suitable methods in order to meet the B2B objectives and the overall aim.

•

Achieve average website traffic of 5,000 visits per month within the 1st year after launch to increase brand awareness

•

Gain coverage in 10 news outlets by the end of 2020 to create consumer demand and encourage purchase

•

Attain 1,000 followers on LinkedIn within the 1st year after launch to increase brand engagement

•

Attend 3 networking events within the 1st year after launch to raise brand awareness and inform the market of Sync’s offering

Website: This is likely to be the first point of contact and experience that businesses will have of Sync. A successful website is the hub of a brands online presence and a projection of its expertise into the marketplace (Frederksen, 2019). Therefore, it will be a communication method for the product offering, contact details, promotional video and about information relating to the brand. Once Sync has built up its portfolio, it will showcase success stories through blog posts and case studies.

LinkedIn: Due to Sync being a white label company, the only online social media necessary in the first few years of establishing is LinkedIn. It is a powerful tool for companies looking to make new connections, generate leads, and build their brand (DeMers, 2015). It will allow for a wide reach at a low cost to establish dialogue with constant content relating to the need for improved retail experience being posted as well as clear links and information about the company. Sync will also create sponsored content ads that will appear in the homepage feed (on desktop, mobile, and tablet) and in the right rail of the desktop homepage. The high price point of Sync will be difficult to convey on this platform, however the effectiveness of the channel cancels out that risk.

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Website (made on wix, and mobile friendly example)

Sync website homepage and service page

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Promotional Video:

PR:

The advanced technological experience that Sync creates is sometimes difficult to convey in written language. Therefore, a visually compelling and information rich promotional video will be created in order to inform buyers of the potential that Sync can provide. The creative content will reflect the contemporary mid-market audience, promoting the seamless experience Sync can offer. This will be expressed through the lens of the consumer, showcasing how Sync is a vital step along their path to purchase. It will be presented on Sync’s online channels as well as their offline at networking events and trade shows to easily convey the brands message.

“PR is the sustained effort to establish and maintain goodwill and mutual understanding between an organisation and its public” (CIPR, 2019)

Case Studies: After the first partnership with a retailer is successfully completely, a case study will be used to assure businesses that Sync is a vital role in their O2O retail strategy. It will be communicated through a narrative that focuses on how the client has had success with the solution including facts and figure as well as customer satisfaction to convince buyers. This method will crystallise Sync’s expertise, build confidence and expand credibility among key buyers (Amplify, 2019). It will be shared on Sync’s online channels as well as in event talks and trade shows.

PR is a crucial communication method needed for Sync to build reputation and awareness about the new brand. Although there is no guarantee that the message will meet the target, it will allow customers to find more ways to connect with the brand through business stories and press releases. PR will be the primary focus in Sync’s communication strategy to ensure major media coverage and drive traffic to the website. As Sync is a new start-up brand, London PR agency, Clarity will be utilised to contact a variety of media outlets. Specific outlets that will be targeted include: trade magazines, journalists, technology/ retail publications, industry contacts, trend writers, bloggers.

S o l u

Press Release Date: 15/1/20

t i o n

WHY DOES PERSONALISATION HAVE TO END AS SOON AS YOU WALK INTO STORE?

Sync

How Sync’s new business concept is syncing the online to offline retail experience.

Sync

Sync is the revolutionary solution to offer a fully integrated consumer journey. Personalisation doesn’t have to end online, as Sync provides interactive in store touchpoints to unlock individualised profiles linking to the customers online shopping habits. Users opt in to create a profile and through facial recognition log in, they receive tailored information about their past purchases and style preferences. The technology combines AI and user data profiling to provide situation-relevant information including any products left in their online basket that are in store, style suggestions that are available, online reviews or correct sizing that is in stock. Loyal customers are instantly recognised and rewarded with special offers and sneak previews, developing innovative customer relationships and resulting in valuable in-store experiences.

SY NC

To see the experience in action head to our website: www.syncsolution.co.uk Email us at solution@sync.co.uk or check us out on LinkedIn

Sync

53

An online communication strategy is a cost effective and time efficient method of promoting Sync. However, offline communication remains just as important to B2B companies in adding faceto-face value to the communication. Therefore, the next promotional methods explained are offline to combine the O2O strategy.

Networking Events: This method of communication allows for a valuable place to meet like-minded people and build visibility. It is also a beneficial way of staying ahead of competition as competitors can be analysed at these events. Going to specific events geared towards the technology/retail industry offers reassurance that Sync will able to communicate directly to their target market and drive purchase. Therefore, 3 events including: The Retail Business Technology Expo (London), The Internet Retailing Expo (Birmingham) and Retail Week Live (London) will be targeted in the first year. The booth design must be engaging to connect the brand with possible buyers with examples of the profiling technology.

Event Speaking: Volunteering to speak at technology events and conferences will boost the brands visibility. The talk will recognise the underdeveloped, detached in store experience that needs to be improved to meet the needs of the consumer. This will convey the brand message of utilising new, innovative technologies in order to offer a higher degree of individualisation, gaining positive reputation by sharing the opportunity to the market. It also opens up further discussion about the brand to get people talking and raise Sync’s profile.

QR Code Business Cards: These will be handed out at all events and talks that Sync takes part in. The QR will direct the audience to the Sync website to carry on the business conversation from offline to online.

S o l u

t i o n

Sync nc

solution@sync.co.uk

SY NC

c

Syncing the online to offline retail experience

54

+447703 678424

www.syncsolution.co.uk

London EC3A 7DT

Front and back business cards

Networking event stand inspiration

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8.4 B2C Objectives

8.5 B2C Strategy

Aim: To communicate an optimised in store customer experience through an enticing social media campaign, increasing customer satisfaction and brand loyalty

Sync will partner with mid-market retailer, COS, launching the in-store experience in April 2020.

The communication strategy will promote the white label collaboration through only the fashion brand’s channels to provide an innovative and seamless experience to the COS consumer.

Therefore, it will target the COS audience that is an onmi-channel, sophisticated shopper who enjoys enhancing their personal style which the partnership can provide.

•

To improve customer satisfaction with a retailer by 15% within 6 months of launching Sync into store

•

To increase the overall number of loyal customers by 20% within the 1st year of implementation

•

To increase a retailer’s social media engagement by 10% the month running up to in store launch

Pre-Launch The partnership will follow a fast build campaign strategy, with a series of teasing posts on all of COS’s social platforms starting 1 month prior to the launch. The campaign is titled “what’s in store…” which will be used as a viral hashtag to entice the audience and create a buzz surrounding what is to come. The campaign tone will be highly alluring with lack of knowledge about what is launching until the launch date to create a captivating and exciting message to reflect the new innovation that will be available.

Visuals will be contemporary, clean and stylish to echo both the COS and Sync brand. Invitations to the launch night event will be sent out two weeks prior to opinion leaders and influencers.

#whatsinstore social media campaign

#whatsinstore

#whatsinstore

#whatsinstore

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Post-Launch The build of the campaign will end with a big reveal launch night at COS’s UK flagship store on Regents Street, with high press coverage, opinion leaders and fashion influencers. The following day will invite loyal followers of the brand by direct email marketing to come and be the first to try the exciting new technology linking to the campaign #whatsinstore. To keep the momentum with in-store visits and engagement with the touchpoints, users that create a profile on the software will receive a bonus of 500 loyalty points if they sign up within a month after launch. There will also be a refer a friend option to gain more points, as explained in the user journey section of this report.

To evaluate the effectiveness, a survey will be sent out to COS consumers before product implementation then after to measure satisfactory levels with the customer experience Sync has provided. Other KPIs will include event turn out, increased website visits, social media engagement and how many enquiries from other retailers come after the launch such as requests, phone calls and quotes. See page 71 for more detailed information on how measurement of success will be tracked.

Direct email marketing

YOU’RE INVITED Have you guessed it yet? It’s finally time to see #whatsinstore. Come and be one of the first to try the exciting new retail experience in Regents Street COS today.

Psst...you might even get a little reward.

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8.6 Time Plan

Activity B2B Launch Sync Website LinkedIn Promo Video Case Study PR Event Exhibition 1 Event Exhibition 2 Event Networking LinkedIn Sponsored Content

B2C Social Media Email Marketing Launch Event

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Jan

Feb

March

April

May

June

July

Aug

Sept

Oct

Nov

Dec

As the time plan shows, promotional material is focused around the launch of Sync at the start of the year in order to attain partnership with COS in March. This then follows the B2C communication strategy, building a fast social media campaign ready for the launch in April. In order to measure the effectiveness of how Sync benefited the COS consumer experience, the next B2B communication after the networking events come into play in September. This will include a case study and PR to build connections with buyers, ready for implementing in the early months of 2021.

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8.7 Communication Overview Y2&3 Years 2 and 3 will follow a similar strategic direction from year 1 to meet the medium term business objectives. These include securing more retail partnerships and increasing the overall number of Sync touchpoints available in stores. This will impact the industry by allowing a higher amount of users to be able to come into contact with the software, creating new customer expectations and disrupting the offline retail experience.

Year 2 By 2021, the brand will be established and successfully positioning in the market. Therefore, promotional B2B material will be heightened through the same methods minus the promotional video. Press releases will no longer focus on a new product launch, but instead on the remarkable customer experience Sync can provide. More traditional forms of advertising will be added with Sync’s success story in technology magazines such as Wired or Raconteur.

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Year 3 In year 3 Sync will move away from being specifically a white label brand, allowing the Sync name to resonate within consumers rather than only businesses. This will be achieved through creating a brand Instagram and twitter account to communicate directly to the consumer. This strategic move allows Sync to be less restricted and ease the possibility of growth in the future.

By year 3, other businesses may have tried to replicate a similar offering to Sync. Therefore, the brand must keep its offering as innovative and cutting edge as possible, adopting advancements in technology to stay ahead of competitive. This will be communicated through consistent blog posts on the website of how Sync is offering the best service on the market.

9

Brand Management

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9.1 Initial Funding In order to successfully launch Sync into the market, £140,000 capital must be raised to cover expenses relating to development of the software and other start up costs. This figure will be split between £120,000 from Angel investment and £20,000 through personal investment.

Angel investment is the most effective option to bring financial feasibility to the business. The figure of £120,000 will be requested from the investor with the agreement that the investment will be returned with 20% interest in year 3. This method provides opportunity for guidance and mentorship, which will be extremely valuable in ensuring growth within the technology industry.

It is also in the investors best interest to maximise the potential of the business, creating a safe and beneficial relationship with the Angel investor.

The risk of utilising Angel investment includes the possibility of losing control over the business in exchange for funding. However, it is still a lower risk option than a start-up loan due to the valuable mentorship and lack of financial vulnerability.

Using personal savings allows for creative freedom within the business and a heightened motivation for the business to succeed. Therefore, £20,000 will be accumulated by personal investment to raise enough capital to launch the business.

Start-up Funding

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9.2 Start-up Costs Item

Rationale

Start-up Cost

Annual Cost

Software development

A contractor will be paid £70,000 to create the initial software. This will be the start-up costs for the actual software to offer retailers, there will then be on-going costs relating to software maintenance for hosting and upgrades.

£70,000

£70,000

Premises

A fully furnished, private office space in Aldgate, London has been chosen due to accessibility location in the centre. Most PR contacts in the retail industry will be based in London as well as many technology networking events. Rent includes Wifi, meeting rooms and printing facilities, making the space suitable for Sync.

£590pcm

£7,080

Office Supplies

This includes office consumables such as pens, paper etc. The first month will have a higher cost of £40 to fully equip the office, then it will drop to £30 a month.

£40

£370

Website

The website will be used for B2B marketing and communication. Wix will be used to create Sync’s website which is a free process, however to register the domain, a monthly premium subscription of £8.50 will be paid.

£8.50 p/m

£102

Insurance

Sync will need to cover public and employer’s liability insurance. This will protect the business from property damage claims from customers or visitors and allow employees to be covered, should anything happen in the workplace.

Insurance will be provided through AXA with a yearly cost of £116 for both types of insurance.

£116

£116

Business Registration

The cost to cover Sync as a private limited company on Gov.uk is £12. This will keep costs separate from personal finances. Trademarking the business is also required to protect Sync’s logo and brand identity. This costs £200 on Gov.uk.

£212

£212

Wages

The founder of the company will be paid to cover living costs with £8000 for the year. This will then rise to minimum wage in year 2 to £15,269

£8,000

£8,000

A software developer will be hired in July to write code, modify, and debug software for client applications and update visual developments.

They will be paid the average salary for this profession which is £15,500 for half the year then £31,000 for the full year in year 2.

£15,500

£15,500

See Appendix section 10 for full breakdown and justification of costs.

Total: £101,380

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9.3 Marketing Budget Media

Cost

Quantity

Annual Total

Press Release

£0

3

£0

Website

£8.50 p/m

1

£102

Business Cards

4p

500

£19.49

Event Exhibition 1

£4,030

1

£4,030

Event Exhibition 2

£3,750

1

£3,750

Networking Event

£50

1

£50

Promotional Video

£2,000

1

£2,000

Launch Event

£500

1

£500

LinkedIn Profile

£0

1

£0

LinkedIn Sponsored Content

£5 p/d

60

£300

PR Agency

£1,500 p/m

4

£6,000

Case Study

£0

1

£0 £16,751.49

A contingency fund of +10% will be added to the total, bringing the final marketing budget to £18,433.24. The event exhibition includes, event space, stand dressing and travel. £500 will be contributed to the COS launch night event with location being provided by COS in their flagship store. Other costs of promotional material on the night will be split between COS and Sync, including drinks, decoration and entertainment.

The costs of the #whatsinstore campaign will come out of COS’s marketing budget. Financial justification can be found in the Appendix section 11.

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9.4 Pricing Architecture Sync’s pricing runs on a monthly license fee that costs retailers £500 per month. However, savings can be made if the retailer chooses to licence a high amount of Sync touchpoints with discounts as shown below: Monthly fee for 1 touchpoint: £500 5 Sync touchpoints (recommended for 1 store) = £2,350 monthly fee (saves 6%) 10 Sync touchpoints (recommended for 2 stores) = £4,600 (saves 8%) 20 Sync touchpoints (recommended for 4 stores) = £9,000 (saves 10%)

Sync also offers a discounted price for the first 3 months of implementation. Retailers can receive a discounted monthly rate of £450, saving them 10%. This will then increase to the stand rate of £500 per month, unless they choose to implement one of the bulk buying options shown above. Offers cannot be used in conjunction with each other. The retailer must pick either the first 3 months discounted price or set amount of instore implementation.

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9.5 Financial Objectives

9.6 Sales Forecast

Year 1

The year 1 sales forecast reflects the partnership between COS and Sync, with the first 3 month offer. 5 touchpoints will be implemented into store in April with a £450 monthly fee per touchpoint (450 x 5 = 2,250). For full breakdown of sales forecasting for all 3 years, see Appendix section 12. Increases in the sales forecast will align with marketing activity. Partnerships with the retailer will be a result of the marketing actvitiy, however there will then be a short delay from confirming a deal to implementation into store, as there has to be user testing and communication campaigns targeted at the user to make them aware of the new experience. Once the software is introduced into store that is when retailers will pay the monthly licence fee, resulting in about a months delay from communication activity to sales.

• •

Sell a minimum of 25 Sync touchpoints to a mid-market retailer by the end of 2020 Maintain a positive cash flow

Year 2 •

Make a net profit of £35,000

Year 3 • •

Year 1

Obtain a 50% increase in revenue from Year 2 Provide a return for Angel investors

Jan

Feb

March

April

May

June

July

Aug

Sept

Oct

Nov

Dec

Sync Touchpoints

0

0

0

5

5

5

25

25

25

25

25

25

Revenue Stream

0

0

0

2,250

2,250

2,250

11,500

11,500

11,500

11,500

11,500

11,500

Total Revenue: £75,750

Year 2

Jan

Feb

March

April

May

June

July

Aug

Sept

Oct

Nov

Dec

Sync Touchpoints

25

30

40

40

50

50

53

53

53

58

58

58

Revenue Stream

11,500

14,200

18,800

23,400

23,400

23,400

24,750

24,750

24,750

27,100

27,100

27,100

Total Revenue: £270,250

Year 3

Jan

Feb

March

April

May

June

July

Aug

Sept

Oct

Nov

Dec

Sync Touchpoints

58

58

58

63

68

105

115

120

120

125

125

125

Revenue Stream

27,100

27,100

27,100

29,350

29,350

31,600

47,750

50,250

50,250

52,500

52,500

52,500

Total Revenue: £477,350

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9.7 Profit and Loss

2020 0 -

0

2,250

-

2,250

3,758.5

2,250

-

2,250

-

58.5

2,250

-

2,250

1,166.6

-

8.5

11,500

-

11,500

30.0

1,166.6

-

8.5

11,500

-

11,500

590.0

30.0

1,166.6

-

1,508.5

11,500

-

11,500

16,166.7

590.0

30.0

1,166.6

-

1,658.5

11,500

-

11,500

-

16,166.7

590.0

30.0

1,166.6

-

8.5

11,500

-

11,500

1,000.0

-

16,166.7

590.0

30.0

1,166.6

-

8.5

11,500

-

11,500

70,000

1,000.0

212.0

101,000.4

7,080.0

370.0

13,999.2

116.0

16,751.5

75,750

-

75,750

Full Year

0

4,538.5 -

1,166.6

30.0

590.0

16,166.7

-

-

-

210,529

Dec

0

28.0 1,166.6

30.0

590.0

16,166.7

-

-

-

18,961.8

(134,779.1)

Nov

3,658.5 1,166.6 30.0

590.0

16,166.7

-

-

-

17,961.8

(7,461.8)

Oct

0

Cost of Goods Sold -

Total Net Revenue

1,508.5 1,166.6 30.0

590.0

666.7

-

-

-

19,611.8

(6,461.8)

Sept

Advertising & Promotion 116.0 1,166.6 30.0 590.0

666.7

-

-

-

19,461.8

(8,111.8)

Aug

Insurance 1,166.6 30.0 590.0 666.7

-

-

-

17,961.8

(7,961.8)

July

Maintenance 40.0 590.0 666.7

-

-

-

17,961.8

(6,461.8)

June

Office Supplies 590.0 666.7 -

-

-

2,511.8

(6,461.8)

May

Rent 666.7 -

-

6,211.8

(261.8)

April

Salaries & Wages 212.0 -

-

6,991.8

(3,961.8)

March

Business Registration -

2,481.3

(4,741.8)

Feb

Accountant Fees 70,000

6,111.8

(2,481.3)

Jan

Software Development 74,299.8

(6,111.8)

Expenses

0

Total Expenses

(74,299.8)

Gross Profit

Net Earnings

67

2020

2021

2022

Total Net Revenue

75,750

270,250.0

477,350.0

Cost of Goods Sold

-

-

-

Gross Profit

75,750

270,250.0

477,350.0

Advertising & Promotion

16,751.5

14,751.5

19,751.5

Insurance

116.0

116.0

116.0

Maintenance

13,999.2

13,999.2

13,999.2

Office Supplies

370.0

360.0

360.0

Rent

7080.0

7080.0

7080.0

Salaries & Wages

101,000.4

196,375.3

196,375.0

Business Registration

212.0

-

-

Accountant Fees

1,000.0

1,000.0

1,000.0

Software Development

70,000.0

-

-

Total Expenses

210,529.1

233,682.0

238,681.7

Net Earnings

(134,779.1)

36,568.0

238,668.3

Expenses

The profit and loss tables show a loss of 134,779.1 in the 1st year of launching the business, which was expected due to the initial high cost in software development being £70,000. However, once the software has been made, the on-going monthly revenue from retailers provides healthy profit growth in years 2 and 3. In year 2 the same marketing activities will take place, minus the promotional video expenses, lowering the total by £2,000. Wages will increase with employing a full time software developer and raising the founders salary to minimum wage. Sync will exhibit at another networking event in June 2022, increasing advertising and promotion by £5,000 for costs of exhibiting, stand dressing and travel.

68

Incoming Cash

Opening Balance

Total o/hs

Cash Injection

Total Revenue

(74,299.80)

0

120,000

(74,299.80)

120,000

0

Jan

39,588.40

(6,111.80)

0

45,700.20

(6,111.80)

-

0

Feb

37,107.10

(-2,481.30)

0

39,588.40

(2,481.30)

-

0

March

32,365.30

(6,991.80)

2,250

37,107.10

(6,991.80)

-

2,250

April

28,403.50

(6,211.80)

2,250

32,365.30

(6,211.80)

-

2,250

May

28,141.70

(2,511.80)

2,250

28,403.50

(2,511.80)

-

2,250

June

21,679.90

(17,961.80)

11,500

28,141.70

(17,961.80)

-

11,500

July

35,218.10

(17,961.80)

31,500

21,679.90

(17,961.80)

20,000

11,500

Aug

27,256.30

(19,461.80)

11,500

35,218.10

(19,461.80)

-

11,500

Sept

19,144.50

(19,611.80)

11,500

27,256.30

(19,611.80)

-

11,500

Oct

12,682.7

(17,961.80)

11,500

19,144.50

(17,961.80)

-

11,500

Nov

5,220.90

(18,961,80)

11,500

12,682.7

(18,961.80)

-

11,500

Dec

2020

Outgoing Cash 45,700.20

The cash flow shows when cash injections will be needed in year 1 in order to stay positive throughout the year. The full £120,000 Angel investment will be injected in January to cover software development costs and launch the business. To stay above 0, the £20,000 from personal investment will be injected in August.

The left over £5,220.90 at the end of the year will be re-invested into the business.

Closing Balance

9.8 Cash Flow

69

9.9 Sensivity Analysis A sensitivity analysis was carried out to see if sales were to change, how it would impact the profit.

Variables from the profit and loss accounts were inputted into the table, whilst expenses stay the same to assess the potential risk.

Year 1

Forecasted Figures

+20%

-20%

Total Revenue

75,750

90,900

60,600

Cost of Sales

-

-

-

Gross Profit

75,750

90,900

60,600

Expenses

210,529.1

210,529.1

210,529.1

Net Profit

(134,779.1)

(119,629.1)

(149,929.1)

Forecasted Figures

+20%

-20%

Total Revenue

270,250

324,300

216,200

Cost of Sales

-

-

-

Gross Profit

270,250

324,300

216,200

Expenses

233,682

233,682

233,682

Net Profit

36,568.0

90,618

(17,482)

Forecasted Figures

+20%

-20%

Total Revenue

477,350

572,820

381,880

Cost of Sales

-

-

-

Gross Profit

477,350

572,820

381,880

Expenses

238,681.7

238,681.7

238,681.7

Net Profit

238,668.3

334,138.3

143,198.3

Year 2

Year 3

70

9.10 Measures of Success The key performance indicators (KPIs) shown below will be used to determine levels of success throughout the brand. They will be a crucial tracking technique to ensure each objective is met within the business and therefore achieve overall aims. This is particularly vital for start-up brands survival in a highly competitive market.

With Sync having a clear focus on adding value to customer retail experience, customer satisfaction measures are top priority for the business. As shown, this will be measured by surveys, feedback and overall interaction with the Sync touchpoint.

Brand Awareness

Brand Loyalty

• • •

•

Website traffic and duration spent on the site Number of press articles wrote about Sync Number of LinkedIn followers and reach of sponsored content

• •

Customer satisfaction survey before then after launch in COS Customer retention rate with retailers Number of refer a friend codes activated

Brand Engagement

Brand Performance

• •

•

•

•

Likes/comments on LinkedIn posts Click through rate on LinkedIn sponsored content Turn out for launch event at COS followed by increase in website visits, social media engagement and email/phone call enquiries prior to in store launch Stand visits at the networking events leading to sales enquiries after event

• • • •

Number of touchpoints available in-store and sold to retailers Number of users who create a profile on the software Time spent on the software Feedback from retail partnership Increased footfall

71

9.11 Risk Assessment The following risk assessment has been carried out to identify and premeditate any possible internal or external risks that could impact the business. The external risk with the highest threat level would be if the partnership between Sync and Polytouch was to end as it could cause issues in reprogramming the software onto another hardware. It is then top priority to build a strong business relationship with Polytouch to mitigate the risk. The phone call with the UK manager of Polytouch reassured the company that it would be a successful venture as he said “That sort of area of online and offline is the holy grail at the moment in creating a seamless transition“ (Derby, see Appendix 4).

The highest threat level coming from internal risks would be the potential hyper growth stage to maintain customer satisfaction with low resources available. As explained, the business must be sensible and only take on a restricted amount of partnerships to maintain a high standard of service.

72

External Risk

Threat

Impact

Prevention

Medium

As stated in the strategy overview, when Sync has made its mark in the retail industry, other software companies could replicate a similar offering to Sync. This will limit Sync’s USP and add competitive rivalry.

Sync has the advantage of being first to market with its innovative offering.

Once a retailer has subscribed to a monthly licence fee, they are extremely unlikely to change provider, as it will already be used by their customer base.

Sync will also prioritise utilising new advancements in technology to convey a highly cutting-edge product solution.

Loss of Hardware Supplier

High

Sync is reliant on the hardware supplier, Polytouch, to offer the software to retailers on their in-store touchpoints. It would be extremely problematic if this agreement was to end as it could cause issues in reprogramming the software onto other hardwares.

There must be a strong relationship between Sync and Polytouch to mitigate the risk. Other hardware providers would have to be contacted, however this would set back the business with the risk of technological issues occurring.

Advancing Technology

Low

Due to the rapid rate at which technology is advancing there is a threat of Sync’s offering becoming outdated.

Sync must keep strong awareness in everything technological. Constant monitoring of trend reports, blog posts or press releases in innovation will be tracked to drive their core brand values of innovation.

Legal Requirements

Low

Due to the topical conversation of data security, if legal requirements become more restricted such as GDPR, this could impact Sync with a cautious approach from retailers and users.

Sync must always follow and promote the legal requirement in relation to data capture and sharing. If this becomes too overwhelming for the founder to handle, a part time data protection officer will be hired to meet any legal implications that could arise.

Economic Downfall

Medium

The current physical retail landscape is facing economic struggles with more retailers shifting to the costeffective world of online e-commerce.

If this economic condition drastically changes, there is a chance retailers may not be financially capable of investing into Sync.

This is one of the reasoning behind why Sync has chosen to target big name mid-market brands that will be able to invest in Sync and improve their instore experience, making it financially beneficial to them.

Replication of Software

73

Internal Threat

Impact

Prevention

Hyper Growth

High

As explained in the marketing overview, when the market sees the potential that Sync can provide, an immense amount of interest from other retailers could come at once. To support the newly acquired customers, the business could be spread thin in time and money to try and retain high customer satisfaction.

The business must therefore limit the amount of new retailers chosen to partner with in order to offer the same level of service provided in the first year. This risk can also be used as a positive to build exclusivity and desire surrounding the brands offer.

Lack of Interest

Medium

Users not wanting to interact with the touchpoint could lead to retailers ending their monthly subscription due to a lack of interest. This would result in limited monthly revenue to run the business and raised uncertainty relating to brand reputation.

The consumer desire for a Sync was selfevident in primary research with high levels of frustration relating to their current in-store experience. Therefore, this risk likelihood is very low. Although, in order to prevent it from happening, the launch campaign with COS will build a buzz around the new experience with a strong incentive to try the product. In store sales assistants will also be trained to promote the touchpoint so customers don’t miss or forget it is available.

Software Feasibility

High

The technology Sync is using is incredibly advanced and complicated to offer the most innovative solution possible.

If developers are unable to make the product, Sync will have to forfeit some of the features in order to make it feasible.

This could impact the brands USP with a less differentiated offering to other competitors.

Sync will have a bank of software development agencies noted in case one company says they are unable to create the finished product. Also, the business must make it clear at the start what needs to be included in the software.

Rejected Investment

High

It is crucial that Sync acquires the Angel investment to be able to fund the business. Therefore, if this was to not pull through, the cash flow would be in minus figures, impacting the marketing budget.

Funding to develop the software will also be impacted, delaying the launch of the whole business.

Other sources of funding would have to be obtained. This could be achieved through pitching to other Angel investors or taking out a bank loan.

Lack of Employees

Medium

The founder of the business will take on many roles in the first 3 years of starting the business. This could become too much to handle resulting in poor customer service and lack of organisation within the business. This would therefore, hinder Sync’s brand reputation.

The possibility of marketing and finance freelancers will be contacted in order to spread the workload when needed.

Software Failure/Bug

High

This would impact the overall customer satisfaction when using the touchpoint and therefore, result in negative feedback from the retailer. Reliability would then be questioned within the mid-market retail industry, lowering partnership probability.

A full time software developer is set to start in the company half way through year 1 to eliminate this risk. However, if there are signs of problems earlier on, the job offering would be promoted earlier on in the year.

Unexpected Costs

Medium

Unexpected cost would impact the cash flow of the business resulting in possible setbacks in implementation.

A monthly cash flow evaluation will be carried out to keep finances in check with added contingency funds for any hidden costs.

Risk

74

9.12 Future Growth The question of “where do you think the business could go in the future” was asked to potential consumers in the focus group and in-depth interview. Both answers came to the same response of it having the potential to go mainstream and be available in lots of big brands (see Appendix 3&5). This confirms the scalability of Sync becoming available in every physical retail setting, from high street to luxury. It will disrupt the fashion market with raised consumer expectations for a fully integrated experience that transcends the online to offline consumer journey.

The brand will pioneer optimal user experience with new innovations and adoption in technology to enhance the Sync offering. This will include smart hangers, to track in-store interest in items of clothing, virtual mirrors allowing for a fully immersive experience and QR code scans for more information on clothing. The potential to launch the brand globally will also be strategised after 5 years of building UK market presence.

75

10

Evaluation

76

10.1 Object Review Object

Review

To critically analyse the insights found from stage 1 and transform them into innovative business solutions

Stage 1 insights were reflected upon and analysed, providing clear direction for a potential business solution. It was identified in the first section of the report that it is crucial that the consumer understands clearly how they personally can benefit from acceptance in new technologies. This has been considered throughout with innovative user benefits of loyalty and individualisation.

To evaluate the current retail and customer experience landscape, assessing the external environmental impacts that will affect the launch of a new business concept

Through primary research, consumer frustrations relating to the current retail customer experience were identified in the problem section of the report. The external environment was evaluated using a STEEPLE analysis, macro/micro trends and market drivers. This then allowed for analysis of how these factors would influence the new business concept, resulting in the opportunity.

To strategically position the new business in the market place whilst segmenting the B2B and B2C consumer

Investigation into the retail and CEM market was carried out to gain greater understanding of the market place as well as analysing the current competitive landscape to strategically position the business.

This lead to B2B and B2C consumer segmentation in order to precisely target Sync’s audience.

To produce a clear communication strategy that creates high awareness of the brand through strategic and impactful marketing methods

The marketing strategy was firstly approached in order to support and justify the communication plan with reasoning behind promotional methods. AIDA and DRIP models were then assessed to ensure the methods of communication would be effective and impactful.

Building high awareness was also a key communication objective.

To present a feasible financial plan and generate commercial success that considers possible risks that the business could face

Financial feasibility was showcased through multiple finance tables including sales forecast, profit and loss, cash flow and sensitivity analysis. Initial funding was also justified of how it would be attained to cover start-up costs and the marketing budget. A thorough risk assessment was then conducted to consider every possible risk the business could face.

77

10.2 Conclusion 92% of consumers are frustrated when they go into store and cannot find what they were looking at online (see Appendix 1). This is due to the digital revolution drastically impacting the retail landscape with a detached online to offline customer experience. The convenient and individualised world of e-commerce has resulted in high consumer expectations for this to be reciprocated the minute they walk into store. It is therefore vital that retailers respond and technologically transform their instore offering to meet the desires of their consumer and survive the digital revolution.

This report has demonstrated how Sync can offer the solution to this problem through a strategic and viable business proposal. Syncing the online to offline retail experience, the brand holds the answer to an integrated digital to physical world of fashion. Both retailers and consumers receive clear benefits through the application of Sync, providing the correct use of data sharing in return for a higher degree of individualisation. The business concept will revolutionise the industry by ensuring that technology is not a replacement for the physical, rather an enhancement.

78

11

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11.4 Appendix Section 1: Online Survey

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Section 2: Expert Email Interview Date: 07/03/19 Participant: Joshua Edington, Marketing Coordinator at Victoria Leeds Dear Joshua I am a final year Fashion Marketing and Branding student from Nottingham Trent University and as part of my dissertation research I am looking into innovation in retail and how to offer online to offline marketing strategies. Being from Leeds, the premium shopping experience that Victoria Gate has to offer is very exciting and inspiring to me. It has completely revolutionised the retail industry and I am basing my project on creating personalisation in store that reflects the online world of shopping. I’ve been sent your email in the hope that you would be able to answer a few questions based on a business opportunity that we have to create for our final project at University. I would really appreciate your time and your expertise in this area as it will be really valuable to my research and I am in Leeds this weekend carrying on my primary research if you would prefer to meet in person.

To give some context around my idea, my final year studies have been surrounding the implementation of intelligent technologies to enhance customer experience. My passion lies within the fashion and retail industry and I found an opportunity for in store personalisation that reflects the online shopping experience. Also, from in depth primary research there is a key consumer frustration of wanting to enjoy the benefits of creative AI, offering personalised experiences whilst providing the correct use of data sharing. Therefore, my business idea is to create a B2B platform provider that offers the solution of digital touch points to physical stores. Facial recognition cameras linking to interactive tablets are added to create user data profiling. It will provide situation-relevant information to users including their browsing history, past purchase and style preferences to create a coherent and meaningful service in store. Customers opt in to create a profile and receive statistical information about their online shopping habits and If the user is recognised as a loyal customer, they will be rewarded with special offers and sneak previews. The touchpoint can notifying the user of any products left in their online basket that are in store, reviews, style suggestions that are available, or correct sizing that is in stock. This will then develop innovative customer relationships, resulting in brand loyalty and valuable in store experiences.

Questions relating to idea: 1) Would this be a feasible business idea in the real world of retail and does it have growth potential?

Main concern is user’s data rights & the process of ‘opt-in’ with facial recognition. Definite market for innovation in making in-store more valuable & unique vs online. Whilst the focus above seems to be on just the customer, if it’s B2B what data does a retailer get for improving the store/shopper marketing to pay for the platform above data capture by customer opting in (which is already done through % discounts, competitions etc.). Remember reading about potential innovations in things like ‘hot rails’ / ‘smart hangers’ that track how much a rail is visited or clothes moved which shows its popularity or the type of clothes on show. Knowing what a user have bought before, may be of interest, left in basket etc at a specific touch point in store is interesting, like the AI mirrors / virtual dressing rooms, to use this it would need an incentive as discussed like % off BUT then would they want to sacrifice sales & would it need to be facial recognition or just biometric (fingerprint) or email log in? Our style seeker app is an example of using AI to link to wider products at relevant centres https://www.thedrum.com/creative-works/project/isobel-hammerson-see-it-snap-it-own-it 2) Do you think it is an innovative idea that could be successful in blurring the lines between online to offline shopping?

Yes, there is however adding another step for the customer, who are already time poor & where online shopping has a major benefit, where going into a shop may mean they already have planned what they want but the above may help suggest alternatives / impulse buys but it would need to be a seamless transition. Also how would it work if a store if at capacity / full for tracking individuals?

3) Who is Victoria Gate’s target market and do you think this idea would appeal to that consumer?

ABC1s. There are early adapters to each segment 4) Would the brands in Victoria Gate be interested in this idea and if so, how could it be marketed to them?

This is a decision each brand would make on their own so not fair to say 5) What improvements could be made to the business in order for it to succeed?

RE points above, just because tech exists doesn’t always mean it’s the best solution & the main priority is make the process as easy as possible. Asking too much of a user may result in negative feedback as some may just want to browse instead of opting in to be tracked around the store even despite the lure of a % discount & as above how would it work with tracking people when a store is at peak trading times with lots of people in. Think there’s scope in enriching the in-store experience & providing additional information to link their shopping habits on line

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Section 3: Focus Group Date: 11.03.19 • • • • • •

Participant 1 (female, 21) Participant 2 (female, 22) Participant 3 (female, 21) Participant 4 (female, 24) Participant 5 (female, 22) Participant 6 (female, 21)

Interviewer: So I’m looking into innovation in retail, and how to offer online to offline marketing strategies and I’m basing my project on creating personalisation in store that reflects online shopping. My idea, just to explain what it is, it’s a platform provider that offers the solution of digital touch points to physical stores. So, facial recognition cameras linking to interactive touchscreens create user data profiling and on the screen, it would have your profile that links to your online activity including your browsing history, past purchases, style preferences, and online shopping habits. If users are recognised as loyal customers, they’ll receive rewards and the touch point can notify the user of any products left in their online basket that’s in store, item reviews that they’ve been looking at, style suggestions and other available correct sizing that’s in stock. So overall, do you like this idea, and is it something you’d be interested in using?

Participant 1: What would the facial recognition be doing?

Interviewer: I’ll jump to that question because it could be facial recognition, fingerprint or email login. Which would you prefer to use? Because of the iPhone X is has become more normalised Participant 2: Yes, that’s true Participant 3: I think I would use it because I like the fact that it integrates well online and in store because I hate it like, if I’m in store and I’ve saved something on my wish list and I have to get it up on my phone and if I don’t have any data it is very annoying so I like that it would already be there.

Interviewer: What specific features or elements of the product spark your interest?

Participant 3: Like I said the wish list stuff is good and just knowing what you’ve searched before would be useful. I think the reason I don’t shop that well in store is because I can’t always find something I like, it’s not always there if I search something like dress like online so if it would know my browsing history and could show me what’s in store it would just make life a lot easier Participant 2: I like the discount thing that you said Interviewer: Yes, so if you’re loyal to a brand you’ll get rewards because you’re sharing your data so you’ll see the benefits as well.

Participant 1: So, is the main objective to get people to go into store?

Interviewer: Less so to get them to go into store but when they do it feels less dethatched, so you can connect your online shopping to offline.

Interviewer: So, what if anything, do you find unappealing about this this product or concept?

Participant 6: I guess a lot of people might find it intrusive, just because it’s very personal, but I would like it just because it’s more tailored to what you like Participant 3: But probably before you’d have to sign up or log in first?

Interviewer: Yes, it would be purely opt in Participant 3: Yes, so you can choose obviously to do it or not Participant 5: I do think it happens anyway to be honest like they’re always tracking what you’re doing so why not make it more useful?

Interviewer: Exactly, people share without realising so to get some sort of loyalty points in return would be good Interviewer: Do you browse a brands website before going into store?

Participant 2: It depends what it is Participant 4: If I’m looking for a particular product then yes

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Participant 1: Yes, agreed Participant 3: I do in general even if I didn’t think I was going into store then it might so happen that I pass it the next day and think oh I might try find what I was looking at online Interviewer: How do you feel about the main benefit of bringing your online activity into store would it be useful to you?

Participant 3: Yes, I think it would be really useful because I feel like there’s a lot of hassle between being online versus not and the only reason I really shopping online is the fact that I like having things saved and having things I’ve looked at before Interviewer: Whereas when you walk into store it’s like you start from zero Participant 6: And make your way around the whole shop but then you might miss something whereas I feel like that would help a lot Interviewer: Yes, it would show your size of the you’re looking for that you might not have even realised Participant 5: It definitely saves a lot of time and effort like having that information all first Participant 4: Yes, like me and my mum went shopping in H&M and they’re awful to shop in and it makes you not even want to look at anything because you don’t know where everything is Interviewer: Do you think this would give you more of a valuable and seamless experience in store?

Participant 2: Definitely Participant 1: It would probably make me go into store more because I used to enjoy shopping but now I find it such a chore going into store Participant 3: Me too, it’s quite overwhelming Participant 4: There’s stuff everywhere I don’t know where to start and I hate knowing I could’ve missed something that I would’ve loved Participant 2: I feel like it would let me go back into store and let me enjoy shopping again Participant 1: Especially because when you’re in store you can try on so you’re less likely to return Interviewer: How do you feel about the customer profile resulting in loyalty rewards?

Participant 4: I think that’s a really good idea Participant 6: Me too Interviewer: And what kind of rewards would you like?

Participant 2: Maybe discounts Participant 1: Or maybe like a collection points think because I prefer that to like 10% off Participant 3: I liked when ASOS did the points thing then sent you emails with money off I think that’s good Participant 5: Like the Boots points I think that’s really good Interviewer: Can you think of any improvements for this idea?

Participant 4: Is it going to be in most stores or?

Interviewer: It’ll be more in like the mid-market, premium store so it’s not like a busy H&M or Primark Participant 2: It’s not really an improvement it’s more a suggestion but I’d prefer loyalty points into money versus 10% if you were to choose between the two because you can get discount codes online anyway so it’s just something new Participant 3: You could maybe do a refer a friend scheme or something like that saying five pounds off when you do

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Interviewer: And the last question is, where do you think it could go in the future? Is there anything that you think could be added?

Participant 1: it could definitely go more mainstream

Section 4: Expert Phone Call Interview Date: 28.03.19 Interviewee: Graeme Derby, UK manager of Polytouch. Polytouch provides retailers with interactive touchpoints in store.

Interviewer: So basically, I’m in my third year and we have to create this business. My idea is to offer customers in store experiences that reflects the personalisation of online shopping. The software that I’m thinking would provide users with data profiling, so customers can log into their profiles in store with the touchscreen which is why I wanted to ask you questions about if you partner with businesses, and how do you go about and working that out?

Interviewee: So in terms of providing touch points in store, we’ve provided them in Marks and Spencer’s, which we did about five, six years ago. Kiosks in the F&F department of Tesco. So I think you said it was fashion you want to go into?

Interviewer: Yes Interviewee: So, there’s 3 parts to this, one is the hardware. What’s the case that people are going to see? The second is the software, the third is the services. Who’s going to install it, who’s going to maintain it if it goes wrong. And there are 3 distinct sectors, so people tend to have expertise in one of the 3, and from a retail perspective, that’s quite important. For the customer point of view, that couldn’t care less. If you’re selling something to the retailer you need to cover all 3 areas, so what would normally happen, or what should happen is that the retailer will take their existing website and then they’ll repurpose it for use on the technology, most websites are designed for you to use when you’re home, on a kiosk, that’s not the case.

Interviewer: So if I want to be the middle party and the software to offer to retailers, could I use the Polytouch hardware and partner with you? Would that be a partnership?

Interviewee: Yes, what tends to happen is either you would be the lead contractor with the retailer and we would effectively be the subcontractor so you’d say I’ve got this software and it works on this piece of hardware. And in that instance, I would probably organise the installation for you. I would do a services package with the retailer so if things do go wrong.

The alternative is that we would, sometimes the retailer will say, well, we don’t know your software company. You’re not particularly big. You haven’t got to pick back up etc. So we want to deal with a larger company which might be us because big companies like dealing with big companies. So perhaps we would lead and you would be the sub-contractor of the software.

Interviewer: So how would the payment terms and conditions come about would the retailer’s pay you? And would it be like a monthly thing?

Interviewee: It can be. We would be selling the hardware as a tackle purchase. Most of our kiosks will cost between three and a half and five thousand pounds each. So retailers would pay for that as a capital purchase. Installation and the services will tend to be on a monthly fee. £300 per month per kiosk and then they’ll either want to buy your software, and you agree an enterprise fee so they just make one payment or they’ll want to buy a license from you. In which case, they get access to your software.

Interviewer: And what about payments between pyramid and then my software Interviewee: There wouldn’t be any payments for that because it’s the customer, the retailers who’s paying for it Interviewer: And when you say they pay three to five thousand do they own that technology then?

Interviewee: Yes, they own the kit Interviewer: So do you do any sort of renting hardware? Or do you just offer the package to buy?

Interviewee: 99% of the time, we will just do a package purchase, there are one or two cases where we’ll do a leasing deal or a renting deal but they’re very, very small. Most retailers are very cash rich.

Interviewer: So I was reading about the fast implementation that you guys provide. So if I was to, work with you and do a targeted campaign with a retailer with the hardware, which I’m thinking of doing, roughly how long would it take? And what special offers do you do?

Interviewee: From a price perspective, if you’re buying one it’ll be three to five thousand. If you buy 100, or the retail is buying 100, then they’ll be a discount from that maybe 20%. Something along those lines. It will take about 4 to 6 weeks.

Interviewer: So I have to do finances in my report about how this would all work. So when it comes to the hardware and stuff, obviously, that would be quite expensive. Would I be paying any sort of fee for the equipment?

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Interviewee: Typically, the way it works is the retailer is paying the money. You’re not paying the money for the kit or the services and the retailer would want that contract with someone who’s got the scale that they’ll feel comfortable with. So what I would suggest is to concentrate on the fees you’re going to charge the retailer for your software. And what you’re going to decide whether it’s worth selling an enterprise license, a one off big sum of money. Or, it’s on an ongoing monthly license fee. With that you’ll need commitments of updates, and making sure that it’s working at a certain level. The software market is a bit of a whatever you can negotiate, there’s no set standards. £500 per month per kioks was what Tesco had agreed Interviewer: So 500 pounds a month for the kiosk and then the software on it would you say that’s quite good ballpoint to go from?

Interviewee: I’ve seen places do it for let’s say five pounds a month. It comes back to what you can negotiate, 500 pounds I’d say is top.

Interviewer: For the project, I was thinking of just hypothetically partnering with Cos, the retailer. And so if I came to them saying, I have this package of like the kiosk with the software on. How would the payment terms work? Would it be completely separate?

Interviewee: Completely separate Interviewer: I think that’s all my questions answered to be honest Interviewee: That sort of area of online and offline, as you mentioned in your email is the holy grail at the moment in creating a seamless transition. Lots of people will start the process online looking to see what’s available. And what you’re trying to do is recreate that process in store and potentially pick up from where they were online.

Interviewer: That’s what I want to provide Interviewee: Yes, it is difficult to offer that experience and there aren’t many, if any that are doing it from what I can see so if you can get to that point that would be fantastic Interviewer: Thank you for answering those questions

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Section 5: In-depth Interview Date: 08/04/19 Participant (female, 27) Interviewer: I’m basically looking into innovation in retail, and how to offer online to offline marketing strategies and I’m basing my project on creating personalisation in store that reflects online shopping. My idea, just to explain what it is, it’s a platform provider that offers the solution of digital touch points to physical stores. So, facial recognition cameras linking to interactive touchscreens create user data profiling and on the screen, it would have your profile that links to your online activity including your browsing history, past purchases, style preferences, and online shopping habits. If users are recognised as loyal customers, they’ll receive rewards and the touch point can notify the user of any products left in their online basket that’s in store, item reviews that they’ve been looking at, style suggestions and other available correct sizing that’s in stock. So overall, do you like this idea, and is it something you’d be interested in using?

Interviewee: Yes, I’d definitely be interested in using it Interviewer: Does it make sense?

Interviewee: It makes sense, yes Interviewer: Why do you like the idea? And why do you think you’d be interested in it?

Interviewee: Because you get rewards if you’re a loyal customer, I like that idea a lot. Also I think it would let me shop better by saving stuff like you said on the wish list.

Interviewer: What specific features or elements of the product spark your interest? So you said about the loyalty thing, anything else?

Interviewee: It’s good that you know your shopping habits and can like actually see that I find that quite interesting, always feel like i can never find my sizes in anything or mightve missed something I found online because theres so much choice, it’s good for linking them both Interviewer: what if anything do you find unappealing about the product?

Interviewee: maybe that you have to do it every time Interviewer: You don’t have to do it every time it’s just if you wanted to, if you just wanted to go in and not use it you wouldn’t have to Interviewer: The options on the touchpoint would be quick search, loyalty, wish list and discover. Do these seem interesting to you? And would you want anything else?

Interviewee: They seem really interesting, especially the wish list that’s cool Interviewer: Do you research products or browse a brands website before going into store Interviewee: I do sometimes yes Interviewer: How do you feel about the main benefit of bringing your online activity into store would it be useful to you?

Interviewee: Yes I think it would be very useful because then you can still try things on in store Interviewer: Do you think it would give you a more valuable and seamless experience in store Interviewee: Probably because you can see everything in one place Interviewer: Can you think of any improvements for the business?

Interviewee: No I don’t think so Interviewer: Where do you think the idea could go in the future Interviewee: I think it could go into a lot of shops and really big brands

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Section 6: LinkedIn Interview Date: 28/03/19 Interviewee: Alistair Guthrie, expert software developer Interviewer: Hi Alistair, I am a final year Fashion Marketing and Branding student from Nottingham Trent University and as part of my dissertation research I am looking into innovation in retail and how to offer online to offline software solutions. I am basing my project on creating personalisation in store that reflects the online world of shopping, offering digital touchpoints to users for them to be able to see their online shopping activity in store. Would you be willing to answer some questions around this topic and if this software would be achievable? I would really appreciate your time and expertise in this area as it will be very valuable to my research. I hope to hear from you soon Thank you, Alice Interviewee sent the following message at 11:41 AM: Hi Alice, Yes happy to answer any questions the best I can. Thanks, Alistair Interviewer sent the following message at 12:03 PM: That’s great thank you! For my project I want to create an in store experience that allows users to create a profile that links to their online shopping experience. For example using AI and user data to notify them of any products left in their online basket that are in store, style suggestions that are available, online reviews, or correct sizing that is in stock. The software would need to be added to in store touchscreens. I basically want your opinion on my idea and if this kind of software would be feasible to create? Also, would my business employ a software developer and that would be the whole cost of making it or would there be added fees? Thanks so much for your help, Alice Interviewee sent the following message at 12:45 PM: Sounds like an interesting project. When it comes to costs there are a lot of different factors that come in to play so it’s quite tricky to put a figure on costs, but if you elaborate a little more on some of the points I can see what they would charge for such a project. I hope this helps answer some of your questions. Let me know if you want something more specific.

Is this software feasible?

It’s definitely feasible, there are companies doing some of what you mentioned already. Not sure if many have embraced the online / instore link that your project is looking at. There is a company in Edinburgh called ‘Mallzee’. They have an app that uses ‘tinder’ like functionality to swipe left and right on clothing that you like. From this it learns (AI) and tailors its suggestions to what you’ve swiped left and right to. In store experience Linking an online account to an instore experience could be quite straight forward. A common approach for that now is to use a QR code. 1) Customer approaches in store touch screen 2) Presses a log in button that brings up a QR code on screen. 3) Open up the store app on their phone that may have a ‘log in to store terminal’ feature 4) App uses phone camera to view QR code on the touch screen and logs them in From here I would imagine it would use a system like Mallzee along with previous purchases or even just things you have looked at to recommend other clothes or remind them of things left in their online basket.

Software developer?

I guess this really depends on the size of the company and how complicated the system is. If it’s a small company with a handful of stores then it probably doesn’t make sense to employ a software developer full time.

Costs Development?

This would mean paying a company / developer to build the initial system (website, phone app, software for terminal – could be another app). If it’s a smaller company It would probably be best as a one off initial build with some future iterations added into the contract. If it’s a bigger company then having a developer / team full time would likely makes sense. Hosting the applications would need to be hosted somewhere. This is an ongoing cost and it really depends on how many people are using the app. If you have a lot of users then these costs can go up pretty quickly. Would likely be a nice problem to have though. The app that is built will need to be upgraded occasionally to work with the newest devices and technologies. This could mean a 6 / 12 monthly refreshes. Any other changes to basic functionality would likely incur more costs to implement. Updates of stock and items should be able to be handled by a non developer person as this functionality should be built into the apps.

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Interviewer 2:34 PM: Hi Alistair, That’s amazing, thank you so much, this will really help me in my project! I’m thinking how it would work would be to have facial recognition instead of QR code to be able to log in. This will then take the user to 4 possible features on their profile: Quick search (pick up collection they ordered online or quick search for a specific product they have been browsing online to show if it is in stock) Loyalty (show the user’s online interaction with the brand in a visual dash board atheistic, showing the amount of online visits, previous purchases and the amount of points they have accumulated whilst creating a profile) Wishlist (any items saved online in the users liked or wishlist section, complimented with machine learning and AI to create other tailored recommendations that are a similar style to the user’s wish list. Discover (using AI and user data profiling to recommend products tailored to the user’s individual style. The user then has the option to browse by “finding their style” “top trends” or “try something new” depending on what their intentions are for that particular visit. I hope that’s enough information in terms of costing Interviewee 3:02PM: Facial recognition is actually a great idea. Any idea on the size of clientele? How many stores?

Interviewer 3:41 PM: I would offer the solution to mid-market fashion retailers and was thinking 1 brand in the first year so 5 stores then in second year work with maybe 2 more Interviewee 3:55 PM: Alright no worries. I’ll talk to some people. If the case of somewhere with 5 stores the upfront cost could be quite significant. Something that a larger retailer would possibly be able to absorb a little easier. Equipment for 5 stores: Based on one cashier and two terminals. Around £8000. This is also based on quite simple tech. Development costs: a solo developer employed working on such a project would probably be on a salary around £50k depending on location. Obviously having one developer would mean a long development time. It would probably make sense to contract the work out to someone. The costs to develop something like this... (mobile apps for android and ios, website, app for in store terminals) would be looking at £70k for bare minimum. There would also be ongoing costs for hosting and upgrades. This has came out quite expensive for a sme. Great if the funding is there. These figures mostly came from someone who has owned a business building small apps. He had no real experience in the facial recognition aspect though but expects that to get something that works really well the price could go up a fair bit more. Hopefully this helps a little.

Interviewer 4:23PM: Thank you so much that’s really helpful

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Section 7: Instagram Poll

106

Section 8: Consent Forms

107

108

109

110

Section 9: Tutorial Record Sheets

111

112

Section 10: Start-up Costs Justification Item

Price

Justification

Reference

Date

Software Development

£70,000

This figure came from the LinkedIn interview with Alistair Guthrie (see Appendix 6)

See Appendix section 6

28/03/19

Premises

£590 per month

Price of a rented private office in central London

HubbleHQ. (2019). 1n1 Fashion n Pizza Spitalfields | Book Office Space with Hubble. [online] Available at: https://hubblehq.com/office-space/5623/1n1-fashion-n-pizza-spitalfields?option=15935

20/04/19

Website

£8.50 per month

Wix subscription plan for customisable domain name

Anon, (2019). Wix Pricing Information | Upgrade to a Premium Plan | Wix.com. [online] Available at: https://www.wix. com/upgrade/website#/

20/04/19

Software Maintenance

£14,000

Costs a yearly average of 20% of the original development costs. 20% of initial development £70,000 is £14,000

FierceWireless. (2012). Maintaining an 20/04/19 app is critical to its overall success. [online] Available at: https://www.fiercewireless.com/developer/maintaining-app-critical-to-its-overall-success

Software Developer Wages

£31,000

A software developer will be hired in July to write code, modify, and debug software for client applications and update visual developments.

They will be paid the average salary for this profession which is £15,500 for half the year then £31,000 for the full year in year 2

Payscale.com. (2019). Software Developer 20/04/19 Salary (United Kingdom) | PayScale. [online] Available at: https://www.payscale. com/research/UK/Job=Software_Developer/Salary

Insurance

£116

£58 a year for public liability and £58 employers liability=£116

Brightside Insurance. (2019). Business Insurance. [online] Available at: https:// www.brightsideinsurance.co.uk/axaspecialistrisks

23/04/19

Registration

£12

It costs £12 to register as a private limited company on GOV.uk

GOV.UK. (2019). Set up a private limited company. [online] Available at: https:// www.gov.uk/limited-company-formation/ register-your-company

23/04/19

Trade Mark

£200

It costs £200 to trade mark the business through GOV.uk

GOV.UK. (2019). Trade mark forms and fees. [online] Available at: https://www. gov.uk/government/publications/trademark-forms-and-fees/trade-mark-formsand-fees

23/04/19

Founder Wage

£15,269

Minimum wage for founder which is currently £15,269

Ons.gov.uk. (2018). National Living Wage earners fall short of average family spending - Office for National Statistics. [online] Available at: https://www.ons.gov.uk/ employmentandlabourmarket/peopleinwork/earningsandworkinghours/articles/ nationallivingwageearnersfallshortofaveragefamilyspending/2018-03-28

25/04/19

113

Section 11: Marketing Budget Justification Item

Price

Justification

Reference

Business cards

£19.49

500 business cards cost £19.49 on Vistaprint.com with a glossy, premium finish

Vistaprint.co.uk. (2019). Customer 20/04/19 business cards. [online] Available at: https://www.vistaprint.co.uk/business-cards/standard?xnav=LP389_ SBC_CTA

Event Space

£3,500

This is an estimation of price for an event space at the retail business technology expo (London) which backed reserach around similar prices

Marketingdonut.co.uk. (n.d.).

Exhibition FAQs. [online] Available at: https://www.marketingdonut. co.uk/exhibitions-and-events/exhibition-faqs

20/04/19

Stand dressing

£500

Educated estimation for dry mounted large photos and text panels costing £50 each

Marketingdonut.co.uk. (n.d.).

Exhibition FAQs. [online] Available at: https://www.marketingdonut. co.uk/exhibitions-and-events/exhibition-faqs

20/04/19

Event Exhibition 2

£3,750

Figure has come from the same reference as used above however stand dressing will be less as most of the dressing will already have been purchased from the first event. £50 travel expenses have been added to get from London to Birmingham

Journeyprice.co.uk. (2019). Journey Price Calculator - Calculate the petrol price for your trip. [online] Available at: https://journeyprice. co.uk

20/04/19

Software Developer Wages

£31,000

A software developer will be hired in July to write code, modify, and debug software for client applications and update visual developments. They will be paid the average salary for this profession which is £15,500 for half the year then £31,000 for the full year in year 2

Payscale.com. (2019). Software Developer Salary (United Kingdom) | PayScale. [online] Available at: https://www.payscale.com/ research/UK/Job=Software_Developer/Salary

20/04/19

Promotional Video

£2,000

Creative promotional video will be used to create the promo video.

Thie price includes a duration of up to 2 minutes, 1 Day Filming on Location or in a Studio, 4 days PostProduction, basic motion graphics/ Animation and single Music Track

Video Production Company Corporate Video Bristol London.

(2019). Video Production Prices | 2019 Corporate Video Price Guide. [online] Available at: https://www. creativevideoproduction.co.uk/video-production-prices/

21/04/19

PR

£6,000

Clarity PR agency in London will work part time with Sync to delivery high-impact communication in the technology industry They will be paid for PR in the months of January, February, September and November. An estimate of £1,500 per month has been found through educated research

Unhooked Communications.

(2019). How much does a PR agency charge? | Unhooked Communications. [online] Available at: https://weareunhooked.com/howmuch-does-a-pr-agency-charge/

21/04/19

LinkedIn Sponsored Content

£300

Maximum budget of £5 per day for 2 months of sponsored content

Business.linkedin.com. (2019).

Advertising on LinkedIn - FAQs | LinkedIn Marketing Solutions. [online] Available at: https://business. linkedin.com/marketing-solutions/ advertising-faqs

21/04/19

114

Date

Section 12: Sales Justification Year 1: Sync partners with COS with 3 months discounted price of £450 per month. They implement 5 touchpoints into their Regents Street flagship store. £450 x 5 = £2,250 per month

By July, the first 3 months discounted price will have ended. With increase in customer satisfaction, COS will then take on 20 more touchpoints, qualifying for the 10% discount of £9000 with on going monthly costs for the first 5 Sync touchpoints.

5 x £500 (monthly licence fee) = £2,500 2,500 + 9,000 = £11,500 As stated in the report, marketing activity will be heightened towards the end of the year with case studies and PR which will lead to partnership with more retailers. Although, December would not be a cost effective month to launch into store, therefore February 2021 will be when the next partnership will commence. After high exposure at networking events and exhibitions around May in year 2, that will result in another partnership, with in-store launch set for June/July.

Year 2: Year 2 sees on going monthly income coming from COS. February is when the next retailer partnership will begin with the first 3 months discounted to £450 with the retailer choosing to start with 6 touchpoints available in-store.

6 x £450 = £2,700 £11,500 + £2,700 = £14,200

By March COS want to expand their offering to customers due to positive in store feedback resulted from Sync. They choose the 10 touchpoints for £4,600 discount to grow the offering into 2 more of their stores. £4,600 + £14,200 = £18,800 In May, the first 3 months discount for retailer 2 comes to an end and they decide to get the 10 touchpoints for £4,600 deal. £18,800 + £4,600 = 23,400 Due to the impact from exhibiting at technology networking events, the 3rd partnership will come into play with 3 more touchpoints. It follows the first 3 months discount starting at £450 per month, therefore: £450 x 3 = £1,350 £1,350 + £23,400 = £24, 750 With that deal ending in October, the retailer decides to purchase 5 more touchpoints at £2,350 per month with a 6% saving. £2,350 + £24,750 = £27,100 Year 3: Again, from raised awareness by attending the exhibition events, 2 more retailers wish to partner with Sync. 1 in April pays for 5 touchpoints with discount for the first 3 months (£450). The other retailer chooses the same, starting in May.

5 x £450 = 2,250 27,100 + 2,250 = 29,350 (April) 29,350 + 2,250 = £31,600 (May) In June, the retailer acquired from year 2 wants to increase their number of touchpoints by 14 more, taking it from 16 to 13.

14 x £500 = £7,000 £31,600 + £7,000 = £38,600 The retailer who partnered in April, wishes to carry on the relationship with Sync by implementing the 20 touchpoints for £9,000 deal.

115

£38,600 + £150 (due to first 3 month discount ending) = £38, 750 £38,750 + £9000 = £47,750 The other retailer also acquired in year 3 wants more touchpoints for £2,350 (5). £47,750 + 150 = £47,900 £47,900 + 2,350 = £50,250 Impactful PR has led to another retailer wanting to partner with Sync in October. They choose the first 3 months for £450 offer with 5 touchpoints. £450 x 5 = £2,250 £50,250 + £2,250 = £52,500

116

Section 13: Profit and Loss Years 2&3 Accountant Fees

Salaries & Wages

Rent

Office Supplies

Maintenance

Insurance

Advertising & Promotion

-

17,852.3

590.0

30.0

1,166.6

116.0

1,508.5

11,500.0

Cost of Goods Sold -

Total Net Revenue

21,263.4

11,500.0

Jan

(7,097.4)

21,297.4

-

17,852.3

590.0

30.0

1,166.6

-

1,658.5

14,200.0

-

14,200.0

Feb

16,985.4

1,814.6

-

17,852.3

590.0

30.0

1,166.6

-

28.0

18,800.0

-

18.800.0

March

(777.4)

24,177.4

-

17,852.3

590.0

30.0

1,166.6

-

4,538.5

23,400.0

-

23,400.0

April

2.6

23,397.4

-

17,852.3

590.0

30.0

1,166.6

-

3,758.5

23,400.0

-

23,400.0

May

3,702.6

19,697.4

-

17,852.3

590.0

30.0

1,166.6

-

58.5

23,400.0

-

23,400.0

June

5,102.6

19,647.4

-

17,852.3

590.0

30.0

1,166.6

-

8.5

24,750.0

-

24,750.0

July

5,102.6

19,647.4

-

17,852.3

590.0

30.0

1,166.6

-

8.5

24,750.0

-

24,750.0

Aug

3,602.6

21,147.4

-

17,852.3

590.0

30.0

1,166.6

-

1,508.5

24,750.0

-

24,750.0

Sept

5,802.6

21,297.4

-

17,852.3

590.0

30.0

1,166.6

-

1,658.5

27,100.0

-

27,100.0

Oct

7,452.6

19,647.4

-

17,852.3

590.0

30.0

1,166.6

-

8.5

27,100.0

-

27,100.0

Nov

6,452.6

20,647.4

1,000.0

17,852.3

590.0

30.0

1,166.6

-

8.5

27,100.0

-

27,100.0

Dec

36,568.0

233,682.0

1,000.0

196,375.3

7,080.0

360.0

13,999.2

116.0

14,751.5

270,250.0

-

270,250.0

Full Year

2021

Total Expenses

(9,763.4)

Expenses

Gross Profit

Net Earnings

117

118

1,508.5

116.0

1,166.6

30.0

590.0

17,852.3

-

21,263.4

5,836.6

Advertising & Promotion

Insurance

Maintenance

Office Supplies

Rent

Salaries & Wages

Accountant Fees

Total Expenses

Net Earnings

Expenses

5,802.6

21,297.4

-

17,852.3

590.0

30.0

1,166.6

-

1,658.5

27,100.0

27,100.0

Gross Profit

27,100.0 -

27,100.0

Feb

Cost of Goods Sold -

Total Net Revenue

Jan

25,285

1,814.6

-

17,852.3

590.0

30.0

1,166.6

-

28.0

27,100.0

-

27,100.0

March

5,172.6

24,177.4

-

17,852.3

590.0

30.0

1,166.6

-

4,538.5

29,350.0

-

29,350.0

April

6,902.3

23,397.4

-

17,852.3

590.0

30.0

1,166.6

-

3,758.5

29,350.0

-

29,350.0

May

28,102.6

24,697.7

-

17,852.3

590.0

30.0

1,166.6

-

5,058.8

31,600.0

-

31,600.0

June

30,602.6

19,647.4

-

17,852.3

590.0

30.0

1,166.6

-

8.5

47,750.0

-

47,750.0

July

2022

30,602.6

19,647.4

-

17,852.3

590.0

30.0

1,166.6

-

8.5

50,250.0

-

50,250.0

Aug

29,102.6

21,147.4

-

17,852.3

590.0

30.0

1,166.6

-

1,508.5

50,250.0

-

50,250.0

Sept

31,202.6

21,297.4

-

17,852.3

590.0

30.0

1,166.6

-

1,658.5

52,500.0

-

52,500.0

Oct

32,852.6

19,647.4

-

17,852.3

590.0

30.0

1,166.6

-

8.5

52,500.0

-

52,500.0

Nov

31,852.6

20,647.4

1,000.0

17,852.3

590.0

30.0

1,166.6

-

8.5

52,500.0

-

52,500.0

Dec

238,667.7

238,682.3

1,000.0

196,375.3

7,080.0

360.0

13,999.2

116.0

19,751.5

477,350.0

-

477,350.0

Full Year

Section 14: Supporting Models

119