Insight ReportSupply Chain Briefing: A Growing Emphasis on Sustainability Coresight Research October 17, 2019 Executive SummaryIn our biweekly Supply Chain Briefing series, we discuss how technology is transforming the various stages of the retail supply chain, including product design, demand forecasting, manufacturing, logistics, warehousing, last-mile delivery and sales. We also discuss other developments that relate to the retail supply chain. This report discusses sustainability. Sustainability in the supply chain encompasses processes, logistics and technologies, and how they interact to address demands for environmental and social responsibility. Consumers are increasingly viewing sustainability as an important matter that businesses should consider. Sustainability is being addressed by companies across multiple sectors through sustainable sourcing and production, various technologies and the reduction of gas emissions and waste. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Company Earnings UpdateIBM (NYSE: IBM) 3Q19 Results: Remains on Track to Meet 2019 Guidance with Strength in Cloud, Red Hat and Consulting Coresight Research October 17, 2019 Executive Summary IBM reported 3Q19 revenues of $18.03 billion, down 3.9% year over year and below the $18.22 billion consensus estimate. Adjusted EPS was $2.68, down 21.6% from the year-ago quarter and beating the $2.66 consensus estimate. Revenues grew 6.4% year over year in the cloud and cognitive software segment, grew 1.0% in the global business services segment and declined in the global technology services, systems, global financing and other segments. IBM reaffirmed its 2019 adjusted EPS guidance of at least $12.80, adjusted downward by $1.10 on August 2 to account for the Red Hat acquisition. Please Login to read the full report. Not a member? To access this content for free, register for a free account. This document was generated for
Company Earnings UpdateASOS (LSE: ASC) FY19 Results: Revenues Ahead of Consensus, but Profits Plummet Coresight Research October 17, 2019 Executive Summary ASOS reported FY19 group sales of £2.73 billion, up 12% year over year on a constant-currency basis (up 13% as reported) and ahead of the consensus estimate of £2.71 billion recorded by StreetAccount. The company reported diluted EPS of 29.4 pence, down 70% year over year, and below the consensus of 30.4 pence. Profit before tax (PBT) declined 68% to £33.1 million, but was marginally ahead of the consensus estimate of £32.7 million. Please Login to read the full report. Not a member? To access this content for free, register for a free account. This document was generated for
Deep DiveHow Data Analytics Is Driving Digital Transformation in Retail Coresight Research October 17, 2019 Executive SummaryThe use of data analytics is powering digital transformation in retail, from supply chain and in-store inventory management to customer service and engagement. In this report, we offer key insights into the growing adoption of analytics by the retail sector: The use of analytics enables retailers to collect and analyze data on operations, supply chains and consumers, which informs strategic and operational decision-making. The adoption of analytics is considered a priority by the retail industry, with nearly 80% of retailers in Europe having already adopted advanced data analytics capabilities, according to a recent Coresight Research study. Data availability, technology and competition are encouraging further adoption of analytics in retail. Analytics is the building block of artificial intelligence (AI), the technology that enables retailers to advance digital transformation through price-optimization strategies and the rationalization of inventory, and to enhance communication and experiential retail, as described by Coresight Research’s CORE framework for AI in retail. Further adoption of data-intense technology—including AI, the Internet of Things (IoT) and 5G mobile connectivity—is expected to facilitate, and enhance the importance of, analytics in retail. Introduction Analytics is the collection and analysis of data to inform strategic and operational decision-making. This capability is powering digital transformation in retail, making operations more efficient, from supply chain and store operations to customer service and engagement. Analytics is expected to play an increasingly important role in the sector as the adoption of data-intense technology progresses and requirements increase for tools to leverage larger amounts of data.’ This report—sponsored by retail commerce optimization and returns reduction company Newmine—details how analytics can be applied in the retail industry to transform operational practices, from supply chain and inventory management to customer management and personalization, pricing and promotion strategies and in-store layout management. We will outline the extent to which retailers consider the adoption of data analysis capabilities to be a priority and what factors are encouraging this. This report also details how analytics is a key component of retailers’ digital transformation through our CORE framework for AI in retail. Finally, we will see how the adoption of data-intense emerging technologies will likely increase the importance of data analytics in retail. Retail Analytics Informs Strategic Decision-Making In retail, information on operations, supply chains and consumer and shopper behaviors comprise the raw material for analytics. According to the focus of the analysis and the data collected, we can distinguish between three types of retail analytics: Real-time analytics: Monitoring live retail operations to identify possible issues and enable timely deployment of the appropriate response. Behavioral analytics: Formulating customer insight based on the interaction shoppers had with the retailer at different touchpoints, including physical and online browsing and purchasing history, as well as interaction on social media. Predictive analytics: Intelligence based on data related to historic operational and sales performances and relevant external factors—such as weather conditions, economic indicators and seasonality—to enable reliable and accurate predictions of future demand and inform strategic planning. These different types may be used for combined applications. For example, behavioral analytics could be used in a predictive manner to anticipate future shoppers’ behavior. Analytics Applications in Retail Analytics is useful for multiple applications in retail. Some of the most significant of these are listed below. Image source: Unsplash.comSource: Company Reports/The Wall Street Journal/Coresight Research Adoption of an Analytics Capability Is Key for Retailers The application of analytics in retail aims to provide better understanding of consumer preferences in order to devise a personalized sales approach. This is intended to create a longer-term rapport with customers, increasing conversion rates and consumer loyalty. In addition, retail analytics can bring greater operational efficiency thanks to the increased visibility over operations. The adoption of analytics capabilities has become crucial for retailers to maintain a competitive advantage in the current market environment and to prepare for future challenges. For example, almost 80% of retailers in Europe have already adopted advanced data analytics capabilities, according to a survey conducted in August 2019 as part of an omnichannel study by Salesforce and Coresight Research. Of these, some 45% fully implemented data analytics across their operations, while 34% had begun to implement the capability in parts of their operations. Only 6% of retailers questioned did not have plans to adopt analytics, according to the survey. Survey conducted in August 2019 among 470 retail executives based in Europe.Source: Salesforce/Coresight Research Several factors are encouraging retailers to adopt retail analytics, including: Large datasets: Data available to retailers has dramatically increased with the widespread adoption of digital technology in retail. Companies now interact with shoppers through multiple touchpoints, and these interactions leave digital footprints of the shopper’s behavior and order history that can be used to feed retail analytics capabilities. In brick-and-mortar stores, the possibility of tracking shopper behavior has been enhanced by the use of sensors and cameras, as well as mobile apps installed on consumers’ smartphones, which all generate data that can be analyzed. Advancing technology: The introduction and development of advanced technology such as AI has made it possible to generate actionable insight from the large amount of data currently available to retailers. At the same time, older technologies such as radio-frequency identification have become more affordable and reliable, which means they can be deployed on a large scale across retail operations to collect data that feeds into AI-powered analytics platforms. Competitive pressure: The very competitive nature of the retail market encourages companies to adopt analytics strategies in order to achieve competitive gains. Obtaining real-time understanding of operations allows retailers to devise the best course of action to realize operational efficiency, reduce costs and increase profitability, making them more capable of meeting customer needs. Source: Coresight Research Competition is an important driver for the adoption of analytics capabilities by retailers. To remain competitive and gain a larger market share, companies must equip themselves with the instruments that enable them to compete with best-in-class companies—such as Amazon—that are leading the research and development of analytics technologies. Figure 3 shows the number of patent applications among selected leading retail-related companies in the 12-month period ending September 9, 2019. Real-time analytics patent applications and grants by selected major retail-related companies in the 12-month period ended September 9, 2019.Source: Grata Data A Key Component of Digital Transformation Analytics is a key component of retailers’ digital transformation as it constitutes a fundamental building block of AI, the technology that is radically changing the way retailers operate and interact with shoppers. AI takes retail analytics beyond the analysis of market conditions and consumer behavior to enable computers to formulate autonomous decision-making based on insight from data. Coresight Research’s proprietary CORE framework shows the value of AI in four critical areas of retail competitiveness: Communication: AI is key to deliver personalized communication with consumers. Based on the analysis of data related to customer preference records and browsing and shopping history, retailers are able to send more targeted messaging to shoppers. Optimize pricing: AI enables the accurate formulation and automation of product pricing decisions, through the analysis of a number of variables: market conditions, sales, promotions, weather and events. Through AI, retailers can identify optimal price points to encourage sales conversions. Rationalize inventory: AI optimizes inventory management by monitoring real-time stock levels and informing purchase decisions— predictive analytics can anticipate the likely level of consumer demand based on variables such as external factors, seasonality and sales history. Experiential retail: AI enables retailers to refine customer engagement through personalization and improve the shopping experience across multiple channels. Using AI, retailers can bridge the gap between digital platforms and brick-and-mortar stores, creating a more consistent experience for consumers across touchpoints. Source: Coresight Research Future of Analytics in Retail: Emerging Technologies To Boost Analytics We expect retail analytics to play an increasingly important role in the future, in conjunction with the growing adoption of data-intense digital technology by retailers, including AI, IoT and 5G. AI: Efficient data analytics platforms will be required to support greater adoption of AI and machine learning in retail. Data analytics feeds AI and machine learning and enables these advanced technologies to gain the insight needed to automate decision-making based on a testing and learning cycle that is conducted autonomously by computers. IoT: The growing adoption of IoT systems in retail requires sophisticated retail analytics capabilities to be as effective as possible. The connected devices that comprise IoT systems can collect and share data about their working status with other parts of the network. In the retail sector, key applications for this level of connectivity surround inventory management, logistics, supply chains and in-store operations. The data flow is examined by analytics platforms that then formulate actions for the devices to execute. 5G: Stronger data analytics capabilities will be needed to process the large amount of data that 5G connectivity facilitates. In brick-and-mortar stores, 5G offers faster data transmission rates and the possibility of processing more information. As such, it will enable greater adoption of data-rich technology—such as image recognition, computer vision and reality technology—that will detect, react and communicate with shoppers based on their behavior when browsing the store. This will result in more intense in-store shopper engagement and greater customization of the shopping experience. Key Insights Retail analytics enables companies to collect and analyze data regarding operations, supply chains and shopper behavior in order to inform strategic and operational decision-making. Three different types of analytics—real-time, behavioral and predictive—can be used to transform retail operations, including inventory and supply chain management, customer engagement, pricing and in-store layout management. Retailers are increasingly emphasizing the adoption of analytics technologies as a priority. For example, some 80% of retailers in Europe have already adopted advanced data analytics capabilities, according to a recent Coresight Research study. There are a number of factors that are encouraging companies to further leverage analytics: the availability of a large amount of data; the introduction of technology that requires the analysis of large datasets; and competitive pressure in the sector, with major industry players investing extensively in the research and development of analytics technologies. Retail analytics is a key component of the sector’s digital transformation, as it constitutes the foundation of AI, the technology that enables retailers to enhance communication, adopt price-optimization strategies, rationalize inventory and provide consistent shopping experiences across channels, as laid out in Coresight Research’s CORE framework. With the growing adoption of data-intense technology—including AI, IoT and 5G—we expect retail analytics to play an increasingly important role for retailers in the future. The implementation of these advancing technologies will require the ability to handle large datasets and continuously upgrade data analytics capabilities. This document was generated for
Insight ReportHow Is Amazon Leveraging the Whole Foods Acquisition? Coresight Research October 16, 2019 Executive SummaryIn the two-plus years since its $13.7 billion acquisition of Whole Foods Market, Amazon has gained valuable insight into consumer behavior and physical retail. Amazon has used Whole Foods to connect physical and online grocery. For example, selected Whole Foods stores now offer Prime members a curbside pickup service for online orders made through Prime Now. Amazon is taking a two-pronged approach to brick-and-mortar grocery retailing, with the rollout of Amazon Go stores complementing its acquisition of Whole Foods. Amazon Go’s data-rich environment can capture valuable consumer information that is not accessible to most grocery stores. We think these ventures represent an acknowledgment by Amazon that it cannot win major share in grocery with a pure-play online model. Amazon plans to open a new chain of grocery stores in the US, according to a 2019 Wall Street Journal report. We expect learnings from Whole Foods and Amazon Go to inform any future grocery-store formats. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Insight ReportMacy’s: A Timeline of Key Events Coresight Research October 16, 2019 Executive SummaryAs part of our Retailers’ Timelines series, we examine key events in Macy’s recent history. From 2017 to 2019, Macy’s undertook meaningful steps to reinvent its business. In August 2019, Macy’s began a pilot with fashion resale marketplace ThredUP in 40 Macy’s stores across the country, to boost in-store traffic. Bloomingdale’s launched an online subscription rental service for women’s clothing in September 2019, priced at $149 per month. Macy’s is expanding its Backstage off-price locations to an additional 50 stores, with 47 of these already completed as of August 2019 and the rest planned to be completed by the end of the year. Backstage locations are expected to grow further in line with high consumerinterest in value and unique offerings. Macy’s is focusing on enhancing customer experience through technology. The company now offers new beauty touch screens at Bloomingdale’s and virtual try-ons through Marxent, a 3D product-visualization platform. Macy’s is also implementing new and experiential concepts through its emerging pop-up platforms such as STORY and The Market, which rotate new products based on themes. Click here to read our full collection of Retailers’ Timelines. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Insight ReportInsights from China: How Brands and Retailers Are Leveraging Video-Sharing Platform Bilibili Coresight Research October 15, 2019 Executive SummaryIn our biweekly series Insights from China, we examine issues that affect international brands and retailers in China. We cover areas such as policy, consumer behavior, consumer sentiment, government regulations and the competitive landscape—as they affect business operations and the future outlook. In this report, we look at how brands and retailers are using video-sharing site Bilibili as part of their marketing campaigns. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Insight ReportHoliday 2019: Five US Digital Retail Trends for the Holidays Coresight Research October 15, 2019 Executive SummaryIn this report, we detail five online and digital retail trends that we expect to see in the US this holiday season, which include the following: Around two-thirds of holiday shoppers are likely to buy gifts online and in store this year. Those expecting to buy from just one channel look to be a small minority of shoppers. Coresight Research expects slightly more than 23% of all nonfood retail sales to be made online this holiday season, up 200 basis points year over year. Our survey data and market-share estimates suggest that Amazon will likely continue to dominate US online holiday sales. Amazon will go into the holidays with around half of US consumers having a Prime membership. Social media beats e-commerce websites as a source of research for shoppers, according to our holiday survey data. Click here to read Coresight’s coverage on US holiday retail and gain key retail insights for 2019 and prior years. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Question of the WeekHow Can Apparel Brands and Retailers Benefit From Launching Beauty and Personal Care Products? Coresight Research October 14, 2019 QUESTION OF THE WEEK: How Can Apparel Brands and Retailers Benefit From Launching Beauty and Personal Care Products? Apparel brands and retailers can leverage beauty, personal care, health and wellness products to introduce new customers to a luxury brand and increase brand awareness. Additionally, they can benefit from higher average order value, encourage brand loyalty and take advantage of add-on gifting opportunities. This document was generated for
Insight ReportChina’s National Day Wrap-Up: Golden Week Brings Spending Boom Coresight Research October 14, 2019 Executive SummarySales of retail goods and dining in China during the week-long National Day holidays on October 1-7, 2019 saw stronger growth than last year, injecting positive momentum in a slowing economy. Overall revenue from retail and dining in China reached ¥1.5 trillion ($212.6 billion), up 8.5% year over year, according to the China’s Ministry of Commerce. Retail, catering and travel are the three driving forces that lifted domestic demand during the holidays. Movie theater box offices also saw robust growth, owing to movies paying tribute to China’s 70th anniversary of foundation. To encourage spending, some Chinese cities extended retail hours, encouraging businesses to operate during the night (often defined as the period between 6pm and 6am). Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Deep DiveUnstaffed Stores: The Future Retail Format? Coresight Research October 14, 2019 Executive SummaryWe look at the development of unstaffed stores, including checkout-free stores, to understand their potential and limitations as the format of the future. The technologies used in unstaffed stores affect the extent to which a shopping experience can be seamless. Al-powered cameras and sensors come with higher development costs but offer a more convenient shopping experience compared to the use of radio-frequency identification technology. The Japanese government is attempting to relieve the labor shortage problem by inviting five convenience store chains in the country to automate their stores nationwide by 2025 using RFID technology. China is a pioneer in the field of unstaffed stores. However, we have seen frequent store closures after relentless expansion, which reveal the challenges that unstaffed stores face surrounding operating costs, customer experience and range of product offerings. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Insight ReportSeptember 2019 US Same-Store Sales: Costco Experiences Slower Growth, but Beats Consensus Estimate Coresight Research October 14, 2019 Executive SummaryCoresight Research’s monthly reports keep you up to date on US and UK retail sales, US retail traffic and in-store metrics, selected US retailers’ same-store sales and key global consumer indicators. Click here to view our full collection of Monthly Reports. Our monthly US Same-Store Sales Report reviews comparable sales metrics reported by Costco, Buckle and Cato. Highlights from our September US Same-Store Sales report: Costco’s global September same-store sales growth decelerated from August but beat the consensus estimate. Its e-commerce growth came in at 17.8% in September, lower than August’s 23.9% growth. Buckle posted an increase in same-store sales in both the men’s and women’s segments. Cato’s same-store sales growth rate accelerated from 3% in August to 5% in September. The company stated that its same-store sales continued on a positive trend, but it remains cautiously optimistic as it evaluates the impact of the tariffs implemented this month. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Company Earnings UpdateLVMH (ENXTPA: MC) 3Q19 Update: Fashion & Leather Goods Set the Pace Coresight Research October 14, 2019 Executive Summary LVMH reported 3Q19 sales of €13.3 billion, a 17.0% increase on a reported basis, or 11.0% growth on a comparable basis. By division, the Fashion & Leather Goods business grew sales 22.2% compared to the year-ago period, Wines & Spirits sales rose 10.7% and the Perfumes & Cosmetics category was up 9.3%.The growth of Selective Retailing trailed the group. By geography, Japan was the best-performing market, experiencing 20% growth. Sales rose 12% in Asia (excl. Japan), 8% in the US (excl. Hawaii) and 11% in Europe. Please Login to read the full report. Not a member? To access this content for free, register for a free account. This document was generated for
Company Earnings UpdateFast Retailing (TSE: 9983) FY19 Results: Strong Year Driven by Uniqlo in Greater China Coresight Research October 14, 2019 Executive Summary Fast Retailing reported FY19 revenues of ¥2.29 trillion ($48.1 billion), up 7.5%, and operating profit of ¥275.0 billion ($2.55 billion), up 9.1% from ¥225 billion ($2.09 billion) in the year-ago period. By banner, revenues at Uniqlo Japan increased 0.9%; Uniqlo International revenues were up 14.5%; GU brand’s revenue was up 12.7%. Global Brands (Theory, Comptoir des Cotonniers, Princess tam.tam) revenues were down 2.9%. For FY20, Fast Retailing forecasts revenues of ¥2.4 trillion ($50.4 billion) 4.8% higher than this year’s actual of ¥2.29 trillion, and operating profit of ¥280 billion ($2.59 billion), 1.8% higher than the FY19 actual of ¥275 billion. Please Login to read the full report. Not a member? To access this content for free, register for a free account. This document was generated for
Company Earnings UpdateSeven & i Holdings (TSE: 3382) 1H20 Results: Operating Income Grows in Both Domestic and Overseas Convenience Stores Coresight Research October 14, 2019 Executive Summary In 1H20, ended August 31, 2019, Seven & i reported a 1.9% year-over-year decline in net sales. However, the company’s EPS increased 9.2% to ¥125.04. The company’s overseas convenience store business witnessed strong performance, with operating income increasing 11.8% year over year. Domestic convenience store operations recorded an operating income growth of 3.9%. Superstore Ito-Yokado saw operating income declining 72.7% year over year. Department store chain Sogo & Seibu posted an operating loss of ¥1.1 billion, versus an operating loss of ¥292 million in 1H19. Seven & i reiterated its operating income guidance for FY20, yet altered its forecast of total revenues to decline by 1.5% year over year. Please Login to read the full report. Not a member? To access this content for free, register for a free account. This document was generated for
