Enabling Intelligent Retail

Today’s Agenda

Transformational

Forces

Our Strategy Partnering in

Action

The evolution of Retail

Traditional big box stores see mass closures

Amazon.comopens for business

The number of malls in the US reaches 4,500

2016

19951960

Consumers begin receiving catalogues at home

1920

Major mobile paymentapps launch

Selfridge’s promotes

shopping for leisure

over necessity

20151909

BIG BOX STORES E-COMMERCE OMNICHANNELDEPARTMENT STORES INTELLIGENT RETAIL

The first cashier-less store, Amazon Go, launches

2017

AI continues toinfluence the retail value chain

2018

The first “category

killer”, Toys “R”

Us, opens

1957

Internet penetrationtops 50% in most developed retail markets

20001970

Barcode scanners are introduced at major retailers

The first Walmart opens in Rogers, Arkansas

1962

The first iPhone is released

2007

Customer Centric Intelligent Retail Shift from selling goods to new Personalized shopping experiences

46%percentage of

consumer using retail

mobile apps on a

weekly basis

150Number of

sensors-enabled

devices consumers

will interact with

daily by 2020

Digital

World

PhysicalWorld

In-storemovement

ConnecteddisplaysBlogs

Ecommerce

Ad views& clicks

App download

Social media

Geolocation

Personalizedoffers

Smart kiosks

60%device interactions are

passive as users will

accept information

surfaced from

intelligent systems and

machine learning

Source: Microsoft IDC Retail Study, ASIA, 2018

30%percentage more

spend from an

omnichannel

shopper

Coupang Rocket Delivery Order before midnight, get your order the next day

Rocket Wow Subscription-based free delivery

11st Direct Order

(바로오더)

Seamless, one-click check out (Simple payment service)

Naver Smart Store One-stop, easy to manage, shopping mall solution for small

business owners

Daum

Kakao

Kakao Talk Gifts An option to send gifts to Kakao friends from a selection of brands

via messaging app, using Kakao Pay

Kakao Shopping Shopping platform on Kakao messaging app

Lotte

Shopping

Smart Pick Order goods on-line, pick up in store

Scan Shopping Customers scan QR codes of goods in store, check out using mobile

application, goods are delivered within 3 hours

Shinsegae

+ Emart

SSG.COM Emart and Shinsegae online malls merged under one domain

Fast Delivery If customer orders goods from Emart before 3 PM, the goods are

delivered by the end of the day

Daybreak Delivery The goods are delivered starting with 6 AM

New product features and services added by Korean off/online retailers in 2018

Digital/

internet

companies

Traditional

retailers

Increase in numbers of single households & households with working parents stimulating the growth of online grocery shopping

Current market size, offline+online: USD 19.3 billion / 22조7000억원Online only: 10% or USD 1.7 billion / or 2조원

2016: Market Kurly and

Baemin Fresh were the first

to start fresh produce

delivery. Emart, Lotte Mart

and Homeplus followed in

their footsteps.

2017: Coupang, We Make

Price and Hello Nature

(acquired by SK Planet)

started produce delivery

• Market Kurly raised USD 84.9 million/1000억원 from

Sequoia Capital and other investors in 2019.

• Market Kurly investing in Coldchain, warehouse and

mobile refrigerator system, that keeps produce fresh. The

company is a trend setter for produce delivery

Premium segment

• Emart launched daybreak delivery in June 2019; the groceries

are delivered starting 6am (Coupang and Market Kurly have

similar offerings)

• SSG.COM has capacity to process 131,000 orders daily

• As a big box retailer, Emart continues to focus on volume

sales and low price

Low-cost segment

Nextgen logistics

Industry convergence New retailers

Commerce anywhereCustomer loyalty

Responsive product development

AI revolution

Intelligent systems

Health, home, hospitality

Regulatory & tariffs

Data security

Reinvention brick & mortar

China innovation

Transformational Forces in Retail

Sustainability

Marketplaces

Artificial Intelligence: the world runs on software AI

Retailers will spend $7.3 billionon AI by 2022,

Brick & Mortar Reinvention

Over 78% of consumers would choose to spend money on an experience or an event

“The possibilities of mixed reality are endless, and we will continue to explore and push the boundaries to make our customers fall in love with Natuzzi”

—Pasquale Junior NatuzziCreative Director

Our Strategy

Retail & Consumer Goods

Democratizing AIEnabling

Digital Transformation

—Healthcare Dive

—The Wall Street Journal

—Bloomberg

—VentureBeat

—Reuters

Walgreens & Microsoft

partner to develop digital

healthcare services

—Reuters

—The Wall Street Journal

—Bloomberg—Forbes

Your customers. Your employees. Your data.

KNOW YOUR

CUSTOMERS

EMPOWER YOUR

EMPLOYEES

DELIVER INTELLIGENT

SUPPLY CHAIN

REIMAGINE

RETAIL

Enable intelligent

customer journey

Enable your brand

ambassadors to delight

your customers

Close the gap between

demand and fulfillment to

delight your customers

Reimage the customer

experience in Online &

Offline Retail

Our Vision: Enabling Intelligent Retail

AN INTELLIGENT RETAIL CUSTOMER JOURNEY

Deliver intelligent

supply chainKnow your customers

Unified Customer

Unified Commerce

Empower your employees

Productive workforce

Reimagine retail

Reimagine AdvertisingIntelligent Supply Chain

Intelligent Fulfillment

Intelligent Inventory

Intelligent Warehouse

Reimagine Stores

Microsoft Retail Scenarios & Solutions

Enable your brand ambassadors

to delight your customers

Close the gap between demand

and fulfillment to delight your

customers

Imagine the impossible and then

make it happen

Enable customer first retail

Retail Data Workbench

Microsoft Intelligent Retail Data PlatformBuilding Customer Centric Intelligent Retail Organization

Know your Customer

Unified Customer

Unified Commerce

Reimagine Retail

Reimagine Stores

Reimagine Advertising

Empower Employees

Workforce Enablement

Deliver Intelligent Supply Chain

Intelligent Inventory

Intelligent Supply Chain

Intelligent Fulfilment

Intelligent Warehouse

RETAIL DATA

Workbench

RETAILER’S AZURE DATA LAKE

RETAIL DATA MODEL

IoT Edge & Azure Digital Twins

Azure Databox Edge

D365 for Perception Analytics

Azure Cognition Services

Dynamics 365 for Commerce

Dynamics 365 for Customer Insights

Retail Solution

Data Share

Azure Blockchain

IoT Edge & Azure Digital Twins

Azure Databox Edge

Microsoft Teams

DIGITAL SHELVES ENABLE REAL TIME PRICING UPDATES AND PRODUCT INSPIRATION AT THE POINT OF PURCHASE REDEFINING THE SHOPPING EXPERIENCE

Reimagine retail.

Unlock new opportunities and capture new business

CONNECTED DEVICES IN STORE ENABLES PREDICTIVE MAINTENCE, REDUCED WASTE AND PRODUCT CONSISTENCY THAT DELIGHTS CUSTOMERS

Deliver Intelligent

Supply Chain.

Right product, right price,

right time to right customer

APPLYING NEW INTELLIGENCE ACROSS EVERY ENDPOINT TO ENABLE EMPLOYEES TO DELIVER A WORLD CLASS SHOPPING EXPEREINCE

Empower your people.

Empower all employees to delight your customers

CONNECTING ONLINE AND INSTORE DATA ENABLED SELECTION OPTIMIZATION TO BETTER SUIT THEIR CUSTOMER AND DROVE +38% SALES

Know your customers.

Superior, relevant service

increases loyalty

Delivering eCommerce

enablement, Platform

Transformation &

Global Collaboration

Co-Innovation

Increased App usage,

Online Transactions,

Loyalty & Margin,

Supply-chain

transparency bean-to-

cup

Delivered Smart Edge

solution; New business

models to reinvent the

store

Driving additional

Energy Savings /

Optimization through

IoT

Unilever teams with

Microsoft to deliver AI

assisted decision-

making

Empowering a mobile

workforce with data-

fueled insights

New and transformative

experiences to

customers & employees

Customer Partnerships in Retail

Cloud & AI partnership

.

Powering a circular

fashion initiative &

reinventing store

experiences

Transformation of

health care delivery