In a connected world, what’s the role of the physical store?

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Session name: A day in the life of the connected consumer
Kevin Fitchard
Bridget Dolan
David Feller
Andres Wolberg-Stok

Announcer 00:00
It’s safe to zoom, we’re all connected consumers here. Nobody here is a Luddite, refusing to carry phone with them. We’re going to find out what it’s like “A Day in the Life of the Connected Consumer”. That’s a day in the life of you, by the way. It’s going to be moderated by my colleague Kevin Fitchard. He’s a Senior Writer at GigaOM. He’s going to be speaking with Brdiget Dolan, the VP of Interactive Media for Sephora; David Feller, Founder and CEO of Yummly; and Andres Wolberg-Stok, the Global Mobile and Tablet Banking Director for Citi. Welcome out, “A Day in the Life of the Connected Consumer” panel.
Kevin Fitchard 00:41
Hello everyone and welcome to our panels. Anyway, I want to start out taking the title of the panel quite literally and I wanted to ask the panelist here to give me their five minutes spill of what “A Day in the Life of the Connected Consumer’s” going to be particularly to their industries in this case being the fashion and beauty industry, food cooking kitchen industry, and Citi’s case, the big roll to finance. Andres I want to start with you. Today and several years in the future, how is the world of mobile, the Internet of things, big data, all these things and cloud coming together to effectively how we interact with the finance industry, with Citi in particular?
Andres Wolberg-Stok 01:27
Today, you have all these accounts. You have your checking account, you have savings account, you have between three and four credit cards, a mortgage, home equity line of credit, brokerage – you have all of these accounts and they’re difficult to manage. Imagine if we could weave them all together seamlessly in a way that makes them disappear into something that you wear around you like call it “a cloak of value”. And where do you go? Maybe this resides on your phone on your smartwatch. Wherever you go, that goes around you, and this cloak of value does two different things. One is it represents your ability to purchase, good services, your ability to pay. Secondly, it also marks you as a target for commercial offers with things that would be true value to you as a consumer – your preferences, your purchase history, your privacy preference allows that. It begins to work in both ways. One, outbound where you can pay. The other one, where you can get offers and things that are relevant to you. You’re now in a store and you see the things that are for sale, and maybe those things advertised themselves to you in a different way than they would to him or to you because I’m a different consumer. I have a different track record. I have different preferences that are known and maybe one brand is trying to make me drop my loyalty to their competitor. There are lots of interactions that open up. When I’m done shopping, I no longer need to go stand and line at the register. I can just basically, bag my stuff and walk out because I am a known payer. And that interaction of having to swipe plastic or even tap a phone within FC, all that stuff goes away because it’s no longer necessary. That cloak of value becomes your interface to the world. It’s how you interact commercially with everything and everyone. And at the same time, it makes it seamless and transparent, and you’re no longer have to do the routine things that you do today just because they’ve been inherited from the way all these accounts were built decades or centuries ago. All that stuff become seamless and visible, and this cloak of value also removes false choice. Think about it. Today, when you go pay for something at the check out, which credit card or debit card do you taken out of your wallet? It could be the one your most used to, the one that’s your top of wallet. It maybe the one on which you’re trying to build a rewards to pay for a holiday or whatever, but the reality as a consumer, you don’t really know what the relative values of those are because they are so many variables that you can’t compute and be on time. This is something your cloak of value could compute for you, which is the guard that if you use it for this purchase here today, will give you the most value. Except, you don’t even have to think about it. When you think about these accounts today, money is a proxy for value. But if we can come up with that cloak of value, it could make the money, the symbol reside into invisibility and really sure for this value for you as a costumer. Value that you’re not seeing today because you’re focusing on money and not for the value. It’s a hectic day. That’s it.
Kevin Fitchard 05:09
It almost seems you’re like even abstracting the idea of currency, even beyond the abstraction of what is currency, the pure value. Anyway, Dave we want to move on to you. I’ve known Dave for about a year or so now and he’s the CEO of Yummly for Chief Eating Officer of the company. Obviously, a lot of you may know Yummly is a search engine for recipes and I’m sure Dave will tell you Dave actually doing a lot of work about big data, about categorizing food itself. He’s going to tell us a little bit what the “Life of the Connected Consumer” in the kitchen is going to be like in the next couple years.
David Feller 05:49
Kevin give us the task of doing “The Day in the Life of a Connected Consumer” in the kitchen and I wrote a little story, but I want this to be a little bit more realistic than some of the videos that maybe you’ve seen in the past of like 50s or 60s kind of kitchen that has infinite inventory and bakes you a cake while you’re gone. Just kind of assumed that devices and appliances, and your pantry, and food can all talk to each other. This is how I imagined a day going in the connected kitchen in the future not to just in future. Device knows that I’m awake. Could be my [?] could be my phone, and let’s my coffee maker know and my coffee starts brewing. As I’m sitting there and over the realm of my coffee brewing, I’m reviewing my day. My calendar up reminds me that I have dinner plans at night. I’m going to be cooking for my family plus Jack and Jordan who are coming over. I know that Jack is allergic to peanuts and I know that Jordan was recently sick. I’m going to spend a little bit extra time to make dinner that night. The plan starting at about 5:30 and finishing at 6:30. This kitchen platform is aware of all of this. The software that brings the entire kitchen together and it ashamed was plugged for Yummly’s. What we’re trying to do is build that digital kitchen platform. But the kitchen platform knows all of these things, that knows the taste preferences of the individuals, the concept of the family’s taste, the people that are coming over, to be aware of what we have on stock, what we’ve recently purchased, what’s running low, what’s about to expire, what we should use? Maybe chicken spin in the freezer for a little bit too long. It knows all about recipes ingredients, how they relate to each other. Flavor combinations, it knows nutrition, substitutes and shortcuts. How can I make something faster by using a jar of something. Geography skill, the weather, and how that relates to what I normally eat. What I’ve eaten recently, my budget, and how I’m doing on my trajectory for food spent, my health and physician data, and probably a lot of other things that I didn’t mention. And all of these is connected into the platform. As I’m reviewing this, my kitchen platform actually recommends a recipe for me. This recipe is not a recipe that’s on the web. It’s actually created for me. It’s customized my taste. All of these different aspects. In this case, maybe it’s recommending chicken Parmesan with pasta and a salad, and I’d say that’s fine. It creates this because it knows that we haven’t eat an Italian food in the last two weeks and family likes Italian food that it’s cold and rainy and we generally skilled and toured come for food on a day like today. It’s within our scale and budget. We have chicken in the freezer that we should use up. It uses Romano cheese instead of Parmesan cheese because we bought that recently and it’s suitable substitute for Parmesan, but it’s all optimized for me and my family, and the experience that I’m going through. And then since this recipe is created, then it’s automatically pass to a service like Instacart. It’s not the orders in place yet, but it’s just cute out for delivery because there’s some number of things that might change throughout the day. The kitchen platform also notifies Instacart or whoever it is that there’s something’s been recalled and we leave that outside so that the delivery service can pick that up as well because we don’t want that in our shelves anymore. Some other things were running low or added to the list and we confirm it all with one click. Back to breakfast real quickly. The milk is running low. It’s about to expire. We decide that we’re going to have cereal and fruit. I decide to add toast in for my breakfast. My meal plan is dynamically updated. What it does is it produces the amount of pasta that I’m going to have that night and it increase as a salad portion. I leave for work and I forget whether or not my coffee machine was still on. I check my phone. I confirm that the appliance is off. I feel good and I’m on with my day. After lunch, I find out that I have another meeting that was added and I’m not going to be able to make a tomato sauce that I wanted from scratch. The kitchen platform, I automatically updates my recipes and says, Okay you’re going to use a jar of sauce instead of making a tomato sauce. And it picks ragu for me because it’s on sale and it knows that I’m going to be able to save a little bit of money there. That queues all that up for delivery and then order is placed at about 4 o’clock and arrives at 5 o’clock. I leave my office. As I’m leaving my office, the kitchen platform is aware that I’m leaving and it queues everything up for me. The chicken stud, the oven’s heated up, my playlist of music that I want when I’m cooking is put on, my recipe tablet is set up in a step by step format, and I have a very nice and enjoyable meal. My kids probably still clean up afterwards.
Kevin Fitchard 11:09
They’re pretty much everything. Is it the actual cooking itself?
David Feller 11:11
Except the cooking itself which is something people still enjoy.
Kevin Fitchard 11:14
I can relate to that. Next, Bridget is going to talk a little bit about how actually that the Internet thing is alive and well and so for today in your stories. She has a couple of pictures and talk about this connected feature that we’re already certain to see.
Bridget Dolan 11:34
I think I’m inspired to cook now and I should be able to figure it out. At Sephora, we’re doing a lot with a connected consumer. What we have found is that our clans are very connected. We have a lot of women who are considered millennials of the younger generations as well as, just women of all ages. They tend to be very organized and very task driven. They have a lot to do. My day in the life of a Sephora consumer is that she has added her Beauty Insider card to Passbook. We have over 3 million of our Sephora clans have done this where they have their app and they have added their Sephora card to Passbook. Her wallet is too small to have all the cards that she needs. She has a Beauty Insider card and gift card. She’s actually has them in their app and then she’s also added them to Passbook. What so great about that is that when she’s in the mall and she’s walking by a Sephora store, it going to pop up. It knows she’s nearby. This happens today and we can tell her that right now, we’ve just launched a whole new service in our stores, a whole new experience which will help her to find the right foundation for her. She comes in to our store because Passbook is like a magnet and your phone is pulling you into the store I guess you wouldn’t. In there long behold, we have our scanning device. We have actually work with Pantone who’s a color authority to create this tool that scans a woman’s skin or anyone skin. In three places, average is the scan of 27 different photos of your skin tone and it will find the exact, right shade of foundation for you. We have a 112 different shades and we call it “My Color IQ”. Our kind will get a Color IQ and then we move over to the iPad and we put her Color IQ number in and then she can choose based on the parameters that she’s interested in. Maybe she likes powder instead of liquid foundation. Perhaps she wants it to have an SPF or she wants a paraben-free. She puts all of her criteria working with a sales associate into the iPad and it pulls out the exact, right match products for her. Customized to her skin tone and her interest in her, and what she cares about. She tries it on and that’s now the right product for her. She wanted this experience and it is going to keep given because she can enter it and save it in her iPhone app, or on her mobile device, or she can e-mail it to herself on the iPad app with the products that recommended to her. If she just want to buy all them today or she wants to come back to it. You can start to imagine that we can now target her in e-mail with the new products that launched that fit her Color IQ. We don’t just have Color IQ information from her. Where you can see, we know her gender which most sees e-mail. We know her eye color and hair color, her skin tone and skin type, and her skin care concerns. She has acne and she’s worried about wrinkles. We know all this because we asked her and she told us this because it’s valuable to her to get recommendations that are relevant. I’m on a panel with some lovely gentlemen and they asked me earlier all these ways that you could avoid going into Sephora store, the painful trip of buying make-up. I was like, “Oh honeys, women loves having her make-up. It’s a journey.”
Kevin Fitchard 15:21
We all asked the exact questions. Everyone was.
Bridget Dolan 15:24
They did. They don’t believe. Women loves shopping for beauty. This is we are not trying to take away something that’s miserable and awful. We are trying to make her enjoy it even more and we are trying to take away the barriers that make it difficult. When you walk into a Sephora store, if you wanted to see every red lipstick, that would be a challenge. In fact, I would give anyone that challenge that might take you an hour to find every red lipstick in our stores. But, if you use your app, you can just sort by red lipsticks in the app and now you have that information at your fingertips. You can see all the ratings and reviews. You can pick up any product and scan it, and get ratings and reviews right there. All the power of having connected information on our website where we have our over 2 million reviews because our clients love talking about make-up and they love telling each other even though, our product has 20,000 reviews, they have to add that next review because they love it so much. All that information is encapsulated and you can bring it into the store experience with you. We also have digital screens that help you narrow down and shut, but we’re not just adding technology for technology sake. All of this is around making her journey more fun, making it easier to shop, and moving away the barriers like finding the right foundation which is difficult to do on person and impossible to do online. Having all that information readily accessible. But we don’t stop there, of course, then she’s going to take a selfie and post it on Instagram, and put the hashtag My Color IQ with her IQ number. And then people can go on Instagram or on Facebook, or Twitter and look at all the different women who have posted their Color IQ and get inspired by their looks and the products that they’re trying. Women can connect with each other. You can look on Amazon and see what other people are buying. They both the same product that you’re buying but this is a way to do it with personality and with interest because I might look at someone who is a bit of a goth look and she might have the exact same hair color, eye color, and skin tone, but she’s wearing black lipstick. That might not be what I’m going for. It’s good for us to add that contact and add that personality, and I think that’s how women want to connect. They want to use their devices to connect together.
Kevin Fitchard 17:35
Is there any advantage of having a higher Color IQ than someone else?
Bridget Dolan 17:40
No. There is not.
Kevin Fitchard 17:42
I can’t brag about it. One of the things I did want to discuss is you talked about industries here would be very specific about what they do and but they’re certainly not isolated. Any about Sephora is transaction, a finance. You give several examples Dave about the other things and the data that you’re collecting is not really reaching outside the kitchen but to the grocery store, to delivery services, and even to your doctor and health. Can you talk a little bit about how your industries like overlap? How all of this information, all of these services you’re enabling depend upon working outside of your industry then, how you accomplish that? Dave you want to start?
David Feller 18:26
Yes. We’re talking about this a little bit beforehand. A lot of it depends on just making sure that there’s standards and the ability for things to talk to each other. One of the things that we need to solve is my toaster needs to be able to talk to my iPhone and my iPhone needs to be able to talk to my banker, talk to Sephora. One of the risk that we run into, all of this vision happening is proprietary systems and networks that wouldn’t foster this open connection. I think that’s really one of the most important pieces that we need going forward. Each of us are trying to innovate in our respective areas but we’re all talking about ways that we can communicate with each other and that communication needs to be able to happen and some sort of structured and open way.
Kevin Fitchard 19:20
Dr. Lisa Saxon is supposed to be on this panel but she had an emergency. She was not able to make it. That’s too bad but she’s going to talk a little bit about the crossover between the health industry and the medical industry that maybe one day that your doctor will be prescribed a diet for you. Instead of just saying cut out sodium in your diet literally like send commands to your connected kitchen that would like reference recipes would prevent you from eating salt. I’m sorry, go ahead.
Andres Wolberg-Stok 19:50
I just wanting to say, I think the future making now is something that seems to be emerging already as a theme this morning. We’re on to be doing a few hours but I’ve heard this repeatedly that if everyone tries to install a propriety standard to be the only one’s playing or to own the ball for the game, it’s not going to get to the scale that you need for things to really into operate and the whole idea of the Internet. The thing is seamless transparent interaction and that seems very difficult to reconcile with propriety standard. In order for your payments to work seamlessly at the store or the cloak of value that I was mentioning or replenishing your pantry and things like that. It has to be based on some agnostic neutral type of interaction that is not dictated by any particular player or it can’t work I assumed.
Kevin Fitchard 20:54
Andres i’m curious here. You’re talking about even though you’re adding these technological capabilities the idea is not to get people out of the store or prevent them from coming in to enhance the experience. How about conversely in a banking industry? For a long time, mobile banking, online banking has obviate and needs people to do direction instructions with the bank teller. As you can abstract that further and create the cloak of value. Does the need for the branch bank go away? I’m actually been surprised that there’s seems to be more CITI branches in my neighborhood now than they we’re like ten years ago, even though, I’ve really ever go into one or have no need to go into one. What happens to the physical banker relationship?
Andres Wolberg-Stok 21:35
I think that evolves long with everything else where you talking next stage about how practically inconvenient. There is not you have to go into a branch to deposit a check to be able to take a picture of it with your app and not have to go anywhere near branch. For most people, going to a branch is not like shopping for make-up brand. It’s not something will give you pleasure. And for the bank, it’s not something that gives you great ROI if you don’t focus at extremely well because it can be your most expensive service travel. And then if you have too much distribution, too many branches you have too spread out, to present, it becomes unsustainable. The value of each branch needs to be sharply focused on acquisition and then, that would be one industry where showrooming is encouraged because it’s a great place to one-on-one, on board you on digital services, and show you how you can avoid having to come back. Could be a different conversation for a small business entrepreneur who is looking to get a loan for project being able to convey their passion and their intelligence, and by proxy the probability of their project succeed or not is something that may still require face-to-face interaction, but those are high value interactions that do justify having a physical presence and stuff, and everything. I think if you were building a big bank firm nothing today, you probably wouldn’t want to make it branchless because these interactions have high value if they are well-focused.
Kevin Fitchard 23:13
A lot of companies collect data about their costumers but seems that you’re collecting very, very specific data. You’re collecting information about their physical characteristics not their demographic data. What is the logical conclusion of all that? Can you virtualize the physical characteristics of your customers and what could you eventually do with all that information?
Bridget Dolan 23:36
Right now, women want to have an accurate recommendation given to them. Ultimately, as you virtualize all that information as you showcase, you could show what make-up would look like on them without them having a physically put it on. There are virtual make-up of a technologies. Typically, they tend to make you look a little bit more like a clown because you put all the make-up on at the same time and it’s too much.
Kevin Fitchard 24:07
Actually like the make-up gone technology if someone want.
Bridget Dolan 24:09
Exactly. There are probably in the future ways that could make that even better. The idea of maybe someday there’s smaller stores or a way to expand even. Sephora is in 700 different locations in the US but we could have double that if they were smaller but really focused and allowed you to try on some subset, and then the rest was virtual. It’d be way to expand even physical presence or way to make the Internet work even harder for you. I do think that’s possible.
Bridget Dolan 24:44
What I’m hearing for you is that bottom line is all these technologies are being used to enhance as your experience is supposed to replace it since the OPS direction and some industries are heading.
Bridget Dolan 24:52
It’s true. A lot of this technology is around just whatever she wants to consume an experience and we spend a lot of time on our app in our mobile site because we have a lot of times we just transact there. They want to buy or they want to get inspired, or they want to watch a video, or whatever they want to do. Sephora is a retailer and we do sell products. That’s primarily how we pay the bills, but we’re also a place to learn. We really do want our client to gain that confidence. We have a lot of content and we’re building all that content, and we’re using technology and mobile devices as a way to bring it to where she needs it. As you get to wereables and I go get to pick up my Google Glass tomorrow which I’m very excited about. You can imagine that I’m doing the smokey eye which the assist is hard. I’m looking in the mirror and I can project it on and then just follow the lines. There’s a lot of ways that technology will help you if not just in the store that will help you at home, and help you to learn, and then will help the online or mobile experience be that much more enjoyable to be a fun online journey as well.
Kevin Fitchard 26:04
We have a couple minutes left. Did any one have any questions or any one have any ideas? Go ahead.
S? 26:20
We live in a pre-unique bubble here specially, a crowd like this where people are willing to adopt new ways of doing mandain task like cooking or turn on a light, or shopping in the shopping mall. What are all of you doing to engage your casual consumers. People may not go to Sephora everyday or want to manage ten credit cards in a wallet, or connect to 20 different services to pick a chicken, how are you facing the challenges of keeping your businesses in apps and services simple enough so that my mom would use it rather than just open in the cook book or walking down to the supermarket to buy her make-up.
Andres Wolberg-Stok 27:00
It’s easy in my industry and so far, as our few things that really do make a life a lot easier if instead of having to spend minutes dialing numbers to figure out what your credit card balance is, when your minimum payment is due, if you can just flick on the app and see it there, or if instead of having drive all the way to the branches to deposit a check, if you can do it while having coffee at home, those things bring out the value of the digital preposition immediately. They should be design in very simple ways so that they are available not just the people who have a particularly interest but of course, to the general public.
Kevin Fitchard 27:41
I’m just curious. How quick is the adoption of mobile banking been compared to say like the adoption of ATM banking 15 years ago or 20 years ago?
Andres Wolberg-Stok 27:51
I would compare it to online which is closer and more comparable. A thousand years ago or so in the bulk and it’s not faster. It’s the entire audience trained itself on the concept of virtualization, abstraction by going online. Now, although, the touch way is different, that extra step to mobile is just another full of abstraction but in the same direction and it’s going a lot faster than online ever grow at the beginning.
Kevin Fitchard 28:26
I wanted to get your opinion but we’re run out of time so I apologize. Thank you. Please join me in thanking our panelist and thank you very much.
Announcer 28:41
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