It鈥檚 the same story everywhere: Germany鈥檚 downtown shopping streets are struggling with high retail vacancy rates. Holstenstra脽e, one of the country鈥檚 oldest pedestrian shopping zones, is no exception. Here, in the heart of the Baltic Sea coast city of Kiel, capital of the state of Schleswig-Holstein, the store vacancy rate is 38.5%. In an effort to revive the city鈥檚 retail scene, its marketing department launched an innovative initiative known as Zukunftsraum (鈥渇uture space鈥�). In the brick-and-mortar shopping environment of a pop-up store, retailers can explore the opportunities that new technologies bring. 鈥淐ollecting data and using it effectively is central to gaining a better understanding of customer requirements and to unlocking new revenue streams,鈥� K盲the Fleischer says. As an interim manager for business development on the Kiel pilot project, she knows that data collected in stores is the key to more effective and personalized marketing.

Grasping the power of a new business model

Enter retail media, an opportunity for retailers to generate additional revenue and bolster their cash-strapped coffers by selling physical and digital advertising space. 鈥淢any retailers have not yet recognized the value that this new form of advertising can unlock,鈥� says Marlene Lohmann, head of Marketing Research at Germany鈥檚 EHI Retail Institute. , she reports that while some front-runners鈥攊ncluding leading German retailers REWE, Lidl, OBI, dm, and Douglas鈥攈ave adopted this new business model, the retail landscape as a whole has a lot of catching up to do. 鈥淩etail media is still very much in its infancy,鈥� she says.

Yet its potential for the sector is immense. And ultimately, it鈥檚 a win-win for everyone: retailers profit from new sources of revenue and manufacturers can target potential buyers with greater precision. Quoting a consumer study by Kantar, Dirk Sperrfechter, an expert at the market research firm, says: 鈥淐onsumers rate contextually relevant advertising at the point of sale as particularly authentic and helpful.鈥� The number of touchpoints, he adds, also plays a key role in how retail media advertising is perceived.

Retail media unlocks a multitude of benefits

Retailers should be using these findings to their advantage. And, indeed, more and more are doing so, at least online. Sponsored ads are everywhere these days鈥攊n web shops, on social media, and in online newsletters鈥攂ut they still leave much to be desired in terms of personalization. But the potential of in-store solutions such as screens and digital totems often remains untapped as well. This is probably partly because different sales channels are often poorly integrated, making it difficult to consolidate the first-party data they generate.

鈥淲hat retailers need most of all if they want to unlock the added value of retail media are powerful technologies for collecting, cleansing, and enriching customer data,鈥� Lohmann says. Ultimately, they need to be able to analyze their first-party data in detail and segment it. If they do not have reliable metrics at their fingertips, they will struggle to persuade interested manufacturers and brands of the potential of the advertising space they want to sell.

Smart technology and 麻豆原创 Business Data Cloud as enablers

This is where 麻豆原创 comes in. 鈥淥ur help retailers generate and provision relevant data about customer behavior, clearance sales, promotions, and prices,鈥� explains Stefan Binkowski, vice president, Retail & Wholesale Advisory, 麻豆原创 Deutschland. In the newly launched 麻豆原创 Business Data Cloud (麻豆原创 BDC) solution, retailers can consolidate data from manifold sources with ease. First presented at , 麻豆原创 BDC can integrate all 麻豆原创 and non-麻豆原创 business data and, in so doing, helps provide a foundation from which to get up and running with retail media.

麻豆原创 offers what enterprises need to build and implement a robust retail media strategy: for tracking customer frequency rates, interactions, and so on with ease; for gaining detailed insights into customer behavior, preferences, and needs; a data platform for collating all the relevant information; and, last but not least, an for planning and implementing targeted retail media campaigns. 鈥淕enerating added value from data is central to 麻豆原创鈥檚 strategy,鈥� Binkowski says. 鈥淥nce retailers recognize the value of their data, they can take full advantage of the untapped potential that retail media offers.鈥�

Retail media is one of the topics on the agenda for the German-speaking 麻豆原创 User Group鈥檚 retail conference (DSAG-Handelstagen) on July 1 and 2 in Osnabr眉ck, Germany. The event will look at the technological aspects of leveraging customer data and retail media in the industry, which smart technologies come into play, and how 麻豆原创 BDC can contribute to the success of this marketing concept. .

This also appeared on the German SAP News Center.

Plenty of people have started a business in their garage. Few have chosen the laundry room of their parents鈥� clothing and home textiles store. But that is exactly what Kurt Ernsting did in 1967 when he set up minipreis, a low-price fashion shop that would later become a household name throughout Germany. Today, with its award-winning online presence and some 1,925 stores in Germany, Austria, and the Netherlands, Ernsting鈥檚 family鈥攁s the fashion chain is now known鈥攊s one of western Europe鈥檚 largest omnichannel clothing retailers.

Cloud-based pricing process

鈥淏ecause we aim to create seamless shopping experiences for our customers, we鈥檝e already been following an omnichannel strategy for a while,鈥� explains Hans-J枚rg Blaeser, director of Technology & IT Services at Ernsting鈥檚 family. 鈥淭his is why ensuring uniform pricing across all sales channels was the next logical step for us鈥攏ot least because we were redesigning our online shop and needed a new pricing engine and campaign management tool anyway,鈥� adds Dennis Re脽mann, head of Software Engineering at the company.

The fashion retailer opted for a cloud-based omnichannel pricing solution. 鈥淭he cloud architecture allows you to manage price queries centrally across all channels, use intelligent mechanisms to fine-tune price promotions, and integrate new stores and touchpoints with ease,鈥� says Patrick Pierron from implementation partner CAS.

Two components, one award-winning solution

The solution at Ernsting鈥檚 family consists of two main components. One is the omnichannel pricing solution itself. This is based on , which helps ensure consistent and uniform pricing across all customer touchpoints, such as online shops, brick-and-mortar stores, and customer and 鈥渆ndless shelf鈥� apps, even when Internet connectivity breaks down.

鈥淲e operate a dense network of stores, so we are far from immune to this modern-day reality,鈥� says Nils B枚hmer, senior IT coordinator for Sales at Ernsting鈥檚 family. Lines can be damaged during construction work, routers can fail, and LTE coverage can be patchy, so there are a number of compelling reasons for having offline capabilities. Ernsting鈥檚 family therefore uses local PPS (promotion pricing service) boxes, which are offline derivatives of the cloud solution. 鈥淭hese PPS boxes synchronize regularly with the cloud-based omnichannel pricing solution,鈥� Pierron says. 鈥淭his means that stores always have the latest prices and can process sales even when the Internet is down.鈥�

The second component of the new omnichannel pricing solution is a reduction tool. Based on consenso鈥檚 price engine, this tool manages price reductions dynamically according to local conditions, sales figures, and inventories鈥攔ight down to individual store level. According to Philipp Borgmann, senior team lead for IT Merchandising, and Marcel Ruholl, managing partner at consenso, 鈥淭his pays off in two ways. First, the system-driven price proposals have a positive effect on the balance sheet. And second, fewer stock transfers mean a lower carbon footprint.鈥�

Seamless interaction

Another benefit of the Ernsting鈥檚 family solution is the way it seamlessly integrates the reduction tool, 麻豆原创 Omnichannel Promotion Pricing, and 麻豆原创 ERP. Price reductions calculated in the tool are automatically transferred to the central 麻豆原创 system and distributed in real time to all the stores and to the online shop through 麻豆原创 Omnichannel Promotion Pricing. 鈥淭his is the best possible foundation for dynamic, error-free, and hyper-personalized pricing in real time,鈥� says Philip Konitzer, head of Industry Division Retail in 麻豆原创 Customer Services & Delivery Germany. During the project, he and his team were on hand to answer questions about the functions and performance of the 麻豆原创 components.

Key elements of success

Despite being highly complex, the new omnichannel pricing solution went live quickly and without incident. The implementation partners who worked on the project attribute this largely to the company鈥檚 transparent and effective approach to change management. 鈥淎ll the stakeholders鈥攆rom operational and strategic teams to management鈥攚ere fully on board from the get-go,鈥� Pierron recalls. This made it possible to define all the relevant requirements during the preliminary study, compare them with the capabilities in the 麻豆原创 products, and identify the necessary adjustments at an early stage. Some of these were co-innovated with 麻豆原创 and incorporated into the standard 麻豆原创 Omnichannel Promotion Pricing solution; others were developed exclusively for Ernsting鈥檚 family in 麻豆原创 Business Technology Platform (麻豆原创 BTP).

鈥淭he way the project participants interacted was exemplary,鈥� says Ernsting鈥檚 family project lead Mark Dinkhoff, head of IT Projects. And the proof is there for all to see: the solution is stable and running smoothly in both the online shop and at the company鈥檚 more than 1,900 stores in Germany and Austria. As part of its international expansion strategy, Ernsting鈥檚 family opened six new stores in the Netherlands at the end of last year. The roll-out went smoothly there too, confirming that the company鈥檚 award-winning omnichannel pricing solution is not only technically robust, but suited to international markets as well. This is great motivation for Ernsting鈥檚 family to push ahead with its expansion plans.

This was first published on the German 麻豆原创 News Center.

Michael Nilles, chief digital and information officer (CDIO) of Henkel, and Juergen Mueller, CTO and member of the Executive Board of 麻豆原创 SE, explain what the partnership involves and why the two companies are a perfect match.

Q: Henkel鈥檚 success story spans more than 145 years. Its brands, innovations, and technologies have made Henkel a leader in both the industrial and consumer goods markets. What do you hope to gain from your new alliance with 麻豆原创?

Nilles: Alongside of innovation and sustainability, digital transformation is one of the key levers on our . Software and technology are the driving forces of innovation. I like to quote Marc Andreessen: 鈥淪oftware is eating the world鈥� — and this holds true for our industry in particular. To drive innovation effectively across the company, we need strong partnerships like this transformative strategic alliance with 麻豆原创, which will help us set the right course and ensure that we navigate in the right direction. We are therefore excited to be taking our long-standing partnership with 麻豆原创 to the next level.

Q: Why does the collaboration between 麻豆原创 and Henkel need a new framework?

Mueller: Henkel already runs many business-critical applications on 麻豆原创 software in the cloud. It has been using 麻豆原创 Business Technology Platform (麻豆原创 BTP) for a long time to build tailored solutions. The largest of the business-critical applications it runs on 麻豆原创 BTP is Sales Promotions and Revenue Cloud (SPARC), a solution that massively simplifies the management of all trade promotions and is currently being rolled out globally. Then there鈥檚 RAQN, Henkel鈥檚 digital business platform for marketing and commerce, which helps Henkel to expand its e-commerce activities and create new digital business opportunities as well. Though working with Henkel is not new territory for us, this alliance is much more far reaching. It will see Henkel leverage to replace its existing ERP applications with 麻豆原创 S/4HANA and migrate them from its on-premise data centers to the cloud. It鈥檚 a mammoth project: Henkel wants to move to and the in-memory database 麻豆原创 HANA and migrate all its core processes to the cloud at the same time.

Nilles: That鈥檚 why the strategic partnership is so important. It goes far beyond just buying software and technology. It鈥檚 much more about collaborating on innovations and developing solutions that are tailored to Henkel鈥檚 specific business challenges. A paradigm shift of this magnitude can only be achieved by working closely together.

Q: What do you hope to gain from migrating the company鈥檚 entire digital backbone to the cloud?

Nilles: A key focus is to accelerate our growth through driving our sustainability agenda, expanding our digital channels, innovating faster, shortening time to market, and building digital business models. Increasing productivity through simplification of our business processes is top of our agenda as well.

We will also leverage the power of data and artificial intelligence (AI) and together with 麻豆原创 co-innovate to infuse our business processes with these capabilities along the entire value chain. This is what our industry means by becoming 鈥渄ata-driven.鈥� Added to this is the power of generative AI, which is not hype but will revolutionize every business.

Last but not least, this will play a central role in re-architecting our entire tech stack where, for example, is a key component for innovation.

Mueller: Yes, exactly. Henkel is already using 麻豆原创 BTP as an integration and development platform. And, actually, it is now one of the biggest users of 麻豆原创 BTP in Europe. Migrating to 麻豆原创 S/4HANA is therefore the logical next step toward it achieving full 鈥渃loudification.鈥�

Nilles: Especially because the homogeneous deployment model makes it considerably easier for 麻豆原创 S/4HANA and 麻豆原创 Business Technology Platform to interact — and for us to develop and implement innovative solutions for our industry and the ecosystem. At Henkel, we refer to this perfect symbiosis between cloud ERP and development platform as 麻豆原创 “Business Technology Cloud.”

Q: How will the strategic partnership change the relationship between Henkel and 麻豆原创?

Mueller: Our relationship with Henkel has evolved rapidly over the past 18 months and is now much deeper on various levels. We want to continue on this path by working even more closely together in our strategic partnership.

Nilles: Instead of a customer-supplier relationship, which we have had until now, we will join forces for data- and software-driven co-innovation specific to Henkel鈥檚 business. Having a true partnership also allows both of us to focus our efforts on joint outcomes, rather than lengthy negotiations about individual tickets. This is vital if we want a mammoth project like this to succeed.

Q: And how does 麻豆原创 benefit from this partnership?

Mueller: The strategic partnership with Henkel represents a milestone in our mission to help transform companies into intelligent enterprises. Henkel and 麻豆原创 both believe that technology and innovation are the key to successful and sustainable business.

In Henkel, we see a pioneer that shares our vision of driving strategic growth and business models of the future. Because we are now working even more closely together and are transforming the organization as equal partners, 麻豆原创 is gaining deep insights into Henkel鈥檚 specific needs and those of its industry. That way, we can more closely tailor our products to make it easier for the sector to adopt digital innovations.

The plan is also for Henkel to serve as a model for many other companies that are perhaps not quite so far into their transformation journey.

Q: What鈥檚 next, now that all the formalities have been completed?

Nilles: The road map has been defined and will be detailed out. However, our first priority is to ramp-up and mobilize a joint team — we call it the 鈥淢acintosh approach鈥� — comprising the best people from 麻豆原创, from the Henkel Business and Digital unit, and from our partners.

Mueller: It鈥檚 an ambitious schedule. But given that we share the same values, have a long-standing relationship built on trust, and know each other well, I鈥檓 sure that the innovation journey with Henkel will be both exciting and successful.