Agentic AI was everywhere at NRF, emblazoned across the booths of technology exhibitors and the focus of many of the daily conference sessions. The message was simple: retailers face a major upheaval as consumers switch from traditional browser-based search to AI-enabled product discovery.

Consumers are rapidly adopting AI agents to help them find, compare, and, increasingly, buy products—this while many brands are still optimizing for search engines and are quietly disappearing from the models driving the next generation of product discovery.

“Agentic commerce—shopping powered by AI agents acting on our behalf—represents a seismic shift in the marketplace,” McKinsey, the strategic management consultancy, noted in a . “It moves us toward a world in which AI anticipates consumer needs, navigates shopping options, negotiates deals, and executes transactions, all in alignment with human intent yet acting independently via multistep chains of actions enabled by reasoning models.”

This, as speakers and panelists at the NRF conference acknowledged, isn’t just an evolution of e-commerce; it’s a rethinking of shopping itself, in which the boundaries between platforms, services, and experiences give way to an integrated, intent-driven flow through highly personalized consumer journeys that deliver a fast, frictionless outcome.

As the McKinsey report noted, the stakes are high. By 2030, the U.S. B2C retail market alone could see up to US$1 trillion in orchestrated revenue from agentic commerce, with global projections reaching as high as $3 trillion to $5 trillion.

This means all the participants in the retail chain, from brands and retailers to logistics and payment service providers, will need to adapt to the new paradigm and successfully navigate the challenges of trust, risk, and innovation.

To help retailers address the immediate challenges posed by the shift to agentic commerce, 51ˇçÁ÷argues that three steps are necessary: first, restructuring web-page product data to be machine-readable; second, adding semantic summaries for LLM reasoning; and third, tagging products by the problems they solve, not just their attributes.

51ˇçÁ÷announced a series of AI-enhanced retail innovations at NRF 2026, including a new storefront model context protocol (MCP) server that enables retailers to make their digital storefronts intelligible to AI and the new AI-native Retail Intelligence solution in 51ˇçÁ÷Business Data Cloud that leverages data from across 51ˇçÁ÷software and third-party systems to help provide accurate demand planning, improved forecast accuracy, and lower inventory costs to drive more seamless omnichannel engagements.

51ˇçÁ÷Customer Experience has also unveiled a recently that can be combined with theĚý, creating one conversational AI that can handle the entire journey from product discovery and transaction to post-sales support.

These moves reflect a recognition that that LLMs have become a legitimate shopping channel, and that product discovery is moving from search engines to AI recommendations.

This shift challenges years of SEO and brand building. To stay relevant, 51ˇçÁ÷believes retailers must take an AI-first approach and have strong, connected data that helps agents understand products, predict demand, and respond quickly. Without this strong data foundation, brands will be at risk because if customers get poor recommendations and errors in pricing, trust can disappear fast.

Although some early agentic AI adopters in the retail sector are already seeing the benefits of agentic commerce, many global retailers are still ill-prepared for the holistic transformation they need to succeed in this new retail environment.

As McKinsey noted in a separate , “while most retail merchandising teams have invested in automation toolsĚýand experimented with AI, 71% of merchants say that AI merchandising tools have had limited to no effect on their business so far.”

“The challenge,” McKinsey said, “often lies less in the technology than in how it’s integrated and used. Systems remain fragmented, data is too messy to use to deliver useful recommendations, and adoption is uneven: 61% of respondents say that their organization isn’t at all or is only slightly prepared to scale AI across merchandising.”

Onstage at NRF, Andre Bechtold, president for 51ˇçÁ÷Industries & Experience, also emphasized that retailers should prepare now for agentic commerce and noted that simply “bolting on” AI tools to existing systems is not enough.

“Retailers are operating in an environment defined by volatility—tariffs, margin pressure, supply chain disruption, and customers that expect real-time, hyper-personalized experiences everywhere,” Bechtold said during a discussion with Gymshark, the workout apparel retailer. “At the same time, boards and investors are asking a tougher question than ever before: what outcomes are we actually getting?”

“The challenge,” he said, “isn’t a lack of innovation. In fact, most retailers have plenty of tools, pilots, and point solutions. The real issue is that disconnected technology doesn’t translate into resilient growth. That’s why the conversation is shifting. It’s no longer about isolated AI use cases or shiny new features. It’s about whether AI and data are embedded across the business—connecting supply chains, finance, merchandising, and customer engagement—in ways leaders can trust.”

Echoing the same point, Thomas Saueressig, member of the Executive Board of 51ˇçÁ÷SE, Customer Services & Delivery, commenting in a this week about a PwC survey of global CEOs that found that companies rarely achieve lower costs or higher sales through the use of AI, emphasized that AI only contributes value when consistently embedded in business processes. Ěý“As long as AI runs alongside the core business as an isolated project, the effects remain limited,” he said.

Our vision for agentic commerce is bold. In , we showcase a future where humans and AI agents collaborate to drive intelligent recommendations, proactive operations, efficient business processes, and deeper customer relationships. While this vision points forward, SAP’s focus is firmly grounded in helping retailers take practical steps today. This isn’t about flashy demos of a distant future—it’s about building the foundation now for how consumers will buy and retailers will sell in the years ahead.

Unlike traditional AI systems that respond to prompts, agentic systems act on intent. They learn from preferences, make proactive recommendations, and can complete transactions on a shopper’s behalf. These agents are increasingly becoming the starting point of the buying journey, reshaping how brands compete for visibility, trust, and loyalty.

This evolution introduces both opportunity and risk. As AI agents mediate more interactions between brands and consumers, retailers must rethink how they capture intent, transact with agents, and deliver post-purchase experiences that reinforce trust.

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Discovery is moving from search to assistants

Historically, product discovery revolved around search engines, marketplaces, and brand-owned storefronts. That model is shifting quickly. Answer engines and AI shopping agents are becoming new entry points for commerce—often before a shopper ever visits a retailer’s site.

Like marketplaces before them, AI agents introduce a new layer between brands and customers. The difference is speed and autonomy. Agents don’t just surface options; they reason, decide, and act.

For retailers, success is no longer about ranking on a page. It’s about ensuring products are visible, understandable, and trusted by machines that influence purchase decisions on behalf of humans.

At NRF, 51ˇçÁ÷expanded its agentic commerce vision with the announcement of the storefront MCP server for 51ˇçÁ÷Commerce Cloud, planned for Q2 availability. The storefront model context protocol (MCP) server can enable channel-less commerce by allowing businesses to safely and reliably engage with multiple AI agents—whether embedded in a retailer’s own experiences or originating from third-party assistants like ChatGPT or Perplexity.

The storefront MCP server helps merchants surface products and can enable buying across channels for both people and machines. It’s the first of many steps 51ˇçÁ÷is taking to help customers fully participate in agentic commerce by supporting MCP, ACP, UCP, and other emerging agentic protocols.

Product content becomes the currency of visibility

In an agent-driven world, product content is no longer just marketing—it’s operational infrastructure. AI agents cannot recommend what they cannot interpret. Every attribute, image, specification, availability signal, and proof point directly impacts whether a product is surfaced, compared, or selected.

This is where generative engine optimization (GEO) is evolving. Optimization must now serve two audiences: humans and machines. Product data must be structured, consistent, and enriched, so AI agents can confidently represent it to shoppers.

The in helps transform how merchants manage product data at scale. It can clean catalogs, enrich attributes, standardize details, fill gaps, and support multilingual content using real-time data. The agent can scale to catalogs with more than 10 million items, helping teams improve content 70% faster, increase data completeness by 5%, and reduce maintenance effort by 63%.

With AI-ready product data as its foundation, retailers can better match shopper intent, optimize merchandising by channel, and improve pricing and delivery decisions with precision.

Payments must evolve for autonomous commerce

As buying journeys fragment across devices, channels, and agents, payments must become more flexible and nearly invisible. Consumers expect to pay how and when they choose, including through agent-initiated transactions.

New payment rails like FedNow, RTP, and stablecoins are enabling faster, lower-cost transactions, while wallets and bank-based payments continue to converge. Networks such as Visa and Mastercard are already preparing for autonomous commerce by allowing consumers to set spending limits and controls for AI agents.

For retailers, the priority is delivering frictionless, secure payment experiences that integrate seamlessly into agent workflows.

The can enable this flexibility through a no-code, low-code approach. Its headless, extensible architecture helps support diverse payment methods, ensure compliance through automatic updates, and integrate natively with 51ˇçÁ÷Commerce Cloud—working to give retailers agility without sacrificing control or scalability.

Returns become a strategic intelligence engine

Returns are one of retail’s biggest challenges. According to IHL Group, global returns have surpassed US$1.9 trillion and are growing faster than sales. What was once a cost center is now a strategic differentiator.

The next phase of returns management is defined by intelligence. AI enables “keep, reject, or return” decisioning based on loyalty history, behavioral signals, margin impact, and lifetime value. Returns data becomes a feedback loop that improves forecasting, product quality, and merchandising decisions.

Complete, connected data is essential. 51ˇçÁ÷can deliver this through native integration between 51ˇçÁ÷ERP and 51ˇçÁ÷Commerce Cloud, creating a single source of truth across inventory, costs, and transactions. found that organizations using both platforms achieved up to 80% lower TCO, up to 90% productivity gains, and 105%–245% revenue uplift from hyper-personalized experiences.

can extend this foundation across the full returns journey, helping to orchestrate centralized rules, guided returns, real-time inventory visibility, and faster refunds—turning returns into a loyalty-building growth lever rather than a revenue drain.

Commerce is detaching from the storefront

As predicted at the end of 2025, AI agents are taking on more shopping tasks, pushing commerce beyond traditional storefronts. A shopper may simply state an intent and let an agent handle research, selection, and checkout.

Discoverability now depends on structured, trustworthy signals—reviews, ratings, social proof, and consistent data that agents rely on to evaluate quality and brand credibility.

Retailers must move beyond transactional efficiency to deliver connected, personalized experiences across every touchpoint. Loyalty programs must reward engagement, not just purchases. Inventory visibility, accurate delivery promises, and proactive issue resolution become table stakes.

can enable retailers to design adaptive loyalty strategies for this new environment, personalizing rewards and offers based on real-time behavior—whether purchases happen through traditional channels or AI agents. These insights can then feed transactional agents, helping to improve relevance and outcomes across the journey.

Operational reliability remains critical. 51ˇçÁ÷Order Management Services help unify order, inventory, fulfillment, and POS data, while agentic innovations like the Order Reliability Agent can proactively resolve fulfillment issues before they impact customers.

Trust is the core retail responsibility

As agentic systems influence more of commerce, trust becomes the most valuable asset retailers can protect. Consumers must trust that their data, preferences, and payments are secure and governed responsibly.

Retailers and commerce providers increasingly act as AI trust custodians, balancing intelligence with deterministic constraints and governance. On-site AI can scale associate expertise and personalization while preserving brand integrity and customer confidence.

Commerce is becoming an ecosystem of intelligent interactions—where discovery, payments, fulfillment, and returns are connected by agents acting on behalf of shoppers and businesses alike.

The winners will be those who align product intelligence, flexible payments, data-driven returns, and trust across every touchpoint. Agentic AI can make commerce more personal, efficient, and scalable—but only for those who build the right foundations today.

To learn more about how 51ˇçÁ÷Commerce Cloud is powering AI-driven commerce, visit .

Kollen Glynn is global head of 51ˇçÁ÷Commerce Cloud for 51ˇçÁ÷Customer Experience.

Since the launch, has empowered organizations to streamline operations for increased efficiency, reduced manual workloads, and untangled multi-channel complexity. With this approach, businesses can deliver on customer promises with seamless customer experience. This momentum has also been recognized in the market, as 51ˇçÁ÷Order Management Services was named a Leader in by IHL Group for its robust capabilities and enterprise readiness.

, a leading German home improvement retailer, is already seeing the benefits. With 51ˇçÁ÷Order Management Services, Hornbach connects digital and physical stores with full visibility into day-to-day transactions, providing omnichannel retail experience at scale to its customers.

However, the retail landscape is evolving continuously. While profitable growth is critical to businesses, earning and sustaining customer loyalty now is becoming more important. Ahead of the curve, 51ˇçÁ÷has heavily invested in expanding capabilities in the 51ˇçÁ÷Order Management Services bundle to help retailers deliver on customer promises with intelligence, scalability, and adaptability, leading to boosts in customer loyalty.

At NRF 2026, 51ˇçÁ÷is unveiling new and enhanced capabilities that power retailers to not only operate more efficiently but also achieve loyalty-led growth through every order.

AI in 51ˇçÁ÷Order Management Services

Joule in 51ˇçÁ÷Order Management Services: SAP’s AI copilot, Joule, is now available in 51ˇçÁ÷Order Management Services. Access order-related data, analysis, and insights through conversations in natural language and visual display.

Order Reliability Agent: Accelerate operational efficiency with the Order Reliability Agent in 51ˇçÁ÷Order Management Services. Proactively mitigate and resolve any potential issues and gaps, such as stock discrepancies or process bottlenecks, to help ensure every order is fulfilled seamlessly and to boost customer loyalty.

AI-assisted copy generation and translations: Create promotional copy in seconds and translate it into any language with AI assistance, helping to reduce manual workload and accelerate time-to-market.

UI enhancements

Workflow-optimized UI: The enhanced and unified UI in 51ˇçÁ÷Order Management Services can deliver a consistent user experience across order, inventory, and fulfillment operations. Teams can now work faster, reduce training time, and maintain full visibility across every step of the order lifecycle.

Watch the 51ˇçÁ÷Order Management Services  to get a closer look at the AI capabilities in action. Visit the 51ˇçÁ÷booth at NRF 2026, January 11 – 13, to learn more about 51ˇçÁ÷Order Management Services and catch an in-person demo.

Emilie Fournelle is head of Product Management for 51ˇçÁ÷Order Management Services at SAP.

NEW YORK — (NYSE: SAP) today announced a new generation of AI-enhanced retail innovations at NRF 2026: Retail’s Big Show.

51ˇçÁ÷continues to infuse AI into the DNA of every part of its retail solutions, reinforcing its suite-first strategy and helping retailers operate with greater intelligence, resilience and trust while delivering better experiences for customers everywhere.

“Retailers face a landscape where AI is no longer optional,” said Balaji Balasubramanian, President and Chief Product Officer for Customer Experience and Consumer Industries, 51ˇçÁ÷SE. “51ˇçÁ÷provides one closed-loop, AI-enhanced retail operating system that ties planning, execution and engagement together. We put data and AI at the heart of retail, delivering speed, personalization and growth across every channel and segment.”

AI that turns retail data into actionable intelligence

The Retail Intelligence solution in provides accurate demand and inventory planning, leveraging retailers’ data from across 51ˇçÁ÷software and third-party systems to drive profitable growth through actionable, real-time insights. Purpose-built for retailers and direct-to-consumer businesses, it will be generally available in the first half of 2026.

Harmonizing real-time data from sales, inventory, customers and suppliers, Retail Intelligence uses AI-generated simulations so planners can anticipate outcomes and optimize inventory. This improves forecast accuracy, reduces manual planning effort, lowers inventory costs and raises service levels. All this drives more seamless omnichannel engagements, which strengthen customer loyalty and enable growth without adding complexity for retailers.

“Retailers are seeking built-in, embedded AI solutions to help balance daily operations, future planning and agility to manage a dynamic market,” said Ananda Chakravarty, Vice President of IDC Retail Insights. “What sets 51ˇçÁ÷apart is the holistic nature of its approach, offering an agentic operating system that works in the background, connects data and orchestrates agents. 51ˇçÁ÷makes it an easy lift for retailers to achieve enterprise-wide intelligence, avoiding the complexity of many point solutions.”

AI that streamlines modern retail operations

Retailers must make fast, confident decisions across assortments, pricing and planning. To meet that need, 51ˇçÁ÷announced new AI-assisted assortment management capabilities, allowing planners to create, modify or retire assortments using natural language through the Joule copilot. This reduces the bottleneck on expert users, enabling faster responses to market shifts and freeing time for higher-value merchandising decisions.

51ˇçÁ÷also introduced omnichannel sales promotions in sales orders, integrating the 51ˇçÁ÷Omnichannel Promotion Pricing solution with the 51ˇçÁ÷S/4HANA Cloud Public Edition, retail, fashion and vertical business solution. This enables advanced promotions such as bonus buys to be applied consistently across diverse channels, enabling a single source of truth for pricing and promotions in store and online, so retailers can deliver a consistent experience.

In addition, 51ˇçÁ÷is delivering deeper merchandising, segmentation and manufacturing support in the solution, tailored to fashion wholesalers and manufacturers. These enhancements provide the data and process foundation needed for AI-assisted fashion operations across the business.

AI that drives better customer engagement

As shopping journeys increasingly begin with AI assistants rather than storefronts or search engines, retailers need new ways to be present wherever buying decisions are made. 51ˇçÁ÷helps retailers connect products, pricing, inventory and promotions directly to AI-enabled discovery and shopping experiences, unlocking agentic commerce with its new storefront MCP server, part of the 51ˇçÁ÷Commerce Cloud solution.

Retailers can now make their storefronts intelligible to AI, driving shopping experiences not only on their storefronts but also on platforms such as ChatGPT.ĚýThis creates a truly channel-less commerce experience, one where engagement, discovery and transaction happen more seamlessly across human and AI-assisted touch points.

AI that builds customer loyalty

As customer expectations rise and fulfillment networks grow more complex, retailers need confidence that every order will be delivered as promised, using AI solutions that provide proactive visibility and guidance to help keep operations running smoothly and at scale. And as brand visibility shifts in the age of agentic commerce, reliable and consistent shopping experiences are more important than ever to drive sustained customer loyalty and trust.

51ˇçÁ÷announced Order Reliability Agent as part of the 51ˇçÁ÷Order Management Services bundle, planned for release in the second quarter of 2026. The new agent proactively identifies and resolves potential order issues, helping associates answer common questions about order status, stock availability and fulfillment risks before they impact customers.

By combining agentic autonomy with human oversight where judgment matters, these innovations from 51ˇçÁ÷drive insightful planning and improve operational efficiency, both enhancing the customer experience and driving profitable growth.

Visit the . Get 51ˇçÁ÷news via  and .

Media contact:
Mallory Kuno, +1 (425) 239-9362,Ěýmallory.kuno@sap.com, ET
51ˇçÁ÷Press Room; press@sap.com

This document contains forward-looking statements, which are predictions, projections, or other statements about future events. These statements are based on current expectations, forecasts, and assumptions that are subject to risks and uncertainties that could cause actual results and outcomes to materially differ.Ěý Additional information regarding these risks and uncertainties may be found in our filings with the Securities and Exchange Commission, including but not limited to the risk factors section of SAP’s 2024 Annual Report on Form 20-F.
Š 2026 51ˇçÁ÷SE. All rights reserved.
51ˇçÁ÷and other 51ˇçÁ÷products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of 51ˇçÁ÷SE in Germany and other countries. Please see for additional trademark information and notices.

Retailers are looking at new technology tools like AI to help them move into new channels and discover new growth streams, enter new markets and find new ways to engage with consumers, and work with suppliers to find efficiencies in their supply chain, Kristin Howell, SAP’s global vice president of Retail Solution Management, said.

“There is a tremendous market out there for retailers to utilize AI and improve their business processes,” she said during an open theater session at the 51ˇçÁ÷booth during the show.

Over two days, retailers who came to the 51ˇçÁ÷booth spoke about the challenges they face, talked about data, data management, and the opportunities presented by AI, and heard about how new solutions and services from 51ˇçÁ÷tailored specifically to the retail sector can help them become more efficient and serve their customers better.

51ˇçÁ÷officially launched the at the show. The new solution helps centralize operational data and can integrate finance, procurement, and merchandising processes.

“Whether you’re a franchisee with a handful of stores or the biggest retailer out there, there’s a certain level of complexity that comes with running any retail business, especially with consumers who expect a very flexible fulfillment experience,” Howell said during a press briefing. “In order to really fulfill these expectations profitably and meet the needs of these consumers, we believe that this retail-tailored ERP solution is going to make the difference for them.”

51ˇçÁ÷also announced plans to bolster its retail offerings with two new tools—a refreshed loyalty management cloud service and a generative AI assistant designed to give store employees and consumers an easier way to find what they need.

51ˇçÁ÷S/4HANA Cloud Public Edition retail, fashion, and vertical business is available immediately, while the shopping assistant, which is based onĚý, SAP’s unified copilot, will be released during the first half of 2025.Ěý

The shopping assistant is designed to make recommendations and help shoppers find what they are looking for more easily while also helping store associates close sales. Because it can be integrated into the retailer’s ERP system, users can discover specific information, like the current availability of stock.

The new loyalty management application takes data from 51ˇçÁ÷S/4HANA Cloud and applies AI to create profiles around customers and their shopping behavior and preferences.

Howell identified the customer experience in retail, including product recommendations and helping consumers search, “as areas where retailers can start consuming AI.” She also expects retailers to be early adopters of AI tools to help with their pricing strategies and to use generative AI copilots, including SAP’s offering, to ask questions and get answers immediately—about inventory for example—wherever they are.

While it’s still early days in terms of adoption, almost every retailer presenting in the 51ˇçÁ÷booth theater at the show said they are preparing to implement AI tools and some said they are already testing AI tools in specific use cases. And SAP’s retail team made it clear at the NRF show that 51ˇçÁ÷is ready to help.

We are leaving the biggest retail event of the year with so much excitement for what’s to come for the 51ˇçÁ÷Customer Experience portfolio this year. Here’s a look into 51ˇçÁ÷CX innovations for 2025.

Data-Driven Loyalty Management Solution

We announced a new loyalty management solution that helps brands earn the loyalty of their customers using experiential journeys and personalized, real-time offers.

Creating loyalty is key to profitable growth; however, lasting loyalty has been illusive to many brands. According to the , there are diverse motivations among consumers that drive brand loyalty. Forty-percent credit their loyalty to long-standing reputations, 30 percent say brand consistency is what brings them back, and 22 percent say it’s because of a brands iconic status. Yet, despite this loyalty, only 17 percent of consumers feel “truly valued,” leaving the majority wanting more.

Helping consumers feel truly valued is no small feat. Traditional reward redemption methods focus only on customers who actively join loyalty programs, and that is no longer enough. Brands are innovating loyalty programs to create a sense of nostalgia, community, and devotion that delivers a memorable experience through personalized offers across the entire life cycle and on every channel.

The new loyalty solution from 51ˇçÁ÷aims to equip organizations with experiential journeys and personalized, real-time offers to help earn customer loyalty through integration with the 51ˇçÁ÷Commerce Cloud, 51ˇçÁ÷Service Cloud, 51ˇçÁ÷Emarsys and 51ˇçÁ÷S/4HANA Cloud Public Edition, retail, fashion, and vertical business solutions. Key features that enable this are:

• Loyalty profiles that connect every shopper with a cloud-based loyalty wallet, facilitating targeted and personalized offers, entitlements, and real-time basket analysis
• Multi-brand loyalty management, as well as shared loyalty programs with partners that centralize loyalty programs across regions and markets, enabling combined brand programs for gaining market share
• A single place for omnichannel promotion planning with real-time redemption to deliver any type of offer, digital payment, and gifting to all customers on any channel
• Loyalty journey planning that delivers experiential omnichannel journeys tailored to customer needs through personalized commerce, marketing, service, and retail interactions
• Quantifiable metrics that track promotion performance and loyalty-related liabilities, linking to financial systems to measure ROI, and enable settlements with the member and partner brands

We are currently recruiting customers for a lighthouse program, and interested customers can learn more by contacting Yaron Gur-Ari. The solution is expected to be available in the second half of 2025.

Artificial Intelligence Makes Shopping Frictionless

We are also launching an AI shopping assistant to make e-commerce search and discovery a lot easier for customers.

Search abandonment is a real challenge. According to a 2023 Google research report, retailers face more than a . And to add insult to injury, search challenges also serve a huge blow to customer loyalty, with 78 percent of consumers viewing brands differently and 82 percent of consumers saying that they would avoid websites where they’ve experienced search difficulties.

With the AI shopping assistant, users can now deliver that white-glove experience to their customers online. For industrial buyers, it acts as a technical specialist — helping source specific replacement parts, comparing complex specifications, and suggesting compatible components. For retail customers, it serves as a personal shopper — understanding style preferences, recommending complementary accessories, and answering detailed product questions.

The assistant seamlessly integrates with 51ˇçÁ÷Commerce Cloud through a flexible API, allowing users to easily plug it into new or existing storefront while maintaining the brand experience. With built-in security and support for multiple languages, it is designed to deliver sophisticated product discovery at scale.

The AI shopping assistant, as part of the , is available for early access now and will be generally available in March of 2025 for 51ˇçÁ÷Commerce Cloud customers.

Effortless Payment Service Integration

We previously announced a new composable payment solution, 51ˇçÁ÷Commerce Cloud, open payment framework, that helps retailers continue to scale and remain agile as new payment options gain popularity.

Open payment framework is a no-code, low-code framework that gives retailers a low-cost, adaptive, and agile payments system that can best fit their business and customer needs without the need to build out integrations on their own. Extensible and headless, the framework ensures that the front and back ends are decoupled and operate independently, catering to a wide range of requirements across channels and allowing customers to have the freedom to pick their preferred payment methods. It covers common payment needs and end-to-end payment processes across authorization, capture, refunds, and re-authorization as well as automatic updates with security and compliance standards. Open payment framework is natively integrated with 51ˇçÁ÷Commerce Cloud.

Open payment framework is planned for general availability on January 22, 2025. Customers can .

Intelligent Search Service Makes Product Discovery Easier

The intelligent search service is a modern, multi-tenant SaaS solution designed to deliver seamless, AI-powered search experiences for both shoppers and business users. Key benefits that empower end-to-end commerce journeys are:

• Effortless product discovery for shoppers on the storefront with natural, intuitive search capabilities, enhanced by AI-driven verbatims, flexible indexing, and intelligent scoring. 51ˇçÁ÷ like smart word suggestions and personalized recommendations help showcase the most relevant products, improving navigation and driving higher satisfaction.
• Search operation management with ease for business users through back-office processes that enable data-driven merchandising strategies, powered by integration with intelligent selling services. This ensures measurable impact and optimization of search experiences.

By combining modern technology with AI, the intelligent search service maximizes conversion rates and product views, delivering a natural and intuitive shopping experience. It helps retailers not only enhance customer satisfaction but also build long-term loyalty and lifetime value.

The service is planned for general availability on January 22, 2025. Customers can .

At SAP, we are committed to empowering businesses to deliver exceptional customer experience while driving profitable growth. By leveraging connected, insightful, and adaptive technology solutions, we help our customers put their customers at the center of their operations to build loyalty, foster innovation, and unlock new opportunities for success.

To learn more about 51ˇçÁ÷CX, visit .

Balaji Balasubramanian is senior vice president and global head of Commerce and Industry Cloud at SAP.

• 51ˇçÁ÷also debuts solutions to address loyalty gap as new survey results show 80% of U.S. consumers feel undervalued by brands

NEW YORK — (NYSE: SAP) announced a slate of new solutions and capabilities catering to the retail industry at , the flagship industry event hosted by the National Retail Federation.

SAP’s top news is the general availability of the 51ˇçÁ÷S/4HANA Cloud Public Edition, retail, fashion, and vertical business solution. This enterprise resource planning (ERP) solution is built specifically for retailers and marks a significant milestone in bringing tailored ERP capabilities to retailers of all sizes worldwide.

“SAP’s announcement of an all-in-one platform tailored for retail represents a meaningful differentiator in the market,” said Leslie Hand, Group Vice President for IDC Retail Insights. “Retailers often struggle with fragmented solutions that excel in some areas but cannot deliver the end-to-end integration necessary for seamless retail operations.”

“WžąłŮłó , 51ˇçÁ÷brings the same best-in-class functionality trusted by market leaders and recognized worldwide, now tailored to meet the scale, price and time-to-value required by fast-growing organizations,” said Balaji Balasubramanian, senior vice president and global head, Commerce and Consumer Industries at 51ˇçÁ÷SE. He added that retailers, in order to deliver personalized experiences, need an ERP system with retail-specific processes and capabilities that are tailored to the complexities of merchandising, store operations, and retail supply chains. Balasubramanian notes that generic ERP systems lack these end-to-end retail processes and aren’t flexible enough for today’s digital consumer.

SAP’s latest offering addresses these challenges through a solution built on the flexibility of public cloud architecture that unifies industry-specific processes, data and AI and offers out-of-the-box integrations. It also provides a comprehensive suite of capabilities designed to streamline processes, enhance customer experiences and drive sustainable growth. The new platform offers integrated management of finance, procurement and merchandising, with unified operational data and ready-to-use AI.

New loyalty solution to feature data-driven personalization

51ˇçÁ÷also announced a new loyalty management solution aimed at retailers and consumer packaged goods companies, scheduled for release in the second half of 2025.

According to , four in five (83%) U.S. consumers feel undervalued by the brands they remain loyal to, with many questioning their loyalty altogether. This new solution aims to equip organizations with experiential journeys and personalized, real-time offers to help earn customer loyalty through integration with the 51ˇçÁ÷Commerce Cloud, 51ˇçÁ÷Service Cloud, 51ˇçÁ÷Emarsys and 51ˇçÁ÷S/4HANA Cloud Public Edition, retail, fashion, and vertical business solutions.

Key features include:

• Loyalty profiles that connect every shopper with a cloud-based loyalty wallet, facilitating targeted and personalized offers, entitlements, and real-time basket analysis.
• Multi-brand loyalty management, as well as shared loyalty programs with partners that centralize loyalty programs across regions and markets, enabling combined brand programs for gaining market share.
• A single place for omnichannel promotion planning with real-time redemption to deliver any type of offer, digital payment and gifting to all customers on any channel.
• Loyalty journey planning that delivers experiential omnichannel journeys tailored to customer needs through personalized commerce, marketing, service and retail interactions.
• Quantifiable metrics that track promotion performance and loyalty-related liabilities, linking to financial systems to measure ROI, and enable settlements with the member and partner brands.

Artificial intelligence to make online shopping easier than ever

51ˇçÁ÷also announced the general availability of an AI shopping assistant in the first half of 2025. This intelligent assistant, delivered with the , expands the existing AI capabilities of 51ˇçÁ÷Commerce Cloud, transforming the online shopping experience through natural language conversations that help customers quickly find exactly what they need.

Visit the . Follow 51ˇçÁ÷at .

Media Contact:
Mallory Kuno, +1 (425) 239-9362, mallory.kuno@sap.com, ET

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As consumers demand more convenience and accountability, retailers that are ready to integrate omnichannel flows and eco-friendly packaging will be primed to lead. So here are some hot takes from the report to stay ahead in the evolving retail game:

AI and Personalization

Retailers not using AI to meet customer expectations risk being left behind, as AI is not just a one-time tool but a transformative asset. While 61% of shoppers support more AI in retail, 40% believe most marketing emails lack relevance and 23% think retailers do not personalize content effectively. By adopting AI for personalization, 78% of marketers have increased customer engagement and 75% reported improved customer loyalty. The takeaway: Investing in AI-driven personalization not only meets customer demands but can significantly boost engagement and loyalty.

Omnichannel Integration

Seamless customer experiences across digital and physical channels are now the standard, with 80% of retailers syncing customer carts across platforms. By making returns easier, as 65% of retailers already do, businesses can enhance loyalty and encourage repeat purchases. The opportunity is clear: retailers that can capture more customer loyalty; for newer brands, this is a strategic differentiator.

Dynamic Pricing and Inventory Management

AI-driven dynamic pricing is becoming a game-changer in the retail space, allowing real-time price adjustments based on market conditions. AI-based pricing can increase revenue by 1.3% annually on average. Additionally, 67% of consumers want real-time stock updates and 31% find items are often out of stock, underscoring the need for . Retailers that leverage AI for both pricing and stock visibility can enjoy enhanced profitability and meet customer expectations more reliably.

Returns as Revenue

Returns — often seen as a hassle — present untapped revenue potential. By adopting strategic return incentives such as in-store bonuses, retailers can boost foot traffic and secondary sales. Thirty-three percent of U.S. shoppers intentionally over-purchase with plans to return some items. AI-led returns processing can reduce return rates by an average of 26%. Creative return programs, such as second-chance sales and re-commerce, offer a way to turn returns into customer loyalty and revenue opportunities rather than costs.

Sustainable Packaging

Upcoming regulations across the EU, U.K., and certain U.S. states mandate heightened recycling targets — 65% recycling by 2025 in the EU, for example — within the near- to mid-future. While many businesses are aware of the targets, they are not ready for them. As packaging solutions evolve, brands investing in eco-friendly packaging and reusable solutions can gain a competitive edge and connect with increasingly eco-conscious consumers. Retailers that see beyond short-term recycling and invest in sustainable, or even regenerative, packaging are positioning themselves for long-term success in an environmentally driven market.

As retail transforms, staying adaptable, data-driven, and customer-focused is essential. The 51ˇçÁ÷report reveals the winning strategies of top brands, from harnessing AI to reimagining returns and leading in sustainable packaging.

for actionable insights and strategies that can elevate your business — and catch these insights live at industry events like NRF, where retail’s future is on full display. Your blueprint for the next big move starts here.

Joerg Koesters is head of Consumer Industries Solutions Marketing at SAP.

Key to BrandAlley’s success is its deep understanding of its members and the impressive fact that 70% of these customers keep coming back for more. Fifty-two percent of them buy instantly, purchasing an average of three items, or £140 of value.

Michelle Hurney, head of Marketing at BrandAlley, explains the company’s core principle: “We launch up to 40 campaigns every day that offer up to 75% off on some of the best brands such as Reiss, Dyson, Levi’s, and many more.” Campaigns are exclusively for members and interested customers have to sign up to browse the website and to shop. Registration is free.

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Focus on Brand Fans

“We have been rethinking the way we identify our best customers, moving away from the traditional view of the most valuable customers being those who spend the most,” Hurney says. For BrandAlley, the true value lies in its brand advocates who provide more than just what they’re spending. She refers to them as brand fans: “It’s about who they’re recommending to BrandAlley. When they tell their friends and family about our site, that’s where the real value is. Word-of-mouth marketing happens to be one of the most effective ways to acquire new customers.”

To segment its customers, BrandAlley doesn’t only rely on the lifetime value of a customer (total amount spent by one customer), but accrues the amount spent across a customer’s connections and network. “Through the Advocacy Intelligence platform, we’re tracking the true economic value, or ‘extended customer revenue’ of our VIPs, the people who are sharing their favorite brands,” Hurney adds. “This way, we can engage and reward them, and keep them doing what they’re doing.” According to her, other insights become visible as well, like the fact that customers overall are spending less these days while customers from referrals spend more on average and are also far more likely to recommend.

Integration of Mention Me Tactics with 51ˇçÁ÷Emarsys Customer Engagement

To identify these advocates BrandAlley is working with 51ˇçÁ÷partner Mention Me, the world’s first customer advocacy intelligence platform. The Mention Me platform uses advanced AI technology to track and provide detailed insights into customers’ advocacy behaviors, like recommending products or services to others. Additionally, the solution includes prebuilt Mention Me advocacy tactics that can allow companies to quickly build personalized campaigns through various channels designed to motivate fans to share and recommend more frequently. Prebuilt workflows make the integration of Mention Me’s unique advocacy data with 51ˇçÁ÷Emarsys Customer Engagement seamless and easy.  

Kat Wray, director of Strategic Partnerships at Mention Me, explains the benefits: “Our integration feeds Mention Me’s first-party AI-powered advocacy data into 51ˇçÁ÷Emarsys Customer Engagement in real time to identify BrandAlley’s current and future brand advocates and activate them to drive growth. The combination of advocacy know-how and AI-based insights with 51ˇçÁ÷Emarsys Customer Engagement have led to a 25% increase of the repeat purchase rate at BrandAlley.”

The overall improvements are impressive: since the go-live of the solution in September, BrandAlley’s customer base has grown, with 12% more customers acquired organically through referrals and a £9.6 million increase in new customer revenue. Customers who are referred to the brand spend 63% more in their first six months, are two times more likely to purchase again, and are three times more likely to refer their friends.

Wray explains how advocacy insights impact customer engagements: “Traditionally one would offer a discount code to a customer who is about to defect, together with a message along the lines of ‘We’ve not seen you for a while, here’s a discount to come back.’ Based on advocacy data, we can now see that some of these customers might not be ready to spend but are more than happy to share and recommend the brand to friends instead – driving indirect revenue. They aren’t inactive customers but engaged advocates.”  

Machine Learning Advances Customer Loyalty

“At Mention Me, we use AI and machine learning to optimize referrals. We have our own AI engine with predictive capabilities that enable marketers to focus their activities on specific customer cohorts,” Wray says. She explains that it is key to understand that not all customers are ready to refer; some people just aren’t at that stage yet, but future advocacy behavior of specific individuals can be predicted. Machine learning also identifies a customer’s propensity to refer at a given moment. Customers with a high propensity to refer will be encouraged to do so. Once brand loyal, customers’ propensity to refer grows, and sometimes so does their propensity to purchase again.

Asked about BrandAlley’s next step regarding advocacy management, Hurney answers: “As we build on our strategic partnerships with Mention Me and 51ˇçÁ÷Emarsys Customer Engagement, we’re excited to see how our shift of focus from VIPs to ‘very important advocates’ will play an even greater role in our marketing and growth strategy.”

Top photo courtesy of BrandAlley

Companies that prioritize sustainability in their operations, such as using recycled materials, reducing carbon emissions, or supporting social causes, are gaining popularity among consumers. But those consumers demand proof of these values and product promises at the point of sale.

“The rise of sustainability isn’t just a movement; it is a shift in consumer consciousness,” said Dania Fayyaz, 51ˇçÁ÷North America sustainability program manager. “Today’s consumers are redefining their purchasing patterns, opting for products and brands that align with their values, and driving a demand for eco-conscious practices and ethical sourcing.” In her conversations with retailers that visited SAP’s booth at NRF 2024, the world’s largest retail fair, she saw a high interest in sustainability solutions.

Consumers – and Markets – Demand Visibility

When the EU Deforestation Regulation (EUDR) comes into effect for large enterprises later this year all products sold in the EU containing palm oil, cocoa, soy, rubber, cattle/leather, coffee, wood, and their derivatives will need proof that their harvest didn’t contribute to deforestation. Non-compliance will result in potential fines of up to 4% of companies’ EU annual turnover. To help businesses simplify this complex task, the 51ˇçÁ÷Green Token solution can track the geolocation of where raw materials are harvested and automate the creation of due diligence statements (DDS). The solution can also help improve visibility for consumers on where the raw material for their clothing was sourced and offer information on potential reuse and recycling.

Take the example of a cotton shirt made from 50% certified recycled materials. Cotton can be sourced from multiple farms or recycling services and taken to a cotton mill where it’s spun into thread and later fabric. It becomes impossible to distinguish the different cotton elements – conventional versus recycled cotton – once they are co-mingled and the manufacturer loses insight into the sustainability attributes of the raw materials. That’s why it’s important to have a sophisticated tracking solution in place. “51ˇçÁ÷Green Token can enhance transparency for bulk-traded, co-mingled raw materials by digitally storing sustainability attributes on tokens that traverse the supply chain,” said Fayyaz.

In addition to making conscious decisions on raw materials and products, consumers can also consider circular economy models. “I’m really intrigued by the idea of revitalizing clothing items,” said Fayyaz. “Imagine being able to exchange a well-loved jacket you’ve had for years and receive credit in return. And the jacket might find a new owner who will genuinely appreciate it.” The 51ˇçÁ÷Recommerce solution enables that scenario, helping brands and retailers take back, manage, and resell secondhand inventory to help accelerate the shift from linear to circular business models. On an even larger scale, 51ˇçÁ÷Green Ledger is SAP’s vision to make transactional carbon accounting a reality. It can enable organizations to track carbon like they do cash, with every financial transaction having a corresponding carbon entry. “This is incredibly desirable because we will see taxes for carbon imposed in the future, and decision-makers will want insights into which processes are utilizing the most carbon,” Fayyaz said.

A Glance into the Crystal Ball

At the same time, low-price online platforms continue to attract consumers with their affordable and wide range of products. They offer competitive prices on trendy clothing and accessories using economies of scale and direct-to-consumer models. Despite concerns about their environmental and ethical practices, these platforms remain popular among price-conscious consumers. However, there is growing awareness of the environmental and social impacts of fast fashion and low-price models. As a result, consumers are becoming increasingly discerning in their purchasing decisions, prioritizing quality, longevity, and sustainability over cheap prices and fast fashion trends.

“Overall, the consumer landscape is evolving, with a growing emphasis on sustainability, conscious consumption, and ethical practices,” said Sven Denecken, chief marketing and solutions officer for 51ˇçÁ÷Industries & CX. “Companies that can adapt to these changing preferences and demonstrate a commitment to environmental and social responsibility are likely to thrive in the long term.”

At the recent NRF event, the world’s largest retail conference, the mantra of “adjust and adapt” echoed through the halls. AI and digital acceleration took the center stage, making innovation the heart of the conversation. Retailers also highlighted a crucial focus on a motivated workforce, emphasizing how an empowered workforce is critical to delivering exceptional customer experiences.

In a landscape challenged by high turnover rates, retailers showcased their commitment to navigating complexity through strategic investments in their most valuable asset – their people. One of the pivotal elements that drives employee motivation and engagement in the retail industry is incentive compensation, where associates are often paid on commission.

During NRF, Daniel Jasper from Neiman Marcus shared insights into how incentive compensation automation transformed the company’s commission payment process. With over 40 stores and a complex commission structure, Neiman Marcus faced challenges in managing incentive compensation. Its previous incentive management system was cumbersome and complex, which led to errors, delays, and frustration among sales associates. Implementing helped streamline the process, providing real-time monitoring of commission calculations. This allowed Neiman Marcus to identify and resolve issues proactively, resulting in improved accuracy and timeliness of commission payments. “Rather than waiting to hear from associates that something is wrong, we can monitor the calculations in real-time and resolve issues in advance,” said Jasper. This shift has been a game-changer for Neiman Marcus, driving better sales and revenue growth.

51ˇçÁ÷SuccessFactors Incentive Management is one of the sales performance management solutions in the 51ˇçÁ÷SuccessFactors portfolio, and it offers a sophisticated platform for tailoring incentive programs to suit the unique needs of retail associates. With powerful analytics, embedded intelligence, and built-in workflows, this solution can revolutionize compensation management. Its intelligent design can not only foster trust but also ignite motivation among store associates. Through a user-friendly mobile app, retail customers can enjoy a comprehensive and easily accessible view of both store and individual performance metrics, promoting transparency and a unified understanding of team dynamics and trends. Personalized recommendations, relevant insights, and interactive monitoring help enhance the user experience, while the mobile app helps ensure that store associates can access their incentives anytime, anywhere, from any device.

The solution’s agility helps facilitate a swift rollout of new and updated compensation plans, offering the flexibility to manage broadly or tailor plans to individual needs. With a steadfast commitment to accuracy and traceability, associates can trust the fairness of calculations, fostering a positive work environment. The effective dating functionalities help further empower organizations, allowing seamless management of associate promotions and transfers.

“Retail businesses more than ever need the ability to design and manage incentive plans that align with ever-changing organizational goals, with a focus on store-level personalization and granularity that allow for improved accuracy and timeliness of commission payments,” said Rahul Iyer, general manager of Sales Performance Management at SAP. “With 51ˇçÁ÷SuccessFactors Incentive Management, retailers can incorporate key performance indicators, such as sales per hour and units per sale, into their incentive structure. The mobile app can provide visibility and transparency into individual and store performance, effectively motivating and ensuring optimal performance from their associates.”

In essence, 51ˇçÁ÷SuccessFactors Incentive Management emerges as an indispensable tool, helping to empower retail customers to optimize workforce performance and drive sustained success. Displaying key performance indicators and incentives has proven to be a game changer, helping to drive focus on store and individual performance. The result? Associates are more attentive to customers, guiding them through purchasing decisions and enhancing overall satisfaction.

In the always-changing retail world, success comes down to three things: using better technology, having happy employees, and keeping customers in focus. The story of Neiman Marcus proves that automating incentives can be a game changer. It shows how a motivated and well-connected team can not just boost how things work but also bring in more sales and money.

To stay ahead in retail, you need to be ready for change and invest in both tech and your team. This is a clear lesson for retailers planning for the future. Learn more about how . To learn more about how sales performance management solutions can support your organization, visit the .

Kevin Coxwell is vice president of GTM for Sales Performance Management at SAP.

These pioneers, armed with a potent blend of innovation and determination, are reshaping the shopping experience, driving operational efficiency, and connecting with consumers in unprecedented ways. From leveraging AI and machine learning to implementing augmented reality and blockchain, these retail trailblazers are at the forefront of change, seamlessly integrating cutting-edge technologies to redefine what it means to engage customers and deliver exceptional service.

We launched the 51ˇçÁ÷Industry Heroes program in 2023 to celebrate companies that leverage technology to transform their business in innovative ways. Let’s explore the stories of our NRF retail heroes that harnessed the power of technology to transform the traditional retail paradigm into an innovative, customer-centric frontier.

Birkenstock worked with 51ˇçÁ÷on its ongoing objectives to expand retail and wholesale presence while fostering customer growth in line with its renowned legacy of function, quality, and tradition.

Brand Alley delved into the rising trend of utilizing advocacy data in marketing strategies, which led to the transformation of brand perspectives on VIP customers and the strategic utilization of advocacy data within paid search and social media campaigns.

FC Bayern, equipped with over 8 million fan data records, crafted a detailed profile of its worldwide fan community, encompassing specific preferences and interests. 51ˇçÁ÷technology played a pivotal role in enabling FC Bayern, one of the most accomplished football clubs globally, to curate what it terms as the “golden fan record.”

Grupo Axo effectively transitioned to leveraging internal customer data due to the potential extinction of third-party data. Its journey offers insights into standing out from competitors, increasing revenue, fostering stronger customer relationships, and cultivating a more robust, data-driven culture through the utilization of internal customer data.

Hornbach achieved real-time retail success, processed over 100,000 orders, and effectively addressed omnichannel challenges with 51ˇçÁ÷Order Management foundation. Working together with SAP, Hornbach built a composable enterprise.

Neiman Marcus harnessed innovative methods and valuable insights to optimize its compensation management. These strategies are reshaping the retail landscape and revolutionizing team incentives within the industry.

PetSmart, a prominent pet retailer, encountered obstacles in omnichannel order fulfillment, leading to challenges in financial reconciliation and inventory transparency. By adopting 51ˇçÁ÷Customer Activity Repository, PetSmart established a robust foundation for omnichannel retail. This implementation significantly enhanced the omnichannel process and elevated overall customer satisfaction levels.

PVH, a global apparel company with a brand portfolio that includes Tommy Hilfiger, Calvin Klein, Warner’s, Olga, and True&Co, is working with 51ˇçÁ÷to build an IT platform foundation for innovation, modernization, digitalization, and scalability.

Qurate Retail Group, known for its innovative strides in the retail sector, leveraged technology to elevate customer experiences, optimize operations, and propel growth together with SAP.

RD, Brazil’s top drugstore chain boasting nearly 3,000 stores across the nation, achieved a transformative implementation of 51ˇçÁ÷technology, which led to streamlined processes and customer-centric advancements, marking a new era of operational excellence.

Wella Company, a pioneering force in the beauty industry with 15 distinctive brands, utilizes technology to inspire both consumers and beauty professionals to embrace their authentic selves. Wella Company’s approach of leveraging actionable data to craft tailored solutions strengthens its lifelong relationships across B2C (business-to-consumer), B2B (business-to-business), and D2C (direct-to-consumer) realms.

51ˇçÁ÷celebrates these retailers for their outstanding efforts, collaboration, and dedication in driving successful business outcomes with technology. Join us at NRF 2024 to celebrate these 51ˇçÁ÷Industry Heroes that will be sharing their stories and learnings at the 51ˇçÁ÷booth. .Ěý

Read more about our retail and CPG customer stories and wins from 2023.

Matt Laukaitis is EVP and Global GM for 51ˇçÁ÷Consumer Industries.

2023 proved time and again that retailers and their software partners know how to rise to the occasion in the face of increasing pressures – and that they can quickly implement new processes and operations when necessary.

51ˇçÁ÷has worked in the retail space for decades, helping every business across the ecosystem run at its best. Across this shared history, with our industry partners and end customers, our ecosystem has shown repeatedly the organic growth that is possible because of strong relationships.

Here are some prime examples of retail partners serving as innovation and growth multipliers last year:

Coveo’s innovative artificial intelligence (AI) platform helps deliver real value to customers, solving business challenges as only AI can. For retailers, Coveo for 51ˇçÁ÷Commerce Cloud can assist in finding and recommending products faster to help drive more revenue, optimize campaigns, and power generative experiences. The enterprise-class AI platform can be deployed on top of 51ˇçÁ÷in a secure and highly scalable fashion. The result: intelligent site search, tailored recommendations, generative experiences, and personalized, memorable shopping experiences for all customers.

Mention Me makes it possible to harness word of mouth’s true power, thanks to the world’s first Customer Advocacy Intelligence Platform. Powered by advanced AI, the platform enables businesses to identify, nurture, and activate their loyal advocates, building a virtuous cycle of customer love and superior economics so that fans keep coming back for more.

Enterprises can launch digital experiences faster with Contentful, which connects with 51ˇçÁ÷Commerce Cloud to enable commerce projects of any size, both for the Web and for multichannel experiences. Simply put, Contentful can make it easier for retailers to create and manage digital experiences via structured content built for speed, change, and scale. Using one hub – that integrates with hundreds of tools to help personalize and optimize – for easy collaboration, businesses can make their content work harder, so they can work smarter.

The Last Mile Delivery Fulfillment Solution from OneRail provides retailers with the ability to instantaneously scale delivery demand. By integrating with 51ˇçÁ÷Commerce Cloud, OneRail’s offering connects businesses’ e-commerce capabilities with nationwide delivery coverage, meaning retailers can have the ability to ship nationwide with complete visibility, all while providing unique, branded customer experiences. In short: efficiency, from dispatch to doorstep.

With Obsess’ mobile-optimized enterprise platform, retailers can easily build immersive, 3D, virtual stores proven to increase engagement, conversion, and average order value. By integrating with 51ˇçÁ÷Commerce Cloud, the market-leading experiential shopping platform offering can enable enterprises to approach their customers in a branded, personalized fashion – and make retail shopping fun and memorable again.

Retailers can drive top-notch in-store customer experiences – and build customer loyalty – with the 51ˇçÁ÷Omnichannel Point-of-Sale application by GK. The configurable application helps enterprises deploy the right business processes efficiently at the point-of-sale, working to reduce their total cost of ownership in the process. Flexible, rules-based configuration also means merchandisers can quickly react to changing business needs, ensuring a more memorable and impactful customer journey from end to end.

The OMS+ Cross-Channel Order Management Solution from DataXstream is an integrated offering built for counter, call center, and mobile sales. OMS+ reimagines the user interface to reflect real-life customer engagements and can provide the platform for making 51ˇçÁ÷ERP the foundation of a truly unified commerce strategy. It can also automate time-consuming activities to help ensure your team gets more done in less time, meaning increased sales, reduced costs, and an improved customer experience overall.

The Loyalty Experience Platform from Annex Cloud is built around the idea of organically driving retention and loyalty through every stage of the customer journey. The app offers engaging experiences via incentives at first touch, then as the consumer becomes a prospect, a customer, a repeat customer, and eventually an advocate. Moreover, it guides customer behavior by offering loyalty points for a variety of actions, including purchasing, referring friends, writing reviews, sharing pictures, signing up for newsletters, and more. And it all integrates with 51ˇçÁ÷Commerce Cloud.

Retailers looking to maximize revenue and minimize risk should look no further than the Forter Trust Platform for Digital Commerce. The real-time, automated decision platform helps reduce false declines and chargebacks by up to 90%, increasing approval rates so merchants can expand their business. It underlines fraud prevention strategies, enabling safety and security for your commerce processes so you can focus on the business decisions that truly impact growth and retention.

With Aisera, retailers can truly unleash the power of generative AI and automation by reimagining and revolutionizing their services experience. Aisera AI Customer Service provides instant self-service and autonomous resolutions to customer requests across any channel, offering a virtually unlimited supply of “agents” to leading enterprises. Seamless integration with 51ˇçÁ÷can also simplify efforts to help improve customer satisfaction, agent productivity, and support costs, so that retailers can exceed expectations and focus on building their business.

Paradox’s leading conversational AI recruiting software is helping clients like Nestle and Unilever automate candidate screening processes, text campaigns, 1:1 texting, interview scheduling, mobile-first assessments, onboarding, and more – all in a mobile experience fully integrated into 51ˇçÁ÷SuccessFactors solutions. In other words, it can help enterprises hire faster and better than ever, building a foundation for consistent and repeatable future success.

Craig Schertler is vice president of Consumer Industries Global Partner Ecosystem at SAP.

That’s why innovation in technology, business processes, and how these come together will be key to better business results in 2024 and a sustainable future going forward. Retailers must learn how artificial intelligence (AI), cloud, robotics, the Internet of Things (IoT), virtual and augmented reality, and other tools can assist in strengthening customer loyalty and trust. Because, after all, the primary goal of retailers is to create memorable, repeatable shopping experiences that will satisfy and even delight consumers.

At SAP, we’re seeing enterprises pursue that goal every day, using the power of AI-driven business solutions to create strong, lifelong relationships with customers. Whether you’re designing personalized shopping experiences, improving demand planning, minimizing the cost of returns, or addressing other challenges, 51ˇçÁ÷solutions can help you transform your approach.

Throughout 2023, 51ˇçÁ÷enabled retail and consumer-packaged goods (CPG) leaders to overcome today’s biggest obstacles – and position them for a brighter tomorrow. This includes partnerships and success stories with leading brands like Leanin’ Tree, , Cangshan Cutlery, HP, , , , , , and .

More specifically, 51ˇçÁ÷has worked with global leaders to help them drive meaningful customer experiences, adopt more sustainable practices, and set their organizations up for great efficiency and innovation.

• : As one of the world’s leading fashion retailers, the ALDO Group is using 51ˇçÁ÷to help improve customer loyalty and better deliver on consumer expectations. Specifically, the ALDO Group is using 51ˇçÁ÷Commerce Cloud to help improve the customer experience – from personalizing product selection to building a seamless checkout experience – and 51ˇçÁ÷Emarsys Customer Engagement, which is helping to increase customer loyalty and retention.
• : Schwarz IT is the technology partner and central service provider for the Schwarz Group, one of the leading retail groups around the world. Kaufland, a company of Schwarz Group, operates grocery stores in Europe, offering a wide selection of high-quality foods and everyday items at the best price. Customer satisfaction, sustainable action, and the reduction of food waste play important roles for Kaufland. To further improve demand and replenishment planning, Schwarz IT and Kaufland decided together to implement an innovative, self-learning solution with artificial intelligence capabilities.
• Swarovski: As one of the world’s premier jewelry and accessories brands, offering high-quality experiences that draw on its long heritage in luxury is key for Swarovski. In the latest step of its 40-year partnership with SAP, Swarovski will be leveraging RISE with 51ˇçÁ÷and 51ˇçÁ÷Commerce Cloud, among other solutions. Taken together, 51ˇçÁ÷can help Swarovski further customer loyalty as well as create unique customer experiences, all while having a future-proof digital core with the flexibility and security to support continuous innovation.
• : ąáłÜ˛Ô°ěąđłžĂśąôąôąđ°ů, Europe’s fastest growing lingerie brand, will be using 51ˇçÁ÷to further offer customers personalized experiences and help keep up with the strong demand for its products. Moving to 51ˇçÁ÷S/4HANA Cloud Public Edition marks the first major step for ąáłÜ˛Ô°ěąđłžĂśąôąôąđ°ů in its digital transformation journey. Through its future implementation of 51ˇçÁ÷S/4HANA for fashion and vertical business, a version of 51ˇçÁ÷S/4HANA optimized for the fashion industry, ąáłÜ˛Ô°ěąđłžĂśąôąôąđ°ů can manage its business from design to wholesale and retail all on one platform. This helps ąáłÜ˛Ô°ěąđłžĂśąôąôąđ°ů deliver collections faster on all channels, optimize inventory and cost, and increase margins.
• Chow Tai Fook: Chow Tai Fook Jewellery Group (Chow Tai Fook), the renowned jewelry retailer headquartered in Hong Kong that has an extensive retail network in China, Japan, Korea, Southeast Asia, the U.S., and Canada, has adopted 51ˇçÁ÷SuccessFactors solutions to help accelerate its human resources digital transformation. Leveraging 51ˇçÁ÷SuccessFactors Employee Central and SAP SuccessFactors Recruiting, Chow Tai Fook is aiming to streamline core HR processes, optimize recruitment, and enhance employee experience and the productivity of its workforce, thereby driving sustainable business growth and an ability to meet future development needs.
• : Blue Diamond Growers is a grower-owned cooperative representing approximately 3,000 of California’s almond growers. It is also the world’s leading almond marketer and processor. Through its use of SAP, including, among other solutions, 51ˇçÁ÷S/4HANA and 51ˇçÁ÷Integrated Business Planning for Supply Chain, Blue Diamond has been able to improve its supply chain, on-time delivery rate, inventory management, and demand forecasting. Taken together, it allows this century-old agricultural cooperative and global consumer-packaged goods company to provide the best value and experience to its growers and customers.
• : For almost two decades, e.l.f. Beauty has been producing premium quality cosmetics and skin care that’s clean, cruelty free, vegan, and Fair Trade Certified at an extraordinary value. To modernize its backend and help meet customer demand, e.l.f. will be using SAP. Through solutions such as RISE with SAP, 51ˇçÁ÷Analytics Cloud, and 51ˇçÁ÷Integrated Business Planning for Supply Chain, not only does e.l.f. expect to improve demand forecasting but also further enhance its customer experience.

Success in retail requires clarity and conviction around business planning and digital adoption. Businesses can grow intelligently and take control of their future, bringing together rich enterprise data and AI-embedded applications to empower everyone in the organization.

to see what advancements we have planned for enterprises this year and learn how our retail-focused solutions can unlock the power of AI for your business. with us today.

Matt Laukaitis is EVP and Global GM for 51ˇçÁ÷Consumer Industries.

These innovative capabilities, from planning to personalization, will provide retailers with holistic customer insights and data analysis to adapt and thrive amid rapid market changes.

“These AI-driven retail capabilities build on SAP’s industry-tailored, intelligent customer experience (CX) strategy, which provides companies with deeply integrated functionalities to enable their most critical business processes and customer journeys,” said Ritu Bhargava, president and chief product officer, Industries and CX, SAP. “SAP’s composable architecture unlocks the creative potential of retailers, allowing them to cherry-pick capabilities tailored to their unique needs and rapidly innovate and respond to market demands, ultimately helping them to supercharge profitable growth.”

The new capabilities include SAP’s unmatched industry expertise and embedded 51ˇçÁ÷Business AI technology to deliver true end-to-end retail solutions. AI is only as good as the data that powers it, and SAP’s ability to integrate experiential and operational data across the enterprise enables more insightful, AI-driven decision-making for businesses. This integration produces more intelligent, personalized experiences for customers, as the best retail outcomes require great CX.

“In today’s environment, it’s critical to have insight across the business, which is why Swarovski has continued to adopt and leverage SAP’s end-to-end solutions, enabling us to connect our business processes,” said Lea Sonderegger, chief digital officer and chief information officer, Swarovski. “Since leveraging 51ˇçÁ÷software, we’ve had the flexibility and security to support continuous innovation, which offers us a consistent foundation for cultivating unique Swarovski customer loyalty across all touch points and innovating to create unique customer experiences.”

“Retailers and brands that achieve growth and profitability in today’s economy will bring together rich enterprise data and AI-embedded applications to enable everyone across their company to deliver amazing, personalized experiences to the right customer, on the right channel, at the right time,” said Leslie Hand, group vice president, Retail & Financial Insights, IDC. “IDC anticipates more aggressive investment by retailers than we’ve seen in years, and working with a strategic partner that understands and can deliver end-to-end capabilities is essential for buyers.”

Examples of some of the newest capabilities include:

• 51ˇçÁ÷Predictive Demand Planning: This solution will provide retailers with more accurate and longer-range demand forecasts across channels using a self-learning demand model. Besides enabling scalable, cost-efficient, high-volume calculations, it will offer precise forecasting and automatically identify and consider a variety of demand factors and external data. The solution will provide apps for forecast configuration, analysis, adjustment and simulation and offer intelligent alerting with root causes and recommendations.
• 51ˇçÁ÷Predictive Replenishment: 51ˇçÁ÷is adding store replenishment capabilities in a phased approach to its existing solution. The capability will replenish inventory in stores and distribution centers for an optimized, multilevel supply chain across flexible planning horizons. It will consider demand volatility, business targets, rules and constraints to determine optimal order quantities with the lowest expected costs. The capabilities improve fulfillment efficiency and on-time delivery by providing planners with a central tool to create order and delivery patterns for product flows within the supply network.
  
  Example use case: A grocer wants to establish a highly automated approach for replenishing yogurt to lower costs and waste while improving customer service. SAP’s new solutions will automatically forecast and schedule replenishment orders with the correct quantities for the right locations while keeping costs low. Business users can then review and accept intelligent recommendations and transfer to the procurement system to create purchase orders, as well as understand any issue, address it quickly and avoid problems in the future.
• 51ˇçÁ÷Order Management for sourcing and availability: With , organizations can determine the optimal sourcing strategies to deliver customer satisfaction and minimize fulfillment costs. Business users can configure strategies aligned to their unique goals, including delivery time, utilized capacity, cost to ship and shipments per order and then run simulations to test the strategies before implementation.
• 51ˇçÁ÷Order Management foundation: With this foundation, available now, business users can create omnichannel order flows that respond to business events, such as a fraud hold, delivery or in-store pickup activity, using an easy-to-use, drag-and-drop workflow automation tool. Additionally, retailers can customize event triggers based on their unique business processes, and the corresponding actions can take place within the order management system or relevant system of customer engagement.
  
  Example use case: A coffee retailer is offering its customers real-time fulfillment updates. ensures a streamlined operation, which efficiently coordinates with the required insights to fulfill customers’ needs, even in complex cases for various items, such as subscriptions, in-store pickup and sourcing accessories. 51ˇçÁ÷Order Management for sourcing and availability also provides a centralized view of inventory to ensure customer demand is always met.
• TikTok and LinkedIn integrations for digital ads: The platform now integrates TikTok and LinkedIn for targeted digital ads. Marketers are empowered to segment customers, quickly engage leads, optimize ad spend, boost acquisition and retention, enhance the omnichannel retail experience and build trusted relationships for growth. Retailers can easily create, sync and expand audiences; connect with consumers on preferred social channels; complement campaigns with personalized ads on TikTok and LinkedIn for conversion; and use data-driven insights to convert leads and reengage at-risk customers.

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Media Contact:
Jillian Baker, +1 (212) 653-9600, jillian.baker@sap.com, ET
51ˇçÁ÷Press Room; press@sap.com

This document contains forward-looking statements, which are predictions, projections, or other statements about future events. These statements are based on current expectations, forecasts, and assumptions that are subject to risks and uncertainties that could cause actual results and outcomes to materially differ. Additional information regarding these risks and uncertainties may be found in our filings with the Securities and Exchange Commission, including but not limited to the risk factors section of SAP’s 2022 Annual Report on Form 20-F.
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51ˇçÁ÷and other 51ˇçÁ÷products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of 51ˇçÁ÷SE in Germany and other countries. Please see for additional trademark information and notices.

How can I increase sales without raising overhead? How can I create year-round stability for sourcing, inventory, restocking, and order management? And how can I build better omnichannel brand connections in a competitive market whereĚý?

Yet, with AI-enabled advances opening a world of possibilities for operational efficiencies and hyper-personalized, real-time, omnichannel customer experiences, the future of retail is anything but bleak!Ěý

AI is set to level up the retail landscape. Retailers that embrace AI will be the first to achieve higher sales and better brand connections — now and in the future. Much of this adoption will be driven by the need to resonate with savvy consumers who want to buy from brands that share their values and offer experiences that blend seamlessly into their online and IRL (“in real life”) lifestyles.

The strategic use of AI — infused with operational, customer, and third-party data — can help retailers deliver experiences that genuinely emanate from and fit snugly into their customers’ everyday lifestyles.ĚýĚý

At SAP, we use business AI to help companies optimize business processes, drive profitability, and boost customer loyalty. How can AI help retailers accomplish all that? Here are a few challenges we’ll helping retailers solve atĚý.ĚýĚý

Driving Profitability with AI-Powered OperationsĚý

It goes without saying: If the customer can’t find the right product, there is no sale. Poor product discovery can result from the complexity of managing product catalogs, which leads to inaccuracies, poor recommendations, and reduced conversion rates. Inconsistent product tagging and inaccurate descriptions, which are often handled manually by key account or merchandising managers, can ensure products are hidden beyond customers’ reach.ĚýĚý

AI can alleviate these headaches and streamline product catalog management, improving product data accuracy and delivering a more personalized shopping experience to boot. The 51ˇçÁ÷CX AI Toolkit is a single generative AI layer powered by data from across 51ˇçÁ÷products. Built on proprietary AI models and fine-tuned large language models (LLMs), it surfaces in e-commerce features in 51ˇçÁ÷Commerce Cloud. The toolkit renders catalog management challenges painless with:Ěý

• AI Product Tagging: The 51ˇçÁ÷CX AI Toolkit analyzes catalog images and text to tag products within a catalog automatically. The tagging system ensures that each product is appropriately categorized and labeled, reducing errors and inconsistencies.Ěý
• AI Product Descriptions: The toolkit leverages AI to generate personalized and compelling product descriptions. By analyzing product attributes, it can automatically create product descriptions that resonate with customers and provide the details for more informed purchasing decisions, enhancing customer experience and increasing sales.Ěý
• Bulk Editing: Bulk editing of product tags and descriptions allows the quick and efficient update of large catalogs, ensuring that customers are presented with relevant and complementary products. Automating these time-consuming tasks frees catalog managers for higher-value work.Ěý

Optimizing Operations with AI-Informed Logistics 

Getting products to customers necessitates having the right products in the right amounts at the right time. Issues like cost-to-ship, delivery timelines, pick-and-pack expenses, and capacity management can turn into perennial roadblocks that lower efficiency for inventory and sourcing management. Big challenges include consistently managing stock levels for cost efficiency, simulating sourcing strategies for sustainability and margin improvement, and delivering the best solutions to enhance customer satisfaction.

One example of this difficult balancing act is the need for retailers to optimize the return process while proactively managing orders.ĚýĚý

AI can play an invaluable role in efficiently managing inventory and sourcing by tailoring sourcing strategies. In 51ˇçÁ÷Order Management Services, AI is integrated to do just that, using key performance indicators (KPIs) such as cost-to-ship, delivery timelines, and pick-and-pack expenses. With target value, significance weight, and optional constraint for each KPI, retailers can uncover the most effective sourcing strategy and simulate single orders based on these strategies.ĚýĚý

Beyond inventory and sourcing, AI can improve predictive order management and streamline the return process, enhancing overall efficiency and customer satisfaction. 

Meanwhile, the proliferation of channels makes mastering omnichannel advertising and sales a daunting challenge, but if retailers are not advertising where customers are, there’s no chance of making a brand connection. Fortunately, retailers can increase their omnichannel excellence with targeted ad solutions such as TikTok and LinkedIn integrations for digital adsĚýfrom 51ˇçÁ÷Emarsys Customer Engagement.

However strong your omnichannel game is, the opportunity to strengthen brand loyalty and drive repeat purchases drops severely when distribution problems prevent timely delivery. If, for example, a customer cannot getĚýthoseĚýspecific shoes from their “For You Page” (FYP) in time for a big event, there will be no sale.ĚýĚý

For distribution centers, balancing conflict goals such as reducing logistic costs and managing supply chain constraints and supplier restrictions can make achieving efficient fulfillment with optimal order quantities and minimal manual intervention feel out of reach. Enter the power of AI to solve complex constraints at multiple levels and ensure retailers can get products to customers with sustainable business practices and high profit margins. 

AI-infused 51ˇçÁ÷Predictive Replenishment enhances distribution center ordering by automating and optimizing order quantities. This includes analyzing demands from all channels, supply chain constraints, and business goals to determine the most cost-effective order quantities. The solution consumes machine learning-based demand forecasts of related 51ˇçÁ÷solutions. These AI capabilities help manage demand volatility and are integrated with existing 51ˇçÁ÷solutions for improved fulfillment efficiency. 51ˇçÁ÷Predictive Replenishment integrates with industry cloud solutions such as 51ˇçÁ÷Order and Delivery Scheduling, the future 51ˇçÁ÷Predictive Demand Planning, and 51ˇçÁ÷S/4HANA.

Boosting Loyalty with Sustainable, AI-Infused RecommerceĚýĚý

Increasingly, consumers are seeking to minimize their environmental impact and connect with conscientious brands. The need to build this brand awareness and consumer goodwill has many retailers looking to recommerce as a new business model that drives revenue and customer loyalty.

With recommerce, consumers can quickly and easily connect the dots between buying secondhand products from brands and saving money, reducing waste, and improving their overall carbon footprint. Trade-in programs that allow consumers to return their used goods in exchange for incentives also enable retailers to create closer, long-term customer relationships.ĚýĚý

Such a unique opportunity, of course, comes with challenges. How do you ensure used products are inspected, matched to catalog items, cleaned, repaired, and priced based on their condition? What about the potential necessity of manual data entry to capture the details of unique items, which can introduce errors? Crucially, how can you increase sales and reduce overhead costs while running a recommerce business?ĚýĚý

In some ways, these are challenges reminiscent of a typical supply chain process and its challenges that business AI from 51ˇçÁ÷is uniquely qualified to solve thanks to 51ˇçÁ÷Recommerce. For this reason, 51ˇçÁ÷Recommerce will be embedding AI across the solution, enabling retailers to run an intelligent and sustainable business that increases profitability, enhances brand value, attracts new customers, and promotes more sustainable consumption.ĚýĚý

At NRF 2024, 51ˇçÁ÷will show how AI is becoming the competitive edge retailers need to grow intelligently. AI-driven insights for more efficient omnichannel fulfillment decisions, optimized assortments, personalized recommendations, and resilient and sustainable supply chains will empower organizations that adopt AI to make the right decisions and seamlessly scale.

I’m proud to say that 51ˇçÁ÷has been offering AI-infused capabilities for years, with more industry-leading innovation on the way.Ěý

, where we’ll be sharing how embracing relevant, reliable, and responsible AI helps businesses look toward the future with confidence.Ěý

Ritu Bhargava is president and chief product officer of Industries and Customer Experience at SAP.

“If you have your consumers – in our case ‘fans’ – benefit at the heart of everything that you do, everyone is going to win,” Josh Ehren, Gibson Brands global head of Direct-to-Consumer, told 51ˇçÁ÷at NRF 2023. “It is not just a technology that goes into it; it is an understanding of how you communicate.”

communications strategy is playing lead, informing how tech enables its fan engagement, Ehren stated after a fireside chat with , now part of SAP, at SAP’s booth. And the Nashville-based guitar manufacturer’s fanbase extends beyond its legendary Les Paul collab and into its family of brands that include amps, pedals, , and more.

“We have the most amazing, loyal, obsessed fans for our instruments and for our brands,” Ehren said. “It’s our job to make sure that we connect with them in the ways that they want to connect with us – and [in] an easy way for them.”

This is where technology joins the band.

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When Tech Plays Rhythm

Technology helps Gibson understand what each fan wants, what makes an individual’s journey unique, and how fans interact with the brand, according to Ehren. And fan journeys can range from a noob who has never touched catgut all the way to an artist who makes her living strumming six strings.

“That is a massive span of different individualized types of fans that we connect with,” Ehren said in an . “We take that information, and that’s how we can actually craft how we stay connected with them.”

This might mean inviting the aforementioned novice to a try a lesson via or to watch a video on , according to Ehren. Or it could include recommending select accessories to an artist for a specific guitar in his quiver.

“That’s really how we are utilizing that [tech] to connect,” Ehren said. “We go through all the way to the end of that spectrum.”

Gibson wasn’t the only brand at NRF singing the praises of a strategy/tech duet. Other retailers also see tech-driven engagement as essential for growth.

Everything from A to G

Before the pandemic, American home improvement retailer Lowe’s Companies Inc. updated its legacy e-commerce platform, according to Chairman and CEO Marvin Ellison. Similar to Gibson’s broad customer spectrum, Mooresville, North Carolina-based Lowe’s serves everyone from full-time contractors to a new homeowner’s first do-it-yourself (DIY) project.

“If we had not made those investments in retail fundamentals, it would have been a catastrophically bad environment for our customers and for us as a company,” Ellison said during . “We put the investments in place…continuing to grow our online and omnichannel capabilities, merchandising, selection – making sure we serve our pro and DIY customers at the highest possible level.”

Such savvy use of tech and data can help organizations ensure they’re serving all segments of their customer base, as Gibson’s Ehren noted. He advocates for both internal stakeholders and those across Gibson’s vast dealer network to let the data tell them what is and isn’t working.

“That data is really going to help us understand: Are we connecting with our fans? To what extent are we connecting with our fans? Is it working?” Ehren said. “That will inform our road map. That will inform how we optimize…Data is absolutely imperative in everything that we do.”

This includes how Gibson meets customer experience challenges, especially those that are even bigger than competing for share-of-wallet.

Putting Customers First Ensures That Everybody Wins

“It starts with the share-of-time,” Ehren said. “To me, that’s the biggest hurdle.”

The point of sale can’t be the end of a customer’s journey, according to Ehren. Gibson wants its fans to rock on – and on, and on.

“I care way more about getting over the hurdles of getting a share of their time because that means that I’m telling the right stories [and] connecting with them,” Ehren said. “If we can keep people playing…they’re happier, they’re engaged, and it works for us as well.”

All of this engagement supports the entire business – regardless of where they buy, according to Ehren. His job as global head of D2C is to help them decide on the right products for their individual needs.

“If they want to understand a little bit more about this guitar, a little bit about more about this amp, etc., and then go to gibson.com or to the , or to one of our dealers – wherever they want to make that purchase – they are absolutely able to,” Ehren said. “And I encourage it because, again, everyone wins.”

Derek Klobucher is a video producer at SAP.

“More and more of our users are coming online…[and] they still want to have the similar guidance and the systems they had in-store,” Ganna Lobachevska, the touchpoint owner of Product Finder and Product Guidance at , told 51ˇçÁ÷at NRF 2023 for a new video. “Our overall goal is to make it easier for our users to find the right accessory for their job.”

Of course, making something easy to do on the front end is seldom easy to build on the back end. And that was Bosch’s challenge when helping online shoppers narrow their search for the perfect jigsaw blade, drill bit, or abrasive wheel from a truly massive accessory portfolio.

“Any company with a wide range of products has to think how they can simplify the user journey…and how they can make it easier for the customers to find the right product,” Lobachevska said. “WžąłŮłó the Bosch , we provide a solution that makes it easier and faster.”

Building that easier, faster solution meant finding a high-tech way to satisfy a peculiar demand by online shoppers.

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When Brick-and-Mortar Set the Bar (Almost) Too High

Selecting a specific power tool accessory for a specific job – and ensuring it’s compatible with your specific power tool – are big reasons that people historically shopped at brick-and-mortar stores, according to Lobachevska. It makes sense, right? You can consult with a knowledgeable human sales associate.

But Bosch’s e-commerce customers expect the same in-store-style expertise via a quick and painless online exchange, according to Lobachevska. And she doesn’t seem worried.

“The Accessory Advisor guides the user through a series of very simple questions,” Lobachevska said. “In the end, they have three perfect recommendations for the work they want to do.”

It’s pretty much an online conversation that yields the right product, according to Lobachevska. And Bosch found the right tech – and partners – to make these virtual dialogues happen.

Tech to the Rescue

“We realized that there is a need for a better user guidance,” Lobachevska said of Bosch’s decision to go with , a Boston-based digital commerce search platform and partner solution in SAP’s industry cloud. “It offered us the best.”

Zoovu’s Semantic Studio translates technical jargon into e-commerce-friendly prose, which saves time for both Bosch data managers and shoppers. A few artificial intelligence (AI)-assisted questions later, and these accessory hunters have enjoyed a smooth, seamless customer experience.

“This means that our customers spend less time searching for a product,” Lobachevska said. “And when they purchase the product, it’s the right one and they are more satisfied.”

This increases efficiency, according to Lobachevska. It also cuts down on returns and poor online reviews.

Powering Forward

Whether in-store or online, Bosch digital assistants and 51ˇçÁ÷Marketing Cloud connect to improve Bosch’s data analytics, business insights, and customer experience, . Those digital assistants have already helped enhance the customer experience for more than 1 million Bosch shoppers across more than 35 global markets, boosting engagement up to 65% as well as increasing customer loyalty and satisfaction.

And still more can be done by connecting all of that to the Accessory Advisor, according to Lobachevska.

“We would like to connect the Bosch Accessory Advisor with our CRM system, which is basically 51ˇçÁ÷Marketing Cloud,” Lobachevska said. “This will allow us to gain business insights, to build better personas, and to make the user experience even better because it’ll be more personalized.”

Enter Replacements Ltd., which offers to help customers identify, restore, or repair damaged pieces of history. Since its founding in 1981, the Greensboro, North Carolina-based retailer has preserved and archived more than 450,000 patterns; these represent about 11 million pieces of china, crystal, silverware, and other collectibles.

“We want our customers to continue their traditions, to gather with their family and friends, to give that gift to their family member, to help them start their own collection,” Replacements Chief Marketing Officer Lihn Calhoun told 51ˇçÁ÷for a new at NRF 2023. “So we want to find the customers, understand what they’re looking for, and match that together.”

Data and analytics are vital in Replacements’ efforts to connect customers with the right piece, according to Calhoun. This includes how Replacements stores and archives each item; how the company presents products and services to the customer; and how – and how often – to send personalized, meaningful communications.

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How To Better Understand Your Customers

Replacements puts a premium on learning about its customers’ interests and collections, according to Calhoun. Doing so is crucial to helping each shopper find exactly the right item among the aforementioned 450,000 patterns and 11 million pieces.

“Having that information in our technology platform – and being able to aggregate that in a useful way – allows us to better connect each piece to that new person to create that new story,” Calhoun said . “We’ve been doing that right from the start, in terms of collecting that customer information, understanding the patterns of interest, and making that connection.”

The COVID-19 pandemic hastened Replacements’ transition to ecommerce and, therefore, smoother, more relevant connection with customers, according to Calhoun. is now a big part of the company’s tech-driven effort to share the highly specific product information it has painstakingly archived – and to empower its customers.

Innovating to Empower Your Customers

Three types of customers visit Replacements online, according to Calhoun. There are generally shoppers who are looking to buy, people looking to sell their vintage pieces to Replacements, and others who are simply browsing or researching.

“One of the things that they’re looking to do is to identify a pattern…[Before the pandemic] you would call us, you would describe it, you would send us a picture,” Calhoun said of the process, which was time-intensive for both customers and Replacements. Today, the company’s Web site features a camera icon that handles the photography and speedy pattern recognition for china and crystal. “It went from potentially days to minutes.”

Benefits of the rollout include helping sellers and researchers identify patterns faster as well as freeing up time for employees to accomplish other tasks, according to Calhoun. And a pleasant surprise was that customers looking to buy were exploring pieces that they might not have otherwise discovered – which has positively impacted revenue.

“We have improved efficiency internally,” Calhoun said, “and we’ve given that power to the user on our Web site.”

How Data Informs Decisions

“Replacements uses technology to improve people’s lives by making it easier for them to gather with their family and friends, create that memorable experience, and pass along traditions,” Calhoun told 51ˇçÁ÷during the video interview. “That’s what differentiates us, really…We do that so that we can preserve all these amazing pieces.”

Just the sight of a long-forgotten pattern can evoke strong memories, according to Calhoun. Walking through Replacements’ 500,000-square-foot warehouse, she noticed someone unpack the same pattern that her great-grandmother used.

“Immediately I saw my grandmother’s dining room table – how she pre-set it every evening in preparation for breakfast – and the memory was that strong, that visual,” Calhoun said. “Those memories help us; they feed our heart and our soul.”

That’s why data is crucial to Replacements for both finding vintage items for shoppers – nurturing core customers and collectors – and simultaneously introducing its massive inventory to new audiences, according to Calhoun. These are different demographics who all desire to own pieces of history.

“You should still have your stories, your brand connections, your human connections, the emotional connections,” Calhoun said. “But the data helps you better target and provide the communication to your customer at the right time, the right way.”

But Harrods’ most important channel is still its flagship store.

“When we talk about luxury and the importance of experience, the store is core to what we do,” Erik Rasmussen, head of 51ˇçÁ÷& Data Analytics at Harrods, told 51ˇçÁ÷on the NRF 2023 showfloor. “Having that single flagship store is still absolutely crucial to Harrods’ DNA and something that we expect to drive going forward for a long time.”

Harrods’ flagship store is about 1 million square feet (about 93,000 square meters) of retail space in Knightsbridge, an upscale London neighborhood known for grand Victorian and Georgian homes, fine dining, and, of course, high-end shopping. This single, full-line department store offers food, fashion, homeware, furniture, and technology – and it reaped £2.4 billion in sales last year.

“So, small footprint but massive business,” Rasmussen said, noting that the flagship store alone carries more than 400,000 products from about 4,000 brands. “And incredible things [are] going on every day.”

To keep incredible things happening, Harrods and 51ˇçÁ÷invested in the Single View of Customer project, an analytics initiative to help Harrods better understand how customers interact with the brand. When Harrods can accurately anticipate what shoppers will want, it can deliver memorable experiences that make delighted customers say, “Wow!”

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How to “Wow!”

“Harrods is a unique model…A lot of other retailers will have a smaller selection of products in store and an endless aisle online,” Rasmussen said. “At Harrods, the most complete shopping experience is still to come into the store because of the variety…[and] the different experiences you have.”

Indeed, Harrods rewards shoppers at its brick-and-mortar flagship store with expert associates and a truly impressive array of products. For instance, in the furniture department, you can see examples of each piece and then choose your very specific model based myriad variables, such as size, headboard style, and even jewelry configuration.

“WžąłŮłó one single product, you can very quickly get into things like 10,000 different permutations,” Rasmussen said during a presentation at SAP’s NRF booth. “When you think about that spread across an entire product assortment – spread across all the brands that we carry – you suddenly start to find yourself in a really challenging data management perspective.”

To conquer that challenge, Harrods consolidated all the relevant data from vendors and others into its backend, according to Rasmussen. Harrods’ digital technology team then built a Web app that lets shoppers personalize furniture from start to finish – from browsing to home delivery.

“A lot of heavy lifting that we had to do on the backend – it’s not easy to make this work,” Rasmussen said. “But from a customer experience, ultimately it becomes pretty seamless.”

Investing in Customers – And Single View of Customer

It’s vital that Harrods get better acquainted with the roughly 2.5 million consumers registered in its loyalty scheme, according to Rasmussen. Of the 400,000 or so unique customers who shop in store each year, the top 0.1%, roughly 400 people, account for about 20% of Harrods’ sales.

A 2021 implementation of 51ˇçÁ÷Customer Activity Repository and 51ˇçÁ÷BW/4HANA laid the foundation for much of Harrods’ analytics, according to Rasmussen. And, as a high-value – as opposed to high-volume – business, Harrods’ enterprise resource planning (ERP) system and data warehouse could analyze every individual transaction.

“This type of investment – giving us the right insights, the right analytics, the right visibility – has really empowered our teams,” Rasmussen said. “Knowing that information – and we let that feed things like the Single View of Customer platform or our data science initiatives or replenishment – is fuel to the things we can do to drive our business.”

Such drivers include reactivation campaigns, as happened with a shopper to whom Harrods offered a free pastry with a ÂŁ50 purchase, according to Rasmussen. The customer made a qualifying purchase, received the complimentary gift, and then promptly returned to the salesfloor to spend another ÂŁ30,000.

“If we can reactivate those types of customers across the entire 2.5 million [customers], the opportunities for our growth will be enormous,” Rasmussen said. “It’s something that we’re already seeing pay dividends, and we’re really excited to see what we can develop for the future.”

The Future Is Still Experience

Predictive analytics will be a big focus for Harrods, especially identifying new shoppers who might be similar to its high-value customers, according to Rasmussen. Data from 51ˇçÁ÷Marketing Cloud, 51ˇçÁ÷Customer Data Cloud, and 51ˇçÁ÷Service Cloud can help Harrods spot – and serve – its next big spenders, alongside transactional information through 51ˇçÁ÷Customer Activity Repository and analytics via 51ˇçÁ÷BW/4HANA.

“How can we take a customer who might look like they’re spending £2,000 and realize that they are customers who should be spending £200,000?” Rasmussen said in . “Get them the right personalized service within either our personal shopping department, our concierge service, or a stylist to make sure that we can nurture them more quickly.”

And, again, this seamless customer experience is made possible by a lot of work on the backend. But it’s worth it, according to Rasmussen.

“The two things I take away from what we’ve done at Harrods are one, customer experience comes first,” Rasmussen said. “Secondly, I think we’ve really benefited from the strong partnership we’ve made with our technology partners, 51ˇçÁ÷being one of them. We’re making sure that we can invest with them, co-innovate with them, and…we’re collectively moving towards giving the customer the absolutely best experience.”

But clever use of the right data can help you deliver that improved customer experience – so your customers don’t find it elsewhere, according to David Witts, senior CRM manager for PUMA. And the global apparel company has enjoyed great success with referral data.

“That adds a whole new level to who is not just buying – but who is referring – and who are our real brand advocates,” Witts told 51ˇçÁ÷on the NRF 2023 show floor. “We need to rethink how we define loyalty.”

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Redefining Customer Loyalty

“We might have a customer who, in our original segmentation, is a lapsed customer, but we see that they’re referring all of their friends who are then buying from us,” Witts said in . “That changes the way we perceive the value of that customer – and changes the way that we want to communicate with them.”

Customer segmentation is the grouping together of people with similar characteristics, making it easier for organizations to personalize communications, products, and more. First-party referral data is especially useful to PUMA for segmentation and communication, according to Witts.

“It changes the way we think about who a customer is,” Witts said. “If we see customers who are referring people regularly, that makes them much more of a brand advocate.”

Enter PUMA’s referral program, which influences how the company communicates and rewards brand advocates, according to Witts. The referral program was inspired by two company goals: increase customer lifetime value and cultivate relationships with customers.

“Adding a referral program just seemed to fit with both of those goals,” Witts said. “If we see that they’re not showing any interest in buying from us but they’re still referring their friends, that changes the way we think about them, so that they’re much more valuable to us.”

Creating Opportunities

Beyond e-commerce, the right data can offer insights that reinvigorate brick-and-mortar locations, too, as Macy’s Inc. Chairman and CEO Jeff Gennette noted. Data can reveal where you’re succeeding and what needs attention.

“Customers are looking for ideas about the way that they can take a work look and translate it into a night look. They’re looking for opportunities,” Gannette said during . “Creating opportunities for them, from a merchandising perspective, has given our stores a center of gravity that they didn’t have a year ago…We’re always working on it; we’re never done.”

And pandemic-driven changes in the economy offered a chance for Saks OFF 5th “to make bold new changes” and adjust its thinking, according to President and CEO Paige Thomas. The department store chain dug into its data to discover who was engaging with the brand, what they were looking for, and more about their lifestyles – all to better understand relevant demographics.

“We had this kind of wonderful discovery of a really fast-growing segment within our customer base, and this segment was a high earner, very fashion-driven, and shopped everywhere,” Thomas said during . “It really gave us a bull’s-eye as an organization to say, ‘How do we think about our merchandising strategy? How do we think about our marketing strategy? How do we think about our customer experience?’”

The Right Message at the Right Time

Data, analytics, and other tech are helping PUMA discover who is interested in buying and what they’re interested in buying, according to Witts. It also helps them hyper-personalize communication.

“We want to talk to the right customer with the right message at the right time through the right channel…That’s what we can do with ,” Witts said, noting that PUMA can see which e-mails a customer opens, ignores, and clicks through. “Through all that, we can start to build that picture of each individual customer and then tailor our communications to send them things that they want to see.”

Providing a differentiated customer experience has always been vital for PUMA, according to Witts. And making everything more personalized and relevant will be crucial to PUMA’s future success.

“There’s some really exciting things that we’ve seen through 51ˇçÁ÷Emarsys Customer Engagement and through 51ˇçÁ÷at that predictive analytics [and] AI level. I think it’s just going to make it all so much easier,” Witts said. “And as we move into more of a loyalty space, that’s absolutely going to be key for us.”

Derek Klobucher is a video producer at SAP.

The fashion industry contributes significantly to greenhouse gas emissions and creates massive amounts of waste. One study found that the footwear industry alone is responsible for 1.4% of , and despite efforts to recycle , 90% of them end up in a landfill at the end of their life.

The Fashion Industry Faces a Global Reckoning

Consumers, investors, and governments are finally recognizing the link between fashion and the detrimental impacts of climate change, sparking a growing market for sustainable shoes and apparel.

At SAP, we believe the future of fashion will be sustainable, responsible, and conscious.

Who Is the Sustainable, Modern Retailer?

Sustainable retailers seek ways to identify and appeal to customers who are searching for eco-friendly products. Sustainable business practices help retailers differentiate and gain customer loyalty by offering greater transparency on individual product life cycles.

As more retailers put sustainability at the center of their processes, they also need to go a step further and deliver high-quality experiences to their eco-conscious consumers. Through hyper personalization, seamless omnichannel shopping, and unique in-person experiences, sustainable fashion companies can build enduring, long-term customer relationships by offering their customers what they want – maybe even before they know it – in unique and innovative ways.

So​,​ how can fashion retailers leverage data-driven insights and predictive systems to​ differentiate themselves from their ​competition? It starts with hyper personalization.

Taking Marketing Personalization to the Next Level to Generate Interest

Seventy-one percent of consumers expect companies to deliver ​,​ and a similar portion say it is frustrating when this does not happen. ​âśÄ‹Basic segmentation​âśÄ‹ targeting to create value for customers will no longer suffice. Shoppers desire and expect proactive and personalized engagements across every touchpoint. And now, with technology solutions like , retailers can deliver personalized, real-time engagements at scale to grow customer lifetime value and turn shoppers into loyal customers for life.

Let’s take Brianna, a 32-year-old, eco-conscious sneaker enthusiast. She receives a targeted advertisement from one of her favorite brands, S.Fashion. She clicks on the ad and explores the Web site. The personalized Web experience serves relevant content, including a small infographic describing the environmental and social impact of each item. Content dynamically rearranges based on her behavior. She adds a pair of shoes, with the option to customize, to her shopping cart. Her phone rings, and she abandons the checkout ​âśÄ‹process.

What’s next?

Creating Seamless Omnichannel Experiences to Keep the Buyer Engaged

The COVID-19 pandemic accelerated fashion brands’ transition from offline to online shopping channels. And now, these same brands are finding innovative ways to bring these journeys together. With , businesses can engage customers on any device, unlocking business agility and innovation at scale.

Seamless omnichannel shopping helps retailers reduce costs, improve agility, and increase consumer satisfaction by optimizing, streamlining, and integrating online and offline experiences. While bringing customers a dynamic and innovative buying journey, an omnichannel approach gives retailers a centralized view of inventory, improves fulfillment and delivery times, and simultaneously lowers the amount of carbon emitted during the delivery process. With solutions like , retailers can elevate customer engagement through unified customer data from all online and offline sources.

In Brianna’s case, a few days after the targeted advertisement she receives an e-mail from S.Fashion, sharing details about a shoe customization event happening at the store in her city with live music and a sustainable fashion show. Brianna registers, suddenly remembering her abandoned shopping cart. She buys the sneakers and chooses to “click and collect” in store, so she can customize them onsite with different colors, fabrics, and patterns. The online and offline integration guarantees the correct sneakers are at the store, which serves as a micro-fulfillment center, maintaining appropriate stock levels for in-store and online purchases.

Reimagining the In-Store Retail Experience through Experiential Marketing

Today, online shopping offers convenience, while in-store shopping adds value with a memorable customer experience. Both serve as critical customer engagement channels. To compete, physical stores are reimagining the in-store experience and the role it plays in cementing lifelong customer relationships and driving increased consumer spending. Through experiential marketing, brick-and-mortar stores can add value to their customers in unique ways while increasing sales – customers spend 31% more than those purchasing online – and building brand equity.

Brianna arrives at the S.Fashion event, instantly engrossed in the music coming from the DJ located next to a long catwalk with models wearing the latest sustainable sneaker designs. Brianna checks in using a QR code that provides Maria, a friendly staff member, with Brianna’s customer profile and alerts her about Brianna’s purchase. Maria greets Brianna and shows her some of S.Fashion’s latest product offerings and takes her on a digital journey through the sneaker production process. Brianna is excited to learn how S.Fashion’s technology solutions provide sustainability insights at every step of the product life cycle, making it easier for her, as a customer, to make climate-friendly purchasing decisions​âśÄ‹. Maria brings Brianna the shoes she bought online and takes her to the shoe customization table where she watches her one-of-a-kind shoes come to life right before the fashion show begins.

The Foundation of a Loyal Customer Base

Insight-driven personalization, seamless omnichannel shopping, and engaging in-store experiences lay the foundation for a loyal customer base and deliver growth and profitability. In the example of S.Fashion, this sustainable sneaker company personalizes its engagements, bridges its online and offline interactions, and hosts sustainable fashion shows and sneaker customization events that drive sales, loyalty, and brand evangelism.

In case you missed NRF and want to learn more about SAP’s retail technology ecosystem in an immersive fashion experience, follow 51ˇçÁ÷Experience Center on for exciting news about the opening of 51ˇçÁ÷Experience Center NYC on February 15.

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Kelly Cannon is head of Industry Thought Leadership at SAP.

In 2014, 51ˇçÁ÷developed , a user-friendly and modern point-of-sale application. The first version was developed for sports clubs to be used in merchandising shops, and with clubs such as FC Bayern MĂźnchen and TSG Hoffenheim, the application was mostly sold in Germany. Step by step, 51ˇçÁ÷Customer Checkout was also implemented in retail, catering, and food and beverage businesses.

Being sold mostly via partners, the development team started enabling partners in other locations, such as Italy and Dubai, to expand the global strategy. With the increasing number of countries and regions, the requirements around features and functionalities multiplied. After several successful certifications, such as the Registrierkassensicherheitsverordnung (RSKV) in Austria and the French certification NF 525, the application has proven to be internationally competitive.

Today, 51ˇçÁ÷Customer Checkout has over 700 customers in more than 50 countries all over the world.

U.S. Version of 51ˇçÁ÷Customer Checkout Available

The next step in the global strategy of 51ˇçÁ÷Customer Checkout is to gain a footprint in the U.S. market. With the latest software version, 51ˇçÁ÷Customer Checkout now complies with the tax calculation regulations set by the U.S. via integration with Avalara Tax Services.

“WžąłŮłó Avalara, we have chosen one of the leading tax service providers in the United States with years of expertise and compliance with taxes in several industries. The integration is fast, in real time, and easy to use,” highlights Harald Tebbe, product manager of 51ˇçÁ÷Customer Checkout. He developed the application from its beginnings and is excited about this next big step.

“It is amazing to see how the application has developed so far. We started with some basic sales functionalities for merchandise shops in 2014 and now 51ˇçÁ÷Customer Checkout is wildly successful, running the checkout for merchants and retailers all over the world. Based on our experiences, we are very proud and well equipped to take the application to the next level. By achieving this big milestone, we set the stage for future opportunities and customers, and we are ready to access the new U.S. market,” he adds.

Leica Camera Is First Pilot Customer

For a smooth entry into new markets, it’s good to have customers and partners that are stable and internationally known. This is why Fadi Naoum, senior vice president and head of Sports and Entertainment at SAP, decided to make this step with Leica Camera AG. “It was a win-win-situation. Leica needed a point-of-sale solution that can be integrated to its existing landscapes, complies to legal regulations, and can be used globally. On the other hand, our road map plan was to ship a first version for the U.S. Therefore, we joined together and provided Leica a solution which fulfills the requirements to sell its cameras and equipment in the U.S.”

Leica Camera AG is an international, premium manufacturer of cameras and sports optics. The legendary reputation of the Leica brand is based on a long tradition of excellent quality, German craftsmanship and industrial design, and innovative technologies.

First U.S. Stores Live with 51ˇçÁ÷Customer Checkout

Leica has already successfully implemented 51ˇçÁ÷Customer Checkout in several of its flagship stores in Germany. Motivated by the positive experience and great implementation phase in Germany, the customer achieved another important milestone – the Leica store in Washington D.C. is now running on 51ˇçÁ÷Customer Checkout with Avalara.

“All sales transactions within the store are now automatically transferred to 51ˇçÁ÷ERP and all sales tax rates based on several thousands of different tax codes and tax jurisdictions are calculated by the external tax provider Avalara in real time,” says Jan Zuschlag, project manager of POS Systems at Leica AG. “Overall, it was a successful implementation project. And this was only possible due to the strong collaboration between Leica, Avalara, and the responsible 51ˇçÁ÷team. Thanks for this fantastic team spirit.” The rollout will be continued in more U.S. stores this year.

51ˇçÁ÷Customer Checkout at NRF 2023

51ˇçÁ÷Customer Checkout was on display at NRF 2023, where retail buyers and merchandisers got the chance to meet and connect with other experts and discover the latest retail solutions and innovations. Read more about SAP’s presence at NRF 2023.

Elena Vavitsa is senior solution specialist for 51ˇçÁ÷Customer Checkout.

The National Retail Federation’s annual expo kicks off on Monday in New York with more than 1,000 exhibitors, 150 sessions and a focus on a handful of “disruptor” issues. Climate change and sustainability will take center stage at NRF 2023.

SAP’s Take

“Climate change, circular economy and sustainability have all come to the forefront over the past few years and global supply chains sit right in the middle of these challenges: as a major contributor to the problems and as a great area of focus where we can take action to address the problems,” said Richard Howells, a supply chain expert at SAP.

While many companies have created mission statements and goals around sustainability — for example, becoming carbon neutral over the next decade — many still lack the ability to capture, monitor and measure their emissions and waste. Supply chains have a huge part to play in addressing that.

An estimated 76%Ěý of global trade passes through supply chains with much of it destined for the retail sector. End-to-end supply chain transparency is critical to help retail businesses meet regulatory, governmental and company-mandated goals. This transparency needs to encompass not only their own facilities but also those of suppliers, contract manufacturers, logistics service providers and other partners across the business network.

“Sustainability initiatives must extend from the design to the decommission of a product, from raw materials sourcing to last-mile logistics, and even to product usage, returns and recycling processes,” Howells said. “At every stage in the life cycle of specific products, there are social and environmental impacts.”

From the start, product design must be made with end of life in mind, including how they will be recycled, reused, repurposed and returned to the earth.

“Planning processes must take into account not only optimizing inventory, asset utilization and cost reduction, but also emission reduction and ethical material sourcing that eliminates slave labor and ensures fair trade regulations,” Howells said. “Manufacturing and logistics processes must focus on eliminating waste and emissions and ensure the safety of the workforce.”

Contact:
Ilaina Jonas, Senior Director of Global Public Relations, SAP
+1 (646) 923-2834, ilaina.jonas@sap.com

This year, 51ˇçÁ÷Commerce Cloud powered US$31.9 billion in digital commerce gross merchandise value (GMV) for the entire holiday season, covering more than 70 countries around the world. Specifically, our retail customers saw a year-over-year increase of 80% in GMV, with a 29% increase in average order value (AOV).

According to . The metrics from MasterCard are not adjusted for inflation and with , most of that growth can be attributed to it. Online sales increased 10.6% year over year, making up 21.6% of total retail sales.

There is no doubt that inflation has changed the way consumers shop. Many have adjusted to spend less on discretionary items and spend more on experiences. Therefore, it was critical for retailers to offer valuable deals this season with consumers likely hunting for the best promotions. Retail customers of 51ˇçÁ÷Commerce Cloud saw a healthy growth in GMV and AOV in addition to a 138% increase in conversion rates. All this indicates better targeted traffic by retailers.

“Despite the challenging macro-economic environment, 51ˇçÁ÷Commerce Cloud retail customers were able achieve record-breaking holiday results,” said Riad Hijal, global head of Marketing and Solution for 51ˇçÁ÷Commerce Cloud. “Our embedded intelligence and broad capability set enabled them to identify and target the right customers with relevant promotions and offers without over-sacrificing margin. This led to higher conversion rates, AOV, and ultimately profitability.”

According to the Economist Intelligence consumer goods and retail outlook for the 2023, we can expect inflation to continue to dominate the discussion as it squeezes retailers, their profits, and the job market. Consumers will continue to look for deals and price reductions, likely fueling larger market shares for discount stores. They also predict that online sales will slow down even as its share of total retail sales will continue to steadily grow.

To learn more, and join us at NRF: Retail’s Big Show. Learn more about .

https://youtu.be/FIVuB3qKWWg

Winnie Tran is director of Product Marketing for 51ˇçÁ÷Commerce Cloud.

All 51ˇçÁ÷data presented here is approximate and is based on various assumptions. All data is unaudited and is subject to adjustment. Financial figures have been converted into USD. Data represents sales made by 51ˇçÁ÷Commerce Cloud global merchants.

As recently as the 2021 United Nations Climate Change Conference (COP26) meetings, the stated, “Retailers will continue inventing and implementing pragmatic climate change solutions because the needs identified at COP26 demand nothing less.”

To help retailers digitally transform to make their businesses sustainable, 51ˇçÁ÷is featuring a number of offerings, including these:

• The new 51ˇçÁ÷Intelligent Returns Management solution was built to optimize the returns process for the retail industry. The solution uses routing and dispositioning decisions driven by artificial intelligence (AI) to guide products from customers’ hands to the final dispositioning steps, ultimately maximizing customer experience and company margins while also mitigating waste.
• The recently updated now offers advanced category management capabilities. It uses customer data science, assortment strategies, business rules and AI to plan space-aware, localized assortments with a user experience designed for the needs of today’s category manager. Customer-centric, relevant assortments increase customer loyalty, boost profitability and support a more sustainable supply chain.
• The SAP.iO Foundries program is a network of startup companies with integrations to 51ˇçÁ÷solutions, including:
  • , offering a circular platform that encourages consumers to buy in a more convenient, affordable way with zero waste and connects people, brands and retailers in an engaging way to change consumption habits
  • , helping thousands of e-commerce brands offer carbon-neutral products
  • , leveraging blockchain and the Internet of Things to offer transparency into supply chains for clarity on quality, origin, sustainability footprint and compliance standards
  • , helping customers run their businesses differently with real-time data intelligence from each of their products end to end, from factory to consumer and beyond
  • , with a dynamic and risk-assessment-based quality compliance program that provides digitalization, automation, transparency and traceability
  • , offering a platform for sustainable shipping including reusable packaging, real-time tracking and predictive analytics
  • , providing a purpose-built platform for specification management that fundamentally changes how brands, suppliers, manufacturers and retailers manage data and collaborate to bring products to market

In addition to these offerings, retailers can utilize SAP’s entire portfolio of . Learn more in the blog “51ˇçÁ÷Cloud for Sustainable Enterprises: Taking Action Together.”

SAP’s solutions enable retailers to integrate sustainable business practices smoothly,Ěýwhich is critical to a fast-paced industry such as retail. According to Leslie Hand, IDC Group Vice President, IDC Retail Insights, indicates that retail organizations report that, relative to political, social and economic risks, changing environmental targets and regulations will have the greatest impact on their digital transformation and tech investment plans in the next two years. Further, 80% (Asia Pacific) 59% (United States) and 64% (EMEA) of retail organizations agree that their digital technology strategy is an important enabler of their organization’s broader sustainability efforts.*

For more information about 51ˇçÁ÷at NRF 2022, Retail’s Big Show, visit and follow on Twitter.

Visit the . Follow 51ˇçÁ÷on Twitter at .

Media Contact:
Stacy Ries, 51ˇçÁ÷Media Relations, +1 (484) 619-0411, stacy.ries@sap.com, ET
51ˇçÁ÷Press Room; press@sap.com

*Source: IDC Retail Core Processes and Applications, May 2021.
Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should” and “will” and similar expressions as they relate to 51ˇçÁ÷are intended to identify such forward-looking statements. 51ˇçÁ÷undertakes no obligation to publicly update or revise any forward-looking statements. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect SAP’s future financial results are discussed more fully in SAP’s filings with the U.S. Securities and Exchange Commission (“SEC”), including SAP’s most recent Annual Report on Form 20-F filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.
Š 2022 51ˇçÁ÷SE. All rights reserved.
51ˇçÁ÷and other 51ˇçÁ÷products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of 51ˇçÁ÷SE in Germany and other countries. Please see for additional trademark information and notices.

2020 was the Year of the Metal Rat. While open to all manners of interpretation, such a year is considered to be one of renewal and a chance “to turn unfortunate events into fortunate ones.” That could certainly apply to the world of retail.

No other sector was disrupted as much in 2020 as supply and demand see-sawed with each new surge of the pandemic. Lockdowns and social distancing severely restricted in-store shopping and led to a sharp increase in online retail, forcing retailers to reexamine their digital readiness and supply chain efficiency. At the same time, consumers have become more vocal about their expectations than ever before, placing increasing importance on sustainability, convenience, and experiences.

As a result, the sector is undergoing a profound transformation. Now, the question for retailers is ‘How do we proceed?’

The Influential Shopper

During a sponsored by 51ˇçÁ÷at the National Retail Federation’s virtual , Melanie Noronha, a senior editor at the , discussed ways retailers can prepare for an uncertain year ahead with Nuno Pedro from SAP’s Customer Experience team and Rob Wood, head of Online at , a leading UK toy store.

Based on a September 2020 survey of over 4,000 consumers that captured spending levels and habits in the U.S., Germany, the UK, Italy, and Spain, Noronha’s team was able to uncover trends by generational cohort. In a study titled “,” the team reports that although overall monthly retail expenditure in the countries surveyed declined by 9% from January-March to June-August, online spending increased by 15% on average.

Because online buying behavior varies by generation, from Baby Boomers to Generation Z, Noronha’s advice to retailers is to develop a deep understanding of the generational differences within their customer base. Millennials, for example, dominate online spending. In the period of June to August, they reported online spending 2.5, 1.5, and 1.3 times as much as Baby Boomers, Generation X, and Generation Z, respectively. In the same period, Millennial respondents also reported that 53% of their total purchases were made online.

Understanding what Millennials and Generation Z are passionate about is critical; not only are they the most loyal customer base, but the future of business depends on them. “,” for example, is a rapidly growing consumer group that makes decisions based upon values and principles. They won’t buy from, work for, or trust a company unless it is taking action on the issues they care about.

After Millennials, Baby Boomers demonstrated the biggest shift online since the start of the pandemic, increasing their online spending as a share of their total spending from 25% to 37%, followed by Generation X, who increased their share of online spending from 39% to 47%. During the pandemic, online shopping for essential products, such as groceries and cleaning supplies, has become more deeply entrenched, with average monthly expenditure increasing by 78% and 49%, respectively, for the two categories.

But with average monthly spending declining overall by 9% and unemployment soaring in many parts of the world, the report also makes it clear that consumers of all ages are hunkering down for an extended period of uncertainty. Across the five countries surveyed, a quarter of survey respondents do not believe that the economy will recover once the pandemic is under control, and younger cohorts are significantly more pessimistic.

The Opportunity

The shift to online shopping, especially among older generations, presents a unique opportunity for brands and retailers to engage new online customers in ways they never could before. According to Noronha’s team, understanding these trends is vital to crafting strategies for short-term resilience, medium-term recovery, and long-term growth.

As brands expand their digital presence in response to increased customer familiarity with online shopping, they will need to remain agile to respond effectively to evolving consumer habits, enhance the customer experience to stay competitive, and employ personalized engagement strategies – including digital marketing – Ěýto retain customers online.

was one company that was able to ride the ups and downs of the pandemic last year by remaining agile. The toy store’s vision is to fill every childhood with wonder; its mission is to be the best-loved toyshop, one child and one community at a time. The company runs its click and collect business on 51ˇçÁ÷Commerce Cloud, and its intention is to offer the same level of service anywhere, in store or online.

“2020 was a topsy-turvy year,” says Wood, who is responsible for determining online demand and keeping up with fulfillment. “We had seven times the uplift in the first two weeks of lockdown. Our forecasts were wrong all the time. The only way we managed to weather the storm was by remaining agile and flexible.”

Wood says the company decided not to put all its eggs in one basket and to introduce flexible pay options. Another step was to equip staff with iPads to check product availability from the shop floor during those times when children come into a store in person, eager to spend their pocket money. This type of service reflects the company’s goal of creating fond memories and delivering outstanding service, whether in a real or a virtual world. After all, today’s eight-year-olds will be tomorrow’s influential shoppers.

The Experience

The pandemic has clearly helped online spending expand its share of individual wallets. More effective online selling could offer a shorter, smoother path to recovery for companies, but only for those that succeed in giving customers a seamless experience that keeps them coming back for more, regardless of their age. This builds on consumers’ preferences for shopping experiences that are convenient, so that they can shop from anywhere, save time, and find the best deals.

2021 is the Year of The Metal Ox, considered a favorable time for economic recovery or consolidation after a catastrophic event. It’s a year for long-term investments, a year when problems are solved with hard work, diligence, and discipline.

That makes this year the perfect time for retailers to garner deep insight into the effect of the pandemic on retail spending and shifts in consumers’ online shopping behaviors. Experts like Noronha conclude that those retailers that take time now to understand how online buying behavior varies by generation are likely to be the ones that will come out ahead.

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Synthetic fibers used in 72% of our clothing take 200 years to decompose. The apparel industry accounts for 10% of global greenhouse gases as it produces and transports millions of garments yearly. Garment workers toil 16 hours per day earning a fifth of the minimum wage required for living in dignity.

But there may be a silver lining. Thanks to COVID-19, the entire industry has been disrupted. Retailers closed their stores and the rise of online shopping has increased the . Meanwhile, people working at home, the absence of social life, and economic uncertainly mean clothing sales are plummeting. Production has stopped, supply chains have shut down. At the same time, more and more consumers are voicing their concerns about the industry’s impact on the planet.

The disruptions of 2020 have forced fashion retailers into a new era of reckoning. While the top and bottom lines have been the key markers all along, business are starting to realize that doing good and doing well can add up to doing better.

So yes, there is hope on the horizon. Fashion retailers are now beginning to focus on a new green line in accounting that can only be achieved by embracing the concept of circularity — making sure resources and products stay in use for as long as possible before being regenerated into new products.

Going Around and Around

What would a circular world of fashion look like? Imagine walking into your local retail space with a shopping bag full of old shoes and clothes to drop into a recycling bin provided by the retailer. You might stand next to a glass partition for a moment to watch a recycling machine as it disassembles, cleans, and shreds the old garments into fibers, spins them into yarn, and knits a completely new top that is whisked away on a hanger for display in the boutique.

You then stroll over to the digital wardrobe center to check out what’s new on the share and resale marketplace. You select a dress and jacket for the weekend, which you will trade in the following month. And before you leave the store, you stop at the click-and-collect center, where you can try on the new lingerie you ordered online to make sure it fits perfectly before you take it home.

Most importantly, you will feel good about yourself because you were one of the more than back in 2020 who said that environmental impact is an important factor in making purchasing decisions . You will experience the change that occurred driven by your power of choice–now your favorite brands are those that make sure resources and products stay in use for as long as possible before being recycled or regenerated again and again into new products.

Front-Runners

The scenario described above is not far-fetched. Many companies are already implementing innovative ways to engage customers on their journey to circularity.

Nike has introduced “Reuse-A-Shoe” collection points at , separating and turning the rubber, foam, leather, and textile components into granules used to create new footwear. If your old Apple device is still serviceable and can be refurbished, you could receive an Apple Store gift card to put toward a newer model. If not, . ąáłÜ˛Ô°ěąđłžĂśąôąôąđ°ů, Europe’s No. 1 lingerie retailer, encourages customers to bring back disused textiles for recycling. And global clothing retailer H&M’s is an existing, container-sized recycling system where customers can watch old textiles take on a new life.

Sustainability Dividends

The fashion industry is waking up to the fact that decreasing its environmental impact will pay big dividends to both its constituent companies as well as society at large. In fact, the authors of the expect circularity to be the next big disruptor.

As highlighted in the report, the way value is created in circular systems is radically different to how it is created in linear ones. In a circular fashion retail model, a single garment creates value repeatedly–by being sold, returned, repaired, resold, rented, or eventually recycled in a continuous loop to achieve maximum use. This in turn creates a completely new range of experiences.

Three Steps to a Circular Retail Model

While there are no standard solutions, there are three steps recommended by McKinsey’s fashion industry experts: embrace circular design, ramp-up reverse logistics, and support customer adoption.

Step 1: Design for Zero Waste

Waste and pollution are the result of flaws in design. Ninety percent of environmental impact occurs at the design stage of a product, which is why the are the key to a more sustainable future. This requires product and materials innovation along with a shift in mindset.

One exemplar in this area is Subaru Indiana, the first U.S. auto plant to . Beginning in May 2002, the company decided to send nothing to landfills, in the belief that putting anything into the land, air, or water creates a risk. By being a good environmental steward, the company is saving between $1 to $2 million a year.

To go circular, companies can start by reskilling designers and stimulating circular design innovation. They should train their own people as well as their suppliers to reduce waste in production and supply chains as well as to reuse fibers, chemicals, and other resources to the maximum extent

Step 2: Manage Waste with Reverse Logistics

While the will to become more circular already exists in many enterprises and organizations, . Many places lack proper waste-management and recycling infrastructure, and recycling technology still is not good enough. According to a 2020 , 61% of people globally do not have access–or the know-how–to use recycling infrastructure.

Reverse logistics is about reselling or recovering items from disposal to continue deriving value from them. One exemplar in this area is , a committed to using plant-based or recycled plastic packaging. Their “Return.Recycle.Repeat” scheme encourages customers to return empty product containers to a store for refilling or repurposing.

Retailers can help remedy the waste situation by implementing in-store circularity hubs or creating non-store collection points. Most importantly, retailers can eliminate single-use packaging and work with partners to optimize sorting facilities and recycling technology.

Step 3: Create a Customer Experience

Retailers can take a big step toward circularity by educating and encouraging consumers to translate their sustainable values into concrete actions. Involving consumers in the entire process helps create the kind of experience that goes beyond simply buying a product.

The ultimate example of offering a retail experience beyond the product is outdoor clothing retailer Patagonia. The company has an for repairing, trading in, and reselling used Patagonia clothing, and not only educates consumers about the sustainability of its products, but committed individuals to organizations working on environmental issues in their own communities.

Values to Value

While the idea of circularity is still far from being a widespread reality, perhaps the most important takeaway for fashion retailers looking to succeed in 2021 is that doing good can certainly impact the top and bottom line. Any effort to become more sustainable and less wasteful will result in becoming a better company. But to generate value, companies need to find the right balance of people, planet, and profit.

Curious about turning your company values into business value? Check out the interactive to see how well you are able to maneuver your company through business challenges that can lead to a world of new possibilities.

Join the conversation at #NRF2021 and find out how @SAP_Retail solutions can help drive efficiency and deliver relevant, personalized customer experiences anytime, anywhere.

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The add-on, developed in collaboration with Swiss retailer , utilizes intelligent replenishment strategies to reduce cost and waste and enhance customer experience. It is a highly automated solution that helps take the guesswork out of retail replenishment, with a focus on fresh products in stores.

“As part of a larger vision to improve business processes and, above all, ensure customer satisfaction, we partnered with 51ˇçÁ÷for retail replenishment and forecasting,” said Coop’s head of IT merchandise management processes, Thomas Vielhauer. “By integrating intelligent technologies into our promotion and replenishment processes, we’re able to stock accurate quantities. That means customers get the products they need and the fresh quality they expect.”

Food waste has become a global problem. Around of food produced is lost between harvest and retail alone, with even more waste occurring at the consumption level. COVID-19 introduced new challenges for retailers such as Coop, which saw an abrupt change to planning requirements.

51ˇçÁ÷and Coop developed the AI-based 51ˇçÁ÷Replenishment Planning to provide precise demand prediction and optimal order amounts. Its comprehensive capabilities, which support replenishment configuration, planning, simulation and alert management, enable retailers to eliminate over-stocks and stock-outs. Goods can now be replenished based on the changing demand history of each individual product and store, rather than on a rigid formula. Order amounts are optimized to provide the lowest expected costs under consideration of forecast distribution and product-specific replenishment requirements such as shelf life or shelf capacity.

The new add-on will be showcased at theĚý taking place virtually and is featured in this :

Join the conversation by following 51ˇçÁ÷on Twitter atĚý and visitĚýĚýto watch live presentations.

Visit the . Follow 51ˇçÁ÷on Twitter at .

Media Contact:
Stacy Ries, +1 (484) 619-0411,Ěýstacy.ries@sap.com, ET
51ˇçÁ÷Press Room; press@sap.com

Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should” and “will” and similar expressions as they relate to 51ˇçÁ÷are intended to identify such forward-looking statements. 51ˇçÁ÷undertakes no obligation to publicly update or revise any forward-looking statements. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect SAP’s future financial results are discussed more fully in SAP’s filings with the U.S. Securities and Exchange Commission (“SEC”), including SAP’s most recent Annual Report on Form 20-F filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.
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, which surveyed more than 4,000 consumers globally, examined the spending levels of consumers before and since the start of the pandemic with a generational lens. The survey, conducted in September 2020, sought to gauge spending habits and preferred shopping channels before the pandemic, during the pandemic, and once restrictions ease. The report shows a clear trend of consumers shifting their behavior to rely increasingly on online shopping for both essential and nonessential items. The research found that:

• Although overall monthly retail expenditure in the countries surveyed declined by 9% from the first quarter 2020 to the second quarter 2020, online spending increased by an average of 15%.
• During the pandemic, online shopping for essential products such as groceries and cleaning supplies has become more deeply entrenched, with average monthly expenditure increasing by 78% and 49% respectively for the two categories.
• Once restrictions ease, new online shopping behaviors are likely to continue but decrease slightly among younger cohorts (4 percentage points for Millennials and Gen Zers) but will decrease more significantly for older cohorts (9% for Baby Boomers and 6% for Gen Xers).
• The ability to shop anywhere at any time is the number one reason why respondents across all generations like shopping online (cited by 49%). This feature was cited by significantly higher shares of Baby Boomers (59%) and Gen Xers (51%) than of Millennials and Gen Zers (at 42% each).

“In the future, the key to success for brands is to identify ways to meet the needs of and create exceptional experiences for all generational groups in whichever setting they choose — whether that’s in store or across various online channels,” said Paula Hansen, 51ˇçÁ÷Customer Experience chief revenue officer. “Businesses need to tailor and target their marketing with a careful consideration of age and shopping method of choice, to provide a seamless customer experience and guide shoppers down the path to purchase. This will put businesses on the path to a strong recovery and provide the agility to deal with future crises.”

The retail study results will be virtually featured January 12 through January 14, January 19 and January 21 and 22, 2021, at taking place virtually. Join the conversation by following 51ˇçÁ÷on Twitter atĚý and visitĚýĚýto watch live presentations.

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Media Contact:
Janice Tsoules, +1 (650) 223-4817,Ěýjanice.tsoules@sap.com, ET
51ˇçÁ÷Press Room; press@sap.com

Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should” and “will” and similar expressions as they relate to 51ˇçÁ÷are intended to identify such forward-looking statements. 51ˇçÁ÷undertakes no obligation to publicly update or revise any forward-looking statements. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect SAP’s future financial results are discussed more fully in SAP’s filings with the U.S. Securities and Exchange Commission (“SEC”), including SAP’s most recent Annual Report on Form 20-F filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.
Š 2021 51ˇçÁ÷SE. All rights reserved.
51ˇçÁ÷and other 51ˇçÁ÷products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of 51ˇçÁ÷SE in Germany and other countries. Please see for additional trademark information and notices.