The Microsoft Retail Fuels Marketing Reference...

The Microsoft Retail Fuels Marketing Reference

Architecture

Business factors in the Retail Fuels Marketing segment of the oil industry value

chain are driving the need for an information technology (IT) architecture that

provides a highly secure, very reliable and interoperable environment that will

create new ways to connect with customers, enable greater product and service

innovation, and open up new revenue streams for oil companies and merchants.

Oil companies and merchants are also looking for a framework to help guide the

implementation of several new technologies including mobile commerce, hosted

and managed point-of-sale (POS) systems, decoupled payment networks, and

virtual retail management systems to reduce transactional costs and lower

compliance costs, while concurrently increasing customer loyalty, brand

recognition, and profitability. At the same time retailers need to meet existing

and even more rigorous requirements for environmental, metrological and safety

compliance and, with tight margins, control the cash and inventories.

They also need to be flexible to diversify their business model as more of the

revenues are derived from their C-stores and other backcourt operations. Their

IT architectures should be adapted to support this new business model with

seamless integration between the backcourt and forecourt systems and enabling

new revenue streams that were not possible before. Furthermore, connecting with

the external entities in the supply chain, providing new ways of interacting with

customers and analyzing the information flows are important transformational

areas that will enable retailers to succeed in this new business landscape.

This paper describes the Microsoft’s Reference Architecture (RA) for Retail Fuels

Marketing (RFM). This RA incorporates Unified Communications and new

technology adoption which will enable transformational user experiences – for

example, real time behavioral marketing and campaign effectiveness analytics.

Figure 1

SkyDrive Pro

SocialMobility Big dataCloud

The Microsoft Retail Fuels Marketing Reference Architecture

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The Microsoft Reference Architecture for Retail Fuels Marketing is not prescriptive

— that is, it does not lay out specific implementation details of the architecture’s

actual structure and function. Rather, it describes a set of guiding principles to

which it must adhere, and the general (logical) structure of the architecture to

satisfy the domain requirements. The architecture also provides a framework for

the industry to be transformed as it addresses four mega-trends; “Mobility”,

”Social Media/Collaboration”, “Cloud Computing” and “Big Data & Analytics”.

This descriptive approach provides an agreed-upon set of principles for satisfying

key criteria like payment card industry (PCI) compliance, requirements for cloud-

based hosted solutions, the need for customer data security, and the need for

interoperability between forecourt control devices and the point of sale; while

also providing the flexibility for companies to innovate and establish competitive

differences built upon the base architecture.

This agreed-upon reference architecture approach will encourage simplification

and unification for all organizations in Retail Fuels Marketing. System integrators

and solution providers will benefit from an established, coherent environment

within which to build solutions for the industry that ensures Retail Operations

can be confident that application solutions built upon this Architecture will run

and integrate cleanly into their IT environments.


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Created February 2013 by Adam Hems ([email protected]). Updated April 2013.

Updated September 2014 by Kadri Umay ([email protected])

©2014 Microsoft Corporation. All rights reserved. This document is provided "as-is." Information and

views expressed in this document, including URL and other Internet Web site references, may change

without notice. You bear the risk of using it. This document does not provide you with any legal rights to

any intellectual property in any Microsoft product. You may copy and use this document for your internal,

reference purposes.


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Contents

Retail Fuels Marketing Businesses Demand More from an IT Architecture ............................................. 5

A Day in the Life of a Retail Fuels Marketing Organization ............................................................................................ 5

Current State: Overview and Challenges ................................................................................................................................ 6

Current Architectures ..................................................................................................................................................................... 7

Drivers for the Evolution of a More Efficient Architecture .............................................................................................. 9

Enabling the Evolution .................................................................................................................................... 10

Technology Trends .......................................................................................................................................................................11

Scope, Approach and Guiding Principles ..................................................................................................... 12

Scope ..................................................................................................................................................................................................12

Approach and Guiding Principles ...........................................................................................................................................13

Guiding Principles ............................................................................................................................................ 13

Role Based Productivity and Insights ....................................................................................................................................14

Natural User Experience .............................................................................................................................................................15

Social Enterprise .............................................................................................................................................................................15

Connected Business .....................................................................................................................................................................15

Secure, Scalable, High-Performance Infrastructure .........................................................................................................16

Microsoft Technology Supporting the Reference Architecture ............................................................... 17

Reference Architecture Overview .................................................................................................................. 18

Users ...................................................................................................................................................................................................19

Application Interoperability .......................................................................................................................................................21

Business Services ...........................................................................................................................................................................22

Data Services ...................................................................................................................................................................................25

Payment Card Industry (PCI) .....................................................................................................................................................26

Infrastructure ...................................................................................................................................................................................27

Getting There .................................................................................................................................................... 28

Future State Architecture ............................................................................................................................... 29

Summary ........................................................................................................................................................... 32


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Retail Fuels Marketing Businesses Demand More from an IT Architecture

The Retail Fuels Marketing reference architecture must support and respond to the functional

activities of a retail marketing organization and provide the capabilities needed to effectively and

efficiently run the fuels and convenience retail business.

Retail Fuels Marketing is part of the Petroleum Industry’s value chain within what is broadly

described as the downstream segment of the oil business. Specifically, Retail Fuels Marketing is

where the needs of the consumers, merchants, and oil companies intersect with the economics of

refining gasoline and diesel fuels. The market is characterized by intense competition, “razor thin”

margins on fuel, ever changing government and industry regulations, a shifting landscape of asset

sales and business models across a fragmented market of retail operators (over 150,000 store

locations in the U.S. alone) and consumer perceptions driven by the media’s focus on the “price

at the pump”. This business environment increases the importance of income from other sources

such as the C-store, QSR, car wash and other backcourt offerings. IT infrastructure and architecture

should be flexible to provide new touch points and differentiators to recruit and retain customers.

Finally, the IT needs are increasing dramatically within this vast, complex, data-driven business,

with digital transaction volumes growing exponentially.

A Day in the Life of a Retail Fuels Marketing Organization

A typical Retail Fuels Marketing team in the U.S. or any other country is made up of regional fuel

retail operations managers, pricing and trading experts and marketing business development

brand managers. The team is located across the country and works together to develop a business

plan to assess the economic potential for various marketing campaigns to increase fuel sales and

profitability at their licensee operated branded convenience stores as well as to identify cost

savings initiatives with a short payback. The team’s responsibilities also include technology

controls and checks to ensure payment and settlement systems are sustained securely and cost

effectively. There will be a number of different business models – known as Methods of Site

Operations or “MOSO’s” - that the team will be managing. Across all MOSO’s the business team

will be charged with a number of objectives. Fuels volumes will be a key objective and pricing is

also an important consideration as, even where the oil company does not benefit directly from

the sale, they will be interested in ensuring the viability of their dealer. They will ensure the

maximum penetration of the marketing tools provided by the oil company, such as branded

payments cards or methods (e.g. Mobile payment), loyalty cards, promotions and other tools to

maximize revenues all geared to maximizing customer acquisition and retention. Other activities

will ensure that the site operator’s costs are minimized and that they follow up on any inventory

discrepancies.

The business team is goaled to address three key objectives:

1. Increase revenue and margins on fuel sales through improved brand loyalty

2. Enhance the portfolio of licensee locations and their retention (“stickiness”)

3. Optimize operating costs and ensure safe operations and effective controls.


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The team holds strategy meetings to vet ideas through workshops and proof of concepts (POCs).

However, the number of scenarios and the complexity of the analysis require that the work be an

iterative, collaborative effort. Therefore the team also discusses options and exchanges ideas

using email and instant messaging, and shares necessary documents through their secure team

portal, which makes it possible for them to prepare multiple options in parallel for management

and select third party review.

Current State: Overview and Challenges

The current state of the business drivers in the Retail Fuels Marketing industry business drivers

include:

Marketing Campaign Cost / Effectiveness. The current transactional business models

limit the implementation of world class loyalty programs and cost effective digital

couponing by limiting the ability to use data that is not sensitive from a security

perspective. Although data may be available to allow behavioral marketing, the

limitations of the systems mean that it is not efficient to process it and is often out of

date before it can be analyzed. In most organizations, the volume of information is

increasing exponentially, which should be an ideal scenario for a Marketer. However, the

Retail Fuels Marketing business is seen as an exception, primarily as a result of the inability

to capture consumer data and correlate it in a meaningful way due to a lack of data

acquisition and integration. This data situation means that at best it’s difficult and often

just impossible to obtain or use data quickly and efficiently to get the information and

answers needed for improved brand loyalty, to identify trends, influence behaviors in real

time or close gaps in operational performance.

Compliance and Transaction Costs. With constantly changing regulations and payment

card compliance mandates, such as the Europay-MasterCard-Visa (EMV) upgrades based

on “chip and pin” technology and forecourt Payment Card Industry (PCI) encryption

upgrades, oil companies and merchants are trying to understand and manage the

impacts on their business. Also, with credit card “swipe fees” at an all-time high of, on

average, $0.12 / gallon of gasoline as much as 10% can be added to total processing

costs on micro-transactions on in-store purchases1 and so oil companies and merchants

are looking for alternatives.

Fraud and Payment Risk. In the United States, the retail fuels industry averages over 41

million transactions per day with an estimated cost of fraud that could be as high as 0.51%

on all transactions2. So, oil companies and merchants alike are looking for new and better

ways to protect consumers and minimize payment risks associated with payment cards

including physical theft of cards, white carding (credit/debit card data stolen the

merchants database or “double swiped” illegally), skimming (covertly accessing the panel

1 According to the National Association of Convenience Stores (NACS). 2 2013 LexisNexis® True Cost of Fraud Study.


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behind the pump and inserting an illegal electrical device that captures account

information when unsuspecting consumers swipe debit/credit cards), and credit card

fraud in general.

IT Infrastructure, Upgrades, and Total Cost of Ownership. Both merchants and oil

companies are looking for ways to reduce IT support and technology upgrade costs. With

EMV upgrades on the horizon, it is estimated that merchants in the United States will be

required to spend more than $5.4 billion to upgrade card readers in fuel dispensers and

Point of Sale (POS) systems. For companies with more than 500 franchises, it will cost an

estimated $20M to upgrade proprietary forecourt and legacy POS systems, which will

only provide minor functional changes3.

So one of the key questions is, if merchants will be required to spend millions for upgrades,

how can they leverage these investments to increase sales revenue, optimize operational

efficiencies, and improve the margins on each transaction?

Current Architectures

The current state of IT infrastructure in most Retail Fuels Marketing businesses is that they are

unable to adequately support and respond to analysis, operations, and business needs.

Existing IT architectures in the Retail Fuels Marketing sector are often limited by “siloed”

applications, poor integration, and barriers to collaboration. There is limited consumer data

captured at the Point of Sale and a lack of integration encumbers use of technology like Complex

Event Processing (CEP) to optimize decisions and execute Real Time Behavioral Marketing.

3 NACS reports an estimated $40,000 per location for upgrades and $225,000 per year for audit compliance.


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Figure 2. The current state of IT architectures for the Retail Fuels Marketing sector.

A few basic issues define the requirements of a Retail Fuels Marketing IT architecture. The

opportunities presented by a cloud-enabled, service-layered approach offer a next generation

approach to address the restrictive nature of processing data and workflow inherent in the existing

legacy environments and resolve these issues.

Current Issues include:

Data Management. The industry’s growing volume of data is a great problem to have

but, when the data either cannot be accessed, is held in separate databases or the systems

to process it cost effectively are absent or cannot react in a timely manner, this benefit

rapidly disappears.

Integration. Although the major oil companies often have fully integrated ERP systems,

these are often inflexible to produce the site or product level data that a retailer is seeking

and are not open to independent marketers. Where others have implemented a level of

integration these one-off connections add time and cost, and cannot easily be shared or

reused by other applications. The industry has much to gain by moving from manual and

batch processing to near real time settlement and reconciliation of data for financial,

operational and marketing stakeholders. Unfortunately, many Forecourt Controllers and

Point of Sale systems are “closed or proprietary systems” as they lack open Application

Protocol Interfaces (APIs) and Software Developer Kits (SDKs) that are readily available in

other industries. The need for “open systems” is a common complaint shared by both Oil

Forecourt

Fuel Dispensers, Car Wash Equipment, and Price Sign

Forecourt payment equipment:Dispenser Card Readers, Pin Entry Devices, Encrypted Pin Pads, Receipt Printers

Convenience Store

Payment Equipment:Point of Sale & Pen Entry Device

Payment Switch or Tandem

Loyalty Networks and Programs

Payment Networks: AmEx, Visa, MC, Fleet, Pre-paid Cards, Proprietary Oil Company Cards

ForecourtController & D-box

Electronic Payment Server (EPS)


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companies and Merchants with Retail Fuel operations and brings significant cost when

trying to enhance operations by adding new features.

Coupled Networks. Networks are inherently designed to increase “connections” but in

the Retail Fueling and Marketing industry the current state of network architecture has the

payments network coupled to the Point of Sale network. This situation burdens companies

who wish to provide marketing enhancements to their Point of Sale systems to gain

competitive advantage as to do so requires changes to satisfy the burden of payments

compliance regulations required by credit card Companies (for PCI compliance). The need

to “decouple” the payment network from the Point of Sale network is a common complaint

shared by both Oil companies and Merchants with Retail Fuel operations.

Performance Management. In the current state, Key Performance Indicators (KPIs), that

are needed to understand and assess the current status and overall health of an

organization, are often not readily available. The manual, time and labor-intensive

processes needed to gather and analyze KPIs mean that managers and employees waste

valuable time waiting for answers while data is collected, analyzed, and translated into the

insights needed to understand and run the business. This issue is common to all

stakeholders in the Retail Fuel and Marketing value chain, from oil companies to merchants

to consumer packaged goods vendors (CPGs) and across most functions including

marketing, operations and finance.

As the industry has re-formated over the past decade, oil companies increasingly have divested

their merchant operations, once-removing them from their end customers. Additionally, in some

cases, the oil companies have lost client data access by co-branding gas cards allowing the card

issuer to “co-opt” the consumer relationship. The resulting Retail Fuels Marketing world of

franchisees, large merchants and small merchants has created the need for new forms of customer

satisfaction metrics. For oil companies this means looking at the traditional market segmentation

KPI’s in order to maintain or increase consumer loyalty and also for ways to gain alignment with

their partner merchants (franchisees) to ensure optimal contract renewals and to identify synergies

for joint cost savings and improved “merchant satisfaction”. For Merchants/Franchisees the

competitive pressures necessitate new ways to identify and engage emerging consumer markets

(e.g. millennials) to get them into the stores after fueling and to retain their loyalty.

If data becomes siloed in this way, it is often difficult to locate information and ensure the

timeliness and quality of that data. For example, three or four different systems may compile

available field data separately and so the organization may lack a single, comprehensive means

to analyze and act upon the data.

Drivers for the Evolution of a More Efficient Architecture

Several business drivers are compelling Retail Fuels Marketing companies to seek a new and more

efficient Retail Fuels Marketing IT architecture. Companies must have:

The ability to deliver more with less. In today’s business and operational environment,

premium brand oil companies must deliver more information technology and marketing

support for their merchants and distributors with fewer resources and severely time-


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constrained work teams. For example, branded retail fuel merchants are typically small

businesses so they depend on the major oil companies to provide large integrated

payment networks, loyalty programs, and settlement platforms. However, the oil

companies are constantly under pressure to deliver new platform capabilities, while

reducing network management costs, to help their merchants and distributors compete in

price sensitive markets. This situation is creating a mutually beneficial relationship on the

near horizon between oil companies and their franchisees; where the new architecture

allows the progressive oil companies to provide cost effective and superior security and

reduced IT infrastructure costs with a decoupled payment network from the POS through

a non-CAPEX “managed service” offering.

Integrated views. Merchants, oil companies, and consumer packaged goods (CPG)

manufacturers all need integrated views that reveal relevant data, both structured and

unstructured, to better manage marketing programs, fuel inventory management, and

settlement. However, due to their different ownership of information or responsibility for

operations, it may be necessary to take different “slices” of data for different users. For

example, today’s retail fueling merchants/c-store operators manage gas stations under

multiple brands and distribution agreements, yet need to compare and contrast

performance across all their locations, regardless of brand. At the same time, oil

companies should only have fuels inventory management data for sites where the

operator allows it and for their own brand. CPG manufacturers/suppliers also need

integrated views of data across convenience store brands and regions, regardless of fuel

brands, when agreed with the data owner.

Easily accessible KPIs. Retail merchants, oil companies and CPG companies need up-to-

date Key Performance Indicators (KPIs) to fully understand the current status and success

of marketing campaigns. For example, brand managers need to measure market

effectiveness for promotions based on region, margin, and product availability, so real

time data feeds and business intelligence is required to monitor KPI’s and supply chains.

Plug-and-play technology. The industry needs an architectural approach that allows

Retail Fuels Marketing organizations to use more flexible and cost-efficient plug-and-play

business logic. When a hosted and managed POS system has been implemented using

defined application program interfaces and web services, if a technology supplier adds a

new feature, such as a loyalty platform, this can be quickly implemented and will be fully

integrated with the site infrastructure regardless of which forecourt controller, fuel

dispenser or payment network has been deployed at the merchant’s locations.

This approach reduces the constraints on IT, gives companies access to best-of-breed solutions,

and can reduce the time needed to deploy new solutions from years, to weeks, and months.

Enabling the Evolution

There is a strong wind of change coming in the industry and the future leaders will be those who

implement IT investments already needed to make for compliance or infrastructure refreshment

in a way that leverages new technologies and architecture to leap-frog their competition. These


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leaders will use emerging industry standards and technologies to enable the more flexible,

integrated IT architecture needed for the future in Retail Fuels Marketing.

Technology Trends

There are four main technology trends driving across many Industries, all of which fully pertain to

the Retail Fuel and Marketing Industry:

Mobility and Internet of Things. Most consumers and retailers in various Industries are

taking the benefit of mobile computing (e.g. smart phones such as devices running

Windows Phone 8, tablets running Windows 8.1, and technologies like telematics and geo-

fencing) to transform the consumer experience for purchases of goods and services. With

the introduction of the Internet of Things concept, we do see more and more retailers

trying to use “things” to collect more data on customer usage through wearable devices

and utilizing advanced processing capabilities on the data collected to attract and retain

customers. Some of the examples are as follows:

o In flight payment using Windows 8.1 Phones with credit card readers as mobile

POS devices

o mCommerce, using smartphones for payment using the technologies such as NFC

and eWallet

o Utilizing location information to provide context aware special offers. i.e. when you

are approaching the gas station you will receive an SMS regarding a car wash offer

o Using Windows 8.1 Tablets as POS devices reducing the cost and also enabling

closer interaction with the customer.

o Building mobile applications for consumers to provide coupons and directed

marketing

o Integrating with the new generation of car infotainment systems for mobile

payment and directed marketing.

o Fleet payment solutions.

Cloud Computing. This is computing capability delivered as a utility through Internet

standards and protocols, commonly grouped into “public cloud” and “private cloud” types.

Public clouds, as the name indicates, are available for anyone who wields a credit card –

like Windows Azure. Private clouds are meant for the exclusive use of a business or a

consortium of businesses that collaborate. The cloud approach is ideal for complex Retail

Fuelsand Marketing operations, with its multi-vendor, multi-partner environment and

huge volumes of data that require a combination of strict security and easy sharing with

appropriate partners.

Social Media and Collaboration. With current IT infrastructure, collaboration is also

difficult because there is no convenient, shared location where multiple internal and

external partners can access information stored on the corporate network. For example, it

would be extremely valuable for both merchants and marketers to correlate consumer

profiles with fuel purchases and with in-store purchases. This correlation would require

marketing data tied to the purchaser, payment event data of the actual fuel purchase,

marketing data of an offer being accepted for in-store purchase and payment data of the


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in-store purchase. Facilitating this collaboration would lead to predictive analytics being

available to the value chain participants. Also, the industry is now embracing social

enablers to increase worker productivity, using social media technologies such as status

updates and notifications from social networks like Twitter, Yammer and Facebook

inclusive of real-time messaging, blogs, photo sharing and wikis. As Marketing

professionals use these technologies to manage their personal and professional

connections, the Industry is adapting network-based capabilities to foster cross-discipline

collaboration and to better understand and manage the Retail Fuels Marketing operations

environment.

Big Data/Analytics. The future of Retail Marketing will incorporate the concepts of data

mining, business intelligence and real time event correlation to create predictive analytics

from “mashups”. Mashups in the Retail Fuels and Marketing industry will take two forms -

Consumer mashups, which will combine data from multiple public sources to facilitate

behavioral marketing, and data mashups which will combine similar types of media and

information from multiple sources into a single representation (e.g. new behavioral

profiles, segmentations and categories).

Scope, Approach and Guiding Principles

Although the specific requirements of a business will vary depending on the scale and scope of

that business and this will be an important element to consider in defining a tailored architecture

for each business, there are some generic considerations that will need to be taken into account

by all businesses. This section will describe the overall approach to a Reference Architecture that

Microsoft is taking for the Retail Fuels Marketing Industry.

Scope

The diagram in Figure 3 indicates where the Microsoft Reference Architecture for Retail Fuels

Marketing is intended to lie in the typical sequence of defining a Reference Architecture for IT –

after a “Reference Model” has been defined and as input to a “Reference Implementation”.

Figure 3 – Scope

Reference Model

• Foundation for all other architectural elements

• Describes the Scope of the Domain

• Identifies entities within that Domain and their relationships

• Product Agnostic

Reference Architecture (RA)

• Defines rules (principles) and Structures (patterns) for Domain

• Describes general (logical) structure of architecture to satisfy domain requirements

• Guidance for the Reference Implementation

Reference Implementation (RI)

• Physical Instance of RA

• Foundational Architecture for Specific Solutions

• Might be a solution, probably needs adjustments

• May be multiple instances

Solution Architecture (SA)

• Specific Requirements applied to RI

• Physical Architecture that can be developed against

• Follows RA Rules to produce physical architecture

• Many possible instances

Solution Implementation (SI)

• Development & Deployment of an SA

• Applies Operation and management rules from the RA


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The Reference Model in the sequence above refers to the business needs of the particular

business being considered rather than to a generic, industry-wide solution

This document seeks to outline the components identified under the “Reference

Architecture” label in Figure 3 (highlighted in red).

Completion of the subsequent steps – the RI, SA and finally the SI – are left to any Microsoft

Partners who choose to do so, following the guidance in this document using the

Microsoft technologies indicated.

Approach and Guiding Principles

As indicated in the previous section, the Microsoft Reference Architecture for Retail Fuels

Marketing is not prescriptive — that is, it does not lay out specifics of the architecture’s structure

and function. Rather, the Microsoft’s Reference Architecture describes a set of guiding principles

that govern it. This descriptive approach provides an agreed-upon set of principles for establishing

consistent attributes of the subsequent iterations of a Solution build upon this RA – the Reference

Implementation (RI), the Solution Architecture (SA) and finally, Solution Implementation (SI); but

also provides the flexibility for companies building upon this RA to innovate and establish

competitive differences in their individual RI, SA and SI’s.

Guiding Principles

Instead of being prescriptive, the RA describes a set of guiding “pillars,” or principles, that govern

it. This descriptive approach provides an agreed-upon set of principles for establishing consistent

performance, but also provides the flexibility for companies to innovate and establish competitive

differences.

Shown in Figure 4 are the twenty-seven “Guiding Principles” used to define qualities that

Solutions built upon the Retail Fuels Marketing Reference Architecture should encompass. The

top four “Pillars” are a grouping of more business-focused principles, and the ‘platform’ across

the bottom is primarily focused around infrastructure and IT, and underpins those on top. Each

Guiding Principle is described in the following sections.


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Figure 4 - Guiding Principles of the Microsoft Retail Fuels Marketing Reference Architecture

Role Based Productivity and Insights

This group of guiding principles supports the need of the business to get the maximum insight

from the vast amount of data they have and to maximize the productivity of their workers.

Real-Time Analytics. Rich statistical and analysis packages for data mining, discovery, and

reporting for diverse information consumers.

Complex Event Processing. Stream-processing engines that can detect and filter real-

time events, either on-premise, or in the Cloud.

People, Process & Information Integration. Business users use a variety of differing

software tools and systems to do their jobs, often using related or even the same

information or data. These tools or systems should be seamlessly integrated such that the

business users are not required to continuously import and export data from one system

to another in order to get their workflows completed. This extends to and includes

workflows that include multiple users in their execution.

Self-Serve Business Intelligence. To help them gain deeper insights into the increasing

quantities of relevant data that is collected, users should be able to use tools to find, select,

and explore their data themselves in different, flexible ways that make sense to them

without, for example, having to define a report and request their IT to provide it for them.

Storage & Master Data Management. Repositories to capture and enable analysis of

operational and business data; located on-premise, in the cloud; or a hybrid mixture of

both.

MURA Guiding PrinciplesSocial

Enterprise

Collaboration &

Knowledge Sharing

Mobility

Geolocalization

People & Expertise

Search

Role Based

Productivity &

Insights

Real-Time Analytics

Complex Event

Processing

People, Process &

Information Integration

Self-Serve Business

Intelligence

Storage & Master Data

Management

Connected

Business

Industry Standards

Published Interfaces

Information Models

Security

Workflow, Process &

Information Integration

Natural User

Experience

Rich Interactive

User Experience

Smart, Connected

Devices

User-Culture Localized

Simplicity & Ease-of-use

Secure, Scalable, High-Performance Infrastructure

Location

AgnosticSecureScalable Manageability Integration

Domain Specific

Infrastructure

Global High

Availability

App & Data

Marketplace

Software as

a Service


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Natural User Experience

This group of guiding principles includes those features that enable participants to best

experience the world and how technology fits into that experience, such as:

Rich Interactive User Experience. This is a key quality of the user experience of

applications for customers and retail employees as well as those of operations staff, control

center personnel, and for mobile users using lightweight tablet and smart-phone devices.

Smart, Connected Devices. This includes devices with integrated capabilities that are also

connected to the network. Examples would include embedded devices running retail fuel

pumps on gas station forecourts or line-of-business apps running on smart phones used

to visualize business intelligence data, interact with payment devices on forecourts or

enable collaboration with employees in corporate headquarters using Lync.

User-Culture Localized. Oil & Gas is a global Industry and therefore users around the

world should be able to interact with their software tools and systems using their local

culture’s language, and their culture’s date and number formats.

Simplicity & Ease-of-use. As software tooling gets more feature-rich and runs on ever

more powerful devices, it should at the same time continue to be simple and easy to use,

as well as support input methods that make the most sense (like mouse and keyboard,

touch, both, and/or Kinect).

Social Enterprise

This group of guiding principles supports the needs of business users to maximize their

productivity via the assistance of their colleagues and others in the Industry, including those

people they do not yet know.

Collaboration & Knowledge Sharing. This is collaboration using both thick and thin

clients, across a variety of devices, and leveraging today’s most advanced collaborative

tools through corporate portals and public cloud services.

Mobility. Workers on the forecourt or at Corporate HQ are increasingly demanding the

ability to work from a mobile location using the device appropriate to their needs; so

solutions should support this capability and work across multiple devices.

Geolocalization. This speaks to the need to know the location of the source of any given

set of data, and also the location of workers in relation to other workers and/or assets that

produce this data, on an ongoing and searchable basis.

People & Expertise Search. Workers needing to collaborate don’t always know what all

of their fellow workers expertise is in, so this is the tooling that allows workers to quickly

and easily find colleagues or business partners with specific skills for a workflow they are

trying to execute upon and for which they have a need for particular skills in order to

successfully complete it.

Connected Business


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For the Retail Fuels Marketing Reference Architecture to successfully deliver cost-effective,

integrative benefits, it must enable comprehensive interoperability both on-premise and in the

cloud. For this, these features are of paramount importance:

Industry Standards. These define a consistent, industry-wide interface to allow new

component deployment.

Published Interfaces. These are transparently publicized for open-industry use, even if a

standard is not available, and that also satisfy important interoperability needs. All the

elements of an interface are well defined so that applications can be independently

developed to leverage the interface.

Information Models. Consistent ontology (naming system) for referring to equipment

and assets to enable exchange of information throughout the enterprise and the value

chain.

Secure. The definition of the security implementation including authentication,

authorization, identity lifecycle management, certificates, claims and threat models to

enable secure interoperable design and deployment.

Workflow, Process & Information Integration. Connected, agile businesses desire

Solutions that integrate the workflows of the business users and the systems they use,

their process and procedures and the information those user create and manage as part

of their work-day across all the upstream systems they interact with.

Secure, Scalable, High-Performance Infrastructure

This group of guiding principles captures the needs of the underlying technical infrastructure, and

includes:

Scalable. Support for more users, larger models, increased transaction volumes, etc. can

be accommodated through increasing hardware performance (scale-up) or the linear

addition of hardware and network resources (scale-out), either on-premise, in the cloud,

or a combination of both. Organizations scaling up should be able to benefit from

economies of scale and those scaling down should have the facility to reduce their fixed

cost base to prevent the unit cost from becoming excessive.

Secure. Deployed components, functionality and associated information are protected

from unauthorized access or malicious attacks. Utilization of security approaches that

combine standards to reduce the likelihood of data being compromised based on the

users identity can change the paradigm from “adding more locks” to making systems

where there is “nothing to steal”. Real time multi-factor authentication of identity is

proving to be an attractive security approach as an alternative to increasingly complex

encryption and secure elements. With threats of data breaches and expectations of the

steps taken to prevent them both continually increasing (for example, through the

requirements of PCI), the solutions implemented will need to be regularly reassessed and

hardened. This governance process should be an integral part of the architecture.

Location Agnostic. Services are designed so that they can be deployed on-premise in a

private data center, in the public cloud, on a smart phone, on a tablet or on a workstation.


17

Users and software components have secure access to platforms and services wherever

they are located.

Manageability. Infrastructure components can be efficiently deployed, managed and

monitored.

Integration. Messaging and database technology for linking together workflow,

processes, and data optimization. This includes services and components for

communication of device and equipment data, between solutions deployed in the private

data center and/or public cloud, typically via a Service Bus architecture.

Domain Specific Infrastructure. Leveraging unified communications to manage

compliant devices, from Forecourt and store systems and sensors and Back Office point of

sale systems and then flowing that data into appropriate operational systems.

Global High Availability. Although availability of the systems around the world needs to

be high to meet the needs of this non-stop industry, data does not need to be shared and

the specific needs of local markets or sites must be met.

App & Data Marketplace. Marketplaces are now becoming a common method of

deploying applications to both desktops and mobile devices, and a place from which to

purchase data, from vendors. These may be public, or a Corporate-managed store.

Software as a Service. Oil & Gas companies want to buy their software from their software

suppliers as modern cloud-based solutions in order to reduce costs and increase flexibility.

Microsoft Technology Supporting the Reference Architecture

Today there is a large and wide-ranging selection of leading-edge technologies from Microsoft

that oil and gas companies have access to. It’s important to understand how industry solutions

that apply the Guiding Principles, relate to the various Microsoft technologies that underpin them.

To illustrate this, a high-level diagram illustrating all the major Microsoft technology components

available as of this version of this white paper can be seen illustrated in Figure 5. The technology

is stacked in a typical Enterprise View, and the high-level components are colored to match the

containing Guiding Principles that apply to them. Where several Guiding Principles apply, then

several colors are used.

In this fashion, the Retail Fuels Marketing Reference Architecture provides guidance on which

Microsoft technologies would be the best choice to use when looking to solve the variety of

industry problems outlined previously.


18

Figure 5 - Guiding Principles mapped to Microsoft Technology

Reference Architecture Overview

Figure 6 shows the Retail Fuels Marketing Reference Architecture, which reflects an integrated

computing environment that encompasses domain applications, business productivity tools, and

back office applications, both on-premise, and in the Cloud.

These Business Service Layers permit technology vendors, system integrators, and other Microsoft

partners to realize the full benefits of this environment. To function as planned and to eliminate

the need for additional integration work, the Reference Architecture provides inherent, seamless

integration to connect all layers and applications. Built-in integration enables frictionless

communication and information flow, up and down the layers, and provides the ultimate plug-

and-play efficiency needed.

The next sections walk through some key aspects of the Reference Architecture shown in Figure

6 and discuss how they relate to the Guiding Principles described in the previous section and the

interactions that take place between the various service layers shown. Scenarios serve as examples

and show how a Solution can be delivered by leveraging the various components of this Reference

Architecture.

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Experience

Social

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Connected

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Role Based

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Secu

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igh

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Figure 6 - The Retail Fuels Marketing Reference Architecture

Users

Users interact with the System in a variety of ways, which is shown in Figure 7. Components in

this section of the architecture would follow some of the Role Based Productivity & Insights

Guiding Principles, like Real-Time Analytics, Complex Event Processing, People, Process &

Information Integration and Self-Serve Business Intelligence; as well as those in the Natural User

Experience Guiding Principles as well, such as Rich Interactive

User Experience, Smart, Connected Devices, User-Culture Localized, and Simplicity & Ease-of-use.

Also included would be those Guiding Principles in Social Enterprise, such as Collaboration &

Knowledge Sharing and Mobility.

Figure 7 - Integrated Interface Channels


20

Some of the components that Users interact with include:

Customer Interface is the user interface components in the gas stations where

information is presented and/or acquired from the customers in the forecourt, c-store, car

wash, signage and all other places in the station where interaction is required. These could

be one way screens where information and advertisements are presented or two way

screens where the customer fills in forms, answers surveys, etc…

POS (Cashier Interface) is the main interface where the cashier executes all sales

transactions. Although this is called a POS, it is an integrated cashier interface that

connects with the forecourt, backcourt, ERP, e-payment, mobile payment and the loyalty

management systems – much more than a normal retail POS. It is a software based POS

which can be installed on various devices and platforms to provide the best experience

and lowest operational overhead. Connections with the forecourt and backcourt systems

are all based on open standards.

Portals hosted on premise in SharePoint or in the public cloud of Office365, that function

as a common platform where managers access IT-based domain work processes of all

kinds. It provides mechanisms that support blogs, wikis, and social networks like Yammer

used to establish and maintain cross-domain collaborative systems. Rather than logging

on to a specific system, users simply log on to the Integrated Portal to access work orders,

KPIs, analytic, and other business related systems.

Dashboards establish a single location where authorized employees find and use a wide

range of data, including KPIs and business intelligence systems where they can leverage

powerful self-serve analytic tools.

Mobile Applications allow users to communicate via text, voice, instant message and

social media, and access apps to be more productive whether setting up or modifying

their personal profile information or using a specific app to conduct a transaction or do

research.

Vehicle Infotainment as a channel to communicate with the customer

Social Community includes an organizations’ Yammer network, where employees can

collaborate in order to maximize their efficiency and share information. They would also

use messaging tools like Lync to instant-message (IM) one another and collaborate in real-

time in pairs or larger groups using voice and video.

Web Applications are used by stakeholders to track and identify opportunities for

continuous improvements by providing rapid access to resources, trends and KPIs that are

relevant to their role, discipline or geographic region. The new open architecture will allow

for a bevy of new high productivity and cost saving applications provided in the form of

“managed services” to franchisees and company owned operations.

Account Management can be improved through Customer Relationship Management

software (CRM) for better fleet management and franchisee and dealer networks.

Reporting can be used to provide improved pricing updates and MSDS revisions via

SharePoint.

Mobile Wallet such as Wallet in Windows Phone 8 facilitates access to rewards and loyalty

offers and information that might otherwise be unavailable, to be utilized at a point of

interest by consumers, employee and organization members.


21

This portal-based approach allows all disciplines and managers to focus on a more productive

approach of management by exception where they get the information they need when they need

it without the burden of reviewing irrelevant data or cumbersome processes to access information.

As an example – brand managers would like to have better validation of marketing campaign

spend and consumer behavior that can only be proven with quality activity and transaction based

reporting that delineates correlations (e.g. the consumer paid for gas, acknowledged the coupon

on his phone and made the additional purchase.)

Application Interoperability

The Data Integration and Interoperability Services components shown in

Figure 8 are in many ways the heart of a more effective IT architecture, providing a central

mechanism for the movement of data between systems, equipment, and other elements in the IT

infrastructure. Components in this section of the architecture follow primarily the Connected

Business Guiding Principles, like Published Interfaces and Secure and Workflow, Process &

Information Integration; but also many of those in the Secure, Scalable, High-Performance

Infrastructure Guiding Principles as well, such as Secure and Integration.

Figure 8 - Application Interoperability Layer

The Service Orchestration layer is hybrid component where some parts are cloud-hosted solution,

running in Windows Azure that provides a decoupled set of service-oriented interfaces between

the User service layer, and the Data Services that feed the various components of it. The

components that need to be onsite either directly connected with the forecourt equipment or

components to ensure offline operations when disconnected from the network are provided via

onsite services. In very small sites or sites with poor network connectivity, many of these cloud

based services will be provided locally.

It is within this layer that Interoperability Services, built using Windows Communication

Foundation (WCF) or REST APIs on Azure BizTalk Services, expose Interfaces in order to provide a

centralized repository for incoming data from point of sale and from fuel management, forecourt

control, back office and financial systems. Using defined business rules, this component

orchestrates the movement of data between various systems over Windows Azure Service Bus

that would include consumer data master, merchant/operational data master, settlement data


22

master, loyalty data master and the economic evaluation applications used to model the expected

Return on Investment (ROI) of opportunities.

The Data Integration and Business Process Management components also serve to synchronize

hierarchical and metadata across systems to ensure operational coordination and reporting

accuracy. This capability addresses a number of common issues in dynamic Retail Fuel and

Marketing operations.

For example, when a new work process or loyalty campaign is initiated, the intelligence built into

this component identifies the correct source of all data needed for that activity. The data is then

collected and packaged into an XML file (or other standardized format) and forwarded to the

application being used to handle the economic evaluation or other work process using Windows

Azure Service Bus as the transport mechanism to ensure timely and ordered delivery.

By establishing a common path for all relevant field data, the Data Integration and Business

Process Management components also measurably reduce the time, cost, and complexity of

deploying new applications.

As service stations vary widely in scale and complexity there will be different physical

implementations of the RA depending to a greater or lesser extent on cloud based services. In

very small sites or sites with poor network connectivity, some of these cloud based services will

be provided as local services. Even on the largest sites, to ensure continuity of operation in case

of loss of communication, some cloud services will support offline operation and backed up once

connectivity is restored.

Business Services

Figure 9 shows the various Business Services that are included in the Reference Architecture.

Applied Guiding Principles in this section of the Architecture include many within Connected

Business, like Secure and Workflow, Process & Information Integration, as well as some within

Secure, Scalable, High-Performance Infrastructure like Secure and Domain Specific

Infrastructure and Integration in particular.

Figure 9 - Business Services


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These Services include the following:

Coupons. Merchants and Consumer Packaged Goods (CPG) firms have always been

frustrated by the cost, complexity and fraud risks associated with accepting coupons in

convenience stores and on service stations. Success with coupons has been inhibited by

paper based coupons that can be easily duplicated, website accessible codes that are

shared unlawfully and employee/merchant frustration about settlement times and coupon

accounting rationalization. With the advent of mobile commerce these barriers to coupon

acceptance are falling and new real-time digital couponing that is personalized to the

consumer is on the horizon.

Loyalty Programs are common to both oil companies and merchants. Mobile commerce

is seen as key to providing new forms of interaction and relationships with consumers

through “branded mobile apps” and unique and customized offers to increase company

brand loyalty. The “mobile” win for the Retail Fuels Marketing industry is that mobility

provides a cost effective and interactive way to recapture customer relationships with a

“branded app” complementary to their branded cards and allows them to discontinue

some co-branded cards deemed to have little value.

Point of Sale (POS) encompasses those systems located at payment checkout locations

where transactions occur in exchange for goods or services. The POS tracks items

purchased, money/payments received and provides receipts to consumers. In the service

station environment, the POS will usually be integrated with other site equipment, such as

the forecourt controller to operate the dispensers or to capture sales data. This adds

significantly to the complexity of the environment and brings specific metrological

requirements. The devices can vary from older “electronic cash registers” to desktop

computers and entry devices may now be smaller devices such as tablet devices and

smartphones. Some hardware manufacturers are now embedding computing horsepower

into compact printers, allowing operating Systems like Windows Embedded to run the POS

within the printing device itself and host the UI via Internet Information Server. The

displays in these cases can be compact portable tablets or phones running a web browser

and accessing the POS on the Printing device over the network. By way of example of the

POS functionality, consider a convenience store with fueling that provides customizations

for fuel types or special food products or drink types. More advanced POS systems will

also include advanced functionalities that provide integration to inventory management

systems, Customer Relationship Management (CRM) systems, financials and warehousing,

some or all of which may be built into the POS software. There is a clear direction that

hosted and managed POS systems provide a lower total cost of ownership (TCO) but even

more importantly are a means to drive faster updates and differentiation. Soon,

Smartphone apps will begin to facilitate “self-serve” POS capabilities for consumers while

maintaining data integrity with the hosted and managed POS systems. Dynamics AX

provides a readily scalable, open, and hosted and managed POS architecture to deliver on

this vision.


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Mobile Commerce is generally recognized as the delivery of electronic commerce

capabilities directly into the consumer’s hand, anywhere, via wireless technology. More

specifically mobile commerce is considered to include mobile payments by consumers via

smartphones and tablet devices, and use of mobile Point of Sale systems by merchants. In

a broader context, mobile commerce also includes the network capabilities, security,

devices, software, integration, support systems and workflows to make mobile commerce

cost effective for consumers and merchants. Microsoft Windows Phone, Microsoft Wallet

and Surface RT and Pro tablet devices provide attractive options to consumers and

merchants alike as mobile commerce accelerates in Retail.

Payment Networks may be coupled with the POS network, or decoupled. The industry is

starting to utilize open Electronic Payment Server (EPS) Technology. An EPS is a

middleware payment software used to provide connectivity to the payments network and

to provide the specific processing requirements of different payment instruments. EPS

supports POS applications in the Retail Fuels Marketing industry using standard messaging

interfaces (e.g. IFSF, Conexxus, X9 and proprietary). EPS technology can be easily deployed

on an existing POS lane or on the POS in store processor that typically resides in the back

office of the gas station/convenience store site but can also be deployed outside of the

POS on a Windows based appliance that is connected to the forecourt locally. EPS can be

deployed to de-couple the POS from handling payments and reduce PCI scope. In the

cloud, EPS takes the payment rules from the forecourt environment and further de-couples

the Payments Network from the POS Network to provide a singular network end point

that communicates with the forecourt to handle all payments. An EPS, when connected to

appropriate on site hardware, can support many forms of payments: Magnetic Stripe, Chip

and PIN, Chip and Signature, RFID, NFC and various forms of Mobile payment. However,

a properly designed and deployed cloud based EPS system can react to ever changing

business needs, new marketing features or security requirements more quickly and at

lower cost than a site based solution.

Forecourt Controllers on the forecourt are “backplane” devices that connect and send

control signals to components like fuel dispensers/pumps, outdoor payment terminals,

price signs, tank level controllers. The site controllers are integrated to the Point of Sale

systems and/or Payment Systems. Windows Embedded provides a proven O/S to underpin

these systems. Next generation forecourt controllers have adopted open standards and

APIs to facilitate decoupled forecourt and payment system networks and reduce the cost

of integration to both legacy systems and desirable new technologies. The Forecourt

Controller also receives transactional data, condition information and alarms from all these

devices that is needed for the operation of the site.

Fuel Inventory Management is a service to enable the procurement, management, and

selling of bulk fuel. The service facilitates demand forecasting, fulfillment, inventory

management, sales and purchase order management, financial management, and

environmental compliance to help optimize inventory, determine best market price and

reconcile deliveries, invoices, payments, and taxes. When combined with an effective

pricing system the fuel inventory system enables the site operator to maximize fuel

margins.


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All of these systems form part of the Content Management System (CMS) to provide relevant

information to all stakeholders. The CMS includes functionality for publishing, editing and

modifying content via collaborative approval workflows that can also be managed and optimized

from a central web-based interface like Microsoft SharePoint (on-premise) or Office 365 (a cloud-

based Service that includes SharePoint Online).

Data Services

Figure 10 shows the primary sources of Data feeding the Business Services layer. Components in

this section of the architecture follow primarily the Role Based Productivity & Insights Guiding

Principles, like Storage & Master Data Management; but also some of those in the Secure,

Scalable, High-Performance Infrastructure Guiding Principles as well, such as Secure, Scalable,

Manageability, and Integration.

Figure 10 - Data Services

The Data Services include the following sources:

Master Databases – each stakeholder in the value chain desires their own “view” of the

available data that is relevant to their business and to which they have valid access rights.

To accomplish this end, newer architectures are incorporating multi-instance and multi-

tenant design into their cloud based computing environment for master databases.

Business Intelligence tools to help collect, maintain, and organize data to identify new

opportunities and strategies to gain competitive market advantage and sustainability.

Tokenization Service serves as a component of a payment security schema where a

“token” takes the need for sensitive data out of the payment processing environment.

Inherently, even if a token was obtained by unauthorized persons, it cannot be reused for

purchases of goods and services.

http://en.wikipedia.org/wiki/Electronic_publishing


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Payment Card Industry (PCI)

Figure 11 shows the Payment System of the Reference Architecture. Applied Guiding Principles

in this section of the Architecture include some within Connected Business, like Secure and

Industry Standards, Published Interfaces, as well as some within Secure, Scalable, High-

Performance Infrastructure like Secure, Domain Specific Infrastructure and Integration.

The Payment System includes the following components:

Dispenser and Indoor Card Readers for accepting various forms of payment at the pump

or indoors (e.g. credit cards, debit cards, etc.)

PIN Entry Device for consumers to enter PIN (Personal Identification Number issued by

the card issuer) or other personal identification data (e.g. zip code, pass code, etc.) in order

to authenticate themselves with the System.

Front End Process that processes the payment instrument according to the issuers

requirements and complies with the global Payment Application - Data Security Standard

(PA-DSS) as established by the Payment Card Industry Security Standards Council.

Store and Forward is used in cases where online processing is not possible. This may be

because the payment instrument does not require this or, where it does, there has been a

break in network connectivity. This technique ensures that the payment information is

stored until it can be sent, either as batch data or when connectivity is re-established.

Figure 11 - Payment System

http://en.wikipedia.org/wiki/Payment_Card_Industry_Security_Standards_Council


27

Specific rules will be applied about when transactions can proceed if store and forward is

operating – for example, outdoor transactions usually require pre-authorization and this

is not possible when store and forward is operating. This component should also verify the

integrity of the data before forwarding to prevent any loss of data and to prevent a

transaction from being aborted due to intermittent connectivity, especially in the remote

areas or where environments may lose power or internet or satellite connectivity. This

component should be underpinned by the Windows Azure Service Bus, a high-

performance message transport system that provides these features.

Payment Network which provides connectivity for approval and recording of payments,

credits and debits to parties involved in the transaction and settlement between

merchants, third party vendors and service providers.

Infrastructure

Figure 12 shows the Infrastructure for the Network, Systems and Security of the System. Guiding

Principles that apply to this section of the Architecture include some within Connected Business,

like Secure, as well as many within Secure, Scalable, High-Performance Infrastructure like

Secure, Manageability, Scalable, Global High Availability, Domain Specific Infrastructure and

Integration.

Figure 12- Infrastructure

The Infrastructure includes the following components and technologies:

Network includes the Domain, created and managed using Active Directory either on

premise using Windows Server, or on the Cloud (Windows Azure Active Directory), and

accessed by an encrypted VPN connection like DirectAccess over secured network

boundaries.

Systems includes systems virtualized using Hyper-V and provisioned upon Windows

Server, and managed by System Center.

Security is the Authentication and Authorization of users and remote Systems using Active

Directory upon on-premise Windows Server or Windows Azure Active Directory in the

Cloud, and Identity Manager.

http://en.wikipedia.org/wiki/Data_integrity


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Getting There

How can Retail Fuels Marketing businesses best realize the Microsoft’s Reference Architecture

described in this paper? Microsoft urges companies to consider the following factors when

seeking to improve operational efficiency of their Retail Fuels and Marketing Business.

Focus on business processes Ensure that the needs of the business are clearly understood

and agreed with the business owner. Document the business processes and identify

essential interfaces with users, internal and external applications and requirements for

regulatory or other certifications. Work to incorporate robust data management in those

processes.

Start small. Instead of trying to do everything at once, pick a domain process (such as

mobile payments) and build the infrastructure, connectivity, and processes needed to

accomplish that process within the integrated, service-oriented environment described

here, and following the guidance offered by applicable Guiding Principles to aid in

technology selection. Recognize that this high-level architecture is an objective and can at

the very least serve as a guideline for service providers seeking to develop and deliver

compatible applications for a more common architecture.

Use the vocabulary of your business when creating a solution. Build data models that

use and present information in ways that retail merchants and marketers understand—not

based on the systems that generate that data.

The Microsoft’s Reference Architecture for Retail Fuels Marketing described here and the process

of transitioning to this more efficient future state can be applied to address the real-world needs

of Retail Fuel and Marketing operations. Figure 13 shows the desired end-state. (Compare this

with Figure 2.)


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Future State Architecture

Our vision is to make the experience of buying fuel simpler and more effective. By utilizing the IT

architecture outlined in this whitepaper, it would be possible to increase the revenue by providing

better offers, attracting more customers to the station and bundling more value added services

to the fuel sales transaction. This will be possible by analyzing customer interaction patterns to

provide in context offers and providing new channels such as the in vehicle infotainment systems

to enable the consumer to search, navigate and pay.

Breaking Application Siloes

In today’s world IT solutions for the forecourt, backcourt, ERP and headquarters are produced by

the providers of these components with the main features built to support their main functional

areas while providing integration with others as an add-ons. As an example the forecourt

equipment provider that builds the dispensers, automated tank gauges, leakage detection

systems, etc… also provides forecourt controller integrated point of sales (POS) devices.

Connectivity with the backcourt and headquarters are provided as features however the main

functionality is the forecourt operations. Similarly, the c-store and fuel station ERP systems are

usually provided by retail management software vendors and additional effort is needed to

integrate with the forecourt POS infrastructure or an imperfect sssolutio may be built into the

forecourt POS. All of these solutions then need to integrate with the payment networks, loyalty

management systems, headquarters ERP systems and also with integrated fuel retail supply chain

systems, if present.

The architecture we propose is a Connected Fuel Retail Management platform that delivers the

following functions while being built as an integrated platform from the ground up. This

architecture enables connectivity to all major forecourt controllers through standard protocols,

delivers the core ERP functions needed to run the retail operations in the backcourt, connect to

the retailers’ and O&G companies’ core ERP systems for integrated supply chain optimization

opportunities. Furthermore the architecture provides unique advantages by providing software

driven and extensible POS systems that combine the forecourt, backcourt, and retail management

with electronic and mobile payment functions that could be deployed on a multitude of hardware

platforms such as smartphones, tablets, standard PCs and specialized POS hardware. All

information is stored in a central secure repository providing advanced row and field level security

trimming capabilities provided by the Dynamics AX Retail Management and ERP platform.

Integrated Point of Sales

A core component of the architecture is the Dynamics AX 2012 R3 based Point of Sales extended

with wetstock management functions connected to the forecourt controller, mobile payments and

all the retail operations for the backcourt systems. Being part of the Dynamics AX 2012 R3, it acts

as a server for the main ERP system for the fuel station. The ERP system could be hosted in the

cloud or the headquarters while the AX Store and Forward components in the station provide the

resiliency required. Dynamics AX POS could be deployed on smartphones, tablets, regular PCs


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and also specialized POS terminals that run Windows. This simplifies the maintenance operations

while reducing the cost of acquiring and maintaining propriety POS systems.

The POS is extendible to provide additional functionality in the future by adding features using

the software development kit and Dynamics AX APIs.

Secure Mobile Payments

This architecture simplifies the purchase experience with a flexible, trusted mobile payment

platform by enabling customers to quickly find retail fueling locations and lowest price per gallon

or search based on other preferences. Components of the mobile payments architecture are:

Geoservices: Determines customer location, surfaces relevant data (price, brand, distance)

for nearby businesses and delivers concise directions to the user’s selected destination

Identity Authentication: The multi-step authentication process and identity recognition

helps prevent credit card fraud and ensures cardholder information is secure since primary

card data is not stored on the phone or transmitted from the phone to the payment

processing service

Mobile Wallet Ready: Utilizes electronic wallet technology to enable payment and

simplify loyalty point accruals and rewards, while empowering the consumer to choose

which mobile wallet they want to use

Connected Cars

In today’s world car manufacturers are providing very advanced in vehicle infotainment systems

that are always connected and have application marketplaces to download applications that add

functions to the car. Manufacturers are using this as a way to attract new customers and also

creating additional revenue streams by selling software or connected services. Integrating

searching, finding and buying gasoline in the car as a service to the consumer is one of the features

of the architecture. A typical example would be to integrate with the voice activated search

mechanism in the car, then displaying nearest sponsored station on the navigation system and

guiding the driver. Once in the station the vehicle is integrated with the mobile payment system

in the station to activate the pump and complete the payment and, most importantly, to provide

information on different offers during this process. Connected with location information, a

wholesaler could redirect the consumer to another nearby station if there is traffic congestion or

if a certain fuel or service is unavailable.

Advanced Analytics

The information related to the transactions in the station will be analyzed using advanced analytics

and machine learning to detect complicated patterns, potentially across multiple stations and

business units to detect fraud, provide personalized offers to the customer while in store or at the

pump that might suit his/her buying patterns. The integrated supply chain system may optimize

inventory levels by comparing these with buying patterns to automate orders to wholesalers or

distribution companies. Another important point is the ability that this brings to monitor and

optimize the business metrics across the different outlets of the retailer/wholesaler. In this way


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non-performing outlets could be identified and specialized offers could be provided to attract

customers.

Retailers can utilize the social media listening and marketing capabilities of the platform to

understand what their customers are thinking and provide directed messaging to be relevant to

them.

Flexible Deployment (Why should a retailer care about building big datacenters?)

One of the fundamental advantages of the architecture is the capability to deliver a subset of the

functionality on the public cloud. The part that would be deployed on the Windows Azure Public

Cloud is dependent on the choices of the retailer and the current infrastructure they own. For a

green field deployment or for a retailer who wants to outsource the operations and maintenance

of their IT infrastructure, most of the components of the architecture could be deployed on the

cloud, removing all the IT infrastructure investments that are needed by the retailer. The only

components that need to be deployed on premise are the forecourt equipment and the

connectivity components, card readers and store and forward capabilities to provide resilient

operations during a network outage. All other elements, including the POS, could be deployed

through a virtual environment on the public cloud. This also makes the integration with the

payment systems and external entities much simpler. Access to the advanced analytics and

machine learning on the cloud provides real time analytical capabilities while the customer is in

the outlet.

Figure 13 - Proposed future state of IT architectures for the Retail Fuels Marketing sector

Forecourt

Existing Equipment

Existing payment equipment Updated:DCR, PED, EPP

Convenience Store

Existing payment equipment: POS & PED

Commerce Server

Hosted POS (optional)

New – Mobile Payment Method

Alternative payment methods: Pre-paid, ACH, etc. (optional)

Loyalty Network

Traditional payment methods:Amex, Visa, MC

Gateway Server

ForecourtController/EPS


32

This architecture enables the retailer to scale his or her systems solutions to the specific business

needs and permits rapid deployment of new features or offers to ensure that a competitive market

position can be maintained. Through leveraging the cloud capabilities the system will always have

the latest software version and can be updated without site visits. The services offered in the cloud

can be updated and extended as required with minimal impact at site level. By minimizing the

footprint at the site and the change needed to existing facilities the investment required is

minimized and high service factor industry standard equipment can be employed to ensure

availability of the systems to fulfill their prime function – maximizing sales revenue.

Innovative offerings, like mobile payment, or other new methods of payment may be delivered to

the customer quickly and without major upheaval at the site. This and other capabilities can be

fulfilled through the cloud and different applications linked in the central servers rather than

needing significant development and testing of new POS functionality, followed by expensive and

lengthy rollouts on a site by site basis.

Summary

In this paper we have discussed a number of the ever changing needs that the Retail Fuels

Marketing sector needs to address. These include:

The need to meet the expectations of the customer that are unique to each customer and

change as they are exposed to new offerings in other Retail sectors.

The need to respond to competitive offerings as other Retailers attempt to maximize their

market share.

The need to manage operating costs and controls in an environment when many opposing

factors are tending to put up costs (e.g. card transaction fees, fraud costs).

The need to respond to new security requirements that are driving obsolesence of existing

equipment and increasing the cost of ownership when much of this equipment has not

reached the end of its useful economic life.

The need to be able to accommodate different MOSO’s to tailor the site operations for

maximum efficiency.

The need to maximize site uptime.

Retailers are looking for solutions that help them to address these challenges. Some of these

solutions will lead to more data being available to the retailer and they will then need to store

this data securely, give the right people access to the right data with the best tools to analyze it

so that the greatest benefit can be gained for the business in a cost effective way. New techmology

provides many solutions to deal with these issues but the retailer needs help to find the means to

enable different applications to work together in the optimum combinations and how to fit them

into their legacy estate of sites.

Microsoft’s Reference Architecture is an IT and business architecture that serves as a common,

reliable environment for implementation and integration of the many technologies required by

Retail Fuels and Marketing and provides the framework that a retailer needs to develop their


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future IT architecture. Ultimately, this architecture will help to dramatically improve efficiency and

cost-effectiveness for Retail Fuels Marketing analysis, operations, and business. The PetroZone

Retail Fuels Module for the Microsoft Dynamics Point of Sale is a core component of this

architecture that has been designed to facilitate the implementation of the Microsoft Reference

Architecture in Retail Fuels.

The Microsoft’s Reference Architecture for Retail Fuels Marketing provides a unifying

language and a framework for improving productivity and integration in the Retail Fuels

Marketing industry.

For more information, visit www.microsoft.com/oilandgas.

http://www.microsoft.com/oilandgas

The Microsoft Retail Fuels Marketing Reference...

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