Win with SAPA HANA

2014 SAP AG or an SAP affiliate company. All rights reserved 1 2013 SAP AG or an affiliate company. All rights reserved

Win with SAP HANA in the Retail IndustryTim HoodGlobal Vice President Strategic Technologies,Retail Industry Business Unit, SAP SENovember 2014

2014 SAP AG or an SAP affiliate company. All rights reserved 2

Disclaimer

This presentation outlines our general product direction and should not be relied onin making a purchase decision. This presentation is not subject to your licenseagreement or any other agreement with SAP.

SAP has no obligation to pursue any course of business outlined in thispresentation or to develop or release any functionality mentioned in thispresentation. This presentation and SAP's strategy and possible futuredevelopments are subject to change and may be changed by SAP at any time forany reason without notice.

This document is provided without a warranty of any kind, either express or implied,including but not limited to, the implied warranties of merchantability, fitness for aparticular purpose, or non-infringement. SAP assumes no responsibility for errors oromissions in this document, except if such damages were caused by SAPintentionally or grossly negligent.


Powerful CustomersGlobalizationEconomic PressuresSpeed-to-MarketDifferentiation

Real-time Value of Retail powered by SAP HANAWhats on the CEOs Agenda?


Real-time Value of Retail powered by SAP HANAChallenges Faced by Retail Line-of-Business Leaders

How do I get real-time item-level inventory inall locations across all channels?

How do I leverage social networks andpredictive analytics to sharpen my demandforecasts?

How can merchandising, marketing, andsupply chain work together to maximizemargins?

Is the performance of each SKU from a netmargin, inventory turn, and shelf space pointof view available in real-time by store andmarket?

How can I predict and not react to customer buying patterns in real-time?

Are my stores equipped to save or grow thesale in-the-moment?


What do Retailers Need to Thrive in todays tough market?

Redefined Customer Interaction New Level of Real TimeCustomer Data

Global, Channel agnostic supplychain

Put the customer at the center ofall processes

Increase the number of customertouch points

Engage with customers at everystage of the path to purchasewith personalized interactions

Real time personalized offersdelivered to consumers in any channel

Agility and speed in campaigns andpromotions

Customer data at the heart ofmerchandise, assortment, promotionand demand planning

Efficient use of inventory across allchannels and regions

New levels of interaction with suppliers toreduce costs throughout the supply chain

Allow consumers to easily crosschannels to order and receive productswhenever and wherever they want


SAP Business Suite powered by SAP HANA in figures

SAPHANA

trained partnersSuite on HANA

7,600+

HANA basedapplications

> 70

users on asingle ERP onHANA system

100,000fasterperformance

Up to 100,000

productivescenarios andpilots

500+

Suite on HANAgo-live projectsin progress

460+Suite on HANAlive systems

105

end users onSAP HANA

>440,000

Live scenariosBW on HANA

220+

SuiteonHANA

Suite on HANAcontracts

1050+

May 2014


The Technology AdvantageSAP Retail Powered by SAP HANA Platform for Innovation

Business Innovation /TransformationAgility and choice with acomprehensive suite ofapplications on a single in-memory platform

Personalized UserExperience with Role-Based ApplicationsNew class of real timeapplications

Single Source of TruthReal-time information forpersonalized insight


Retail Value Map

Industry Value Map for RetailRetail. Right. Now

Customer-Driven SupplyChain

Real-Time Customer andSupply Chain Analytics

Integrated Demand andReplenishment Planning

Optimized Logistics andFulfillment Execution

Collaborative Sourcing,Buying and Manufacturing

Vendor Discovery andLifecycle Management

Sourcing and BuyingExcellence

Private Label Developmentand Manufacturing

Collaborative BusinessNetworks

Customer-CentricMerchandising

Real-Time Customer Insightand Predictive Analytics

Optimized Merchandiseand Assortment Planning

Marketing, Campaign andPromotion Planning

Perfect Price andPromotion Execution

Unified CustomerExperience

Real-Time CustomerInsight and Personalization

Superior Web and SocialExperience

Store Excellence *

Empowered MobileConsumer

Finance

Accounting and FinancialClose

Financial PerformanceManagement

Treasury and Financial RiskManagement

Collaborative FinanceOperations

Enterprise Risk andCompliance Management

Real Estate LifecycleManagement

People and Talent Core Human Resourcesand Payroll* Talent Management*Workforce Planning and

Analytics*Time and Attendance

ManagementTime and Attendance

Management

Indirect Procurement

TechnologySolutions

Analytics Consumer ExperienceData Management Application Developmentand Integration Enterprise Mobility

IT Management Application LifecycleManagementIT Infrastructure

ManagementIT Portfolio and Project

Management IT Service ManagementIT Strategy and

Governance

SAP HANA Platform

Most significantRetail on HANA

Advantage

www.sap.com/solutionexplorer

* SAP POS by GK is not available on HANAThe Complete* Retail Solution Set is available on HANA Today


Item Management Improve efficiency of merchandisingoperationsIS-R on HANAOptimizations

Real-time Value of Retail powered by SAP HANAOpportunities in Customer-Centric Merchandising

AssortmentManagement

Improve efficiency of merchandisingoperations

AP on CARIS-R on HANAOptimizations

Promotion Planningand Execution

Plan promotions with highest impact on salesand margins. Improve promotion execution

PMR on CARIS-R on HANAOptimizations

Item AffinityAnalysis

Increase offer effectiveness, optimize productplacement and reduce cannibalizationHPA Application (FBS)

http://factbook.saphana.com


With the IBM Systems solution for SAP HANA, Eldorado is able to tune its marketing campaigns and product pricing in real-time, enhancing profitability and maximizing sales revenue in ways that were simply not possible before. The service fromintelligence combined with the performance and capabilities of the IBM Systems solution for SAP HANA make a directcontribution to Eldorados business success.

Fabricio Granja , Enterprise Architect at Eldorado LLC

Eldorado LLC- Retail (Electronic)Eldorado is the leading consumer electronics and household appliance retailer inRussia.

Significantimprovementin planning andreducing the Out-of-Stock rate

167x fasterOn average - Queryruntime on cash-register receiptsreports

y77% Reductionyin database size,dropped from 4 TB to560 GB using SAPHANA

Product: Deploy planning of Merchandise and Assortment using BW on HANA

yBusiness Challenges/Objectivesy Deploy flexible planning by cluster according to market trends and business needsy Inhibited reduction of the Out-of-stock level due to the non-performing assortment planning

system

y Create a market analysis portfolio for only in-time sales and demand forecastyTechnical Challengesy Reduce the 35-hour processing time of sequence planning on ABAPy Allow for analysis of in-depth cash-register receipts reportsy Improve the performance of business analysis report generationy Reduce the time to calculate inventory levelsyBenefitsy React faster to planning changes for Sales, Purchases, Stores and Promotionsy Ability to easily define and run new queries which were not possible prior to HANAy An average of 167x faster in query runtime on cash-register receipts reportsy 77% reduction in database size; dropped from 4 TB to 560 GB using SAP HANAy 66% faster to process complex sequence planning; time dropped from 35 to just 12 hours


Real-time InventoryVisibility

Real time visibility to inventory levels at alllocations, the foundation for cross channel

commerce (click and collect)CAR

POS Inbound andOutbound

Relieve the time pressure on the nightlyprocessing window

IS-R on HANAOptimizations

CAR

Real-time SalesAnalysis

Provide visibility to sales activity and storeperformance in real time

CARShopper Insight (RDS)

Allocation Improve efficiency of merchandisingoperationsIS-R on HANAOptimizations

Real-time Value of Retail powered by SAP HANAOpportunities in Customer-Driven Supply Chain & Store Operations



Centro Cuesta NacionalImprove inventory management and replenishment

Product: SAP HANA

Business Challengesy Maximize shelf space; just because the product is in the store doesn't

mean that its on the shelfy Find the optimal point of Replenishment by closely monitoring in-store

sales

Technical Challengesy Improve sales monitoring, because with the current infrastructure, real-

time or near real-time sales monitoring is impossibley Automate monitoring processes to identify in real-time, shelves that lack

products during peak shopping hours

Benefitsy 10% increase in total Salesy 8% increase in rotation of productsy Greater customer satisfactiony Minimize "Blind stockout"

CompanyCentro CuestaNacional

HeadquartersDominican Republic

IndustryRetail

ProductsFoods

HANA abre en CCN un nuevo mundo de posibilidades, y con humildad pero con gran satisfaccincelebramos el honor recibido y el excelente trabajo de nuestro equipo de profesionales de tecnologaque han hecho posible este gran reconocimiento.Gisselle Muoz, Vice-Presidente of IT of Centro Cuesta Nacional sad to SOMOS CCN (internal customer magazine)

English: HANA opens a new world of possibilities in CCN. It is with great humility and satisfactionthat we celebrate these honors and the excellent work from our technology team that has allowed forthis great recognition

10%IncreasedIn total Sales

16x fasterto run a report(reduced from 4hours to 15minutes)

8% IncreasedIn product rotation


Customer Analysis& Segmentation

Identify and target the right customers with theright offers resulting in increased revenue and

margin

ADTCAR

Real-time Value of Retail powered by SAP HANAOpportunities in Unified Customer Experience

CampaignManagement

Improve the efficiency of Marketing operationsCRM on HANAPMR on CAR

RevelantPersonalized Offers

Deliver personalized offers to the rightcustomers, optimizing marketing spend

PMR on CARPrecision Marketing

ProductRecommendations

Recommend products based on item affinity,increasing basket size and revenue

HPA Application (FBS)CEICAR



Home Shopping Europe (HSE24): First Customerfor SAP Customer Engagement Intelligence

RQ xxxxx (YY/MM)

CompanyHome Shopping Europe (HSE24)

IndustryRetail, Media

ProductCustomer Engagement IntelligencePredictive Analysis

ScopeCampaign Management Optimization

ProjectLive

StatusRamp-up since April 2013

Situationy HSE24 is a true multichannel retailer selling live across six different channelsy Needs to better understand their target audience in real-timey Wants to adapt their offers based on real-time analyticsy Today, Marketing is not empowered to deliver on these requirements, because: Marketing planning is spread across many files and tools Big Data is causing headache and need help from IT and expert users Reports on campaign performance are outdated Takes too long and does not match the real-time nature of HSE24 business

Business and IT Transformation with SAP Business Suite powered by SAP HANAy HSE24 will leverage Big Data as an asset to drive business resultsy Gain actionable insights on the target audience in real-timey Empower the marketing professionals to run more and smarter campaigns while deciding better with

real-time reporting analytics on campaigns performance across 6 live selling channelsy Leverage predictive analytics to optimize product returns and thus saving costsy Become more agile with one platform from SAP to scale the business model into new markets and

have less dependency on IT

Benefitsy Improve ROI of campaigns by targeting the right audiencey Accelerate revenue growth by shifting from product to customer-based cross and up-sellingy Improve margin by leveraging predictive analytics to optimize marketingy Champion the delivery of a superior consumer experience across all channels

Thats what I call a modern UI!Christian Schnetzer (CRM IT Lead) quoting colleagues from the marketing department at HSE24


Transactional(~50 Scenarios)

Insight to ActionVisual overview over a complex topicfor monitoring or tracking purposes

Search and ExploreView on essential information aboutan object and contextual navigationbetween related objects

Analytical(~50 Scenarios)

Factsheet & ContextualNavigation

(~85 Scenarios)

Task-based AccessAccess to tasks like change, create,and to entire processes with guidednavigation

Runs on anydatabase andSAP HANA

Runs on SAP HANA

Introducing FioriThe new People Centered User Experience


Fiori: Example: Article Fact SheetEmbedded in Launchpad with fast Hana-Search


Fiori Example: Retail Promotion Execution CockpitOperational Reporting with Insight-to-Action

Key Benefits

Capabilities

Use Case Description

With a big number of promotions, it is difficult to have an efficient overview onstatus of the promo preparation including follow-on documents and logisticaspects.

Currently, relevant information for the promotion are spread across differentbusiness objects. Therefore it is difficult to identify and solve issues in time.

The target is to create holistic real-time reporting capabilities, to simplify andspeed-up the detection of promotion preparation issues, to find the rootcauses (e.g. supply chain), and efficiently resolve them.

This allows to increase the success of promotions and the consumer satisfaction.

Real-time overview of status, issues and current performance ofpromotions which are in preparation or in execution

Direct drill-down to understand the root causes of issues combined with theinsight-to-action capabilities allows immediate action

Smoother promotion preparation and execution Higher promotion success rate due to avoiding errors Simple and intuitive UI

Pre-built SAP HANA Live virtual data models for real-time transactional analytics of retail promotion preparation and execution and related processsteps in the supply chain, based on real-time document level data of SAP ERP / IS-Retail and SAP HANA (integrated scenario or side car scenario)

Analyses with multiple analytical tools (e.g. Business Objects Clients) possible based on the Virtual Data Model (VDM) The insight-to-action promotion cockpit powered by SAP HANA and SAP Fiori brings together all needed information from various application areas, to

be able to detect and resolve exceptions efficiently

Planning

1) Content contains functionality planned by SAP as well as lab mock-ups . SAPs planning can change.

2014 SAP AG or an SAP affiliate company. All rights reserved. 18Customer

Cloud options with SAP Retail on HANASubscription or bring-your-own-license, elasticity, ubiquitous access

SAP offers a wide range of deployment options to support your requirements

Private Cloud,HybridPublic Cloud

On-premise

Partner ScaleAny Scale Elastic ScaleLimited Scale

SAP HANA OnePublic Cloud (AWS) Subscription license at

99 cents / hour

30GB of compresseddata max

SAP HANAOn Premise 10 certified hardware

partners

Scales to any size

SAP HANAEnterprise CloudManaged Cloud Enterprise grade cloud

Mission critical 24 x 7

OpenCloud Ecosystem Cross license

reference architecture

Portability


Managing Common Challenges

Challenge Solution

Hana is not proven, its too much of arisk for my business

Provide references: SAP has hundreds of customers running mission criticalbusiness processes on HANA

Conduct Technical info sessions with HANA experts describing HANAs DataCenter Readiness (Fault tolerance, Disaster recovery, Load balancing etc)

Hana is too expensive LREA licenses for HANA are comparable to the other Databases we resell Because of compression, HANA actually uses less resources than traditional

databases. Discuss the added value to the business that HANA provides (Real time

visibility, accelerated business processes and renovated user experience)

My company has no HANA skills SAP can operate Retail on HANA in HEC, technical skill set requirements areeliminated

SAP (and partners) can upskill the IT team prior to the project or as part of theimplementation project.

SAP projects are too long and tooexpensive

The actual migration from AnyDB to HANA is a very short process (hours ordays). The most significant challenge is often the upgrade to the supported EhP(EhP7 SP2 for IS-Retail). The most effort and time is usually in testing/validation

SAP has RDS and consulting specialists that can speed the process updramatically

Most of our SI partners have HANA COEs with quite a bit of experience


Retail on HANAElevator Pitch

Up the minute view of the customerfrom wherever they choose to engagewith you

Boost company performance withpersonalized customerexperiences

Single calculation of customer demandacross all channels

Decrease stock outs, improvesales, and optimize use ofinventory

Common real time data platform toexecute the retail applications

Increase systems efficiency,reduce duplication of data andinterface costs

One set of data and insight acrosschannels, products and operations

Quickly maximize sales andmargins with targeted pricing andpromotions

What does Retail on HANA deliver? Benefit to the retail business


SAP Retail on HANAWhiteboard

SAP Retail

SAP HANA

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Renovated User Experience

SAP Fiori

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SA

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IPla

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SAP Retail 15+ years on the market, global customer

base of 3000+ retailers

Corporate Operations

SAP Retail on HANA Introduced in 2013, strong market momentum.

Many live customers as of Q3 2014

Real Time Visibility with SAP BI Analytics on the operational data store, no

more waiting for information to show up in theData Warehouse

Drill down to granular data, no moreaggregations

Optimizations for Line Of Business Accelerated business processes for all Lines

of Business Relieve time pressure on nightly batch

processing window

Renovated User Experience with SAP Fiori New role based applications with simple and

intuitive UI that provide instant value

2014 SAP AG or an SAP affiliate company. All rights reserved. 22Customer 2014 SAP AG. All rights reserved. 22

The TCO Equation is ElusiveHardware is just 5-10% of overall costs

Hardware

ContinuousImprovement

Data Footprint

Replication & ETL

Operation

Search &Accelerators

Software

Significantreductions in all

other TCOdrivers enabled

by SAP HANA faroutweigh any

increase in H/Wcosts

SAP HANA H/W costsimpact less than 5-10% of

the TCO equation


HardwareCost Perception

Perception Reality Fact Implementing SAP HANA as the

technology of the future is costly Combined OLAP and OLTP systems on

one platform thus reducing overallcosts

Pacific Drilling -Significantly reduced datasize and footprint

Certified Hardware means aconsiderable addition in costs to theinvestment compared to othertechnologies

No components are exclusive to SAPHANA and consist of standard ITservers

ASE Korea - 20%potential improvement inIT maintenanceproductivity

The SAP HANA Appliance approachincreases the TCO unnecessarily

The SAP HANA Appliance secures aready to run system and the TDI*concept can be an alternative to lowerthe Hardware TCO

MaschinenfabrikRheinhausen TDI*substantially contributesto protecting out ITinvestments

Existing Hardware can not be re-used Existing Hardware can be used forboth non-productive and productivesystems.

itelligence - New platformto develop and to launchnew solutions add-ons,and functionality based onSAP HANA

*TDI : Tailored Datacenter Integration


TCO constantly decreasing on Suite on HANAHANA effects multiple elements in the TCO model

TCO Suite onAnyDB

TCO Suite onSAP HANA

System landscapesimplification


Operations

Hardware

Software

Hardware

Software


Operations

Search &Accelerators

Replication

Data Footprint

yAchievement in 2014:9 Seamless integration of HANA operations into data center

operations (tailored data center integration, TDI) with

existing enterprise storage Existing networking including check tools for critical KPIs Multi-VM virtualization for productive systems Installation by partner (both physical and virtual)

9 Significant drop of HANA server cost due to next generationIntel processors (Ivy Bridge) and productive use of Intel XeonE5 processor family

9 Multi-tenant database containers (with SP09)9 One-step migration and upgrade with DMO (database

migration option) of SUM (SAP Update Manager)

9 Reduction of data footprint with SAP Financial Add-on

For more information see:www.saphana.com/openness


Factors affecting the Cost and Investments intoSAP Buiness Suite powered by SAP HANA

Differentiate through innovation

Smaller IT Landscape Footprint.Reduction of IT Complexity

Increased flexibility through TDI anddeployment options

Faster Decisions with real-time Analytics and moreLoB users attracted to sw

Reduced expenses through Optimized Planning

Increased speed in Business Processes

Industry Business Processes

ITLandscape


New SAP Retail Learning Map Coming Soon!Available End of NovemberThe SAP Retail Learning Map will provide you with the knowledge you need to: Effectively position Suite on HANA and address retail industry requirements to the CMO Engage your audience when pitching the SAP Retail solutions to the CMO through whiteboard

Coming soon!Available at the end of November on sappartneredge.com Retail landing page

SAP Learning Map will include: SAP Retail: Overview SAP Retail: Selling to the Chief Marketing Officer SAP Retail: Pitching to a Chief Marketing Officer Interactive Video SAP Retail: Overview Whiteboard SAP Retail: Selling to the Chief Marketing Officer Whiteboard

Stay Tuned for more Lines of Business in Retail Industry learning maps yet to come!

Visit sappartneredge.com Retail page

Stay Informed: Subscribe to Partner News and Update your profile!


Where and how to start?Business scenario recommendation, value discovery workshop . . .

y SAP offers a proven methodology and approach to helpyou discover your specific business improvement areasand to quantify the value potential for you.

y Our business scenario recommendation reflects yourcurrent usage of your production software.

Get your own report: http://www.suiteonhana.com

y Our value discovery workshops use a proven methodologyto help you identify your specific business improvementareas and to quantify value potential.

y A deployment road map shows which scenarios wouldyield the greatest business and IT value for your business.It lists suitable deployment options (on-premise, cloud, orhybrid) and the rapid-deployment solutions that would bestfit your needs.


Real-time value of Retail powered by SAP HANAKey points to take home and Next Steps

SAP Retail on HANA provides a single source of truthabout your customers and your business, in realtime Transform into a real time retailer, react faster than

the competition

SAP Retail on HANA allows you to interact in realtime with millions of consumers, providing apersonalized experience across all channels Create a differentiating and compelling experience

for your customers

SAP Retail on HANA has accelerated key retail andLoB processes Optimize your LoB operations and change the way

people interact with SAP systems Reduce the time pressure on your nightly

processing window

SAP Retail on HANA finally allows you to use themountains of data generated in your business everyday to better serve your customers and manage yourbusiness

SAP innovations have revolutionized retail

Next Stepsy What we offer:

1:1 Follow Up sessions too Discuss specific customer opportunitieso Identify the potential in your industry in more detailo Support the re-qualification of your industry BAiO

template on HANA

y What we would like to get from you: Strong commitment to HANA Integrate Suite on HANA for new and existing customers

in your 2015 business plan Accelerate your GTM Plan for 2015 based on Suite on

HANA

Summary


2014 SAP AG or an SAP affiliate company.All rights reserved.

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In particular, SAP AG or its affiliated companies have no obligation to pursue any course of business outlined in this document or any relatedpresentation, or to develop or release any functionality mentioned therein. This document, or any related presentation, and SAP AGs or its affiliatedcompanies strategy and possible future developments, products, and/or platform directions and functionality are all subject to change and may bechanged by SAP AG or its affiliated companies at any time for any reason without notice. The information in this document is not a commitment,promise, or legal obligation to deliver any material, code, or functionality. All forward-looking statements are subject to various risks and uncertaintiesthat could cause actual results to differ materially from expectations. Readers are cautioned not to place undue reliance on these forward-lookingstatements, which speak only as of their dates, and they should not be relied upon in making purchasing decisions.

Win with SAPA HANA

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