Embracing Digitalization, Accelerating New Retail

1. Embracing Digitalization, Accelerating New Retail

2. Retail Industry Solutions Contents Retail Industry Trends Success Stories

3. Retail Industry History 2nd revolution 4th revolution The first department store Le Bon Marché was founded in Paris, France Michael Cullen founded the first supermarket, King Kullen in the USA 1852 1930 1995 Digitalization 1859 1962 2010 to 2016 New Retail • Launched by consumers • Integrated revolution • Omni-channel, multi-model A&P in the USA was the first grocery chain store New Model Omni-Channel 1st revolution 3rd revolution Source: Yiou intelligence

4. New Retail: Consumer-Centric and Data-Driven • Connectivity is the basis: New technologies such as the Mobile Internet, the IoT, and eCommerce connect consumers, goods, and sites together to enable digitalization. • AI and cloud computing mine and utilize the value of “consumers-goods-sites” data and ICT infrastructure resource to realize automation and intelligence of the whole retail business process. Enable “consumers-goods-sites” digitalization Consumers Consumers Mobile paymnet eCommerce Goods Mobile Internet Face recognition Consumer insights Customer segment analysis connection connection Omni-channel engagement …… Sites E2E tracing Automatic accounting Requirements prediction …… Goods Sites connection IoT Product recognition Smart goods placement Intelligent navigation Intelligent checkout Automatic price updates Improve customer experience and enhance brand competitiveness Improve operational efficiency, reducing costs，increasing revenue Infrastructure cloudification ……

5. Retail Industry Solutions Contents Retail Industry Trends Success Stories

6. Retail Industry Solutions Product AI Digital Terminal (Electronic Shelf Label) Commodity Management Customer Segment Analysis Store Intelligent Management Smart Store … ERP/CRM/WMS Supply Chain Management FusionBridge Server Public Cloud Storage SAP HANA FusionROBO Network Retail Cloud Platform

7. Customer Segment Analysis: Helps Optimize the Store Layout and Build High Quality Services Retail Cloud Platform Webchat App SMS Camera Data Wi-Fi Data …… No. and time of Customers Crowd flow TV Terminalt Store Screen Customer category / preference No. and time of stay … VIP Identification • Target customer segment to realize accurate information push • Analyze commodity attraction to optimize store layout

8. ESL Improves Store Operational Efficiency • Traditional way • ESL: Converged deployment • Huawei Wi-Fi and RFID Converged Network ESL Management System (partner) Paper Label AC/LSW Dedicated ESL + Dedicated Network ESL (partner) • Paper label requires annual maintenance • Slow manual price adjustment • Additional ESL network, higher costs • No annual maintenance cost • Network-wide price auto-adjustment, quick response • Reduces Total Cost of Ownership (TCO) by 50%

9. Automated Commodity Management, Efficient Inventory and Reduces Losses • Manual Management • Automated Management • Huawei Wi-Fi and RFID Converged Network Commodity Management System （Partner） AC/LSW Commodity Tag • Manual inventory, high costs, longer time • Lack of means to track commodity location • Automatic inventory, saves manpower, and achieves results in real time • Real-time monitoring of commodity position to reduce losses

10. Store Intelligent Management Creates Optimal Shopping Environment, Saves Operational Costs Creates Optimal Shopping Environment Retail Cloud Platform • Provides optimal shopping environment using intelligent control of a store’s temperature, humidity, brightness, and other factors, for the most ideal customer experience Cloud Managed Wi-Fi Platform Store Management System (Partner) Internet Reduces Operational Costs Huawei IoT Gateway • Monitors the energy consumption of large electrical equipment graphically, such as the store refrigerator, helping stores implement unified management and reduce operational costs. Monitor Platform Huawei IoT AP Store Terminal Zigbee/ RFID Wi-Fi Reduces Store Loss Store Control Panel • Store property can be effectively protected through invasion detection, alarms, and linkage video capture. Environment Management Equipment Monitoring Safety Protection

11. Product AI: More Convenient Shopping, Reduces OPEX Smart Cabinet Checkout Audit Unlock by mobile App scanning Goods information and picture input Pay by mobile App scanning Model and goods updated information push Model and goods updated information push Open and take goods Place goods in designated area Retail Cloud Platform (Model training, updates, application services) Close, App takes auto payment Camera identifies goods and generates the bill Product Identification terminal — Enabled by G1500 • Convenient shopping, shortens checkout time. • Saves store manpower allocation and reduces OPEX. Semi-closed area Shopping mall Convenience store Public area

12. Amazon FusionCloud Builds Safe, Open Retail Cloud Platform Optimal Experience WMS ERP Supply Chain Management CRM • Unified architecture of public cloud and private cloud • Unified services, APIs, and experie Container Middleware Application platform VDC1 VDC2 VDCn Service Driven Resource/Manage/Application Resource/Manage/Application Resource/Manage/Application • Enhances IaaS services GPUs, bare metal servers, and SAP HANA cloud servers to support cloud-based key services. • PaaS services, adapting to application data innovation Resource pool Reliable and Safe • Chips and hardware support high-performance cloud services. • Provides multi-dimensional and reliable disaster recovery services based on storage devices. VMware KVM Remote disaster recovery DC 1 Hybrid cloud SDN … Intra-city HA DC 2 DC n DC 3 Virtualization Bare metal SAP HANA GPU pass-through Docker Hadoop Public cloud Huawei Cloud

13. Smart Store: Improves Shopping Experience and Operation Efficiency Store Intelligent Management Customer Segment Management WAN/Internet AR HQ High-Density Wi-Fi Plan >> Install >> Optimize >> Inspect FusionROBO Product AI Electronic Shelf Label Commodity Management

14. Retail Industry Solutions Contents Retail Industry Trends Success Stories

15. Vmall: High-Performance Cloud Platform Facilitates Business Development Business Challenges • Platform reliability; disaster recovery and backup • System security, preventing hacker attacks • Data visualization, monitoring platform status in real time • Excellent customer experience, even during traffic surges Huawei Solution Solution for Public Cloud • Intra-city Active-Active Deployment and Remote DR Solution • Anti-Distributed Denial of Service Attacks (DDoS), security groups, and Web Application Firewall (WAF) ensure network access security. • CloudEye can customize the monitoring parameters in the background, send notifications by SMS message or email, while monitoring the platform status in real time. Internet Typical visits Typical visits AZ1/Langfang Ordering Impulse buying AZ2/Langfang Ordering Impulse buying Vmall platform-1 (public cloud) Vmall Impulse-buying cluster (public cloud) Vmall Impulse-buying cluster (public cloud) Vmall platform-2 (public cloud) VPN VPN DC Vmall (DR, Guangzhou) Customer Benefits • 300 Virtual Machines (VMs) can be created within 5 minutes during peak business hours, delivering excellent customer experience. • Sharply improves the network access security, preventing hacker attacks. • Reduces O&M and labor costs through customized performance data and alarm data. Customer Background • Huawei Vmall is Huawei’s proprietary eCommerce platform intended for its end users, providing terminal products and services, such as Huawei phones, wireless network access devices, tablets, and other related components.

16. UniEuro: Wi-Fi-based Precision Marketing Business Challenges • UniEuro is always committed to providing consumers with stable, high-quality free Wi-Fi services, including: • 100% Wi-Fi signal coverage  • Easy access to the Wi-Fi network to enjoy high-speed Internet services, even in densely populated areas • Using the Wi-Fi network to provide accurate terminal location information Huawei Solution • High-density Wi-Fi, full coverage against anti-interference signals • Customized portal  • Wireless positioning solution that provides open APIs for third-party professional retail data analysis platforms Customer Benefits Customer Background • UniEuro is the largest omni-channel distributor of consumer electronics and household appliances by number of stores in Italy. UniEuro operates through 225 directly operated stores, 267 affiliated stores, its eCommerce platform unieuro.it, as well as through B2B operations. • Optimizes consumers’ shopping experience. • Improves advertisement placement efficiency, marketing quality, and enables the free Wi-Fi service to become a Value-Added Service (VAS) for UniEuro.

17. SAP HANA Supports ECI’s Real-Time Business Decision-Making Business Challenges • ECI has a tremendous amount of data. It was a huge challenge for ECI to drive faster time-to-value from the data in order to increase profitability. • ECI planned to build a new platform to meet the Big Data analytics requirements of its internal departments for its Enterprise Data Warehouse (EDW). Huawei Solution • Huawei provides a brand new platform for integrating data from all of ECI’s information systems, enabling centralized data processing and analysis. • Huawei provides the KunLun SAP HANA appliance, which supports 16 TB and a maximum of 32 TB memory through expansion. Customer Background Customer Benefits • El Corte Inglés (ECI), headquartered in Madrid, is the biggest department store group in Europe and ranks fourth worldwide. It is Spain’s only remaining department store chain. • Based on in-memory computing, KunLun SAP HANA appliance delivers up to 1,000 times higher performance than the original system. • Based on the new platform, ECI develops operation analytics applications for real-time analysis of live and historical data, to make better, more timely business decisions while improving operational efficiency.