Mobile app pros and cons | New digital chiefs at Walgreens, Kohl's

▸ Procter & Gamble updates ▸ AI gauges guest sentiment ▸ Equifax ex-CIO surfaces ▸ CxO jobs and career moves ▸

Welcome to another edition of Digital Business, a newsletter about real digital activity in corporate America, and the executives leading the way. If you think this is valuable market intelligence, please pass it along and urge your network to subscribe.
— Mitch Betts

Newsletter by journalist Mitch Betts © Ampersand Reports 2019, all rights reserved.
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Retail apps: More sales, more returns. New research in the INFORMS journal Marketing Science shows that retailers’ branded mobile apps are very effective in increasing customer engagement — increasing sales on multiple levels, not just on the retailer’s website, but also in its stores. At the same time, apps increase the rate of returns, although the increase in sales outweighs the return rates.

The details. The study of retail mobile apps was conducted by Unnati Narang and Ventakesh Shankar, both of the Mays Business School at Texas A&M University. Based on a data set from “a large-scale U.S. retailer of video games, electronics, and wireless services” — the study found that retail app users:

  • Buy 33% more frequently, and buy 34% more items

  • Spend 37% more than non-app user customers

  • Return products 35% more frequently, and return 35% more items

Quirky findings. Nevertheless, all factors considered, the researchers found that app users spend 36% more — net of returns. “Interestingly, we also found that app users tend to purchase a more diverse set of items, including less-popular products, than non-app users. This is particularly helpful for long-tail products, such as video games and music,” Narang said. Plus, some customers use the app to check loyalty rewards and product details — even when physically close to a store, Shankar said.

Related: In the retail pharmacy industry, only 20% of customers use a pharmacy’s mobile app, but those who do have satisfaction scores as much as 23 points higher than those who don’t. (J.D. Power)


Real digital activity in corporate America

Executives at consumer products giant The Procter & Gamble Co. provided some insights about FY 2019 digital activity, at a Sept. 5 investor conference:

CFO Jon Moeller: “E-commerce organic sales: up 25%, now well over $5 billion in annual sales, or about 8% of the company total.”

CEO David Taylor: “In the U.S, we built a data & analytics learning lab, based on anonymous media audience data and retail purchase information. We’re moving from generic demographic targets — like women 18 to 49 years old — to more than 350 precise, smart audiences, like first-time moms, millennial young professionals, first-time washing machine owners, and many more, to reach the right people at the right place at the right time.”

AI gauges guest sentiment. Great Wolf Lodge, a Chicago-based chain of family resorts with indoor water parks, is using AI software to better understand guest experiences at its lodges, according to CIO Edward Malinowski. Great Wolf’s homegrown Artificial Intelligence Lexicographer (GAIL) sifts through comments that guests have posted in monthly surveys. Thanks to natural language processing, GAIL analyzes the comments to determine whether the author is likely to be a net promoter, a detractor, or neutral. That helps the business operations team refine guest services, says Malinowski. — Clint Boulton,

Stock brokers get conversational. Investors with accounts at E*Trade Financial Corp. can use the Google Assistant to check their brokerage accounts and positions with easy-to-use voice commands, e.g., “Hey Google, check my E*Trade portfolio,” according to Ed Andersen, VP of Mobile & Advanced Technology. Rival TD Ameritrade Inc. announced the same Google Assistant capability (e.g., “Hey Google, check my TD Ameritrade portfolio”). According to CIO Vijay Sankaran, “TD Ameritrade built the experience with data security & privacy in mind. For example, on shared devices like Google Home, the Assistant will only read aloud percentage changes — not specific monetary values — when clients ask about their portfolio.”

  • Broader trend. A Capgemini Research Institute study says consumers will be increasingly comfortable using voice & chat assistants for researching products, learning about new services, and customer service queries.

Prudential buys online insurance startup. Prudential Financial Inc. has agreed to pay $2.35 billion for online startup Assurance IQ Inc. as traditional life insurers seek to reach digital-savvy customers who shop on the internet. Assurance uses online advertising to attract consumers to its online platforms, and then uses data science & machine learning to assess needs, guide customers to products they can afford, and speed up the application process. — Leslie Scism, The Wall Street Journal


“We couldn’t define digital as e-commerce, because the supply chain guys would say, ‘I want to be digital, too.’ Or as operations, because the salespeople would say, ‘What about me?’ So we clearly defined digital as something that helps us go 100 times faster — not to second-guess what we’re trying to do, but wanting to go faster.”

Sandeep Dadlani, chief digital officer at Mars Inc., in the Path to Purchase Institute’s profile


Executive appointments, promotions, and transitions in corporate America

Walgreens Boots Alliance Inc. (WBA) — which ranks No.17 on the Fortune 500named Francesco Tinto as SVP & Global CIO, located at corporate HQ in Deerfield, Ill., and reporting to WBA’s co-COOs. “Tinto will oversee the global strategy for WBA’s IT operations across all of the company’s divisions, as well as the implementation of its technology and digital innovation. His role will include data analytics, business intelligence, development, support, infrastructure, security, and technical services,” the company said. Tinto previously was Global CIO at The Kraft Heinz Co.

Retailer Kohl’s Corp., based in Wisconsin, named Paul Gaffney as Senior EVP & CTO, reporting to the CEO. As CTO, Gaffney will be responsible for “all technology, information and digital platforms supporting Kohl’s omnichannel business,” the company said. He was previously CTO at Dick’s Sporting Goods Inc., and SVP of IT at The Home Depot Inc.

GATX Corp. — a global railcar leasing company, based in Chicago — appointed Adam Stanley to its board of directors, serving on the audit committee. He is Global CIO & Chief Digital Officer at Cushman & Wakefield plc.

CNA Financial Corp., based in Chicago, appointed Jane Possell as CIO, reporting to the COO. She was previously VP of U.S. Digital and Business Insurance Technology, at Liberty Mutual Insurance.

Jennifer (Jen) Felch has started work as Chief Digital Officer at IT vendor Dell Inc. in Texas. Felch will lead Dell Digital (Dell’s IT organization) like a CIO, with additional duties as “change agent for digital transformation.” She was an SVP in Dell’s Office of the CIO, leading corporate supply chain, IT strategy, and business operations. In an introductory blog post, Felch outlined how she’ll take digital transformation “to the next level.”

The next phase of this journey will be moving forward with our product-oriented approach that will drive more direct accountability for how our solutions are designed and operate. We’re moving Design and DevOps to the forefront of IT, like a software organization. With a better understanding of our customers’ & partners’ needs, we can more quickly adapt and introduce new capabilities to improve the overall experience. All of this relies on our continued work to modernize our applications & infrastructure by migrating to our private/hybrid cloud.

A unique aspect of our new operating model is that it features four critical cross-functional journeys aligned to the experiences that people have with us. These are the Customer journey, Team Member journey, Product Group Enablement journey, and Product journey, which is the experience for our own organization to design, develop, and deploy solutions. Members of my leadership team will assume responsibility for these journeys to drive focus, accountability, and progress across the functional operations.

The Deere & Co., based in Moline, Ill., elected John May as CEO, effective Nov. 4. Currently COO, May has held a variety of executive roles at the company, including CIO (2012-2018).

Former tech chiefs at AT&T Inc. move to the top of the C-suite. AT&T appointed John Stankey as President & COO, effective Oct. 1, a new position reporting to AT&T’s Chairman & CEO Randall Stephenson. Stankey will be in charge of three of AT&T’s four business units (AT&T Communications, WarnerMedia, and Xandr), which had combined revenues of $170.7 billion in 2018. Stankey — who was once AT&T’s CIO/CTO (2005-2007) — is considered a likely successor to CEO Stephenson.

  • Meanwhile, AT&T named Jeff McElfresh as CEO of AT&T Communications LLC (the company’s largest business unit, covering mobile, broadband and pay-TV services), effective Oct. 1, and reporting to Stankey (above). McElfresh was President of AT&T Communications’ Technology & Operations group, where he was responsible for the company’s network, technology, cybersecurity, data, and labs operations.

Marty Chavez, global co-head of the securities division at Goldman Sachs Group Inc. — overseeing a digital transformation there — will retire at the end of the year at age 55. He started at Goldman Sachs as a young computer programmer 26 years ago. He served as CIO from 2014 until 2017, when he was named CFO. (WSJ, CNBC)

The Principal Financial Group, based in Des Moines, Iowa, said that Gary Scholten, EVP & CIO & Chief Digital Officer announced his retirement, effective Dec. 31, 2019. An internal & external search for his replacement is underway.

Guidewire Software Inc., based in San Mateo, Calif., and serving the insurance industry, appointed Michael (Mike) Keller to its board of directors. Keller was EVP & CIO at Nationwide Insurance & Financial Services.

Sirius Group, a global insurance company, announced a new slate of C-suite executives, including Beth Boucher as “incoming” CIO.

Houston-based GoExpedi Inc., which runs an e-commerce platform for industrial procurement, hired Steven Hunter as CTO. He was SVP & CIO at Stage Stores Inc. In addition, GoExpedi co-founder Jonathon Howey was named CIO, overseeing the platform’s architecture, data, infrastructure, and customer experience.

AI Global, a nonprofit organization focused on advancing responsible & ethical adoption of artificial intelligence (AI), named Ashley Casovan as Executive Director. She was Director of Data & Digital for the Government of Canada, where she led development of the first national government AI policy. The organization also added to its network of advisors, including Rajeev Ronanki, SVP & Chief Digital Officer at Anthem Inc.; and Cameron Davies, SVP for Corporate Decision Sciences at NBCUniversal. The group is working on three initiatives:

Responsible AI Portal: An authoritative repository of reports, standards, models, government policies, open datasets, and open-source software to help members better navigate the AI landscape and directly connect with the experts who created these tools.

Responsible AI Designer: A virtual assessment to help members anticipate problems and future-proof their AI system. This tool brings together research and industry best practices to help designers, developers, and product owners keep in mind key AI challenges, including data rights & use, privacy, security, explainability, fairness, bias, and robustness. 

Responsible AI Check: An independent certification mark to help consumers easily identify trusted AI services and tools. Based on an AI Trust Index, the certification mark is continuously aligned with principles, best practices, and standards for responsible design, implementation, and use of AI. 

Related: How to create an AI ethics committee at your company (PDF)

More appointments & promotions: ▸ Shayne Mehringer, CIO at FastSigns International Inc. in Carrollton, Texas ▸ Stephen Skarlatos, CIO at Planned Systems International Inc. (PSI) in Arlington, Va. ▸ Astin Thomas, CIO at Sunbelt Transformer Ltd. in Temple, Texas (via Heller Search) ▸ Wasim Khan, Chief Digital Officer at Ripcord Inc. in Hayward, Calif.


Informal, insider tips

Graeme Payne — the former Equifax CIO who was in the hot-seat when Congress investigated the credit bureau’s calamitous 2017 data breach — has surfaced: He’ll be speaking at a Sept. 13 private event during the InfoSec Security Conference in Nashville. He now bills himself as an executive advisor on cybersecurity, and has a book out: The New Era of Cybersecurity Breaches, in which he “describes the challenges of managing cybersecurity, and the story of the Equifax cybersecurity breach.”

GameStop Corp. admitted that it redesigned its website because of customer feedback that “it had become increasingly difficult to use.”

Options Clearing Corp. (OCC) will pay $20 million in penalties to the SEC and CFTC to settle charges that it failed to comply with regulations involving risk management and IT security.


(links worked at time of publication)

SUEZ Water Technologies & Solutions, in Trevose, Pa., is seeking a Chief Data Officer “who can establish & build a cultural change around data excellence.” Tableau and SAP ERP experience “desired.” The same organization is seeking a Chief Information Security Officer.

HUB International Ltd., an insurance broker based in Chicago, is seeking a Chief Data Analytics Officer “responsible for developing a firm-wide data management strategy … including the development of data mining & insights, governance, analytics, and positive EBITDA programs.”