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CMOs Should Watch “Revenge Of The Nerds” And “Real Genius”

April 30th, 2013
The biggest challenge that is facing marketers in the next five to seven years is the quest to become relevant, which means that they need to become data geeks. In fact, it is crucial that they become bigger and better geeks than their IT counterparts. As the pendulum moves from art to science, many marketing leaders find themselves on a platform of skills that are no longer the keys to success, writes retail columnist Todd Michaud.

Instead of IP addresses, they need to think about e-mail segmentation. Instead of database clusters, they need live content marketing. Instead of disaster recovery, they need to wake up focused on integrated marketing across all digital channels. It’s as much science and math as configuring a new router, and that has many marketers nervous. And it should. But as these marketers find their way into this new world of math and science (digital relevancy), they need to be careful to not cross the fine line between being relevant and being just plain creepy.Read more...


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Walmart’s Employee Mobile Trial Is That Rare Bird: It Helps Associates While Helping Corporate’s Bottom Line

April 29th, 2013
Sometimes, a program that makes associates happier—even Walmart associates—can also help the bottom line. Consider Walmart's mobile (and, to a lesser extent, desktop) program to make it easier for associates to find other work within their Walmart store.

Walmart (NYSE:WMT) has announced that it is expanding—to chainwide—an experiment to let associates more easily see work opportunities in other departments at their store, as a way to supplement their pay. "For example, a bakery or deli associate can now request to work an available shift in electronics or the lawn and garden area and vice versa," the Walmart statement said, adding that "this program is showing value beyond filling available shifts. It's providing associates the opportunity to help build their careers by learning about different departments, which helps strengthen our stores and benefit associates and our customers."Read more...


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Tesco Really Doesn’t Like NFC

April 26th, 2013
Near field communication (NFC) is retail's whipping boy these days, with almost every analyst and vendor going out of their way to point out how poorly it's done and how bleak the NFC future is. And although deep shopper apathy about NFC has justified many of those critiques, major chains—wanting to keep their options open—have hesitated in outright attacking NFC. That's why a blistering critique from the world's third largest chain, Tesco, is so potentially devastating.

"NFC was revolutionary 10 years ago but I think it just might have passed its sell-by date," Lyndon Lee (Tesco Enterprise Consultant Architect) told attendees at a mobile payments conference in London this week, according to a report in NFC World. "Is mobile NFC at the right place, at the right time? I don't see any real movement or activity. NFC usability is not really revolutionary and, for the general public, is it really that cool? I think the next generation won't think it's cool enough for them and they won't use it. Mobile NFC is unappealing."Read more...


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Facial Recognition May Not Work For Security, But For CRM, …

April 24th, 2013
With all of the in-store changes being pushed by mobile—including the long-overdue-predicted disappearance of the cashwrap—retailers are going to be moving payments in-aisle and pretty much anywhere instore. Does facial recognition make sense? One vendor on Tuesday (April 23) tried, with a system that allows facial recognition to unlock a refrigerator, which determines which products are removed based on weight.

Although the current version of the system has serious technical limitations, the potential is probably greater for facial recognition than any other technology. Unlike PIN, cardswipes or any other form of biometrics, facial recognition has the promise to do far more than verify identity, including guessing at emotional state, gender, age and other attributes. Selling suntan lotion? How about the ability to identify shoppers with deep tans? Want to be able to tailor suggestions made to first-time shoppers based on gender or age? With a thermal scan comes the ability to pitch hot cocoa to shoppers whose skin is especially cold or ice-cold lemonade to those whose skin is especially hot. (It could factor in the outside temperature so that it doesn't confuse someone who has been working in the sun with someone who is just running a fever. And if that shopper does have a fever, how about 50 cents off Tylenol?)Read more...


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Online Sales Tax Bill Could Help Chains With Taxes, Too

April 24th, 2013
Online sales taxes are marching toward reality much faster than anyone would have expected even a month ago. The "Marketplace Fairness Act," which would allow states to collect sales taxes through online retailers even if the merchants don't have physical operations in those states, is being debated in the U.S. Senate this week after being fast-tracked to avoid the Senate Finance Committee, where every previous version of the bill since 2001 has died.

One key element of the bill that won't relieve the tax pinch but should simplify the implementation: A state can't start requiring collection of the taxes until it provides free software that nails down all the complexities of that state's sales tax structure, including automatic calculation of what rates are owed on which products for any location in the state.Read more...


Amazon Issued Patent To Make Mobile Purchases Anonymous

April 19th, 2013
When Amazon was awarded a patent this week to allow for anonymous online purchases—anonymous from shopper to shopper, not anonymous to Amazon—it could be the world's largest e-tailer taking its next step into payments. The actual money part of the payments are still to be handled through the same means Amazon does today—payment card, bank account debits, gift cards, Amazon Store Card, etc.—so it's not about Amazon becoming a processor. What it does, though, is add a layer on top to allow consumer-to-consumer transactions to be done without sharing private information with strangers. (Or, much worse than strangers, relatives.)

When this approach would make sense depends on the nature of the transaction. If the purchase involves the seller sending a physical product to the recipient, the recipient has little choice but to reveal name and street address. But for digital purposes, it could work well. And it might even work with physical shipments, assuming the recipient uses a post office box or some similar alternative.Read more...


New FTC Geolocation Ruling Will Force Retail Data Changes

April 18th, 2013
On Monday (April 15), the U.S. Federal Trade Commission (FTC) cut a deal with some manufacturers whereby they agreed not to include "phone home" software, which would tell the leasing company the address of the computer or other device without the express consent of the lessee. The retail bottom line: All of those apps you're using to gather shopper information may now legally require very specific notices. That, plus the always-feared opt-out for gathering any geolocation data. Uh-oh.

The FTC consent decree involves shoppers who lease computer equipment and other devices equipped with GPS tracking or other tracking software, pens legal columnist Mark Rasch. If a consumer fails to make a scheduled payment, or if they default on the terms of the contract, the leasing company would activate the software, which could do things like turn on the cameras on the computer, capture keystrokes on the computer, or use either Internet protocol or GPS tracking to determine the exact location of the computer. In this way, the retailer would be able to engage in a form of "electronic repossession" of the device, either shut it down completely, or sending someone in to actually physically retrieve the device. Read more...


Starbucks Weighs In On “Download Mobile App Vs. Get Customers In-Store” Debate. And The App Won

April 15th, 2013
A classic retail mobile question is whether it's better to get shoppers in the store or to get them to download the retail mobile app. Starbucks (NASDAQ:SBUX), which has one of the most successful mobile payment programs in retail and also happens to not have the typical online-offline internal corporate conflicts, has come down squarely on the "'tis better to get the app downloaded" side.

For years, the coffee chain has pushed a promotion called Pick Of The Week, where it gave free copies of various pieces of digital media (songs, apps, games, etc.) to shoppers who went in-store and grabbed a card with a code on it. As of April 9, Starbucks has changed the program, no longer requiring the card to get the digital goodies. All it requires is downloading the app. "The intent is really to build a relationship. You don't need to go into our stores," said Linda Mills, a Starbucks senior manager for global brand public relations. "This is about educating about our product offerings and just engaging with our customers."Read more...


JCPenney’s Johnson Is Out, Ullman Is Back. Now What?

April 9th, 2013
What happens next at JCPenney (NYSE:JCP), after the 1,100-store chain fired CEO Ron Johnson on Monday (April 8) and replaced him with the CEO that Johnson replaced, Mike Ullman? The retailer isn't saying. But one thing is certain: The chain won't just be turning the clock back to the day Ullman departed in 2011. Many of the internal changes Johnson instituted at JCPenney are effectively irreversible, including remodeling all the chain's stores and replacing much of the chain's IT capability. That money is already spent.

Johnson had already reversed many of his decisions that were the most unpopular with shoppers—including his elimination of sales, discount pricing (including "mark up to mark down") and coupons. And then there's Johnson's beloved shops-within-the-store concept—which isn't likely to be reversed, mainly because it was originally the brainchild of a former Sephora executive with a familiar name: Mike Ullman.Read more...


Care About Issues Beyond IT?

April 6th, 2013

One of the results of StorefrontBacktalk‘s being acquired back in December is that we are going to be expanding into coverage that goes beyond Retail IT into other areas of retail. The first example of this launched last week and is a daily newsletter and site called FierceRetail.

The site applies the same kind of perspective, analysis and bad jokes that StorefrontBacktalk has always delivered, but we can now explore issues way beyond IT. Consider our coverage of an unorthodox Apple patent, the reasoning behind the Sears Portrait shutdown, why Target’s Manatee mishap is a lot worse than it looked, Samsung’s real retail strategy, why Best Buy and Target’s Geek Squad alliance was doomed and stats showing Visa having all-but-cornered the debit market. It’s all free, of course. If you’d like to sign up, our latest thoughts will be in your Inbox early each morning.…


A Breached Chain Needs To Remember Its Shoppers Are Victims, Too

April 4th, 2013
When a cyberthief breaks into a retailer’s network and steals data and payment card specs, the retailer absolutely is a victim. But many chains tend to think of themselves as the only victim, an attitude that manifests itself in various ways when talking with their customers who are also victims. Just because a shopper’s monetary losses are being covered by zero liability doesn’t make them feel less violated and, therefore, feel any less like a victim, pens legal columnist Mark Rasch.

When setting policies and when talking with shoppers after a breach, communicating the message that the retailer is the only victim may prove to be self-fulfilling, as you'll quite likely be an imminent victim of lost revenue and thrown-away loyalty. When a crime has been committed, attitude and empathy go a long way — and they are among the hardest things for many chains to deliver.Read more...


Federal Judge Nixes Re-Used Digital Content Copyright Exemption

April 3rd, 2013
Retailers eyeing the repurposed (aka used) content space may want to rethink whether the effort to prepare to resell those e-books, audio files, videos, apps, games or ringtones makes much sense, given a federal court ruling Monday (April 1). That ruling, in favor of Capitol Records, said that getting around copyright rules by arguing fair use won't fly anymore. At least not with New York City-based U.S. District Court Judge Richard Sullivan.

The ruling dealt with the narrow area of recreated music, once the original producer has stopped selling the initial song. But the court's decision is likely to be applied to many kinds of resale efforts, at least in terms of copyright restrictions. In other words, pay once and sell many may have some new retail hurdles.Read more...


Are Stores Really Helpless Against Amazon? That Question Has It Backward

April 2nd, 2013
There's a jarring bit of retail insight buried in a story from The Register last Thursday (March 28): "No one can compete with Amazon when a customer knows what they want," The Register's Bill Ray writes. "Stores need to excel at selling things the customer didn't know they were after, and greater technology might not be the best way to achieve that." That sounds depressing, even though it's probably not quite true.

But let's turn it around: If a customer isn't a pure-play showroomer who really just wants to see whether that gadget looks cheesy or that blouse is the right color before buying on Amazon.com (NASDAQ:AMZN), what kind of in-store technology can help associates do a better job of helping customers find what they want—and convince customers that here and now is the right time and place to buy it?Read more...


The Ups And Downs Of QR Codes. (OK, It’s Really Just The Downs.)

April 2nd, 2013

QR codes have always been deceptively easy to use, for anyone other than shoppers. Business Insider recently some of the worst QR code deployments it could find and it’s worth a look.

But the retail examples were particularly interesting, such as Subway putting them on employee shirts, which is a place that employees report no one even tries to scan. But our favorite, depicted here, is a sign on how to use QR codes. And to give the lesson? Yep, the shopper has to scan a QR code. …


MasterCard’s Retail Data Grab: Forget PayPal, It’s About Chains

March 26th, 2013
MasterCard (NYSE:MA) wants your customer data. That's the bottom line when it comes to the new fee that the number-two card brand will start slapping on PayPal, Google (NASDAQ:GOOG) and other digital wallet operators in June. It's not really about digital wallets, which represent a tiny fraction of big chains' transactions. MasterCard just wants to put pressure on anyone who might keep customer data out of the hands of itself and its issuing banks.

Wait—isn't losing control of CRM data the biggest reason chains aren't wild about digital wallets in the first place? Wasn't everyone worried that Google might somehow share transaction data with a chain's competitors? Apparently, that fear was well-founded—just misplaced. It turns out the people who will do anything to grab CRM data are the card brands and issuers.Read more...


With Starbucks’ Grocery CRM Plan, It Had To Get Clever About Fraud

March 26th, 2013
When Starbucks (NASDAQ:SBUX) announced Wednesday (March 20) it would spread its CRM program to grocery stores that sell its bagged coffee, it wasn't merely an industry first. It was Starbucks' attempt to track shopper activity beyond the limits of the chain's stores, site and mobile app—as if CRM deployments aren't already complex enough.

Given that its program would deliver expensive value in the form of free food and drink at its stores, the first priority of the rollout was to try and discourage fraud. And that involved some creative packaging and identification mechanisms. And a choice to exclude mobile from the launch.Read more...


KFC Discovers That Mobile Isn’t Nice. It’s Essential

March 11th, 2013
When global chicken fast-food chain KFC launched a major mobile test in the U.K. this month, it has had to learn to deal with realities that are very different than its more mobile-famous corporate brother, Pizza Hut. Although the two chains are both owned by Yum Brands (NYSE:YUM)—along with Taco Bell—the mobile similarities pretty much end there. Some 40 percent of the pizza online orders come from desktops and laptops, with the remainder from mobile.

At KFC, the mobile percentage is expected to be much higher. That's because people typically want pizza delivered to their home or office, whereas a bucket of wings is picked up—after having been ordered from someone driving or walking near the store. (KFC in the U.K. does not deliver.) Pizzas also take longer to cook—compared with preparing already-cooked chicken parts—making the "order and have it waiting for you" model ineffective for KFC. Instead, KFC UK will soon add a geolocation function (likely to be launched in May), so the app knows when the customer is truly right by the restaurant and can ask the customer if the order can be prepared.Read more...


You Know What Your Shoppers Did Last Summer

March 7th, 2013
If consumers make purchases both online and in brick-and-mortar store, you know a great deal. You have surveillance pictures of them in the store. You know what they purchased and what they looked at. You have browser information. If you subscribe to any of the dozens of data aggregation or marketing sites, you know whatever is shared. With "big data" you have aggregated this data, too. Now imagine if you had to tell each and every one of your customers exactly what you collected and what you did with that information. We mean everything.

That is already the law outside the United States and Canada, writes Legal Columnist Mark Rasch, and it may already be the law in those two holdout countries. It's a matter of interpretation.Read more...


Today’s Mobile Uncharted Territory Lesson: What Happens When Your Processor Is Ordered To Not Take Payments?

March 6th, 2013

Today’s frightening question: What happens when your payment processor gets into a legal fight and suddenly can’t process your transactions? This is likely to happen periodically with mobile payments, as patent violations and state revenue rules start to play out. As if to prove that point, Illinois is ordering Square to halt any payments processed within its borders, something that is not likely

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to sit well with Illinois Starbucks (NASDAQ:SBUX) fans—nor Starbucks itself, nor any other Illinois Square merchant.

The Illinois cease-and-desist order involves the ghastly accusation that Square has not obtained the proper state license, something that is complicated by the fact that Square is arguing it doesn’t qualify for that particular license. Square has been fighting this battle in other states, too, with varying results. This is just something to remember when mobile processors are pitching their extreme savings. When entering new, uncharted financial waters, the costs get lower as the risks get higher. This won’t likely be an issue in about two or three years. But for now, having one or two back-up processors is probably not a horrible idea.…


CMU: Consumers Have Sharply Reduced Public Data Sharing

March 6th, 2013
For years, conventional wisdom about privacy has been that shoppers—especially younger shoppers—have been consistently sharing more information online to the general public, a trend that would likely continue as privacy desensitization progressed. But a report released Tuesday (March 5) from Carnegie Mellon University found the opposite when it tracked 5,076 Facebook (NSADAQ:FB) users from 2005 through 2011, one of the most extensive studies of social media privacy yet.

"Over time, Facebook users in our dataset exhibited increasingly privacy-seeking behavior, progressively decreasing the amount of personal data shared publicly with unconnected profiles in the same network," the CMU report said. The implications for retailers are stark, suggesting that many of the privacy strategy underpinnings on both retail and e-tail may be flawed. The report also found that those same consumers started sharing more information during that period, but only with people they assumed to be in a private group. And that sharing was expanded "both in terms of scope and amount of personal data." For retailers trying to extrapolate insights from this report to apply to chain CRM and mobile programs, these two conclusions are frustrating.Read more...


Isis Revamps Its Mobile Wallet And It’s Actually Fixing What’s Broken

March 5th, 2013
The news that Isis is working on a new and improved app for its mobile-payments system is a good sign, though maybe not for the reasons Isis wants it to be. OK, switching to an app developer that has never done a mobile wallet doesn't sound so good. Neither do the only numbers that anyone has yet released on Isis use: only 600 Isis-taps per day on Salt Lake City's transit system, and that's even with Isis giving its users a free ride. Nor do the terrible reviews Isis has gotten since it finally launched in October.

That good sign? As badly broken as its system may be, Isis is trying to fix what's actually broken.Read more...


Will Amazon’s Cursor Patent Lead To Manipulated, Unintended Clicks?

March 4th, 2013
In online, when does anticipating a user's likely move and making that move easier morph into imposing what the retailer wants the shopper to do? Can the programming power to make a site visitor's cursor go where the retailer wants—and to specifically click on what the retailer wants clicked, such as "click here to purchase"—be something merchants can be expected to be disciplined about using? This ethical and marketing question (now there are two words rarely seen together) is prompted by a patent granted to Amazon on February 26.

That patent discusses using what Amazon (NASDAQ: AMZN) calls "gravity-based link assist" to guide a cursor to where the system thinks the shopper wants it to go. And to do so more quickly than some systems can. Although the patent specifies that this approach can be used in laptops, tablets and a wide range of other devices, its initial focus is on ebooks. That is because of a very specific technical issue: ebooks often have much slower refresh rates, so slow that shoppers can be confused about whether they have successfully clicked a link.Read more...


Is Customized Pricing Brilliant Or An Imminent Disaster?

March 1st, 2013
A recent patent by search giant Google (NASDAQ:GOOG) may fundamentally change the sales process from a 21st Century marketplace back to a 7th Century shouk, with prices based on sellers' perceptions of who their customers are and what they are willing to pay, argues Legal Columnist Mark Rasch. There is a huge difference between "dynamic advertising" and "dynamic pricing." In the case of the former, he says as an example, he got an ad for a Toyota while his more affluent friend got an ad for a Lexus. Fine, he didn't want the Lexus anyway. In the case of the latter, he and his friend each got ads for the same Toyota Camry, but his friend's price was different from his. And that is based on what Google, and possibly the Internet, knows about his friend.

And if you go online to search for a better price? The results are "rigged." If you are showrooming at a Best Buy (NYSE:BBY), see a 60-inch LCD for $950 and scan the barcode for an Internet search for a lower price, Best Buy could pay Google (or others) not to deliver lower prices—either to the world or to certain profiled individuals.Read more...


At JCPenney, Everybody Gets A POS iPod In March

February 28th, 2013
All JCPenney (NYSE:JCP) associates will be able to do in-aisle checkout "within one month," the troubled chain's CEO said during an earnings call on Wednesday (Feb. 27). The move comes as 25 percent of sales transactions in the stores are already being done on mobile POS.

The 1,100-store chain is also a few months away from going live with a new financial system from Oracle (NASDAQ:ORCL, to be followed before the end of the year by merchandising, planning and allocation systems, all of which will replace legacy systems. That's presuming the board's patience with CEO Ron Johnson holds out—unlike most big chains, JCPenney's E-Commerce site isn't doing any better than in-store, and the chain lost $552 million during the last three months.Read more...


Macy’s Stops Reporting Online Stats, Blames Too Much Channel Blur

February 27th, 2013
Arguing that "the line between stores and the Internet is blurring so much," Macy's (NYSE:M) has become the first major publicly held retailer to stop reporting its E-Commerce stats. Setting aside the fact that Macy's would always see less disclosure—especially to rivals—as a nice thing, the move signals an important step for omni-channel/merged-channel retailing. The day when in-store, mobile and online are so intermixed that they can't be meaningfully broken out is the same day true merged-channel retailing has happened. For Macy's, that day happened on Tuesday (Feb. 26).

"Candidly, it's getting so hard to know what's a store sale and what's a mobile sale and what's Internet. It's getting harder to figure out the lines between them," Macy's CFO Karen Hoguet told analysts on Tuesday. When asked for some E-Commerce projections, she said: "I really can't give you that number. I mean, I don't know it. But clearly, the growth is continuing very aggressively. But sometimes, it's being bought on a mobile device sitting in a store. So I'm not sure how to define that."Read more...


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