Top Stories



Data Portability Is Your Get Out Of Jail Free Card

March 7th, 2012
On your list of must-haves for a new retail technology, application functionality is essential and ease of use is great. But the absolute top requirement should be the portability of the system's data, pens Retail Columnist Todd Michaud -- even if you don’t need that portability today.

Being able to move data around your enterprise gives the most flexibility in using that data, and data portability also future-proofs your system by letting you bolt on new technology quickly instead of slowly and oh-so-carefully making changes to what you've already got.Read more...


eBay Playing, And Losing, The Retail Prediction Game

March 6th, 2012
For many years, Microsoft top brass entertained Silicon Valley by predicting when it would release an important application and never getting the date right. Microsoft played Lucy to the media's Charlie Brown. eBay CEO John Donahoe is trying to bring back some of that old Microsoft humor.

In Donahoe's case, he has been trying to predict what major retail chains will do. Back in July 2011, he confidently told investors that eBay would have 20 national retail trials in 2012. Last week, Donahoe slashed that figure almost in half, now saying that 10 to 15 retailers will be offering PayPal in-store this year.Read more...


Attention: Kindle Readers. We Need Your Help

March 6th, 2012

Due to the (strange? pyschotic? drug-induced?) unusual policies at Amazon, publishers have no idea who their Kindle subscribers are. That puts us here at StorefrontBacktalk in the awkward position of having to make a plea to our Kindle subscribers: Please reveal yourselves, and tell us how you find the Kindle subscriptions. We’re considering some changes to the service and any customer feedback goes to Amazon—and it’s not sharing. Therefore, we’re begging for whatever feedback you want to share to please share it with us directly.

For you Kindle people who have not yet subscribed to our Kindle feed, it’s not bad for convenience when traveling, when you’d like the latest on retail tech and E-Commerce beamed into your Kindle when you’re not looking. …


Target Site Snafus Sink Sales, Says Target CEO

February 29th, 2012's ongoing teething problems are showing up in the bottom line. On a February 23 earnings call, Target CEO Gregg Steinhafel said that during the critical holiday selling season in November and December 2011, the site's weaknesses hurt comparable store sales—even though the site was no longer crashing the way it did during September's Missoni Tuesday.

That suggests the fallout from all that lost learning during Target's Amazon years goes a lot deeper than it earlier appeared. And any advantage in Target's latecomer-to-E-tail status may have been lost in the struggle just to get the site working properly.Read more...


Can Some Returns Be Predicted And The Associated Inventory/Revenue Impact Flagged?

February 29th, 2012
One of the worst parts about managing retail businesses is dealing with unknown future returns. Is that booked revenue all real? You can certainly know that, statistically, XX percent will be lost to returns. But is it possible to know more specifically?

What if your system could look for hints about specific purchases that could be flagged for likely returns? Perhaps a customer who purchases three of the identical shoe, but each one in a slightly different size?Read more...

Bloomingdale’s And The CRM App That Associates Were Never Asked About

February 29th, 2012
One of the oldest adages in IT is that corporate tends to issue edicts without checking how they will play in the stores, without asking the foot soldiers and store managers whether it's a good idea. A consultant this week offered a deliciously illustrative example, and it involves Bloomingdale's and a CRM project.

The coincidental number that was the program's weak spot? The required information-gathering with a customer took about 10 minutes, which is also roughly the same amount of time it takes most associates to make a new sale. They receive commission for those new sales and nothing for filling out the forms. Wonder why the program didn't work well?Read more...

You Feel Like Arguing? Yeah, I Mean You

February 27th, 2012

In our attempts to battle the never-ending assaults by Spammers, StorefrontBacktalk had to do something this week for which we need to apologize. Our direct discussion forum—Go Beyond The Story—was recently overrun by Spammers. To make the forum useful, we had to wipe out existing users. We then put in place much better security. Now, we are asking our readers who had signed up for accounts in the forum to please sign up again.

We have also cleaned up our discussion forum on LinkedIn. If you want to jump into a discussion on our LinkedIn page, you simply need to first join the StorefrontBacktalk group forum. For you Facebook fans, we have also reactivated the StorefrontBacktalk‘s Facebook page. We love when people comment on the stories, but we need to insist that only comments relating to a story be posted to that story. For comments that do not directly relate to a story or column, the Go Beyond The Story forum is home. And we want it to be a noisy home, with lots of loud arguments and shouting. That’s how retail discussions are supposed to be.…

Never Mind Google’s Crumbling Cookies, It’s Retailers Who Are At Risk

February 22nd, 2012
In the wake of Google's latest privacy fiasco, is it time to give up on cookies? Last Friday (Feb. 17), a Stanford University researcher reported that Google and three other advertising companies use cookies on Apple's Safari Web browser even when it's set to block cookies. The backlash has increased scrutiny on how Google uses cookies—but any new regulations will affect cookie-using E-tailers, too. That same day—coincidentally—Facebook was sued for its own cookie mishaps.

With cookies already under tighter controls in the U.K. and the European Union, and the near-certainty of some sort of U.S. Congressional hearings, retailers should be making new customer-tracking plans—plans that don't include cookies.Read more...

Lousy Looking Apps Cost Retailers A Lot Of Money

February 22nd, 2012
Here's a bit of heresy that will drive your business managers wild: When preparing app requirements, forget business requirements (it needs to provide a 5 percent increase in sales), functional requirements (it needs to ring up a sale) and technical requirements (it needs to be built on Windows). Instead, push to the top of the list interface design requirements (it needs to accomplish the critical tasks in the least number of clicks possible).

Believe it or not, writes Retail Columnist Todd Michaud, that's where the money will come from. RIM had the BlackBerry on the market for years delivering E-Mail to business users around the world, but it wasn't until Apple launched the iPhone and that mobile access to E-Mail became ubiquitous.Read more...

Google’s PIN Pains: Will Citi Make This Wallet Safer?

February 16th, 2012
Google Wallet's security problems that surfaced last week—two different ways for a thief who has stolen a phone to get access to payment cards in the digital wallet—prompted Google to block new Google Wallet provisioning for several days until the company pushed out a fix. But the vulnerabilities also highlighted a major pain point: Shifting payments from plastic card to smartphone isn't just about technology, it's also about getting partners to cooperate—in this case, card issuer Citi.

The big problem: The most logical and secure technology fix—moving PINs to secure hardware—is something Citi seems unwilling to do.Read more...

New Retail Crypto Hole: Check Your Keys Now

February 15th, 2012
A new cryptographic hole revealed this week will impact one in 500 encryption keys, will be fairly hard for cyberthieves to find and will almost certainly be patched quickly. Still, it raises fundamental questions about encryption reliance. The group of cryptography researchers described an encryption hole that hits RSA especially hard, and at least one major chain is taking this very seriously.

"The bigger concern is internal keys, ones they couldn't survey. Without their data of 'weak keys,' we can't be sure we aren't using any," the retail exec said. "All owners of certificates do not know today if their keys are weak or not, and have no way of finding out just by examining them."Read more...

MasterCard Clarifies Its EMV Plans, Paints An EMV E-Commerce Future

February 8th, 2012
MasterCard has clarified its EMV push policies, saying its campaign will be focused solely on direct data breaches (as in a wide-scale attack on servers stealing millions of card numbers). Its second campaign will deal with individual fraud (as in consumers losing their cards and someone finding them and then running up charges).

But the number-two card brand also spoke of a near-term future where E-Commerce will be able to use the EMV chip to authenticate and process E-Commerce and M-Commerce transactions. However, will consumers pay more for laptops that can handle such security? And will tablets and smartphones—which can more easily and more cost-effectively handle such technologies—grow quickly enough to make desktop/laptop enhancements irrelevant?Read more...

Home Depot’s Weekend Noon Shutdown? It Made Perfect Clock Sense

February 8th, 2012
Home Depot's unusual move last week to shut down its site for 18 hours starting on Wednesday at noon was apparently done for some very logical reasons.

The timing of the move raised eyebrows. Such shutdowns have historically been done overnight, perhaps starting at about 11 PM or midnight East Coast time, and during the weekend. Also raising eyebrows was why a planned software upgrade required the site to be taken down at all. Given the home repair nature of Home Depot, weekend downtime can be more costly than a Wednesday or Thursday.Read more...

The Backward World Of Loyalty: “I’d Like A VCR, A Wired Phone and a Plastic Loyalty Card, Please”

February 7th, 2012
When it comes to loyalty, many retailers are stuck in the 1990s. Does anyone else find it funny that in a world where you can very easily have a video conference with your kids from a $500 tablet over free Wi-Fi from a random hotel, we're expected to keep a 3.3- x 2.2-inch piece of plastic in our wallets to get benefits from some of our favorite retailers?

All of this, pens Retail Columnist Todd Michaud, in an area—such as CRM—where the application of technology could directly impact a retailer's top and bottom lines.Read more...

Neiman Marcus Goes Down, But Only For A Special Few

February 2nd, 2012
Why are small problems sometimes the biggest pains? Sometimes because they're the hardest to spot. On January 25, Neiman Marcus' Web site was inaccessible only to customers using Internet Explorer versions 6 and 8 on Windows 7—everyone else was apparently able to get in without difficulty. This sort-of outage should have been easy to fix, but it lasted more than nine hours.

That suggests the Dallas-based high-end retailer made a change in the wee hours—exactly when you'd expect—but then accidentally left test code in the homepage. The result: a Web site that probably worked fine for everyone in IT, just not for all customers.Read more...

It’s Time to Ditch the Spaghetti Diagrams

February 1st, 2012
With all of the new data coming in from mobile and social, retail IT has a truly strategic psychological problem. The old way of creating interfaces between systems can't scale and will not deliver the results this new world of information overload demands. You've got to stop thinking about interfaces and start thinking about services. You've got to stop thinking about batch ETL processing and start thinking about real-time data integration and unstructured data.

You've got to start accepting cloud computing as a method of scaling your computing platform up and down, pens Retail Columnist Todd Michaud. In short, you've got to rip out most of your information architecture and start over.Read more...

As PayPal’s Home Depot In-Store Trial Expands, Can Users’ Sloppy Security Habits Change?

January 26th, 2012
PayPal's expansion of its in-store payments trial at Home Depot (up from 400 PayPal employees to all PayPal users) marks a huge jump in the trial's scope—and risk. On January 19, PayPal opened up the trial to include 51 stores (up from the initial 5) and said all PayPal users could now sign up for the system. That should give both PayPal and Home Depot much more useful information on who will use the system, and how.

But PayPal's approach—which essentially reverses 50 years of payment-card advances by eliminating any physical authentication device—still presents a big challenge when it comes to security. The ability to check out with just a mobile phone number and PIN—no plastic card, NFC-enabled phone or other authentication hardware required—means anyone who can acquire that phone number plus PIN has a free shot at the legitimate customer's account.Read more...

In Theory, E-Commerce Sites Are Way Too Slow. But Do Customers Care?

January 25th, 2012
Speed-tuning for retail Web sites may have finally hit a wall. A report released Wednesday (Jan. 25) says Nike, JCPenney, JCrew and Amazon had the fastest retail sites in 2011. But the survey also notes that the most popular and profitable sites are actually slower to load than the average site, because they contain so much content, and that content delivery networks don't actually speed up load times.

In theory, load times of 3 seconds or more should cost retailers half their customers. If that's true, E-tailers should be going out of business. Maybe it's time to dump those theories.Read more...

Should CIOs Now Surrender To Marketing? (Oddly Enough, The Answer Is “Yes. With Limits.”)

January 24th, 2012
In the power struggle between retail marketing and retail IT, IT is getting its server farms kicked. It started with E-Commerce and is now growing with mobile and social. What has to go? If it can go in the cloud, get rid of it. E-Mail? Gone. Web hosting? Out of here. CRM? Exit, stage right. If it can be easily outsourced by specialist firms or even done by people in the business unit, you need to let it go.

It's time to evict Web and mobile app development, and pretty much any marketing initiative that isn't core to your business. Heresy? Certainly, pens Retail Columnist Todd Michaud. But it's necessary.Read more...

Home Depot’s In-Store PayPal: Mobile Without The Mobile

January 11th, 2012
Home Depot's trial to let shoppers pay in-store with PayPal—a program confirmed late last week, which is loosely related to PayPal's wallet—is interesting more for what it doesn't do than what it does. It's a baby-step program in two ways.

On the mobile front, it's the first retail trial of PayPal's mobile payment program and it doesn't use a mobile device at all. (OK, that's more an embryo step than a baby step.) On the payment front, this is also a test of Home Depot accepting a rectangular magstripe card that doesn't say MasterCard, Visa, American Express, Discover or Home Depot on it.Read more...

Guess CIO On iPad Trial: “This Is The Consumerization Of IT.”

January 11th, 2012
Walk into one of about 25 Guess stores this week and you'll see customer-accessible iPads in the men's, women's and accessories departments and even in the dressing rooms. "For the cost of a kiosk, I can put in four or five of these," said Guess CIO Michael Relich. "This is the consumerization of IT."

But the Guess iPad trial is hardly being done to save costs. The flexibility of the tablets and sharp, customer-friendly graphics make the devices a much more effective way to show demos and to locate merchandise, check inventory and do anything else that a kiosk would normally do.Read more...

Questions To Ask Your System Vendor Or Reseller

January 9th, 2012
The National Retail Federation's Big Show is next week, and the exhibition floor will be crowded with vendors offering retailers all types of software applications. As a public service, following is a list of questions all merchants should ask their POS system supplier or reseller based on one QSA's experience—namely the experience of PCI Columnist Walt Conway.

The good vendors will be able to address all these questions. The not-so-good ones will hand you a carrier bag or a pen instead. Read more...

Protecting Call Centers, The PCI Way

January 3rd, 2012
The PCI Council used its December 2011 newsletter to remind merchants and service providers to control physical access to their call centers with video cameras or other devices. This recommendation is both sound security and good advice, and merchants everywhere should take it to heart. But as a QSA, PCI Columnist Walt Conway wishes the Council had done more than highlight just one particular sub-requirement.

There is more to protecting sensitive areas than installing video cameras. The second, and possibly thornier, concern for small and midsize merchants is how effective the reminder is likely to be when many of them mistakenly think they won't need to follow the advice.Read more...

Massive Subway Cyber Attack Ripped Into Weak Remote Access, Unencrypted Card Swipes

December 15th, 2011
The latest major retail data breach—involving 150 Subway locations and more than 50 other retailers, payment-card data from more than 80,000 shoppers and more than $3 million in bogus, but completed, transactions—is different than its predecessors for several reasons. Most notably, it appears to be the first major breach that was initially detected by a chain's own IT team.

The essence of the attacks' success leveraged two weaknesses: different unsecured remote-access packages used by various franchisees of Subway, which enabled easy Internet access to POS systems; and card swipes with minimal encryption. That meant key-capture software installed by the cyberthieves was able to grab data in the clear, as it was being swiped.Read more...

Microsoft Gives Up On Tag

December 14th, 2011

Microsoft has effectively thrown in the towel for Microsoft Tag. On Tuesday (December 13), Microsoft announced that its Tag Reader smartphone app will now support QR codes and NFC. Officially that’s to make Tag Reader a one-stop app so users won’t have to worry about what reader to use with various tags. In practice, it’s curtains for Tag, the multicolored 2D barcode that Microsoft rolled out in January 2009 but that never really caught on (not that the more successful QR code has been a barn-burning success).

In a blog post, Microsoft said it now recommends NFC for retailers to “blend in beautifully,” QR to “grab their attention” and Tag to “raise curiosity”—presumably as in, “curiosity about who’s still interested in Microsoft Tag.”…


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