advertisement
advertisement

JCPenney’s In-Aisle Checkout And Store Redesigns Are About To Collide

Written by Frank Hayes
September 20th, 2012

JCPenney showed off its new “shops within the store” concept on Wednesday (Sept. 19). But there are still more than a few unanswered questions about exactly how the retailer’s in-aisle checkout will work when it goes live in February 2013. The biggest issue: Will customers treat the clusters of mini-shops like a mall (pay when you leave each mini-shop) or like a department store (pay all at once at the end)?

The 1,100-store chain’s CEO, Ron Johnson, admits that JCPenney is still figuring out the workflow for checkout. He’d better work fast—this is a lot more complicated than anyone assumed.

The idea is simple. As Johnson reminded investors and analysts at an event this week, JCPenney plans to use item-level RFID tagging for all merchandise, which will enable every associate to carry a specially equipped iPod Touch to do in-aisle checkout. (Johnson is calling that “checkout in pockets,” because associates will be carrying the iPods in their pockets. Yeah, we thought so, too.)

Customers can also choose (for the foreseeable future) to check out at a conventional cash wrap, which will still take 75 percent less time because of the RFID tags. The chain will be phasing out those cash wraps very slowly, to avoid the “where do I check out?” reaction Johnson said was an early problem at Apple Stores.

All this will be going live next spring, just as JCPenney begins its three-year project to replace its 500-plus legacy systems with Oracle Retail. There’s no indication whether the chain plans to use Oracle’s new mobile POS offering, which the vendor announced on Tuesday (Sept. 18).

Whether it does or not, the problem JCPenney faces is the same: The new layout is terra incognita for checkout, and in-aisle checkout just makes things more complex. This isn’t like a conventional department store (say, the current JCPenney), in which nobody will look twice at a customer who decides to avoid the lines in the Women’s department and pay for her sweater in Housewares.

The chain’s plan is for each of the mini-shops to have its own branding, the way the Sephora stores already do. That means a completely different look, in addition to special training for associates in the mini-shops pushing Levi’s, Disney, Liz Claiborne, Joe Fresh and other brands.

It also means IT will be one of the few things that will be consistent from one mini-shop to the next. Or will it? Yes, every item will be RFID-tagged for the same inventory system. But that iPod Touch app used in the Liz Claiborne mini-shop? Will associates be able to use it to answer questions about other “departments” merchandise? If they can, that specialty branding is out the window. If they can’t? Well, what type of customer service is that?

What about the look and feel of those mini-shop apps, including the checkout apps? Will the Levi’s app look distinctively like it belongs to Levi’s and the Disney app to Disney?

Will a customer be able to get a Disney receipt when he buys his Levi’s, if the Levi’s line is too long, or will he have to go to a generic cash wrap? Will associates encourage customers to pay for everything they’ve got in their shopping carts to discourage customers from mixing paid-for and not-yet-paid-for merchandise (the biggest Loss Prevention fear that comes with in-aisle checkout)?

JCPenney could opt to have customers pay as they leave each mini-shop, but that’s a little crazy. It’s like making them pull out a wallet 10 times, when it’s clearly all the same store.

Or what if a customer hits the Levi’s mini-store for jeans and Sephora for makeup, planning to pay at a conventional cash wrap, but then sees a line at the cash wrap and decides to duck into the Disney mini-store to pay—and maybe ask an associate there questions about the makeup if it turns out she has changed her mind?

Exactly how much technology should be available to help when the Mouse House gets Sephora questions is really not clear. And JCPenney has less than six months to figure that out.


advertisement

One Comment | Read JCPenney’s In-Aisle Checkout And Store Redesigns Are About To Collide

  1. The Dr Says:

    Will the folks carrying the mobile POS i-pod (really an i-pod) be carrying around i-bags, and i-receipts to use once the RFID is disabled? You know those things that often tell the LP folks that someone actually paid? This sounds like a love of technology deal….. JCP needs to fix the supply chain and infrastructure – just buy a couple of shirts from them and you’ll realize the tech packs are out of wack – no two shirts / style fit the same. Hum – are i-pods really going to fix this company? Fix the supply chain / product mix first.

Leave a Reply

Readers, specifically those who want to comment on a story:
Our Comment SPAM system is getting very aggressive these days and has been blocking legitimate comments. If you post a comment and don't see it appear within 2 hours or so, can you please send a heads-up to customer-service@storefrontbacktalk.com? Ideally, please include the time you posted the comment. That will allow us to try and hunt for it. Thanks! P.S. We're working on fixing the system, but we don't want to lose any valuable comments in the meantime.

Newsletters

StorefrontBacktalk delivers the latest retail technology news & analysis. Join more than 17,000 retail IT leaders who subscribe to our free weekly email. Sign up today!
advertisement

Most Recent Comments

Why Did Gonzales Hackers Like European Cards So Much Better?

I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
Two possible reasons that I can think of and have seen in the past - 1) Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
@David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

StorefrontBacktalk
Our apologies. Due to legal and security copyright issues, we can't facilitate the printing of Premium Content. If you absolutely need a hard copy, please contact customer service.