Evan Schuman's StorefrontBacktalk

The new groups would be modeled on industry-specific security groups formed in the U.S. in the wake of the 9/11 attacks. One of those groups now puts on real-time security exercises for retailers and payment-card processors, and a handful of large retailers also have participated. But exactly how useful are those war games? It's hard to say, because the participants aren't identified. And that may be one of the biggest selling points of this type of security program.Read more...

In Google's case, the employee reportedly abused his privileges to access confidential user information. In a payments context, a similarly trusted employee at one of your service providers could have access to your payment card transactions and maybe even your systems. But could PCI prevent a data compromise in such a case?Read more...

Actually, fully a third of the 33,000 sites tested by the CMU researchers used that loophole. But most other sites can at least pretend they've done it accidentally. Amazon actually uses its stock symbol, AMZN, to jimmy the system.Read more...

Last Wednesday (Sept. 15), a Pittsburgh-based vendor called Dynamics unveiled a battery-powered device in the shape of a credit card that is capable of mimicking multiple cards by reprogramming its own magnetic stripe on the fly when the user hits a button to change accounts. Instead of replacing all of the credit cards in a consumer's wallet, this device would instead sharply reduce their number.Read more...

That finding has some very powerful implications for both in-store and online retail. Maybe the fact that touch matters shouldn't be a surprise, though it certainly surprise the Caltech researchers. Of course, the in-store experience is different from online or M-Commerce. Some retailers, like Nordstrom, work those high-touch elements of the brick-and-mortar store to the hilt. And even a utilitarian approach—think Wal-Mart or Costco—gives customers a far more sensual experience than a Web site. Shoppers can handle products. Smells, textures and sounds all matter.Read more...

Once that suite is in place, retail CIOs should plan for a risk- and security-based assessment of their log management needs and allocate the resources to make the system work. Otherwise, retailers may centralize their logging but find themselves overwhelmed by the white noise of too much data. Or, IT could distribute log reviews down to the store level only to learn that the individual locations cannot achieve separation of duties, back-ups or daily log reviews conducted by people who know what they are doing. Read more...

This scenario isn't entirely science-fiction, although this particular mobile technology is in its earliest stages. An Israeli vendor called EyeSight Mobile Technologies announced last week (September 7) a set of what it calls Hand Gesture Interface packages, initially designed to control a phone's MPS player. What's important about EyeSight's effort is that it marks a critical new phase for mobile, where developers start trying to get creative with this descendant of Ma Bell. That's what mobile needs to truly take off in retail.Read more...

OK, maybe rational is a reach. But if you’d like to help mobile be closer to rational, you have your chance. The National Retail Federation’s (NRF) Association for Retail Technology Standards (ARTS) Council is trying to finalize feedback before its conference this week.

Officially, the comments are supposed to be for the Mobile Blueprint ARTS released in July, as the group prepares to release version 2 of that report. Unofficially, ARTS officials are hard at work trying to hammer out mobile specs for all of retail—from barcode scanning to in-store mobile payments to M-Commerce. Have a few thoughts on that topic? (Thought you might.) Executive Director Richard Mader would love to hear from you at maderr@nrf.com. But please keep it clean. Dick’s a classy guy.…

Although an outage is never a pleasant thing, this one was especially untimely for quite a few reasons. First, it was the middle of the day (or the start of the business day, depending on which coast you're on). Second, it was in the middle of a major well-publicized sale. And the coup de grâce of this outage: It was on a federal holiday, potentially meaning a skeleton crew in the office and perhaps difficulty in obtaining replacement parts.Read more...

And it's another reminder of the unintended consequences of Web and mobile site infrastructure changes. "This seems to be a recurring problem with any major site changes. You just never know the consequences until you roll it out and hold your breath to see what happens." said Forrester Research E-Commerce Analyst Sucharita Mulpuru. Read more...

The implications for any chain with a major Web—or mobile—presence are intense; preserving the integrity of comment and customer rating systems is essential to that feature influencing sales. Etsy took several good steps to minimize harm, such as making sure that sellers know the real identities of complainers and, of course, that site admin still knows all. Even though these moves may prevent blatant fraud—when, for example, a rival posts untrue criticisms—they can't prevent two of the most common issues.Read more...

After spending a lot of time in recent months contemplating and designing an Information Architecture for Focus Brands, he argues that IT systems should be designed from the ground up with an understanding of the information supply chain--as in "What groups/people will need access to the data entered into or created by this system?" Through this process, Michaud has concluded that one precursor to an Information Architecture is an Action Framework. Read more...

A security report published Thursday (Sept. 9) concluded that cyberthieves are creating 57,000 new sites every week that exploit major brands, including Amazon (2.42 percent), eBay (23.21 percent), PayPal (1.77 percent), Visa (9.51 percent) and Bank of America (2.29 percent). Although little is surprising in the existence of these rampant phishing sites, we have to be impressed by the time management skills—and business efficiencies—on display here.

One reader, a senior IT executive, suggested tongue-in-cheek that there are a lot of reasons to be impressed by that number: “How did they get these new sites approved by marketing, legal and four levels of product management in that timeframe?” We have to ask, how many rewrites of site text were included and what kind of revision timetable was permitted? Even though this information was not covered by the Panda Security three-month-long study, they are legitimate questions if we’re going to learn any management lessons. Not sure how Amazon feels about getting trounced by eBay (losing with a score of 2 percent compared with eBay’s 23 percent), but how must it feel to be a major brand that is not even worth being ripped off? Sorry, Wal-Mart, even the real Wal-Mart E-mails make consumers clutch their wallets tightly.…

It's ironic because both chains are taking substantial steps to secure the access to confidential patient data, but neither is specifying steps to protect transcripts of that very same data. Imagine forcing call center employees to comply with all PCI rules regarding not preserving prohibited payment card data and then allowing them to write down all of that data in plain-text files that are then transmitted to consumers (who are unlikely to protect them) and saved in the chain's files.Read more...

Think about it: millions of customers and prospects post their innermost product thoughts on Twitter, Facebook, Youtube and the blogs of themselves and their friends. this info is free and often visible to all. But how do you take that data and match it to specific customers/prospects so that the data can be acted on? That's the untouchable part.Read more...

Tuning E-Commerce site performance for multiple browsers is an old problem, of course. But programming is just the beginning of the mobile performance problem. It also depends on smartphone hardware, which varies widely in horsepower, and mobile carriers, whose performance can change dramatically if a user moves literally just a few feet away. That makes the puzzle hugely more complex--at a time when retailers can't afford to avoid that complexity.Read more...

What is a realistic near-term goal? Is it to generate true additional revenue or is it acceptable--initially, at least--to simply shift purchases from Web to mobile? Moving from revenue to the much-beloved profit margin, is it possible to say whether mobile or Web has lower operational costs?Read more...

In the latest saga of North Carolina’s attempts to get sales tax revenue from E-tailers–its battles with Amazon are nothing if not creative–the state offered tax amnesty to 450 retailers, if they cooperated. Only 27 accepted the offer, which is barely 6 percent of those approached. Those 27 “represent a variety of large national and smaller specialized retailers,” said Beth Stevenson, the public information officer for North Carolina’s Department of Revenue.

The deal was simple. If the retailer agreed to collect North Carolina’s taxes for four years, the state would agree to not “assess tax, penalties or interest” and “to not exercise its authority to obtain consumer information from the retailer to collect a tax liability.” I’m stunned that more retailers didn’t leap at the offer. I’m really curious as to which national chains agreed to this proposition, as it would almost certainly force them to also pay taxes to every other state. Then again, if the chain’s participation stays secret, the other states wouldn’t know and it couldn’t be used against the retailer.…

Retailers aren't usually hit with patent lawsuits. Those are usually reserved for manufacturers, although the ways retailers handle debit cards, gift cards, micropayments and site accessibility have attracted litigation in the past. This time, though, it's their Web sites that have the office stores under legal attack. But there's nothing special about these Web sites that make them dramatically different from other large E-tailers. That means if these retailers lose in court--or settle the case--every other major retailer will soon be looking down the barrel of the same legal gun.Read more...

It's not often that people challenge our technical conclusions while simultaneously questioning the marital status of our mothers. The column suffered from one key technical error, questioning how easy it would be to extract clues to an encryption key from encrypting the short payment card expiration date field. Walt admitted that error--and explained the context--in his column this week. (By the way, if anyone else wants to yell us at, this week has a column from Frank Hayes that questions the very premise of security passwords. Gluttons for punishment we be, a rare breed of journalistic masochists.) But there's a bigger issue at play here, a long-standing technology frustration beneath the emotions.Read more...

Retailers looking to purchase a product rather than develop one in-house have to be equally thoughtful. They should make sure the software vendors providing their POS applications have experts on cryptography as part of their development teams. It's not enough to ask what algorithm or key length the POS uses or even to check that the application is on the PA-DSS list of Validated Payment Applications without understanding the operational implications of how that application handles cryptographic functions. Read more...

And here’s a passage that’s sure to capture the attention of privacy advocates everywhere: “The photograph can be taken without a flash, any noise or any indication that a picture is being taken to prevent the current user from knowing he is being photographed. As another example, a recording can be taken to capture the current user’s voice through, for example, the microphone. The recording can be taken when the current user makes a phone call with the electronic device. In some embodiments, the electronic device can record any voices or sounds that are detected, regardless of whether or not a phone call is being made.”Read more...

The world is moving to an open, sharing, social platform at a lightening pace. As a result, people behave differently today than they did yesterday. How have your sales and marketing strategies adapted to this change? What if you could provide incentives to customers to entice their social graph to visit the location (receive 10 cents on your loyalty/gift card for each of your friends who checks in)? Laugh if you will, but I believe the restaurant industry will see multi-level marketing become a large part of its business in the next three to five years.Read more...

The new rules apply to activity as of Sunday, which means that the millions of cards already in circulation must be handled differently until they're all gone.Read more...

As retailers plunge ahead with Mobile-Commerce plans, they are continually looking for market evidence that there’s gold in them thar hills. Anything to appease corporate’s comically relentless search for ROI proof, whether it’s realistic or not. Late last month brought Amazon’s boast of $1 billion in M-Commerce revenue. That was great for starters, even though a lot of the sales were for e-books and Kindles and other especially M-Commerce-friendly purchases. Still, a billion dollars is a billion dollars.

Today, from China, we have a new stat that’s almost four-and-a-half times better. China’s Union Mobile Pay is reporting an M-Commerce sales volume equivalent to $4.4 billion U.S. (30 billion yuan, which is about 3.1 billion euros), according to a report Tuesday (Aug. 25) from PaymentsSource. That service also reported 140 million registered users, as of the end of last year. There are always caveats, and it should be said that China is a much more mobile-payment friendly country, that the infrastructure has fewer obstacles (with government blessing) and that mobile is sometimes the only viable payment method accepted by some Chinese merchants. But $4.4 billion? That’s hard to dismiss with even a billion caveats.…