Evan Schuman's StorefrontBacktalk

Domino’s is seeing a huge increase in online sales—a critical and fiercely competitive arena for national pizza chains today—after it allowed consumers to see a real-time interactive graphic that depicts their pizza order, adding or subtracting toppings and the corresponding price adjustments. It also throws in some impressively detailed product status information, “with updates on when a pie enters the oven or leaves a store.” But the requirement of a new $20,000 POS system for each of its 5,000 franchisees and company-owned stores in the U.S. was a bit difficult to swallow.

Also, according to this well-done story in The Wall Street Journal, those new systems were apparently delivered with extra glitches. “We built a system by trying to do 1,000 things, but 500 of them didn’t work. We had a real crisis of quality,” Domino’s CIO Christ McGlothlin said. “We had to make sure the 20 basic things the system needed to do would work, so the first year all we focused on was getting those basic things working flawlessly.” An example of an early problem: “One franchisee had organized delivery maps in a way that didn’t work with other franchisees’ maps. Another franchisee sorted his employee time sheets in a way that wasn’t compatible with the rest of the system.” All in all, it’s an interesting read.…

Conway's concern is the almost inevitable fourth quarter 2010 PCI train wreck as the new rules collide with human frailty and the calendar. The result may be that even some Level 1 merchants and processors don’t get their assessments (and ROCs) completed on schedule.Read more...

Wine deliveries often require signatures, and many fruits, vegetables and meats can be ruined by sitting out in extreme temperatures. Many two-income families are not home during much of the day, making such deliveries difficult. One vendor is trying to make some money off of this issue, by establishing alliances with businesses that will act as maildrops for such deliveries. The move by Kinek is not without precedent. Overseas—especially in parts of Asia—such services are common.Read more...

A Macy’s trial—limited to Florida—of a system where online databases can be accessed from in-store POS terminals has been “working very well” and will be rolled out to the $25 billion chain’s 800 stores by the end of next year, Macy’s CFO Karen Hoguet said at a recent analyst call. “I think we have only begun to realize the potential of the multi-channel integration. I think the potential that still is yet to be completely tapped is again integrating it more with the stores,” she said.

The technique is not new, and Macy’s is certainly not alone among major retailers testing it. But the Macy’s results are interestingly favorable. “Customers are increasingly using both vehicles to shop. Sometimes they are pre-shopping online and going to the store to try things on. Other times they walk through the store, they see something they want, don’t have time to stop, go home and order it online,” Hoguet said. “So I think we are going to see this tremendous growth continue. We’re beginning to roll [the system] out to some of the Midwestern stores as well as Herald Square now, and we will continue to roll it out in 2010.”…

When Amazon last month reported huge double-digit third-quarter growth—coupled with an equally aggressive prediction about the fourth quarter—many wondered whether the world’s largest E-tailer was merely an outlier or if this was a truly positive hint. The U.S. Commerce Department has now weighed in, and the stats suggest Amazon will be far from alone.

Floundering for the first half of 2009, E-Commerce sales took a decent upswing during the third quarter, according to the U.S. Department of Commerce. Adjusted for seasonal variation, the government figures released on November 18 show that about $34 billion was spent online during the quarter, an increase of 4.5 percent from the second quarter and a 1.8 percent increase over 2008’s third-quarter figure. E-Commerce sales accounted for 3.7 percent of total retail sales during Q3 2009, which came in at about $922 billion, a 1.7 percent increase over the prior quarter but a whopping 7.8 percent decrease compared to Q3 2008. But online still accounts for less than 4 percent of total retail revenue. As such, its impact on retail holiday sales figures will be diluted. Given the maturity of online, though, it’s more likely an indication of strong purchasing overall, rather than merely a shifting of dollars from one retail pocket to another. If so, it may indeed be a very merry retail Christmas.…

The most significant initial glitches of Black Friday seemed to be owned by Staples and Kohl's, though. Staples was down much of the morning, displaying a screen that said "Oops, you're too early. Staples.com will be unavailable until 6 AM ET. Come back then and save big!" That clearly seemed to be a deliberate shutdown, but the site went down again throughout much of the day, bizarrely displaying the same "come back after 6 AM" screen, although the 6:00 AM time had come and gone. In fact, the screen was seen in mid-afternoon and, when the site was up, page loads were quite slow. Setting aside the post-6:00 AM glitches—which were clearly unintentional—the strategy of bringing the entire Staples site down is intriguing. Why cut off access to the entire site?Read more...

But the A&P exec said his concerns are more generic, as in "the imaging of the mobile device itself and the readability of the barcode on the mobile." Another factor is that chains need to deal with a staggeringly large number of different phones, with very different screens, and they must interface with all of them with the same barcode scanning wand.Read more...

MasterCard is offering two types of the new mobile Chip Authentication Program (CAP), an SMS version and a downloadable app for smartphones. Both options present single-use passwords in a fashion similar to the home-based card readers usually supplied to consumers by banks to authenticate card-not-present transactions. With the SMS version, the one-use password is sent within a text message to a user's cell phone when the consumer reaches the point in the checkout process where the site asks for the secure code. Smartphone owners using the installed MasterCard app have their one-time-use passwords displayed after they enter a PIN.Read more...

Amazon is in the midst of a very limited trial to send SMS text alerts to customers to update them on delivery status. The SMS package tracking feature—which Amazon said is being tested with “a small set of customers”—is available only for items sold by Amazon, not those offered by third-party sellers on Amazon.com. The text messages include the order tracking ID number as well as information about the shipment’s whereabouts, such as “Out for Delivery @ 10:15 A.M.,” according to Amazon. The company said it will only send text messages between 8:00 A.M. and 5:00 P.M. Pacific time.

After they click the Amazon.com “Track your package” button, customers being offered the SMS service are presented with a page on which they can enter their mobile number and click a “sign up” button. Although Amazon is known for its speedy, 1-Click ordering, this option would seem to be unavailable for SMS users—at least in the trial version. Users won’t be able to change preferences to add text alerts for all purchases, the retailer said. Instead, customers must request text alerts individually for every order.…

In what a senior company official conceded was an oversight, the 430-store, New Jersey-based chain failed to publish any ahead-of-time advisories before yanking its E-Commerce site's plug in the wee hours. Nor did it post much in the way of an explanatory statement during the long downtime period that followed. "The messaging on the site could clearly have been better," Burlington Coat Factory Supervisor of Web Development Jack Follansbee said. "It was an omission. We should have done something (a status page) a little more customized."Read more...

That includes gaining access to the keys, but it also includes access to token lookup tables or any other way to get back to the original data. That means you need to be just as concerned with social engineering attacks, malicious insiders and phishing as you do with hackers stealing encryption keys. Read more...

At its simplest, out-of-scope means beyond jurisdiction; it means that whatever is being discussed no longer falls under the rules and requirements of PCI. One critical problem is that the brands and the PCI Council giveth and they can taketh away. In other words, if you've started sharing some, for example, tokenized data with marketing because a temporary out-of-scope ruling makes you comfortable doing so, you find it almost impossible to undo should that ruling be reversed. Put more philosophically, you won't likely be able to get the clear-text toothpaste back into the "they're going to fine me from here to Shanghai, aren't they?" tube.Read more...

The 63-year-old Willett has been at Best Buy since early 2004 and is leaving with the title of CEO, Best Buy International. He had served as corporate CIO, a title he held along with the CEO International title until Neville Roberts assumed the CIO title in late May 2009. But the way the retirement—slated to go into effect December 31—was announced was unusual.Read more...

A couple of years ago, Near Field Communication was seen in some influential corners—such as at consumer goods giant Procter & Gamble—as the ultimate victor in the fight between NFC and 2D barcodes. Many saw NFC as the better technology, with 2D barcodes being used as a placeholder until NFC was ready. But in the last couple of years, neither technology has gotten very far in the U.S. Few phone manufacturers included the feature and even fewer developers tried to design for it.Read more...

It might be the ultimate in retail technology: A way to make huge profits by selling things that do not need to be acquired, stocked or shipped. But these items—perhaps a diamond-lined collar for a virtual pet or a special power in a shared game—are becoming big money. Virtual goods sales are projected to hit $5 billion this year, according to The New York Times.

But virtual goods are hardly free. The paper of record said the revenue was “all for things that, aside from perhaps a few hours of work by an artist and a programmer, cost nothing to produce.” Would they have said the same thing about a bestselling—albeit basic—applet? What is software other than the work of artists and programmers? The more important thing about virtual gifts, though, is what they say about the gift buyers. As Winston Churchill’s Web designer said, “Never before have so many spent so much on so little.” Is this pent up demand for immediacy? Entertainment? Is it a sign that consumers are now ready to embrace micropayments? Regardless, $5 billion is nothing to virtually sneeze at.…

The easy path is to be very lenient. Offer access to anyone receiving the E-mail announcing the event. If that person posts the URL and perhaps the password—for that one event—on Facebook, Twitter and LinkedIn accounts, let it happen. So the audience is somewhat diluted. If those others buy stuff while attending the event, what’s the harm? The intent of an invite-only event, however, is to be able to control the attendees, perhaps to reward excellent customers. More likely, though, the invite-only approach is to lure a very lucrative small subset of your audience to a virtual gathering where you can flood those people with highly targeted promotions. Maybe a key supplier wants to pay you for access to that subgroup?Read more...

Many of the Supreme Court justices expressed significant skepticism about whether the current system should be maintained. Questioning one attorney about a financial approach patent, Justice Anthony Kennedy raised a Congressional intent argument. "In your view, clearly those would be patentable: the explanation of how to compile an actuarial table and apply it to risk. It's difficult for me to think that Congress would have wanted to give only one person the capacity to issue insurance." The newest member of the court, Justice Sonia Sotomayor, asked how far process patents could go. "How do we limit it to something that is reasonable? Why not patent the method of speed dating?" Read more...

Basking in the instant efficiency of E-mail and other forms of digital communication, we tech-savvy types often look down our noses at “snailmail.” But E-mail can’t deliver a pair of shoes. And, as an ongoing mail strike in the U.K. is reminding us, even the most Web-proficient retailers stand to suffer when wrenches are thrown into the easily-taken-for-granted cogs of the good old postal services. The strike by the Royal Mail union, whose members deliver letters and packages throughout the U.K., began October 22 and it has E-Commerce operators wringing their hands as the holiday shipping frenzy is about to begin.

The nail biting began even before the strike began. A survey by Interactive Retail in Media Group reportedly found that 85 percent of E-tailers believed even the threat of a postal strike would discourage their customers from placing holiday orders. At least one retailer, TJX, decided to be proactive. On its U.K.-only E-Commerce site, TKMaxx.com, the $19 billion seller of off-price clothes had this to say: “Postal strike? Phah! For the same price as our Royal Mail standard delivery, TK Maxx is upgrading this service to our DHL courier partner for the duration of the postal dispute.”…

That was bizarre. But when Heartland issued a statement that directly—almost word for word—contradicted its own legal filings, the situation took an Alice In Wonderland twist that makes retail tech worth covering.Read more...

In theory, this will reveal if that retailer is charging way too much. It's an option that E-tailers love; they see themselves making lots of sales off of greedy physical stores, especially because the sites typically have lower overhead expenses and, as a result, can sometimes charge a lot less. But that's the opposite of what seems to be happening. Read more...

It also allows consumers to have different addresses (home, work, the in-law residence where the holidays will be spent, etc.) associated with different phrases and potentially different payment methods (the corporate credit card for office deliveries, a personal card for home, etc.). But Amazon's vision for PayPhrase goes beyond online; it includes mobile and, especially, in-store options, said Matt Williams, the general manager for Amazon PayPhrase. "We want [PayPhrase] to be used anywhere they want to pay, anywhere a customer happens to be," Williams said.Read more...

For time immemorial, or at least for a decade, E-tailers have been using everything from alchemy to algorithms to try and master search engine optimization (SEO). The oft-elusive goal: to have the almighty Google find their sites and place them high on prospective spenders’ search results pages. Now, as blogger Paul Gillen perfectly points out, the Don’t Be Evil Gods have changed the rules. With its experimental new program, called Social Search, Google is including–high on the precious first page of the results it fetches–items culled from the searcher’s social network sphere.

Say John wants to buy a Gateway computer and does the regular Google search for the model he likes. With the new Google program, a Facebook rant by John’s trusted college buddy Joe about how, say, Best Buy weaseled its way out of matching a competitor’s price for a Gateway might show up right next to an expensively SEO-fertilized Best Buy listing. Granted, the Google Social Search listings appear at the bottom of the first page, but there are retailers and vendors that would kill for that chunk of real estate. …

Forrester Research, predicting an 8 percent increase in online retail sales this holiday season compared with the recession-devastated so-called holiday season of 2008, says E-Commerce sites should brace for traffic surges. The reason? Their offline counterparts will be frustrating shoppers with product unavailability because of cautionary inventory reductions. In its “Online Holiday Retail Forecast,” Forrester said E-Commerce players “internalized lessons from last year’s holiday season” and are “focusing on margins as opposed to chasing sales” this time around. These new strategies will include maintaining leaner inventories as a means of more closely aligning purchasing to demand “to prevent last year’s unbridled discounting.”

But online sellers must be ready to deliver when consumers encounter empty shelves at local stores where managers, burned badly last year, failed to order enough stock for this year. The researchers found that E-Commerce sites are cranking up “engagement strategies” to slow shopping cart abandonment, will send alerts about new products or stock levels, and will offer early access to new products or promotions. Forrester paints a more conservative picture than the double-digit holiday forecast recently offered (for itself) by Amazon.com. But we figure Forrester’s 8 percent figure is reasonable for the online retail industry as a whole.…

Wal-Mart's statement confirming the incident was vague—even by Wal-Mart standards—and Walmart.com spokesperson Ravi Jariwala declined to elaborate, saying "At this point, we’ve shared all the information we have to offer." Unknown details include when the glitch started, when it stopped, the nature of the problem and how many people were impacted.Read more...

But that's in the U.S. Things are different in India, where a new law gives the government the clout to actually block access to Web sites if doing so would help ensure public order. Whether an inability to shop online can be defined as a form of public disorder is questionable, but there's no doubt an Internet crippled by bandwidth-hogging flu sufferers could wreak havoc with E-Commerce and dent the economy.Read more...