Evan Schuman's StorefrontBacktalk

Execs at Domino’s Pizza learned a painful lesson in the power of Web video and social networks this week. Although the chain already understood the power of those new channels to sell product and boost brand loyalty, it seemed to have been offguard how those channels could just as easily halt sales and hurt brand loyalty. It also seemed stunned that the powerful national chain could be undone by a 10-minute effort from two low-level employees.

The story—deliciously told here by The New York Times—involves two workers at one restaurant that posted a video of them doing some impressively unsanitary things to a pizza before he was sent. See the picture accompanying this story? All I can say is that that had better be cheese.…

After tracking that for an extended period and noting the ebbs and flows, he then ran a major campaign. But instead of looking at impressions, clickthrough, leads generated or any other typical Web metric, he simply repeated his study. The only test of a social site marketing campaign, he reasoned, is to see if it was changing the dialogue at all. Were his brands getting talked about more? And was it boosting his favorable and dropping his negatives?Read more...

Chains are just starting to see the business ROI potential of POS—especially when working with CRM—to fuel upsells and to legitimately increase loyalty. But few look at POS as a potential protector and a protector against some potentially very large expenses. Consider four items from the last few days.Read more...

A web analytics train wreck is expected later this year, when an old version of Google Analytics—still being used by a huge number of retail sites—gets phased out, according to a report issued Wednesday (April 8) from Pingdom. The report was a survey that looked at the top 10,000 Web sites and it discovered two interesting figures: 50 percent of all of those sites use Google Analytics, which in and of itself is fairly mind-blowing; and a full 40 percent of those sites are using an expired version of Google Analytics.

“Google switched its development over to ga.js well over a year ago. It’s truly remarkable that almost half of the sites using Google Analytics have yet to migrate to the new ga.js script,” the report said. “The question is, for how long will urchin.js keep working? Back when Google made the switch it was widely believed that Google would stop supporting the old script after 12-18 months. If that is the case, the end for urchin.js is getting near.” The report speculated that “urchin.js will be decommissioned sometime this summer” and, when that switchover happens, all of the sites using the older version will “start returning a 404 error (file not found) and therefore stop registering traffic.” (Update: Google is now officially denying that they plan an end-of-summer cutoff. Is Google telling the truth? Most likely. The denial is too explicit.)…

Google has told the world that, as of May 5, it will institute a tiered fee structure for Google Checkout, one that makes the currently cheaper program essentially on par with rival PayPal in terms of fees. The move comes about five months after Google stopped giving Checkout free to retailers that bought ads on Google.Read more...

But from a strategic marketing perspective, Calvin Klein's approach-avoidance relationship with E-Commerce and New Media is fascinating. They waited more than a decade to get into E-Commerce, even though they wanted that audience. Even when they did launch, they're hesitant to go mobile and social. And yet, this is the same fearless company that pushed the envelope—many would say blew past that envelope—of good taste in X-rated advertisements, trying to stir up attention among younger consumers. That's fine, of course, but it hardly fits the profile of a brand that is scared to move into mobile and social in 2009.Read more...

Google hasn't been faring especially well, with some seeing Google's move in April to boost prices as desperate. Then on Thursday (April 30), Amazon counterpounched, offering to waive fees for five months for retailers who would be new customers for its Amazon Payments program. The Amazon offer was quite limited, excluding any existing consumers, having the fee waiver only lasts five months (from April 29 through Sept. 30). Technically, it would be five months for those who signed up immediately. The deal isn't for five free months, it's free transactions until Sept. 30, apparently regardless of when a merchant signs up. The deal also has an especially low ceiling, with Amazon saying that the fees will start sooner than Sept. 30 if $2 million or more is sold.Read more...

One reader argued that Fifth Third's resistance had much less to do with making life easier for retailers and more to do with minimizing the processor's own liability. "Fifth Third sees a major transfer of card fraud liability shifting exclusively to them from the merchant who traditionally has (effectively) 100 percent of the liability. This dynamic would leave Fifth Third (and all acquirers) as the sole liability holder for all card fraud," wrote one reader. "I can understand their concern. It is rational and it is well-founded."Read more...

When we recently suggested that E-Commerce sites should do more to facilitate brick-and-mortar purchases, reader feedback brought an interesting take. Is it true that many C-level executives don’t focus on the details enough to support a thoughtful merged channel approach?

If true, is this a key factor in pushing E-Commerce execs to not push proper initiatives to help the overall business? The thinking: “If I’m only going to get credit for purchases made in my channel—regardless of how many sales I deliver to the overall chain—why bother?” This would suggest that the lack of such programs might be much less insulated E-Commerce execs than attention-lacking C-Levels. Something to chew on…. …

This leaves open the question of whether Macy's is refusing to turn the files over for legal—or other—reasons or if it simply cannot access and thereby produce such records, for technological and logistical reasons. But Los Angeles Deputy District Attorney Daniel Wright said he is leaning more toward the "won't" as opposed to the "can't" theory, at least for some of the requested records. "It's aggravating," Wright said. "It's inexplicable to me."Read more...

"As part of these efforts, many of these companies, such as eBay, have provided their customers links to the IC3 website," the report said. "As a direct result, an increase in referrals depicted as auction fraud has emerged." Because of that, the IC3 cautioned its statistics about Internet crime complaint numbers might be "misleading" and should be viewed as a generalized "snapshot" of the problem.Read more...

But other retailers are re-evaluating their E-Commerce strategy and are not necessarily pulling back. Many are questioning the impact on their brand strategy—let alone their channel strategy—of having a high percentage of their product sold by huge E-Commerce sites that sell hundreds of thousands of other—often unrelated—products. Cloud B, a maker of fancy sleep products for children, is a good example of a specialty manufacturer who has opted to make such a change and pull its products away from Amazon. That wasn't an easy decision, given that Amazon's sales have accounted for about 10 percent of all of Cloud B's revenue.Read more...

When Toys.com got delisted from Google after it was apparently forwarded—rather than transferred—by its new owner, Toys R Us, many (including us) were quick to point fingers at Toys R Us. But one SEO consultant penned a fascinating piece that questions whether Toys R Us had much choice in the matter.

“Did Toys ‘R’ Us goof by redirecting Toys.com to ToysRUs.com and losing the existing Google rankings? I doubt it. There are simply bigger fish to fry at this time,” wrote John Andrews. “It is important and usually profitable to consider SEO aspects of a site move or relaunch, but Toys ‘R’ Us must also pay attention to opportunity costs.” Andrews took the time to craft a well-reasoned and detailed look at the Toys.com issue. Worth a read.…

Hearing a litany of PCI problems, the U.S. Congress threatened to get involved, passing laws making certain provisions mandatory. Although few retailers argue that PCI isn’t in need of serious help, Congressional assistance wasn’t quite the help desired. It’s akin to calling for help because your basement is flooded and having a tsunami respond. Suddenly, the basement flood looks a lot more tolerable.

On Tuesday (March 31), the House of Representative’s Committee on Homeland Security held a hearing where, according to this detailed report from Forbes, committee chairman Rep. Bennie Thompson suggested that the PCI rules were written by card companies to shift blame to retailers and partners rather than actually preventing cybercrime. “I’m concerned that as long as the payment card industry is writing the standards, we’ll never see a more secure system,” Thompson said.…

"None of our internal systems will even have access to cardholder data," said McDonalds CIO David Weick. In the U.S., he said, the typical McDonalds brings in about $2.1 million to $2.2 million in revenue per store. "So any solution that I come up with needs to fit within a P&L that starts with a $2.1 million or $2.2 million revenue line. If I come up with something that is way out of line, I have the franchisees who are there to tell me and to describe for me the economics of their business and whether or not it fits," Weick said.Read more...

That meant lousy rankings for some very big names in E-Commerce, with eBay, Amazon and Dell situated near the very bottom of the ranked table. The Toys R US site presented the most functional failures of all sites reviewed, primarily due to links that didn't work. Lawrence Shaw, CEO of London-based Web site performance monitoring company Sitemorse, noted the site's links to Toys R Us' UK, Canada and Japanese sites were among those that didn't function. "That's not very good housekeeping," he said.Read more...

In the memo, Britton said that the chain disregards its own policies. "What is the first thing we do when a customer comes in to our humble box brandishing a competitor's as asking for a price match? We attempt to build a case against the price match. Trust me, I've done it, too." In a deposition, Best Buy officials tried to blunt the significance of that memo by testifying—and I couldn't make this up—that the employee was just kidding.Read more...

On the one hand, the deal would initially seem to make little sense for Amazon, as it takes away much of the spontaneity, speed and convenience of an online brand. But this program isn't about saving money or boosting convenience. The only way this makes sense is giving the program credit for being the only way to make online purchases that are—in theory—absolutely safe. If Amazon, Amazon's card processor or Western Union is breached, there's no private financial data exposed. If any of those businesses has a glitch and tries to overcharge the consumer, the consumer is completely safe as there exists no more money to access.Read more...

This incident was limited and the damage seems to be minimal. But the bigger issue is why has this hole not been adequately plugged by now? Was this sloppy work done by the online equivalents of the guys that dump credit card files in front of the store when a location is shut down? Or is this problem hitting those who are otherwise security sensitive? Read more...

Given how far e-tailers are pushing everything to try to get a little more margin room, it’s always perplexing how ineffective the shipping tracking functions are for almost all but a small handful of major E-Commerce sites. This point is detailed quite nicely in a recent E-Commerce Times column. Amazon, which seems to be the exception for almost every E-Commerce rule, is the gold standard for tracking shipping today. Not all chains can afford to replicate the kind of operation Amazon has, but some of this is simply not that complex.

With mobile and social networking sites opening consumers’ minds to the possible, and Amazon continually illustrating the practical, e-tailers need to rethink their shipping strategies.…

In what very well might be the first case of an E-Commerce site blaming the global economic slump for its decision to go out of business, Chinese E-Commerce site Tootoo.com is being taken offline by its owner.

In deciding to pull the plug on Tootoo, Ninetowns Internet Technology Group Company Limited cited the unfavorable worldwide economy. “We carefully assessed the long-term impact of continuing our B2B business and have determined that the time and investment required for further support is not in the best interests of the company or its shareholders given the uncertain global economic environment,” Ninetown CEO Shuang Wang was quoted as saying in a China Tech News story . Tootoo served as search and service provider for companies involved in international trade. The shutdown should be completed within 60 days.…

KMart.com went down a few minutes after midnight (New York time) on Thursday (March 19) morning and stayed down for at least several hours. Pingdom first detected the outage but it wasn’t hard to confirm. Initially the site was simply not responsive. After a little more than two hours, the homepage was replaced with a sign that said, “We’re sorry. Kmart.com is temporarily closed for site enhancements.” Is it coincidental that this comes on the heels of Sears declaring this week that it was going to be expanding more of its online efforts with its KMart corporate brother?

The early morning timing of the outage could suggest some site maintenance, but the fact that the site went silent for hours and that it was only then that such a “Move along. Nothing to see here today, folk” sign was posted, that does make it look a little baffling. (Note: The site seems to have come back now, several hours after the darkness. That’s certainly good, but the question of why it went dark for hours before a maintenance note was posted still exists. Sears just messaged that the outage was for a planned site upgrade and that they had thought the splash page had been there since it went down. It might have been somewhere, but we didn’t see it.) …

The Form 10-K also listed a wide range of agencies probing the breach, including what a few whose Heartland probes had not been public. The list now includes the Federal Financial Institutions Examination Council, the Federal Trade Commission, the Louisiana Department of Justice Office of the Attorney General, the Canadian Privacy Commission and quite a few state Attorneys General.Read more...

When Heartland announced in November that it was acquiring Chockstone, it issued a statement that “Terms of the agreement were not disclosed.” Why do publicly-held companies try such things? They know they’ll likely have to disclose it at SEC filing time.

This week, that filing time came and the Breach Boys had to report that they had dropped some $4.1 million in cash for Chockstone, including $1.6 million in goodwill and $2.4 million in intangible assets. They also took on some $200K in short-term capital lease obligations and about $300K in long-term capital lease obligations.…

When Toys R Us paid more than $5 million this month to buy Toys.com, perhaps they should have set aside a few more dollars for search engine optimization (SEO) counsel. This after the popular domain was de-indexed by Google because Toys R Us chose to forward the domain, rather than transfer it. Oops!

There’s some nice background on the case at Domain Name Wire, especially the context about how much more value the different method would have realized. “Now the value of Toys ‘R’ Us’ $5.1M purchase of Toys.com has been relegated to type-in traffic and potentially some of the inbound links to Toys.com,” the story said.…