Evan Schuman's StorefrontBacktalk

Long before the term customer relationship management was bastardized to secretly mean salesforce automation, many companies had the vision of an IT system that would help them manage and maximize the relationship they have with their customers. The idea of being relevant is a complex equation that means a lot of different things to a lot of different people. Because no one really knows the secret formula to being relevant, Michaud's goal as an IT leader is to create systems that will help his business partners answer questions they don't yet know to ask.Read more...

ABI Research is predicting that overall retail tech spending will grow to nearly $21 billion in 2014, an almost 50 percent increase from last year. The global integrated POS new sales segment alone will likely be at $6.56 billion this year, growing to $7.2 billion next year and $8.5 billion by 2014, said ABI Research Director Larry Fisher.

In North America, those integrated POS figures will be $3.3 billion this year, barely rising to $3.6 billion next year and inching up a bit more to hit $4.3 billion by 2014. The slower growth in North America is overwhelmingly because of installed base. As the sales are limited to new sales, it’s going to reflect much smaller percentage growth for an established market such as North America. …

We don’t typically share quotes from entertainers, but this retail line seemed worth it. From Bill Maher: “True love is like a salesman at Home Depot: It only comes along once or twice in a lifetime, so you gotta grab it.”…

The counter argument has been that these technologies allow retailers to redeploy people into positions where they can truly deliver customer service. The classic example: taking cashiers out of checkout lanes and instead having them carry customers' bags to their cars. Would Macy's be facing less of a backlash if, instead of quietly laying off some of those box wrappers, it prominently featured them in highly visible customer-facing situations? Consider an associate working aisles wearing a button that declares: "I was taken off giftwrap so I can help you here."Read more...

What would happen if we turned NFC on its head? For example, rather than the phone making a payment to the POS, it makes a payment to the restaurant's bank in the cloud. What would happen if the restaurant deducted the cost of lunch from Facebook credits? What if the guest could earn a free lunch by promoting the brand on Twitter? What if restaurants gave guests their menus on an iPad? What if that menu was customized to each diner’s likes, dislikes and allergies? What about a restaurant booth that has a video-conferencing setup that allowed to people to have lunch together without being in the same restaurant? Read more...

The conventional belief among retail marketers is that Gen-Y consumers (especially teenaged girls) have zero sense of privacy and that they will—and do—share every aspect of their lives with anyone online. Well, if a new study out of Europe is to be believed, those girls may be a bit more private than their personaes would imply. It suggests that the teens will indeed share anything, but only with a relatively small circle of friends.

The report comes from Euro RSCG: “Although the average teen girl might have more than 100 friends on Facebook, she focuses on sharing key information with the one or two people closest to her,” the report said. “When they find a good deal, teen girls want to share it—but they’re more interested in tipping off a friend than in broadcasting the information. Shopping with just her best friend or sister, a teen girl will spend 23 percent more than when shopping with two or more friends. Shopping with a boy, she will spend less than half of what she spends with her close friend or sister. And shopping with her mother, who provides access to a larger budget and is also a key member of her intimate circle, she will spend triple the amount she spends with a group of friends.”…

The Centers For Disease Control have to tackle some wonderfully difficult detective assignments, including a recent case where they had to find out why people were getting sick from salami. (It turned out to be some pepper used as a seasoning.) The government operation is now formally tapping into loyalty card CRM databases from retail chains for help.

Some chains—such as Costco—have been using their CRM databases to alert customers to recalls for years. But the CDC hadn’t done so, at least not in an organized fashion. Now they are, according to this Associated Press story. “Through interviews and questionnaires, investigators suspected some kind of Italian meat was the culprit, but people couldn’t remember what brand they bought, CDC epidemiologist Casey Barton Behravesh said,” according to the AP story. “So the CDC asked supermarkets for certain buying information on seven victims in Washington state, focusing on suspect products rather than everything the customers had bought, Behravesh said. ‘We didn’t care about the brand of toilet paper people were buying,’ she said.”…

A new report from IHL concludes that “after contracting 9 percent in 2009, the Europe/Middle East/Africa region is in the process of seeing growth return to the POS market for the first time in two years.” IHL thought that Russia’s situation was especially illustrative. Following an 18 percent plummet in POS shipments last year, “Russia’s economy has stabilized and shipments should grow 6 percent in 2010 and once again see double-digit growth in 2011. If oil prices increase to more than $100 per barrel, the shipments will increase further,” said IHL President Greg Buzek.

“For most markets such as UK, France and Germany, the pullback of the last two years means there is pent-up demand because equipment has been kept longer than it normally would. The region did not see the same level of store closures and contraction that we saw in North America, due to employment laws that preclude closing stores in many countries, and that limits the used market for POS. So everything out there simply got older. Thus the pullback of the last two years increases the growth chances moving forward,” Buzek said. “Instability in Greece, financial issues in Dubai—which had been seeing strong growth—tight capital markets and the prospect of conflict between Israel and Iran remain drags on the region’s growth, but 2010 will grow. UK, Germany, France and Scandinavia will each see growth for the first time in 3 years. And preparations for the World Cup are driving adoption rates in South Africa.”…

Last Thursday (March 11), Google made a major—albeit extremely preliminary—move into local inventory search through a deal with a handful of major chains: Best Buy, Sears, Williams Sonoma, Pottery Barn and the Vitamin Shoppe. But instead of working out this process internally and then bringing in retailers—or the reverse, with retailers figuring it out first—Google's objective is to run the earliest stage tests with various chains "so we're both learning how to do this in parallel," said Paul Lee, Google Product Search's business product manager.Read more...

The power of a mobile coupon program is not just in the convenience of the always-with-you device format. It's in the customizable nature of it and the related upsell and CRM implications. Why wouldn't Target offer consumers the ability to pick and choose—from their desktop machine—from a huge selection of offers? Those choices would provide valuable targeting information on an individual shopper basis. And if Target's decision is indeed to offer one blanket list of mobile opportunities, why not use existing CRM data to target certain offers to specific customer segments? Plus, why update those offers only once a month?Read more...

The direct-sell CG announcements are all couched in politically sensitive phrasing, with promises that it's just a short-term test to better understand mutual customers and that some of the data will be shared with retailers. Some even argue that these direct-to-consumer moves will help retailers make more money by allowing the manufacturer to better target its products. (That argument is not necessarily impressive, but making it with a straight face is.)Read more...

Although true item-level RFID is still years away, ABI Research is still confident that RFID sales will hit $5.4 billion this year. And it projects that number will reach $8.3 billion by 2014. The tagged segments expected to lead the way include real-time location systems, baggage handling, animal ID and a smidgen of item-level use in high-end fashion and other similar high-priced retail offerings.

“Other key opportunities include electronic vehicle registration, continued penetration of RFID-enabled e-ID/e-government documents—including health cards—and continued expansion of library systems. Also worth watching: slowed but continued progress in retail CPG supply chain management and multiple flavors of asset management that leverage RFID technologies, including specialty passive UHF tags,” said ABI’s practice director, Michael Liard. “Modernizing applications for RFID will grow more rapidly than their traditional predecessors such as access control, automobile immobilization, electronic toll collection and others that account for slightly more than 61 percent of the total market today. These applications are expected to grow 6 percent compounded annually from 2010 through 2014. In contrast, modernizing applications—animal ID, asset management, baggage handling, cargo tracking and security, POS-contactless payment, RTLS, supply chain management and ticketing—are forecast to grow roughly 19 percent in the same time period.”…

But we have now seen the first concrete government effort to slow down that data flow, and it comes from European Union data privacy regulators. An EU letter said that not only must Google provide more warnings to consumers before it sends cameras out to shoot street views, but that Google "should shorten the length of time for which it keeps the uncensored photographs it takes from one year to six months."Read more...

Think video store, convenience chain, 24-hour restaurant and gas station. Hacking away out of boredom is a very different profile from someone looking to harm the chain or even steal something to sell later.Read more...

But one group of cyberthieves in Utah—as yet uncaught—has hit about 200 gas stations in that state with a toothy tweak: Bluetooth-y, to be precise. By arming their skimmer with a Bluetooth transmitter, the stolen card data was beamed out indiscriminately to anyone nearby—make that very nearby—who happened to choose to listen for it. When such a device is found by law enforcement, it reveals nothing to point to the thieves' location—past or present—and nothing to even indicate how long it's been there. The devices in the Utah case had no local storage whatsoever, police said; they simply grabbed the data and instantly beamed it away.Read more...

"The product now doesn't disappear from your mind after it’s sold. It actually just begins a different lifecycle," said Larissa Hall, the Best Buy general manager in charge of the consumer end of Best Buy's new venture. "Why let eBay have all the fun? You don’t throw away a car when you're done with it. Even a broken DVD player is worth something."Read more...

Such a system obviously can’t be unleashed on the Internet. Consumers will not tolerate a system that is difficult to use. For chains, the challenges often come from tracking data in one way while marketing/selling it in another. Add to that the complexity of each franchisee having unique, local store marketing offers and the responsibility for its own pricing, and what seems very simple can quickly become very complex.Read more...

This month, an electronic message started appearing on automatic deposit machines telling investors that the machines were being "decommissioned" early this year. Some store associates added that the timing would be more like May or early summer. At first, this seemed an ordinarily unusual move, as few chains that have made the investment in self-service machines (Fidelity started rolling them out 10 years ago) bother to yank them out. But then Fidelity tried to explain the move, and what seemed merely unusual became positively surreal.Read more...

For the mysterious data breach crime folder, the U.S. Secret Service is investigating a series of payment card thefts—originating at an Alabama Dairy Queen—that has only been impacting debit cards. The Hanceville, Ga., police department’s Capt. Jimmy Rodgers is quoted in a local newspaper saying: “At that location, somebody has apparently tapped into the Internet server and hacked into the debit card system, and they’re printing out the customers’ debit card numbers and using them all over California and Georgia.”

This is a disturbing trend, as retailers see debit card approaches as a way to try and reduce interchange costs. It’s even more frightening when we factor in that debit cards are more likely to suffer a processing glitch—as Best Buy and Macy’s discovered last year–than credit cards and that consumers impacted by a debit card data breach are far more exposed than they would have been had they used a credit card.…

During an onsite assessment, QSAs confirm that merchants have met PCI Requirement 11.2 by examining the passing vulnerability scans for each of the last four quarters. The problem is, what if the merchant has missed a scan? If this happens, is the merchant noncompliant until it can get four quarters of passing scans? Ouch.Read more...

Target, for example, has decided that its in-house payment cards are a priority, so it's trialing a program in Kansas City that—in part—offers customers who use the card "5 percent off on every item, every transaction, everyday," Target CFO Doug Scovanner told analysts in a Tuesday (Feb. 23) conference call discussing the chain’s earnings.Read more...

Braden Black, a senior enterprise architect (and security specialist) for 305-store shoe chain DSW, said that, in his opinion, the biggest problem with chip-and-PIN—as it's currently deployed—is that banks have little incentive to make these systems secure because they no longer have any liability if they're repeatedly breached. That liability has been pushed to the retailers. "The ramifications of this attack are most disturbing when viewed in light of the fraud liability regulations that were adopted alongside the technology. Essentially, the banks offloaded fraud liability to merchants and cardholders." Read more...

From a security perspective, PCI Columnist Walt Conway pens, retail CIOs should understand a few things about these chip cards or smart cards (i.e., payment cards with an embedded integrated circuit or microchip). Chip cards can reduce fraud losses, but chip-and-PIN zealots can overstate the benefits.Read more...

But the economic hardships of last year may have shined a tiny ray of light on some bargain-hunting retailers at the expense of Big Blue. IHL President Greg Buzek said second quarter POS shipments last year for IBM plunged more than 40 percent worldwide, and a good chunk of that was a flood of barely used, ludicrously discounted POS units from chains that never made it to 2010.Read more...

Let's flip it the other way. You're in the market for a new couch. Your Google search shows you a page with 35 results and they all, at a glance, seem interchangeable. You've already limited your search geographically, so most of these places (OK, granted, Google's geography limiter doesn't do much) are nearby. Most consumers tend to only focus on the first two or three results and choose from there. But what if there were thumbnail photographs of the insides of all of those stores, sized and positioned so that you could meaningfully flip through them all in seconds? Might that draw your eye to Result 26?Read more...