Evan Schuman's StorefrontBacktalk

"Let’s say a group of retailers is being chased through the jungle by a tiger named, say, Gonzalez. To avoid being eaten by the tiger, it’s not necessary that each retailer run the fastest, but merely that each retailer should run faster than the slowest retailer," he writes.Read more...

Franchisee Columnist Todd Michaud can’t tell you how many times he had heard some version of this over the years. On the surface, this seems like a pretty straightforward argument . But with most things in life, it’s not quite that simple. I also have franchisees who pepper me with questions like: “Why is the system so expensive? Why can’t I have a single phone number to call for all of my problems? Why are these upgrades so expensive and why on earth do they take so long to complete? Why can’t I get access to better data faster? Who is holding this vendor accountable?” Not always, but sometimes, the answers to these questions are found by limiting the franchisees choices.Read more...

This is the latest in a series of high-tech blunders from the 123-year-old $47 billion 3,900-store chain. Is this because of the chain's size or, more likely, because it has been pushing the envelope on what it's trying to do technologically, perhaps beyond its testing limits.Read more...

In March, Western Union cut a deal with Amazon to let the E-Commerce giant's customers use the 44,000 Western Union locations with fees ranging from $3 to $8. Then Bank of America and Citi got into the act with a one-time use card, another tactic to make sure the payment is only used for the immediate purchase price and nothing else. Last Thursday (Sept. 3), eBillMe offered its version, where the payment company is working with MoneyGram—and others—to offer cash-only options at about 75,000 walk-in locations, for a $5 fee. Read more...

Last Wednesday (Sept. 2), TJX struck quite a bargain and settled with the handful of remaining banks. In settling all charges with four different financial institutions—AmeriFirst Bank, HarborOne Credit Union, SELCO Community Credit Union and Trustco Bank—TJX agreed to pay $525,000 to be split between the four businesses. Was that punitive or was that something closer to a nuisance payment for the $19 billion retail chain? Punitive would generally mean covering all legal costs plus reimbursing the banks for all out-of-pocket costs and then paying them something to compensate them for the pain of the litigation. The payment specifically excluded legal fees. According to the statement TJX issued, the settlement didn't even cover all of the banks' out-of-pocket expenses let alone offer anything for their efforts. Oh and it also allowed TJX to say that it "has denied all wrongdoing." The amount enough that it was already covered in a reserve that TJX took back in the second fiscal quarter of 2007.Read more...

When negotiating—or surrendering to—a service-level agreement guaranteeing uptime levels with a Web hosting service, retailers need to be cautious of how “downtime” is defined. Pingdom is now blogging about more SLA games, including some hosts that exclude any downtime that they consider maintenance. Here at StorefrontBacktalk, if our site is down, it’s of little comfort that it was a planned outage that we never asked about.

Pingdom’s post on Monday (Sept. 7) also spoke of hosts that exclude server downtime and only count network downtime. Again, if the site is unavailable, that’s downtime. Pingdom is a bit more forgiving, though: “To be fair, for dedicated hosting providers, it would be difficult to guarantee anything else when the customer has control over the server.” It also repeated an observation that Pingdom has made before that hosts often ignore smaller outages, even if they have many of them. Of course, for chains, it’s not merely situations of Web hosting. These tricks also apply to services handling mobile sites, customer comments, video reviews, shipping and almost anything else your site needs to outsource, especially for the holidays. Sometimes—and may I be forgiven for saying this—it’s actually good to have the lawyers involved in SLA negotiations.…

But what does any of this have to do with M-Commerce? A lot. If they finally get around all of the technical and logistical hurdles of M-Commerce, they will be trying to get millions of consumers to interact with their sites—via their phones—and see product lists, read reviews, watch multimedia demonstrations, interact with social sites, download PDF instruction manuals and even ask their peers for feedback on their shopping choices before consummating those purchases. That's all great, but—if successful—will it turn the Home Depots, Walmarts and Targets of the world into examples of what may become known as "The AT&T Factor"?Read more...

In the Gonzalez plea bargain, the agreed-to sentencing recommendation—which calls for at least 15 years in prison and "no more than 25 years" in prison—does not seem much more lenient than he would have faced at trial. Even with as extensive a cyber attack as these, most U.S. courts wouldn't go anywhere near "more than 25 years" in cases where no one was physically hurt and the defendant wasn't accused of real violence or threatening violence. But a jury is a tricky animal and, technically, the counts he is pleading guilty to have a cumulative maximum sentence of 193 years in prison. Read more...

Grocery chains have historically been afraid to reach out to consumers with personalized pitches, fearing the consumers would be put off by what might be seen as a privacy intrusion. But with privacy expectations now much lower, more chains are willing to take the chance. Case in point: the $4.6 billion 1,400-store Big Lots grocery chain will launch its first CRM program in the Fall, the latest in a series of grocery chains slowly embracing official loyalty programs.

The Buzz Club card will offer consumers a discount when they make 10 purchases of more than $20 each, according to this DMNews report. The story quoted Big Lots CEO Steven Fishman as saying: “The program will allow us to learn more about our core customers’ shopping tendencies and opens up micromarketing capabilities we’ve have never had before as a business.” It will be used to create personalized follow-up offers and Fishman said that all of the chain’s “messages going forward will be more aggressive.” …

Look for Gonzalez to officially plead guilty to the federal charges from Boston, primarily involving TJX, BJ's Wholesale Club, Boston Market and Sports Authority and New York, primarily involving Dave & Buster's, on Sept. 11.Read more...

In the trial—conducted over 13 weeks and published Monday (Aug. 24)—looked at a non-item-level store (the control store) and one item-level store and the same limited product area (denim jeans) were examined for both.Read more...

A 500-store franchise chain, for example, could easily have to indulge more than 50 different POS configurations, given various owner demands. Each location is likely to have it’s own nuances and, in a franchise environment, each store will likely have different needs than the rest. So what do you do when you have 500 locations that each have their own needs? You need to think of the rollout as more like 500 little project plans. Asks Franchisee Columnist Todd Michaud: Now doesn’t that sound like fun?Read more...

If a retailer will invariably be declared non-compliant after a breach, what's the point of doing the assessment right? Turns out, there are quite a few points.Read more...

The Missouri law is similar to most other state laws dealing with data breach notifications, but it includes medical and health information, data the states usually don't mention because it is protected by the federal Health Insurance Portability and Accountability Act (HIPAA).Read more...

As details trickle out about how the feds supposedly broke the Gonzalez attacks against TJX, Hannaford, Heartland, 7-Eleven and tons of others, much of it focuses on a global effort to access servers and laptops overseas and doing so in countries where U.S. law enforcement cooperation is perhaps not what it should be.

Wired did a wonderful piece, summarizing federal filings in the New York part of the Gonzalez accusations (this is the Dave & Buster’s case). The story details the chase for a laptop in Turkey and the legal and police bumps along the way. Nothing new revealed for retailers trying to protect their networks, but it’s interesting background nonetheless.…

In the world of retail CRM programs, warehouse chains such as Costco, BJ’s and Wal-Mart’s Sam’s Club occupy a very specialized niche: they can boast that their customers use their loyalty cards just about 100 percent of the time, allowing for near-perfect purchase histories for all customers. Of course, requiring that the membership/loyalty card be displayed to get into the store and to make any purchases certainly doesn’t hurt. But it’s equally noteworthy how little those chains have pushed those extraordinary purchase history databases. Sam’s Club has now made such a move, claiming to be the first warehouse club chain to offer automatic paperless coupons. These chains have typically provided deeper-than-normal discounts, but they make it up with membership fees and, much more importantly, volume purchases.

That’s not merely buying huge quantities of products, but packaging the products to force consumers to buy larger quantities at any one time. If the consumer can use 100 bars of soap, they can enjoy that financial benefit. “There are no coupons to clip and no rebate forms to complete and mail,” said a Sam’s Club statement. “Members will receive customized offers tailored to them and discounts will be automatically taken at the register using their existing membership cards.”…

Such a drama is now unfolding with the Albert Gonzalez case, the Miami man accused of breaking into TJX, Hannaford, Heartland, Barnes & Noble, Sports Authority and a laundry list of others. Is Gonzalez the masterhead of a cyber thief ring? Was he coordinating different teams in the U.S., each group assigned to attack different retail chains? Or was he merely the pawn of an Eastern European data theft syndicate? In Dickensian terms, was he more Fagin, the Artful Dodger or even Oliver Twist?Read more...

As we pointed out in a recent package of stories, retailers have been slow to deploy mobile sites that actually support purchases. However, the lure of potential holiday dollars seems to be inciting at least some of those foot-dragging merchants to lean on third-party mobile site developers to quickly create M-Commerce sites.

Representatives of several mobile commerce technology vendors have said they’re suddenly being pressed by retailers to develop mobile sites or applications before December. Folks from Usablenet, Digby and CardinalCommerce told the publication they’re working on rush-job M-Commerce sites or apps for economy-battered retailer clients that want to make sure they offer consumers every possible opportunity to buy something for the holidays. For example, Jason Taylor, vice president of mobile products at Usablenet was quoted as saying the company expects “to launch 10 mobile retail Web sites between September and November” and Digby CEO Dave Sikora said “there’s definitely a push right now to have some kind of mobile presence for the holiday season. There’s a sense of urgency right now to engage with customers in the mobile channel with the thinking that come January they’ll learn from the holidays and create a whole mobile strategy.”…

But the indictment revealed several key contradictions with 7-Eleven and Heartland and one major retailer's security executive found the government's specifics to be a convincing indictment against PCI.Read more...

Now MasterCard is taking what can only be called a “get tough” policy, issuing larger fines and, most significantly, forcing both Level 1 and Level 2 merchants to use assessors rather than take on the task of self-assessment. But still, opines PCI Columnist David Taylor, merchants, banks, processors and service providers aren’t happy with MasterCard. They just can’t seem to get a break. After numerous conversations with companies on the receiving end of MasterCard’s “get tough” efforts, Taylor thinks it's all a difference of philosophy.Read more...

Retailers tend to get so caught up in their global rollout plans and product strategy that they often forget to look at things from the store owner's perspective. That phrase is what many franchisees hear when talking to their chain hierarchy about all the great things that the brand wants to do with detailed data from the store. “By analyzing the data that we collect from these various sources, we will be able drive sales far more effectively.” But, similar to other grand plans they have been sold in the past, franchisees are skeptical that that yellow brick road is so easy to follow.Read more...

Many of the wording changes are subtle. For example, the revised document says the standards apply to persons "who own or license personal information about a resident" of Massachusetts. The prior version of the sentence said the regs apply to those who "own, license, store or maintain" the personal information.Read more...

At the end of last month, Best Buy had a POS price glitch for the Palm Pre and chose to let those who made the inadvertently good deals keep them. When an even more severe price glitch happened this month, the chain was less generous.

On Wednesday (Aug. 12), a Web glitch had a $3,400 52-inch flat-screen television selling for $9.99 and the online system sold quite a few. This time, though, Best Buy corrected the price and said that it would not honor those orders, instead opting to cancel them and refund the money. The details on how such an error wasn’t detected before sales were processed were not–amazingly–released.…

But the more important question raised in the report is whether those merchants have an unrealistic sense of how vulnerable they are to data breaches. The problem is that the report didn't sufficiently track who said what, making it impossible to determine whether any one merchant's appraisal was legitimate or not.Read more...

Instead, the U.S. M-Commerce space is floundering as merchants drag their feet deploying purchase-capable mobile sites or find their mobile initiatives stalled by an avalanche of obstacles beyond the anticipated mountain of incompatible platforms and mobile browsers. The problems encountered are legion. They include a vacuum of standardization for everything from design, programming, payment processing and even URL naming to fears about carrier conflicts over the types of permitted content and a Catch-22 business strategy about how much, and when, they should embrace M-Commerce.Read more...