Evan Schuman's StorefrontBacktalk

Sure, we can do news stories and columns on these documents but we thought some some readers might want a database of all of these documents as they evaluate new issues. We're not sure if we have the right answer, but today we're launching our best shot: StorefrontBackground. StorefrontBacktalk and StorefrontBackground are linked and share many of the same resources (such as our image library, some of the editors, shared servers, etc.) but are, editorially, polar opposites.Read more...

"After dozens of failed projects in the last ten years, the time is ripe for payments by mobile phone at retailers' checkouts," said the report. "Powerful initiatives in France and the Netherlands, initiated by the likes of Carrefour, Ahold and Auchan, may be strong enough to set European, perhaps even global, standards for mobile phone payments."Read more...

A Pennsylvania-based RFID tag-maker is introducing what it says is the thinnest active RFID tag in the world. CenTrak CEO Ari Naim said the size of his company’s new 3mm-thick IT-740 Staff Badge makes it an ideal tool for keeping physical track of not only employees but also of expensive equipment that can be moved, such as notebook computers. “It is pretty thin, at 3mm, for an RTLS tag,” said ABI Research RFID analyst Michael Liard. “The advantage is that the tag does not need to be the badge itself. You can overlay the active tag on current badges — retrofitting them if you will.”

Asked about the new tag’s battery power, Naim would only say that battery life is one of his company’s “specialties” and that power specifications aren’t very informative. “That, honestly, doesn’t give you much information,” said the CEO. “What defines the life of the tag has to do with how the system works. Our system updates every three seconds. If we change it to update every six seconds the battery life would nearly double.” Naim said the IT-740 unit can be programmed to operate at varying intervals and has a motion-sensor that can be used to prevent activation if the unit remains stationary for certain periods of time, such as when it is not tracking product.…

Typically, statements announcing such deals (which, in this case, included Subway's acquirer for its stores in Canada, Chase Paymentech) feature a canned quote from an executive with the chain, praising the vendor for its wisdom. In this case, the quote provided by Subway was anything but warm. Read more...

The worldwide RFID market is likely to grow 11 percent by the end of next year, with highlights including contactless ticketing, contactless payments and item-level tracking of clothing, according to ABI Research. The recession, particularly the drastic impact it had on the automotive industry (which is using RFID for anti-theft features), slowed RFID’s growth, ABI said. “Remove the deeply depressed automotive immobilizer numbers, which are directly tied to vehicle production, and the growth rate jumps to almost 16 percent” between 2009 and 2010, the report said.

Another area that’s seen some decline is RFID-enabled identity cards. This decline, says ABI, was caused by “the winding down” of a national ID card program in China. However, ABI says the RFID identity card industry should see resurgence in 2010 as dozens of governments move to adopt RFID-based passports, driver’s licenses and electronic vehicle registrations.…

But analysts were less than impressed, pointing out that the Motorola units were actually larger than many other major RFID readers today, despite being smaller than other Motorola RFID readers. "I definitely classify this as 'ho hum.' ThingMagic and Impinj as well as some others have much smaller form factors and more functions," said Pete Abell, a longtime RFID analyst (used to be with IDC) who today works as an independent consultant.Read more...

Washington State’s governor has signed into law one of three bills relating to RFID and privacy, a measure that prohibits, with a dozen exceptions, the scanning of RFID chips by anybody other than the company that attached them.

The signed bill includes a number of significant changes to the initially-proposed measure which was denounced in January by Dan Mullen, President of the Association for Automatic Identification and Mobility (AIM), as potentially being “traumatic” to retailers and consumers. Mullen, according to an RFID Journal report, believes the enacted version is “pretty reasonable” because it focuses on banning the surreptitious scanning and reading of RFID chips, as opposed to the devices directly.…

However, not all areas of the RFID world are in good shape. According to IDTechEx, the adoption level for pallet and case tagging has been slow. "The tagging of pallets and cases remains a failure, with only 225 million passive UHF tags used for this application in 2009 - a far cry from the 35 billion tags that one consumer goods company alone predicted that it would be buying in 2009, when they presented at an event in 2003."Read more...

This is one of these ideas that could work extremely well in a very limited set of circumstances. A whisky company opted to put up a billboard in a densely-populated and traveled urban area and wanted it to change–very significantly–with every person who saw it, tailoring to that person. The problem is that it can’t scale, requires workers on site (and workers who can craft ad copy on the fly, with literally seconds to create) and is likely quite expensive.

Still, as this video of Jameson’s truly interactive billboard illustrates, the marketing tactic can break through the clutter of a message-laden environment. And it’s hard to argue with the potential of a billboard that–as shown in the video–hailed a cab for a prospect. But could it be practical for in-store use? Maybe at a large mall? And what of the flip side: Are there consumers who would be alienated by having such a public message directed at them? And what if it was connected with CRM, allowing for personalization beyond that which can be observed? In this day of digital messages overflowing consumers’ cellphones, Web screens and shopping carts, it’s absolutely a concept not be dismissed too quickly.…

At its core, the DataBar codes are today's barcodes but are much more tightly packed with much more information. But not all of this transition will be akin to scanning sugar and spice. Most chains will have to absorb non-trivial costs to support the upgrades, a tricky move at a time of store closings and massive layoffs. Most product scanners built since 2000 are capable of reading DataBars but investments need to be made beyond just the scanners.Read more...

Shoppers with RFID-enabled loyalty cards from a chain of Washington State grocery stores get their accounts automatically credited the price difference, plus 1 percent, if products they buy go on sale within a week of their shopping trips. Now there’s an incentive to use the cards. The program is being trialed at the Top Food & Drug chain, which owns 33 supermarkets in Washington and Oregon under the TOP Food & Drug, Haggen Food & Pharmacy and Larry’s Market names.

“If you buy milk for $4 on Tuesday and the provider sells it on Thursday for $3.50, you get an E-mail saying you’ve got fifty cents in your account based on the fact we put this on sale,” said Peter Gruman, president of Accelitec, a vendor involved in the program. “The next time the customer visits the store and taps his loyalty card at the POS, the cashier will see he has fifty cents credit and will ask if he wants to apply it to the sale or let it remain in the account.” The program also provides no-questions-asked automated refunds for products with quality problems. If a loyalty card holder finds the milk was sour, he can call the store and ask for a refund, which will also be credited directly to the CRM card.…

That's the deal being offered by Citibank Singapore, Visa payWave and mobile network M1 as part of a 3-month pilot program in Singapore. For the trial, which involves as many as 300 people, the companies are allowing participants to keep the Visa payWave-equipped Nokia 6212 Classic handsets if they make at least eight transactions with the phones each month.Read more...

Typically, statements announcing such deals (which, in this case, included Subway's acquirer for its stores in Canada, Chase Paymentech) feature a canned quote from an executive with the chain, praising the vendor for their wisdom. In this case, the quote provided by Subway was anything but warm. 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...

But the key issue has consistently been much simpler. Unlike other forms of consumer-issued RFID devices—such as EZPass and even the keyless entry systems of some newer cars—typical contactless payment methods have not given consumers any real reason to use them. With no significant convenience or cost-savings issue, one need not look too far to figure out why contactless is struggling in many sectors.Read more...

"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...

The RFID industry is being slowed, but not stalled, by the recession, according to ABI Research. The company’s latest market data shows that total revenue earned from RFID transponders, readers, software and services will exceed $5.6 billion by the end of 2009. “The recession has had an undeniable effect on deployment plans,” said ABI Research practice director Michael Liard. “Despite some project deferrals and terminations, there will be market growth, albeit fragmented.”

The RFID market is “worthy of cautious optimism in the near to mid-term, particularly in the closely-watched passive UHF segment,” said ABI Research. And while the RFID industry, like most others, is struggling, the researchers said they “would not characterize it as being in a state of despair or turmoil.”…

Even more cynically, is it possible that those execs know that surveys like this tend to impact CEO/CFO expectations and, therefore, they'll give the answers they want their CFOs to believe? Even if the execs are being straight with the survey takers—and that the survey takers are being straight in reporting all of the collected data without sanitation—we have to wonder what was behind those answers.Read more...

In a Japan-only (for now) rollout, Sony is including a TV remote control with its new line of HDTVs, but this is no ordinary remote control. With a built-in RFID tag reader, it’s designed to talk with consumer’s cellphones and authorize purchases.

Initially, the devices are to be used to pay for very TV-related items such as video-on-demand, ringtones from a music show and other multimedia features. But the next phase could include any purchases, whether it’s a barbecue grill from the Home Shopping Network, a washing machine from Amazon (as seen through the TV’s Web connection, courtesy of a built-in Ethernet port) or groceries from the local Wal-Mart (to be picked up later). Of course, that’s in Japan. Here in New York metro, I’m happy if my Treo can actually connect two phonecalls in a row.…

Some of the state legislation doesn't even limit itself to dictating what retailers must do while operating in their states but are setting new rules protecting the residents of that state when they happen to be shopping out-of-state or online. Do they expect cashiers at Wal-Mart to ask what state a customer lives in and then, based on the answer, change the way they handle a credit card payment?Read more...

Just a couple weeks after word got out that Wal-Mart and Procter & Gamble had backed off their support for RFID tags on marketing displays comes the news that the nation’s largest drugstore chain, Walgreens, is boosting its support for the very same RFID tagging of promotional displays.

“The results have been impressive: Over the past year, our in–store execution has grown to nearly double the industry average,” said David Van Howe, purchasing VP for the $60 billion 6,658-store chain. “Store–level information about what is up and where it is in the store allows unprecedented accountability for achieving program potential.”…

One vendor is trying to get consumers to sidestep the hassle of filling out loyalty card applications at every store by integrating the functionality into a PDA.

The field test by Japan’s NTT Communication started this month, just as the vendor promised when it rolled out the program in October 2008. NTT’s new “Gyazapo” system, which uses an RFID chip in a mobile phone to carry loyalty card information for multiple retailers, can allow RFID scanners at the POS to grab shoppers’ personal information from a central database managed by NTT.…

In a proof-of-concept experiment in Bangalore, Intel India is marrying RFID tags and POS with a CRM database where “frequent customers would have their preferences and favorites recorded.” Such a system could tout related products and flag new versions of that consumer’s preferred brands.

“This system is designed to replace the current simplistic computer or other system that only provides billing and basic services,” said Sanat Rao, Marketing Director (Emerging Markets), Embedded and Communications Group, at Intel. “Our system, once implemented, allows the possibility of being operated as a kiosk and provides the information on inventory.”…

To interpret motivation and real intent, sometimes a look at history can be useful. Do you remember another Facebook privacy incident back in December 2007? In that case, Facebook tried sharing—without permission—customers' purchases with people on their friends list. Is this a pattern? Is Facebook trying things, and if it's caught and there's a loud enough protest, the site pulls back? In short, is Facebook trying the permission versus forgiveness approach? Indeed, it seems to have tried both options. For a company that is trying to solidify a brand and build as much trust as possible, these tactical approaches seem odd.Read more...

Wal-Mart has historically had a strong fondness for its own homegrown apps, given the $401 billion chain’s rather absurdly large size. The company has liberalized that policy recently, allowing a few shrink-wrapped enterprise apps to slip in. Now there’s a report in Economic Times that Bentonville is seriously considering an Indian business process outsourcing contract that could include “non-core processes of procurement, merchandising, finance, accounting and payroll” and be valued at as much as $500 million.

The story quoted from a Wal-Mart document that said “Wal-Mart will expand staffing of certain elements of IT application maintenance and development with some of India’s leading information technology firms. India is one of several countries that the company is targeting as part of its remote sourcing model for IT activities.” Vendors in the running, the story said, include IBM, TCS, WNS and Wipro.…