Evan Schuman's StorefrontBacktalk

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...

The idea is for shoppers to phone the service and then speak the product name and the automated voice system will say the exact location of that product. If it works, the system's creators envision successor systems that will turn that consumer phone number into an impromptu CRM customer-identifier. Baalmann, who will try the system at a store in Desperes, MO (right outside St. Louis) starting Tuesday (Aug. 18), already has people ready to call manufacturers this week to sell them the ability to send text codes to customers who ask about certain product categories.Read more...

This begs the question: How does an IT department successfully deliver retail technology that meets the needs of both a franchisor and the chain? Both sides need to change the way they think about large-scale IT projects. StorefrontBacktalk's new Franchise IT Columnist Todd Michaud contends that this is a lesson that shouldn't be ignored by non-franchise chains, too, as today's reality of Web-enabled, mobile-fueled, social-network-infested high-turnover low-margin is forcing everyone to play by very different rules or to die not trying.Read more...

When working on its annual study of manufacturer Web sites that try selling directly to consumers, Forrester Research pretty much found what it expected to find: that manufacturer sites are great for research with brand-loyal consumers, but the purchases are invariably made elsewhere. Forrester’s Sucharita Mulpuru, the principal analyst for Retail eBusiness and arguably the sharpest E-Commerce analyst working HTMLs today, said that, sometimes, the market works just as it’s supposed to. Many manufacturers were originally scared about offering direct-to-consumer deals, fearing that they’d undermine their channel and cannibalize sales. Turns out that consumers are smarter than they look and the product-maker sites haven’t hurt retail partners one little bit.

As Hershey’s concluded this month, the E-Commerce community trusts manufacturers to make stuff, not to sell it. It’s the exceptions that make the rule, Mulpuru said, pointing to two rare manufacturers that actually do make some direct to consumer sales: Apple and Dell. Apple does it by an almost biblically strict adherence to price, making the prices same regardless of whether the product is purchased directly, while Dell has a lengthy history of only selling directly (although it now sells through the channel). Still, Mulpuru argues that manufacturers should still offer E-Commerce for the CRM data collection and customer feedback info it provides.…

This technique of analyzing the light-reflection has a few potential advantages, such as bokodes are much more difficult to fabricate, meaning it will be much more difficult for thieves to use consumer-grade printers to make fake stickers or to print bogus codes on product containers. Also, it can trump RFID tags in a few ways, both for security and supply-chain efficiency.Read more...

"Our goal is to have it be completely comprehensive, for both online and offline," said Zoe Strickland, the Wal-Mart VP who serves as the chain's Chief Privacy Officer. "We need to govern all the different ways that we collect and use information. Privacy is not just about using the Web site. It's everything that happens when you're interacting with the company." The new policy opens the doors to consumers being able to examine their full customer files. Or does it? Read more...

The mandate is being criticized by the Internet & Mobile Association of India (IMAI), which issued a statement asserting the measure will do little to prevent online fraud, since it will pertain only to payment cards originating in India. What it might do more effectively is make life hard for India's online retailers, said the group. "India is in an evolutionary stage in E-Commerce and this RBI directive may end up being the biggest deterrent to E-Commerce in the country, rather than an enabler," said the IMAI statement.Read more...

Germany’s Metro Group, the world’s fifth-largest retailer with $96 billion in annual revenue and about 2,200 stores, has co-created a new kind of UHF-RFID tag that is reportedly delivering “nearly 100 percent read rates despite being attached to pallets loaded with goods containing metal and fluids.” Metro is using the new Avery Dennison AD-843 tag to track pallets sent from its warehouses to all of its food stores in Germany and to “at least 90 in France,” Gerd Wolfram, managing director of MGI Metro Group Information Technology, is quoted as saying to RFID Journal.

“As the pallets are loaded onto trucks, Sirit or Intermec RFID interrogators capture their tag ID numbers—reading them even in instances where a tag is obstructed by cases of goods—and send those ID numbers, along with a date and time stamp, to software running on Metro Group’s server,” the story said. “The software, designed and integrated by MGI Metro Group Information Technology, includes a database of pallet RFID tag ID numbers linked to the bar-code serial numbers of the products loaded on those pallets, enabling the software to interpret the RFID data and track when a pallet was shipped.”…

"Despite the world’s largest RFID project, the $6 billion China National ID card scheme, being completed a year earlier, the global RFID market is rising 5 percent this year to $5.56 billion, in the face of the global financial meltdown which has caused some car production, for example, to plummet by 50 percent," wrote IDTechEx CEO Raghu Das.Read more...

Concluding that “its current (E-Commerce) business model is not sustainable,” Hershey has shut down its direct-sale Web site, killing the jobs of about a dozen Web employees. But whether this is more of an E-Commerce issue for the $5 billion chocolate maker or a channel conflict issue is unclear.

Hershey’s chocolates will apparently continue to be sold by a wide range of online retailers, suggesting that the nation’s largest chocolate company was simply cleaning up its channels, finding little extra profit in selling product directly. The site closure is “a strategic decision. Our present business model is not sustainable and we will continue to evaluate all options in E-Commerce, including strategic partnerships and licensing agreements,” said Hershey spokesperson Kirk Saville. But with many major retailers—including Canadian Tire and Borders–stepping back from E-tailing altogether, it’s hard to not look hard at any multi-billion-dollar player pulling out of the Web business without some concern.…

Web coupon fraud "is rampant. All you need is a computer and Photoshop and you're ready to go," said Bob Olstead, the store manager of a Foodtown in Denville, NJ, who added that it is sometimes as long as three months after a coupon is honored that the store's coupon clearinghouse tells them it's bogus and therefore rejected. Would it make sense for manufacturers to get together and create an database to authenticate Web coupons and to allow chains to access the database as easily as they can verify a credit card?Read more...

But in a June 3 "assessment summary" regarding the plan to stop including the UPC-A on coupons, the group said "preliminary data" about retailer readiness for the change show the January target is unrealistic.Read more...

The $5 billion 72-store grocery chain Wegmans is trying a very focused trial this Fall. It will offer a kiosk at one store that will offer to scan one specific type of fruit–berries–from one distributor. The point of the kiosk is to tell consumers–via a barcode scan–the exact farm that the berries are from.

A spokesperson for the chain, Jo Natalie, was quoted in The Packer as saying that the trial “will ensure confidence in product safety.” But it’s not clear why such data would be of any value to consumers. At best, consumers may hear something on the news about avoiding produce from a particular country, but that would likely be clear on the printed label or the store’s signage. What consumer would even know the significance of one farm versus another? It’s an interesting trial, but the value to the consumer seems rather amorphous. …

The move has huge potential mostly because, from the consumer's perspective, it's so non-interruptive. Consumers are already in the habit of using self-service beverage machines at fast-food facilities, so it should encounter almost no resistance. All that will be visibly different is a much greater amount of beverage choice. As long as the machine's interface is clean, that shouldn't be a problem. But if the options look—even at a glance—overly complicated or time-consuming, things could turn ugly quickly.Read more...

Ahold Information Services Vice President of Applications Development Alan Williams argued that a January replacement of the current UPC-A barcode with the DataBar "would create a significant hardship for a large number of retailers." Ahold, a Netherlands-based grocery chain operator with sales of $40 billion, has about 1,400 stores in the U.S. including Stop&Shop and Giant.Read more...

It’s well known that temperature-detecting active RFID tags have extreme value with perishable goods transportation, but a new study delves into microclimates, which indicates subtle differences of temperature in different parts of the same pallet. The Aim Global story looks at the IT ROI implications and whether it could change the business case for active tags.

“Each link in the cold chain must have the ability to reject partial shipments based on temperature data. This could make it either more expensive for the supplier (because some goods are now being rejected that had previously been accepted) or less expensive (because whole shipments are not rejected because of a single temperature reading). In either case, there would be a financial incentive to more closely monitor temperature and other critical conditions,” the story reported. “Customer refusals or charge-backs for less-than-fresh goods might provide an incentive for processors to pressure growers/packers to tag individual cases so that improper handling at the beginning of the supply chain does not adversely affect a processor’s or distributor’s downstream revenues.”…

NEC is preparing to sell its next-generation of tag readers/writers at a price more than 90 percent lower than current pricing, according to a report in Japanese business publication The Nikkei.

“The tags are compatible with all of the six worldwide radio communications standards. NEC is ready to accept orders beginning as early as this July,” the story reported, adding that some “10,000 of the new tags will be available for approximately (the equivalent of) $100.”…

The scenario of consumers using their smartphones to barcode scan for everything from price lookups to quickly gathering more product information via the Web is nothing new. But despite all the talk, it hasn’t progressed much beyond being in a lot of hypothetical scenarios.

Is Google’s entry into the space likely to change that? U.S. and U.K. owners of mobile devices running the Google Android operating system can now download from Google a “Barcode Scanner” app that allows them to use their phones to scan UPC/ISBN codes with the phone’s digital camera. The application has been integrated into Google Product Search for Mobile. …

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...

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...

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...

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...

This all raises the issue of "should retailers wait for the PCI SSC to 'bless' or integrate so called 'beyond PCI' technologies into the standards?" GuestView PCI Columnist David Taylor's answer is a profound "no." Read more...