NRF’s New Tech Toys: Getting Investment Blood Out Of An IT Stone

Written by Evan Schuman
January 8th, 2009

The retail industry, fresh out of its exhausting and profitable holiday season, is used to coming together in January and watching vendors strut their latest toys for good retail IT girls and boys. But this year is not shaping up to be like most years. The vendors, in smaller numbers, will still be strutting, but will anyone be buying?

The pitches have been tweaked this year, to stress low-cost units, typically stripped down of features. The more daring vendors will be pushing more aggressive deployments, arguing that consumers need to be wowed now more than ever. This approach is coupled with a sales pitch that younger consumers are expecting more instantaneous feedback while in-store, so retailers must either invest now—somehow—or lose even more revenue to online and smaller brick-and-mortar rivals.

Microsoft will use the show to roll out its version of smartphone-readable 2-D barcodes. Redmond’s approach with “Microsoft Tag” brings multiple colors into those barcodes, which allows them to be 50 percent smaller but still more easily and reliably read than today’s 2-D barcodes, said Kevin Kerr, Microsoft’s worldwide retail technology strategist. Microsoft Research has dubbed them High Capacity Color Barcodes (HCCBs).

“The advanced computer imaging of HCCBs employs different symbol shapes in geometric patterns and multiple colors to significantly increase the amount of information that can be stored on analog printed media (over traditional 2D codes)and improve readability on poorly lensed mobile phones,” said a Microsoft statement.

The part Microsoft likes best is that the data flows through the phone to its servers, where retailers can use Microsoft’s analytics via a Redmond-hosted model.

But Microsoft isn’t seeing this application initially as a mainstream retail option, focusing instead on niches where mobile-friendly consumers tend to shop. “You have to look at the demographics of who’s using these phones,” said David Gruehn, Microsoft’s U.S. retail industry director. “Think about a large gaming store. It’s not that I won’t be talking to the Targets and Home Depots of the world,” he said, but it’s not where he’ll start.

The service will also include geolocation, but the consumer must agree to allow his/her location to be transmitted to Microsoft and then to the retailer or consumer goods company. Microsoft’s location effort doesn’t involve GPS, using instead cell tower triangulation, which delivers a location accurate within about 500 feet. In other words, it will pinpoint which store is being used but not where in the store the person is standing.

How to get retailers to invest in it? Microsoft is offering the 385K application for free, along with the cloud package.

Beyond Microsoft, the show floor will include a concept store selling music, one where consumers can drag virtual instruments onto a screen to create customized music, said NRF VP Susan Newman. Another booth will let consumers scan their face and then paint that image with virtual makeup and lipstick, allowing an easier way to experiment with cosmetics.

Another vendor will use the show to unveil a wireless debit card device, a piece of equipment delayed until PCI debit-specific rules could be accommodated. But as Macy’s reminded the industry this month, debit cards can cause a lot more consumer damage than credit cards. If the typical credit card has a multi-hour glitch, it’s barely noticeable to consumers. If the same thing happens with a debit card, those consumers could have their bank account emptied and start bouncing checks all over town.

Still, with credit rules tightening, debit cards may be the only viable plastic option for some consumers this year. And now, they’ll be able to make those charges wirelessly. The question for retailers: Will enough consumers be spending money this year in any format?


Comments are closed.


StorefrontBacktalk delivers the latest retail technology news & analysis. Join more than 60,000 retail IT leaders who subscribe to our free weekly email. Sign up today!

Most Recent Comments

Why Did Gonzales Hackers Like European Cards So Much Better?

I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
Two possible reasons that I can think of and have seen in the past - 1) Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
@David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

Our apologies. Due to legal and security copyright issues, we can't facilitate the printing of Premium Content. If you absolutely need a hard copy, please contact customer service.