Evan Schuman's StorefrontBacktalk

This week’s audiocast looked at issues ranging from payment systems—practical problems with retail PCI deployment as well as a new POS/Loyalty card program from Subway–to a new search feature unveiled on Thursday by Amazon.com and a look at the RFID industry after Alien Technology’s failed IPO. This week’s panelists featured return visits from IDC’s Pete Abell, Solutionary senior VP and former federal prosecutor Mark Rasch and Jupiter Research’s Patti Freeman Evans. Newcomers to StorefrontBacktalk’s Week In Review this week were Cathy Hotka, senior VP for the Retail Industry Leaders Association and Jupiter‘s Edward Kountz. StorefrontBacktalk Editor Evan Schuman moderated.

The PCI discussion was a fascinating realworld look at how PCI is great on paper but much more challenging in live retail environments. No panelist kept out of that free-for-all. You really should listen to it, if for no other reason than to get better excuses for PCI hiccups.

In a bid to help improve its search accuracy and relevancy, Amazon.com on Thursday rolled out a feature it’s calling “Search Suggestions,” which allows site visitors to suggest non-intuitive word associations. Jupiter Research analyst Patti Freeman Evans applauded the effort, describing it as “a great experiment. This is kind of an interesting way to tap into the really involved customers.”

One example that Amazon cited: “The Shakespeare play ‘Macbeth’ now appears when customers search for ‘The Scottish Play.’ The customer’s explanation is shown next to a link to the book: ‘theater superstition dictates that “Macbeth” is referred to as “the Scottish play.””

“Amazon’s announcement added in the generous line that “there is no charge” for the service, whereby tons of consumers spend their own time improving Amazon’s for-profit-service. The most frightening part is that the line’s inclusion brings up the possibility that someone at Amazon actually considered charging for it.

Although Google itself has been clever in its click fraud battles, it’s issued a report saying that clickfraud claims are overblown. The message is legit, but I wish it was another messenger.

Click fraud claims–as opposed to actual click fraud–are a huge threat to the massive but not especially stable Web advertising market. Ad-hawker-extraordinaire Google is doing its best to combat that threat. Unfortunately, the threat they are focusing on are the claims as opposed to the fraud itself.

This week’s audiocast panel discussion of the StorefrontBacktalk retail technology week that was …. was decidedly global in topics. This week’s group of retail technology analysts that sat down late Thursday was Patti Freeman Evans from Jupiter Research, Sucharita Mulpuru from Forrester Research and Paula Rosenblum from the Retail Systems Alert Group. StorefrontBacktalk’s Editor Evan Schuman moderated.

The group opened with a hard look at the German Metro Group’s Item-Level RFID plans and whether Wal-Mart can survive as a retailer outside (and, as one panelist argued, inside) the U.S.

The group also discussed retail attempts at mobile marketing, focusing on the Subway chain’s experimentations with cellphones, which raised issues of how far ahead of the U.S. much of Asia and Europe are and how that should impact retailer’s global IT strategy.

The panel also jumped into a report expected next week from Jupiter Research that looked at how e-tailers—including Netflix–are making some surprising decisions about incorporating user-generated product reviews.

Another group of retail technology analysts sat down Thursday late afternoon to look at the retail technology week that was. This week’s panel independent retail technology consultant John Fontanella—veteran analyst with the Aberdeen Group and AMR Research—along with returning guests IHL President Greg Buzek and the Retail Systems Alert Group’s Paula Rosenblum.
StorefrontBacktalk‘s Editor Evan Schuman moderated. This week’s topics were Alien’s delayed IPO and the problematic ROI picture of kiosks. If some disappointing earnings and a few economic darkclouds are any indication, the retail tech sector may be in for a serious downturn. If so, what segments will fare well and which will likely get bloodied?

A few vendors have been pushing digital watermark technology—somewhat equivalent to a 21st Century microdot—as a clever way to bridge the physical store and online worlds, without the need for keyboard interactions. The cellphone becomes the remote control. Is this where much of retailing is headed? Will it work? What are the practical implications for customer service?

Are there topics or panelists you’d like us to consider for next week? Please don’t be shy.

At the end of every week, StorefrontBacktalk.com will assemble some of the industry’s top consultants, analysts and IT executives to discuss that week’s retail tech developments. We inaugurated our StorefrontBacktalk Week In Review on July 21.

The July 21 panel included Pete Abell from IDC, Paula Rosenblum from the Retail Systems Alert Group, Greg Buzek of IHL and Mark Rasch, a former federal prosecutor who today serves as VP for Solutionary.

The panel–moderated by StorefrontBacktalk Editor Evan Schuman–ripped into a wide range of topics. Listen to Rasch, Rosenblum, Buzek and Abell discuss the new PCI changes announced by Visa or Rosenblum, Rasch and Buzek debate how multi-channel will likely do this holiday shopping season. Abell tackled HP’s RFID-rival Memory Spot alone while Rasch, Buzek and Rosenblum ganged up on self-checkout trends, including a fascinating discussion about self-checkout obliterating impulse purchases. Rosenblum and Buzek also argued about workforce management technology, concluding that the larger companies are–much more than they initially thought–avoiding workforce technology.

Please listen and shout your feedback to us.

Outsourced live chat is nothing new and as long as there is no law passed requiring live chat personnel to answer the questions being asked and not just read from a script, its value will be limited. But one veteran provider of these typing services has been toying with an interesting twist. Live Person is now pushing a database-driven process that automatically pops up a live chat session when it concludes the customer is having some difficulty, such as with an abandoned cart or he/she seems to be waffling between two similar products.

But the interesting part is that the software looks at the nature of the products involved in the confusion and assigns an appropriate product specialist to handle that query, to allow–in theory–a much more sophicated and specific exchange. Said one company exec: “If you’re buying a snowboard, you’re matched only with a snowboard gearhead.” This is an effort we’re going to be watching.

Coupons are a time-honored retail tradition, but like secret Black Friday promotions and regional pricing, there is a good argument that they may no longer make sense. There are many Web sites today that are designed to empower consumers, often ostensibly against the interest of big business, whether those are major retailers, government agencies or large publishers.

Some of the more interesting ones help consumers get around mandatory free site registration—such as www.bugmenot.com–or get to a human voice when locked inside a voice-system hell (www.gethuman.com).

Wednesday’s decision supports leather goods manufacturer Louis Vuitton’s claim that a search for Vuitton should only return sites and ads that mention Vuitton and not those that mention knock-offs or competitors.

A French court of appeals on Wednesday sided with leather goods manufacturer Louis Vuitton and ruled that Google had violated trademark, unfair competition and advertising laws by showing ads for Vuitton rivals when people searched for Vuitton. The closely-watched case—which involves Google having to pay a fine of about $250,000—has huge implications for wide range of search and related Web activities.

The CIO for billion-dollar clothing retailer Guess Inc. had a challenge. He knew their search engine was delivering terrible results and that he would take many months to replace. What should be done in the meantime?

Even CIOs at billion-dollar retailers have to put their jeans on one upgrade at a time. But Guess Inc. CIO Michael Relich found himself in an especially difficult position when web analytics told him that 60 percent of his E-commerce site’s search results were delivering “not found” responses to prospects.

In theory, a smartphone can bring into the store the depth of data possible on the web, merged with enough site- and user-specific data to make even the stodgiest CRM system blush. But can it work in the real world? NeoMedia is arguing that it can.

The Web is all abuzz with the Grass Is Always Greener On The Other Side Of the Firewall stories about Google preparing an online payment system (a la EBay’s PayPal) to be called GBuy while EBay is preparing a contextual Web ad service (a la Google’s AdWords) to be called EBay AdContext.

But the most reality-based analysis is that Ebay and Google are proving to be the quintessential example of coopertition (is there an accepted spelling yet for that blend of cooperation and competition?).

Just as E-Commerce players are getting used to the idea of people buying products using their cellphones, whether in a physical location beaming right to a POS or making purchases online, the cellphone wants to make the next leap forward. Nokia has ported the Apache webserver to Symbian, which will theoretically allow cell phones to directly serve Web content.

According to a report in LinuxDevices.com, Nokia installed its experimental port, initially, on a Nokia 6630, which it then accessed over a Bluetooth PAN (personal area network). This proved somewhat useful, in that it brought “the possibility of accessing functionality on the phone using a big screen and proper keyboard.”

However, the project’s goal was to enable access to the phone of the cellular network, the story said. This proved challenging due to firewalls explicitly deployed by operators to prevent such access.

This is the logical next step with the growth of the Web. The Internet’s early days were made powerful because of the networking of millions of PCs around the globe. The potential to expand that now with the networking of huge numbers of connected cellphones is, to say the least, powerful.

Some of the largest Web retailers—including including CircuitCity, CompUSA and RitzCamera–use the same product-comparison database. But a comparison of those sites with each other—and with the full database—show what they’re choosing to keep from their customers.

The vision of convergence circa 2000 was a remote control influencing live network broadcast action. That never happened, but BET has gotten close, But BET’s executives found the profit rested in knowing the particulars of its large niche audience. What will this mean for E-Commerce? Will broadcast, cable, cellphones and PCs finally learn to play together, with smart advertisers along for the ride?

Although the market for content for cell phones and PDAs is still in its infancy, the two applications that are expected to seize major market-share the fastest are reservations for airplane seats and hotel rooms.

Like every major sales and communications advance that preceded it, e-commerce’s 12-year existence has moved along in phases, as it slowly abandoned earlier methods to accept the new reality.
Offline and online brands were initially kept distinct, then they were awkwardly merged. Initial e-commerce efforts were flashy brochure sites, with rudimentary shopping carts and checkout.

One of the more intriguing movies with a technology theme in the last few decades was a 1983 flick called “WarGames,” starring Matthew Broderick in his second movie.
Critics of the movie from the IT community at the time said that the film’s plot—about a sophisticated war game computer that confused its NORAD masters into thinking that a simulated nuclear attack was real—was unrealistic because every computer has more failsafes than the one in the story.

In what Yahoo is carefully characterizing as mere research, the portal is asking some of its users whether they would be willing to perform all—or at least most—of their searches on Yahoo in exchange for discounted music downloads, frequent flier miles, video rental discounts and even charity donations.

One of the Web’s first search engines, Yahoo has taken a distant number two position behind Google in search market share, while MSN is a distant third.

Retailers who have tried selling wines next to the canned plums and the greeting cards have grown frustrated. The high-margin beverage is bathed in its own language, leaving non-wine-schooled consumers drunk with confusion.

One retail software company tried to deal with this situation by introducing a kiosk that uses a sophisticated form of 20 Questions to establish the consumer’s wine preferences by asking about everything from their coffee, soda and salt preferences to the nature of the occasion.

Betting that price comparison sites will play an increasingly prominent role in e-commerce, credit information vendor Experian was spending almost half a billion dollars to take over PriceGrabber.com.

Following on the heels of the June 2005 purchases—just days apart—where E.W. Scripps paid $525 million for Shopzilla and eBay paid $620 million for Shopping.com, Experian’s move seemed to continue a trend.

Trust and credibility—often associated with a brand—are arguably the most powerful assets of any e-commerce site. Without it, the Web is just an electronic version of the Wild West, with the shootouts won by the lowest-price site, until that site is shot down by another low-cost site.

Consumers and B2B shoppers purchase from a branded site because they have faith they will be treated fairly and honestly.

The argument that e-commerce allows price and product quality to trump large marketing budgets has been crushed by, well, large marketing budgets.

One of the core beliefs among e-commerce cognoscenti is that the Web serves as the great equalizer, allowing 20-employee retailers to effectively compete with Fortune 100 giants with $100 million ad budgets.

When Office Depot sued Staples over search engine keyword purchases, it touched on more than marketing strategies.

The suit could force the discussion of the ethics of Web advertising tactics, a discussion that many in the industry would rather not have.

The most altruistic gift is an anonymous contribution, in which a giver wants to help but does not want to benefit from the donation.

Sometimes, though, anonymity is not possible, and that’s where things can get dicey.