Global Retail Executive Council

Buzzword Bingo "For a Cause": Social + Retail + Charity = ???

HAPPY NEW YEAR!

I hope you all had a wonderful holiday season and are looking forward to 2011! I thought it was fun reading so many posts on 1/1/11 by my friends on Facebook that were adamant that 2011 WILL be better. "It HAS to be better!" they implore. It couldn't get worse right? Preliminary holiday numbers show that "it's getting better" is the mantra of retailers this season.

Well, to some degree I agree with them that 2010 was tough and I'm glad it's over too. But on a deeper level, all in all, it wasn't that bad and I think that despite a lot of things blamed on the economy, some great things came out of it.

For one, I witnessed a lot of people helping each other out - especially through Facebook, the enfant terrible of social media. Friends helping friends find jobs, being supportive through divorce, illness or even the death of a loved one were commonplace. Many of these situations were very difficult, but it was comforting to see people reaching out to one another and making a difference.

It was only a few years ago that we never had visibility into so many people from our past and present all at one time. It's amazing and I personally agree with the choice of Mark Zuckerberg (founder and CEO of Facebook) as Time Magazine's Person of the Year for 2010.

But the most significant social outreach I witnessed in 2010 was without a doubt the response to the disaster in Haiti. It's sad that when you look on CNN today you don't hear a word about it... but the groundswell of charitable giving that came immediately after the earthquake was incredible.

What I want to believe is that the support for Haiti and the large amounts of  aid that were created to help the victims are just the beginning of the "new normal" in charitable giving, so I'm going to offer a couple observations on how retail can play a bigger role in this phenomenon.

1. Do good by doing well.

The old saying is that you will "do well by doing good." In other words, if your heart is pure and you do good, eventually profit and success will follow. Retailers need to remember that staying true to your core values goes hand in hand with being profitable and serving your customers. Embracing the latest cause celebre will not get you anywhere. Your connection to charity needs to resonate with the brand. It makes sense for Whole Foods to donate money to local food programs: they buy a lot of their food locally. Patagonia and REI supporting conservation initiatives? Spot on. But shoppers can spot hopping on the bandwagon a mile away, and they don't like it.

2. Charity starts at home.

It's inspiring when the world comes together to help in global tragedies like Haiti or the 2004 tsunami. But other than the customers of a handful of truly global retailers, most shoppers will care more when they can see the results. One local retailer here in Portland chose something simple but amazingly impactful: donate a coat, get 20% off. Anyone who has ever driven past a homeless person in the cold rain will connect with this simple, heartfelt and local effort.

3. Don't guilt your shoppers.

Safeway has done an admirable job of raising money for breast and prostate cancer research. But... No one wants to have the pinpad ask me electronically if I want to "round up"... then be asked AGAIN by the cashier if I'm sure I don't want to "round up"... Over-asking for gifts is a faux pas no matter how admirable the cause. Ask ONCE and make sure that NO ONE feels guilty or awkward declining. Remember that bad economy of 2007-2010? Charity begins at home, but so does saving money. And alienating shoppers by asking too hard is a poor idea.

A side note: if you promote your charitable causes, embrace transparency. A simple Google of "safeway rounding up buzz" yields a host of negative comments about both how the money was raised and what it was spent on.

4. Choose a passion, not a pasttime.

This post comes on the eve of one of the most amazing charitable events in the retail industry. A group of analysts, tech vendors, and retailers is coming together on Saturday for the Retail Orphan Initiative's "Super Saturday" event. This single day will raise almost $300,000 for orphan-related projects around the globe.

Why is this group successful? Because everyone who touches it has their own reason for embracing the cause. It's not a "corporate donation," it's a mission.

Authenticity counts. And being authentic, respectful, connected and local will ensure that retail + social + charity = amazing.

PS - If you'd like to support the efforts of the Retail Orphan Initiative, click here.

Black Friday #retailfail and #retailfabu: A Retail Report on the Early Winners and Losers

Every retailer is anxious this year. Many think they've got just one shot at it and their pulling out all the stops. SOME will do well, others unfortunately will crash and burn.

LOSERS (aka #retailfail)

• TJ Maxx - Offer $100 off the price of the iPad to shoppers on Black Friday. Steve Jobs responds: "TJ Maxx isn't authorized reseller".
• Banana Republic - Decides to be open ON Thanksgiving in many of their locations. When you are the ONLY ones open in a mall - where do you think your foot traffic is going to come from? However in locations where there are Sears stores, they be the only ones, Sears is doing the same thing after 85 years of being closed on the holiday.
• Lowe's - goes all out on it's Black Friday Facebook promotion, crashes website and angers MANY. So here it is retailers as a warning... if your mechanics of an offer aren't bullet proof - expect what you get.

WINNERS (aka #retailfabu)

• Target - buys the Twitter Hashtag #blackfriday
• Walmart - fighting the Amazon dragon head on! Free shipping on over 60,000 items online through December 20th.
• Toys R' Us -  pops up!!! Taking advantage of the proliferation of empty mall space / short term leasing expanding their reach with their Toys R Us Express Stores and FAO Schwarz branded pop-ups. With 600 pop-up stores, they double their national store footprint and gain a lot of new shoppers.

Have any #retailfail or #retailfabu to report? Share it here!

The death (and rebirth?) of the mall

It's become a familiar site in virtually every American city. Sprawling shopping complexes with empty buildings adorned with the ghostly echo of removed brand signs. The stores Circuit City and Blockbuster once occupied now sport perpetual "For Lease" signs, in some cases leaving shopping centers without any anchor tenants at all.

Inside the traditional shopping mall, it's not much better. With vacancy rates at a 20-year high, mall managers are trying everything from discounting rates to short term leases to embracing pop-up retail. And though some of these tactics are innovative and are filling in spaces - for now - for the most part, they are band-aid fixes covering up a far greater problem.

The mall, as we know it in the United States, simply isn't relevant to today's shopper. Gone are the days when the convenience of a collection of disparate stores under one roof is essential: we have the Internet, with infinite diversity only a click away. And time-pressed shoppers want the convenience of in-and-out surgical shopping rather than the long walk from the fringe of the parking lot for a day of leisurely browsing.

The one bright spot seems to be that department stores - a retail sector that has been ailing for some time - are capitalizing on the same trends and re-inventing themselves as the mini-malls of the future. JC Penney is leasing space to Mango and Aldo, and one Sears store has leased 45000 square feet to Forever XXI. The raw scale of department stores and their experience with "store-within-a-store" concepts means this trend is one to watch as it may exacerbate the challenges facing traditional mall operators.

In fact, once you strip away the collection of stores, today's mall simply doesn't offer much: a collection of common chain brands, perhaps a few dingy "local" retailers, and a food court brimming with mediocrity. Free WiFi, mall-based "loyalty points," and early-opening days simply won't resurrect the mall to its former glory, so increased vacancy leads to diminished foot traffic leads to lower sales... and repeat until closure.

But the humble mall does have a chance to reinvent itself. At the World Retail Congress, a diverse group of speakers including a retailer, an architect, and a mall operator all discussed the question: what is the future of the mall?

And surprisingly, a strong consensus emerged.

1. A social gathering place that offers more than just shopping. The shopping mall at Potsdamer Platz in Berlin is surrounded by high-end restaurants, movie theaters, a casino, and a performing arts venue. The streets connecting these locations boast a changing variety of festivals, moving the week we were there from the Festival of Lights to an Alpine festival, complete with pop-up taverns and a temporary downhill ski slope. Inside the mall proper, an exhibit on the "shoeshine boy" culture informed and inspired, even featuring a stand selling the traditional favorite cuisine of the shoeshine boys. And all of this in addition to a great collection of stores, anchored by not one but two grocery stores, one upscale and one discount.

 

2. Integration with the virtual world. Eric Kuhne of CivicArts spoke on some of the innovative malls they have designed around the world. While the retail redevelopment of Moscow's Sheremyetvo Airport into a mall instantly captured my imagination (Combining a mall with an aviation museum? Yes, please!), it was the Bluewater mall in Kent, United Kingdom that offered perhaps the best lesson. Aside from the "new basics" for malls (stunning architectural design, community integration, entertainment as a destination), Bluewater features an incredibly innovative solution to two problems that vex most malls. With a two-story limit imposed by local council, Bluewater created a virtual "third floor," an online-only part of the mall that holds virtual stores for retail brands waiting for store space to open up in the mall. With 0% vacancy, the waiting list for the 320 store spaces currently has 189 brands, all of whom can engage mall shoppers "virtually" and test the waters with brand concepts and offers prior to physically moving into the mall.

 

3. Popup retail is a part of the draw of the mall. In many US malls, vacant space is filled twice a year: costume stores before Halloween and Christmas stores right after. But popup retail is now attracting luxury brands to create a time-urgent destination for shoppers such as Dunhill's New York popup and Longchamps' temporary store in Tokyo. This marriage allows the mall to get more affluent and upscale shoppers onto the premises and gives luxury brands a presence in markets that can't support a year-round branded store.

These ideas aren't a prescription for all that ails the American mall, but rather a diagnosis of what needs to improve for long-term sustainable viability for these properties. And despite the rough economy of the last few years, this is the time for malls to draw inspiration from new retail development around the world and create something that isn't there for many malls today: a reason to shop there.

The Retail Experience: BERLIN – Desigual’s ‘Atypical’ Approach to Outlets

Despite nearly a 6 month delay to this year's World Retail Congress (thanks for the volcano, Iceland!), we were rewarded for our patience with a huge attendance by retail executives from all over the globe, excellent speakers, and the opportunity to visit - and shop - the beautiful city of Berlin.

Within a few blocks of the Hotel Intercontinental, where Congress was held this year, is one of Berlin's most famous shopping districts - Ku'Damm (Kurfürstendamm). Berlin's most celebrated department store, the Kaufhaus des Westens (known colloquially as "KaDeWe") is located in this district along with a who's who of global fashion brands: Nike, adidas, Bally's, Burberry, Versace... just to name a few along this two-mile stretch. One in particular that I first encountered at the 2009 World Retail Congress in Barcelona and was VERY excited to see again was Desigual.

Desigual is a women's, men's, and children's fashion retailer that began in Barcelona in 1984 and continues to expand their global operations. They entered the U.S. market with a store in New York City's Soho district and recently opened a second location in NYC on 34th.

Desigual is known for their colorful and 'atypical' fashion style, something I personally ADORE them for. But beyond the style of Desigual's clothes, I want to call attention to one aspect of their retail approach that I find very 'atypical'. It's their "internal" outlet model.

Many fashion brands have an outlet presence. The lagging economy has pushed even more high fashion retailers into this arena. Outlets generally reside in a mall-like cluster found on the outskirts of the metropolitan core. Prada, Tommy Hilfiger, adidas, Dolce&Gabbana, Versace, GUCCI, Mango, Nike, Replay, Levis, and Burberry, just to name a few. Germany is NO different than in the U.S. in terms of the proliferation of outlets. In fact, before I went to Germany I was informed that Germans LOVE and expect a deal. (Remember, this is the country whose discount-centric grocers sent Wal-Mart packing...) What is different though is that there are strict regulations in Germany that prohibit retailers from having separate price labels on a garment, so the same outlet strategy we have here in the U.S. isn't possible in Germany.

In their Berlin store along this most fashionable street, what Desigual has done differently is actually position the outlet WITHIN the store on the top floor. Why is this a good strategy in my opinion? Well, first you don't have shoppers immediately divereted away from the premium offering to a discount one. Second, the shopper maintains the brand perception of quality instead of feeling they're in a "lower-end" section. And third, it ensures that shoppers are exposed to two floors of the latest designs and styles before getting to the bargains.

Like many other brands I mentioned above, Desigual has a huge following of "loyalists" who are constantly looking forward to the next new debut of their designs. (Heck, these people are even willing to show up to a Desigual promotion in just in their underwear to receive 2 free items!) But Desigual recognizes that all shoppers - including those "loyalists" -  want a deal as well. Desigual has made it possible for them to have the best of both worlds in one place.

In most outlet scenarios shoppers are being offered product specifically designed and manufactured for the outlet (82% on average according to NPD analyst Marshall Cohen) - much of the time of a lower quality. As retailers have improved their planning and allocation processes, the amount of excess goods has significantly diminished. Hence, the need to feed the outlet beyond sparse past-season surplus or "irregular" merchandise means custom-making "outlet products". The outlet model certainly expands brand-awareness, but it leaves retailers at risk of cannibalizing their own brand's marketshare, harming their image/value proposition, and the profitability of their "regular" stores. Plus they aren't connecting with their best shoppers. Outlets are one of the few bright spots in today's retail economy, since they give fashion labels access to shoppers who otherwise wouldn't pay for the designer labels, but is splitting the brand up the best approach?
 
We heard a lot of discussion at WRC about "value" and what that means to the shopper. Is it about the shopper's willingness to pay full price or that value now refers to the "experience" and service? Neither is a wrong definition and shouldn't be any less of a concern to them, but the bottom line is that today's shopper will continue to define the value of a brand and what it means to them.

Desigual has a very different strategy when it comes to offering value to its shoppers. They don't have sale racks on the first two levels of the Berlin store. The first floor is designated to women's fashion and accessories - current season and full price. The second floor is children's and men's - also full price and current season. But instead of hiding the "deals" in a stark, dark basement in a disorganized fashion or the location clearly marked, there are prominent signs on both floors directing shoppers up the escalators to the third floor where here they will find a lot of merchandise marked down (sometimes dramatically) that is either last season, overstock or damaged, but unlike many other retailers, the merchandising and display is the same style and quality as the full-price levels.

Does this strategy hurt them or help them? I think it helps and maintains the brand image. After all, I ended up observing the store twice during my stay in Berlin, and both times saw shoppers browsing all three floors picking up merchandise all along the way. And personally, I was not swayed away from the freshest, seasonal merchandise in favor of the discounted offerings on the third floor: though I browsed the outlet level, the clothes I ended up buying were current-season... and full-price.

The intersection of technology and store design

I had the opportunity again this year to address the International Retail Design Conference on the subject of technology-enabled design two weeks ago in Toronto. Out of the conversations stemming from this presentation, it quickly became apparent that this is a major area of both interest and concern to retailers, as the opportunities to bring the disciplines together are immense... as are the potential challenges.

In that presentation, I explored 5 "Do's and Don'ts" of technology-enabled design:


1. Don't let your competition design your shopping experience.

Designers are used to thinking of the in-store experience as self-contained and in their control. No matter what influences a 21st century shopper may have been under OUTSIDE the store (marketing/advertising, ecommmerce, social media, etc.), once they step into the store, they're free of those influences. That's simply no longer the case, as competitors can (and do) connect with shoppers at the store shelf using tools like Amazon's mobile app. With two touches on their phone, a shopper can go from considering a product in your store... to purchasing it from Amazon, at a lower price and without the overhead of bringing the product to the shelf. This leaves retailers with a simple choice: step up and create a better mobile enabled shopping experience that keeps the shopper engaged with the brand both physically and electronically... or cede half the shopping experience to competitors.


2. Do start thinking of yourself as an experience designer.

The discipline of store design is changed by the addition of the new tools next-generation technology brings to the table. Technology has in the past been relegated to the IT department and design constrained to the in-store experience... and never the twain shall meet. The future of "store design" is taking the shopping experience and expanding the touchpoints beyond the physical elements of the store. Store designers must embrace a future where their "designs" are experience that touch the shopper at home, on the go, and in the store... not just physical elements within the store itself.


3. Don't think technology use is (too) generational.

It's far to easy to dismiss technology as something that only the youngest generation of shoppers embraces, and therefore not relevant to "our target shoppers." The truth is that shoppers of virtually all demographics are rapidly adopting new technologies into their lives, and retailers that dismiss incorporating technology into their store experiences run the risk of being perceived as increasingly irrelevant by ALL their shoppers, not just the young ones. The fastest growing segment of Facebook users, for example, isn't college students: it's women 45-54, and these tech-enabled mid-life women represent a powerful buying segment who are already FAR ahead of most retailers in their use of technology.


4. Remember that 50% of shoppers will be carrying smartphones in 2012.

The window of opportunity for retailers to take a "leading edge" or even "fast follower" role in embracing mobile technology is closing rapidly. Ecommerce players like Amazon and Zappos already have strong mobile strategies in place, and retailers deploying mobile solutions will quickly see the perception of their innovation shift from thought-leader to also-ran. Analyst estimates vary somewhat, but all project a tipping point within two years where the majority of shoppers are carrying and using smartphones. And retailers should keep in mind that on average, the demographics of their shoppers will skew slightly higher than the "average" American... so the percentage of smartphone users amongst their most important shopping segments will likely be even higher.


5. Consider a trip to Japan for inspiration.

While examples abound all over the world of retailers who are "doing it right" with store design, Japan alone has the unique advantage of a very well evolved mobile infrastructure. Near ubiquity (and universal compatibility) of smartphones that can read a single barcode standard, display information, and even allow payment means that shoppers in Japan are simply more used to using their phones in the shopping process than any other single market. From Japanese gardens to convenience stores to public transportation, Japan abounds with cutting edge examples of mobile shopping. The JAPANSHOP expo in March 2011 offers a unique opportunity to see the intersection of technology and design both from the retail industry perspective and examples scattered around in stores.


6. Don't be afraid to take risks; this is the time to experiment.

There is no right or wrong answer to technology-enabled store design, and what will benefit retailers the most right now is the willingness and ability to experiment and make (controlled) mistakes. The bottom line is that there are many new shopping patterns and dynamics emerging, and taking advantage of these new shopping ideas requires trying new things, measuring the results, and deploying those that work. Without both a willingness and ability to learn from those trials, retailers will relegate technology into old paradigms in the store... a fatal mistake that will let their competition leapfrog ahead.

Obviously, this isn't a complete list, but starting here will give retailers - and in particular store designers - a good foundation for begining to bring technology into the store.

The entire presentation, including slides and video, is hosted on our Vimeo channel, and you can view both parts - or an eight-minute shortened version - below.

IRDC 2010: The Do's and Don'ts of Tech Enabled Store Design - Part One

 

IRDC 2010: The Do's and Don'ts of Tech Enabled Store Design - Part Two

 

IRDC 2010: The Do's and Don'ts of Tech Enabled Store Design - 8-minute Short Version

 

The Retail Experience: Suffering from shopper's block? Maybe here's a reason why.

About a week ago I found myself at one of my frequent retail haunts... The Lego Store. Being the mom of a Lego-maniac, it's quite easy to determine what to get my 10 year old son for Christmas, his birthday, Groundhog's Day, Earth Day... basically ANY day. If it involves bricks, he's a happy boy.

Anyway, this post isn't about my son's Lego love, but my continuing analysis of how retailers are using technology to improve or enhance the shopping experience with one simple end goal - increase sales.

About a year ago I blogged about a kiosk that our local Lego Store had set up where the sales manager was actively deterring my son from using it to look at the online Lego games. It's purpose, as he explained it, was for us "moms" to go online while in-store to purchase items that weren't in stock or only available online.

Fast forward to this last trip. The adult eye level kiosk was gone and in it's place was a circle of four monitors and keyboards on a child-high table with a bin in the middle containing Legos for kids to build with. I was caught in a long queue waiting for my turn to buy my son's birthday present so I used the time to observe how this table crowded with kids was using the technology that was intentionally there for their use. Guess what? NOT A SINGLE CHILD WAS USING THE COMPUTERS. They were instead vying for space around this table cluttered with keyboards to get at the bricks to build with. They absolutely IGNORED the technology. Huh. Now Lego WANTS them to go online, but now they kids don't? How could this be?

I'll tell you why I think this is the case and I was only able to articulate this thought after watching a wonderful slide presentation "The importance of brand in the digital media environment" by Helge Tenno, It was a simple quote found on slide 13 that really resonated with me...

‎"Even if people are technologically available, it doesn't mean they are behaviorally available."

So here it is retailers. You want to influence me in-store aided by technology  to make a decision purchase. The big word today is "multi-channel" and it's your goal to capture me any way you can. Well, here's where it gets challenging and you make huge investments on installations like the one I observed in the Lego Store and they don't do as you intend. Technology as a SOLUTION misses the mark. What shoppers desire isn't more gadgetry, but a seemless experience NO MATTER THE CHANNEL that supports their desire to purchase. What those small children wanted around that table was the tactile experience of playing with Legos, not gaming. What many parents standing in the long line appreciated was that their kids were being kept busy without their need to intercede while they waited to make their purchase. The bins of Legos alone in this instance were perfect enough.

Where improvement in the experience needs to be made by retailers is to rethink the means to achieve the desired outcome. This means creating an experience that is what the shopper is looking for at that point of interaction, not what YOU want them to do at that point of interaction.

Shopping styles have certainly been influenced more than ever by digital, but the simple truth still holds that shoppers have the same core needs that they have always had: value, convenience, and most importantly service. When technology is deployed to support those core needs, it can bring scale and efficiency along with higher customer satisfaction. But when tech is simply plunked down in front of shoppers, they'll do the same thing they do when confronted with any other unappealing retail experience: ignore it.

The iPad in Retail: All Bark and No Bite?

A few weeks ago, I explained some ways in which the iPad could be used to revolutionize the retail industry, specifically in the way it can be used to boost sales associates' knowledge and overall usefulness. However, as we've seen in recent weeks with the iPhone 4, Apple is not infallible, and its products do contain their faults, which could prevent it from becoming a player in the retail business space. So this post will be somewhere between a reality check for Apple fanboys (yes, we know a few work in retail) and the right side of a SWOT chart.

First of all, a major problem is simply a security matter: Having a $700 piece of technology laying around your store with access to much of your business intelligence isn't a very safe system. After all, it's much easier to slip an iPad in your shirt than trying to, for example, fit a kiosk in your purse. Plus, as a hot consumer device (with waitlists to even get one), they're more likely to walk out the door than, say, an IBM 4690 would be.

But beyond the logistics of keeping track of loose iPads, the devices still have many problems that brings their usefulness in retail into question. A major barrier is Apple's app store, which doesn't allow third-party applications. Retailers could "jailbreak" the device (or some less criminally named process since it's now an "enterprise activity") to allow them to deploy in-house developed "apps," but this would likely void the warranty and render the device bricked with the slightest code errors.

There are also a slew of hardware problems that make the iPad hard to use.

• reports of WiFi connectivity issues
• no multitasking, which means 100% application integration on the back end 
• no camera, which means it can't be used to scan barcodes (unless you want to buy an external camera or barcode scanner, which pretty much defeats the purpose of such a sleek and sexy device). This is a huge disadvantage for the iPad, since many customers will be walking into stores with barcode-scanning abilities in their own pockets via smartphone.

Similarly, the iPad very publicly and explicitly does not support Flash. Many retailers such as Nike, Converse, Arctic Cat, and IKEA use Flash elements on their websites, which would make accessing those sites impossible via the iPad. The iPad also doesn't support GPS, and with geolocation becoming a hot new thing in retail, not having GPS ability will greatly impair the iPad's retail impact. For example, it makes it much harder for the sales associate to help a customer find a nearby location where they can find the item they're looking for if the store they're currently in doesn't have it in stock.

Another problem with the iPad is that you need adaptors like CRAZY to hook anything up to the tablet. You even need an adaptor for a USB plug! This would make it very inconvenient to attach the iPad to any of your in-store devices. One last problem is simply a matter of typing ability: The touch-screen keyboard makes it rather inconvenient to type with one hand while holding the iPad with your other hand, which would be the typical position sales associates would be in when using the tablet to help customers.

With all these downfalls, it seems unlikely that the iPad will catch on as a major tool for retailers to employ. Like so many "next great things" at the consumer level, the enterprise implications are just a little too challenging to make adoption easy.

However, this isn't to suggest that tablets aren't useful in retail; in fact, their potential is enormous. Cisco's recently released Cius tablet is specifically aimed at businesses, and it explicitly fixes many of the aforementioned problems with the iPad: It is compatible with a company's current Cisco business applications, it has a camera and can be integrated with existing Cisco telephone and conferencing products, it offers both USB and bluetooth connectivity, and it even will support 4G. Plus, to Steve Job's chagrin, it runs on the Android platform which offers far greater adaptability and configuration options.

It remains to be seen who what tablet maker will come out on top in the retail space, but with Cisco specifically targeting businesses rather than consumers, the battle has already begun.

The iPad in Retail: A Sales Associate's New BFF

Since the launch of the iPad by Apple, the tech industry has become even more tablet-crazed than usual, and by the end of the year we should expect to see a whole variety of tablet computers flying off the shelves during the Christmas season. But besides (hopefully) propping up holiday sales numbers, what can these thin, ultra-portable computers do for the retail industry?

A lot of attention has been focused on the utility of the iPad for point-of-sale systems. Although no retailer has yet completed a chain-wide iPad-to-POS system integration, retailers and restaurants have begun experimenting with the iPad and attempting to integrate it into their existing systems.

Unfortunately for retailers, the lack of multitasking is a handicap. While apps like Square allow the iPad to do the transactional elements of point-of-sale, most chain retailers have either custom functionality in their point-of-sale system (such as processing gift cards) or access multiple applications using their register hardware (such as capturing email for CRM). The "app" model works fine for smaller retailers, such as this example found at a coffee shop in San Francisco, but deploying the iPad into chain retail would require at best a custom app, and most likely a whole new array of integration to make the device a true extension of the store systems.

The majority of iPad-as-POS examples currently come from the restaurant industry. For example, the Rydges Hotel in Sydney, Australia, has implemented ten iPads in their restaurant so customers can place their orders directly to the kitchen, as well as allowing for easier menu changes from the chef. The restaurant iPad POS system has begun to see some competition already, such as the competing systems from Lecere and 4ASoft. While both those videos show systems that appear to be clunky, over-complicated, and not very time-efficient, it is a tantalizing glimpse at what the restaurant of the future could possibly be like.

However, where the iPad really has a chance to shine in retail is in adding to the abilities of store associates. With the increasing adoption of smartphones, more and more customers are entering stores with more information available at a moment's notice about the items sold in that store than the associates actually have. If you walk into Best Buy and ask a random associate how much cheaper the DVD you're looking at is if you buy it online, chances are he or she will have absolutely no idea. However, the customer can easily whip out his or her cell phone and find the answer in a matter of seconds. The iPad, however, can level the playing field, and bring retailers' e-commerce strategies into their stores in a more controlled manner.

Not only will sales floor associates have as much information as the customers (or even more, since presumably their iPads would be able to virtually check the store's stock levels and other metrics), but the possibilities are almost endless as to how the iPad could revolutionize the shopping experience. A sales associate could easily find computer-generated recommendations for the customers in real-time, as well as doing nifty things like showing a shopper what the shirt they're currently holding will look like in a different color, or even offering demonstration videos of tools or toys in use! Or when shopping at the Home Depot, a sales associate could help you virtually break down your DIY project so you don't forget a piece of pipe or buy the wrong size screws. As you can see, the possibilities are legion.

While less portable than mobile phones, the iPad is a radical improvement over existing fixed-point registers and kiosks in allowing information to be shared with the customer to fully bring the online experience onto the sales floor. This will allow sales associates to be more knowledgeable, more helpful, and much more efficient salespeople, to keep customers engaged in the in-store experience and feeling as if they achieved truly the best possible deal and service from their shopping trip.

It's not hard to see why retailers should be excited about the iPad and other tablet devices. Whether or not these computers can successfully be worked into POS or other IT systems in-store, it is absolutely in a retailer's best interest to implement the iPad or a similar device into their customer experience strategies. With sales associates armed with these powerful, efficient tools, your customers will be guaranteed a shopping experience like no other, one which will keep them coming back for more.

Lessons in Mobile Retail Fail: Part One - The FMI 2010 "App"

The sign made it sound deceptively easy.

At the recent Food Marketing Institute 2010 conference and expo in Las Vegas, prominent signage on the show floor promised those of us with smartphones the ability to navigate the conference schedule and expo show floor more easily. "Works on any smartphone!!!" and pictures not just of the ubiquitous iPhone, but also an Android and Blackberry. Sounds good to me... I'd love to replace flipping through the bulky expo guide searching for exhibitors with a cool next-generation smartphone app.

Could it truly be that a conference ostensibly about food retailing had embraced one of the most important principles of mobile retail: don't alienate 80% of your customers?

You see, for all it's vaunted prowess (and ease of "app" distribution), the Apple iPhone isn't the only game in town. Though statistics vary, and depending on which geography, demographic segment, and cycle of the moon, the market share ebbs and flows... it is a relatively safe bet to say that the major smartphone players all enjoy some rough parity in market share:

• Apple iPhone
• Google Android
• RIM Blackberry
• Microsoft Windows Mobile
• Nokia Symbian

If we imagine each of these roughly equal, the average retailer would alienate 80% of their shoppers by embracing a single handset platform. So, needless to say, I was excited by the prospect that my new HTC Hero phone (sorry Apple, I just sunsetted my iPhone... so long AT&T, hello Sprint...) would be my guide to a show I was attending for the first time, and I eagerly followed the instructions on the sign:

"Download at supermarketnews.com or your App store (FMI 2010)"

So, you can imagine my disappointment when a search of the Android Market for "FMI 2010" yielded... nothing. Not a jot, not a tittle. Nothing. Apparently "works on any smartphone" and "your App store" have different meanings to some people.

This is serious fail, not because FMI failed to provide an app that ran on my Android phone, but because they literally promised it to me and failed to deliver on the promise. Had the signage promised only an iPhone app, I would have accepted that leaving my uncharged iPhone in my suitcase was MY failing, and simply considered bringing it the next day. But, to promise a consumer that their phone will, in fact, work with your application, then leave them high and dry does more than keep the consumer from the information. It causes frustration that borders on rage, and more often than not, leads to disproportionate consequences. For me, it's writing this blog. If you're a retail brand that does this, prepare for Facebook statuses and constant retweets griping about how you don't care about your shoppers that use smartphone "X."

The moral of the story: make sure shoppers know what to expect from your brand when it comes to a mobile experience. Don't mislead them and make them fail on their own if you aren't supporting the technology they've already bought.

MILLENNIAL MUSINGS: Social Causes And The Retail Effect

On a recent trip to San Francisco, I accompanied a few of my friends as they spent the day shopping. We stopped in a shoe store because the girls wanted to look at the different types of shoes offered by TOMS. I had heard of TOMS before, but had never really paid much attention. However, what I saw in the store definitely caught my eye: As I sat there waiting, I saw girl after girl after girl grab pairs of TOMS from the shelves and try them on, and the store associates were almost constantly running back to see what was in stock. (Clearly they could have used the prototype shoe shopping application debuted by the GREC Mobile Retail Experience at CTIA last October...)And, invariably, the answer was always, "Sorry, we're out of that size." Unfortunately, the store could not keep up with the demand, and my friends were forced to resort to the internet to find the shoes they desired.

So what's the big deal about these shoes? Well, TOMS was founded in 2006 by Blake Mycoskie, with a simple idea: For every pair of shoes you purchase, another pair will be donated to a child in need somewhere in the world. To date, TOMS reports they have donated over 600,000 pairs of shoes (which means they have also sold over 600,000 pairs). And the company is only getting hotter. They've partnered with some huge retailers, such as Ralph Lauren, which offers specially branded Polo Rugby TOMS, or Element Skateboards, which offers limited edition TOMS + Element shoes as well as matching skateboards.

But why are these shoes so successful, particularly with Millennials? Quite simply, they offer the ability to not only show off your unique style (TOMS come in a wide variety of patterns and colors), but most importantly they allow the shopper to feel good about her purchase and the effect it has on the world. According to the 2006 Cone Millennial Cause Study, a staggering 83% of Millennials say they will trust a company more if it is socially or environmentally responsible, and 89% are "likely or very likely" to switch from one brand to another if the second brand is associated with a good cause! Keep in mind, Millennials represent $350 billion in retail buying power in the US... that's more than baby boomers! Without a doubt, retailers should realize that it is of the utmost importance to tie their brands to social causes, unless they're prepared to watch their sales go to the competition.

For retailers that do make the changes, the results are almost always positive. Gap, Inc. is one of the best recent examples. Suffering from reports of human-rights abuse related to their use of sweatshops, Gap finally stopped using sweatshops in 2004, and in 2006 partnered with Product Red, a brand focused on raising money for the Global Fund to Fight AIDS, Tuberculosis and Malaria. Gap has remained committed to many additional causes; Recently, they offered a 30% discount on a new pair of jeans to anyone who brought in an old pair. With the 270,000 pairs of old jeans Gap received, they plan on creating insulation for homes in "underserved communities." For practices such as this, Gap has been the top-rated retailer in The Corporate Responsibility Magazine's list of the 100 Best Corporate Citizens for the past two years in a row. And Gap's profit margins are also benefitting from this renewed brand image: In March 2010, sales were 12% higher than sales in March 2009, and all of Gap's brands (Banana Republic, Gap, and Old Navy) have similarly grown.

Tying your brand to social causes will not only create loyalty with Millennial shoppers, but it will also create loyalty with your Millennial employees. Here's a question: Do you know which employer received applications from 11% of all graduating Ivy League seniors of the class of 2009? (Hint: It wasn't anywhere on Wall Street.) It was Teach For America. According to a new survey by the Pew Research Center, 21% of Millennials say "helping others in need," is one of the most important things in their lives - more important than owning a home, having lots of free time, or having a high-paying career. What this means is that if a company is not socially conscious, not only will we not shop there, but we won't work there either (56% of Millennials say they would refuse to work for an irresponsible corporation). And don't think you can fool us with "greenwashing" or a faux-sense of social responsibility: we're cynical and connected too, and if it turns out your "living wage" garments are actually made in sweatshops, that news will spread through Facebook and the blogosphere faster than you can imagine.

Clearly, Millennials like to feel like they are making a difference, and this matters to retailers to keep both their customers AND employees happy. With such a staggeringly high percentage of Millennials saying they would switch to another brand that is more socially conscious -- and with our ability and willingness to easily compare similar products via our computers or mobile devices -- retailers can't afford to be selfish. The fact that products like TOMS shoes continued to fly off the shelves even in a recession shows that if a retailer is willing to open up to the world, we're more than happy to open up our wallets.