2011.16 | M-commerce Redux

The influence of mobile technology continues to make itself felt in retail this month:

Home Depot Canada iPhone App Update – There are many retail apps, and more and more of them are attempting to provide value and functionality that you can’t already get with the standard mobile phone apps.  Finding store locations is certainly useful, but not something that will cause users to open an app again and again.  The way McDonalds Canada’s app indicates 24 hour sites with different icons on the map, and Starbucks shows whether stores are open or closed at the moment you are searching does add some value for those of us trolling for late night (or early morning) snacks.  An interesting update to the Home Depot Canada app adds some value in a different way.  The updated app provides a number of tools that are unique to a DIY environment, and more importantly, are actually useful.  Among a number of mini apps within the app, the new toolbox has an app that provides for a quick match for nuts and bolts based on aligning a sample on the screen, a great conversion tool, and a tape measure that allows users to estimate a distance by entering in their shoe size and pacing out a distance.  Users can even save their measurements with whatever titles they want.  This is an excellent example of providing a small but memorable and valuable service on an app that meets the needs of a specific target market.

Selfcheckout on Mobile at Stop & Shop - Further to their iPhone and Android apps, Stop & Shop announced last week that they releasing an app that allows users in stores to scan their own items for checkout.  I would enjoy using this app just for price verification – there is so often a shortage of signage and a long walk to a price verifier that would make this a helpful application for me.  As far as using the solution to checkout, this turns into a real operational scenario.  I’d be fine using it if Stop & Shop trusts me enough to just scan my items, pay and walk out.  Unfortunately, security usually requires periodic audits – which could slow this process down for some users.  Also note that all of the operational issues I pointed out in an earlier post in 2009 about self-scanning still apply, but with some mobile considerations added in.  It’s great technology, and getting better all the time.  If it is to have wide success however, these serious operational changes need to be accommodated to ensure that the solution will work as it should for consumers, and any shrink issues are fully understood and dealt with. 

Mobile Purchasing – With over 70% mobile penetration in Canada and over 90% in the US (see page 190 of the report), it’s no wonder that these apps continue to roll out, and that retailers target sales directly on the devices.  I’m an early adopter, so I’ve purchased tickets, rented and purchased movies, bought music and maybe a book or two.  I can see purchasing a lot more on mobile if it was easy enough to do so.  I’m seeing more and more retail sites optimized for use with mobile devices that automatically move to a mobile version when you access them on your phone, and that could move more purchases to the device.   It would also be nice to have a simple interface to some of the half day sales the likes of the Gap put on.  Consumers might be more likely to take advantage of a short term deal if it was only a few screen touches.  Expect retailers to improve on the mobile web to take advantage. 

Don’t expect the mobile wallet to get solved any time soon however.  Even though apple stores are selling the square dongle, there is still much to be worked out on the back end for real full scale consumer payments to take place.

2011.15 | Shop by Touch | Shop by Image

Shop by Touch –  Pokeware offers the opportunity for consumers to touch an item on screen shown in a film or TV show and then see details on that item including the opportunity to purchase it online.  This is a very powerful idea.  There are infinite directions for this sort of technology and it provides tremendous opportunities for buyers and sellers.  It is quite relevant in an inflight environment, but would also work very well in a larger format street sign or even on an iPad or iPod touch viewing any video at all.  We all see the obvious product placements, but how many times have you seen some interesting item you might wish to purchase – a bag, a shirt, anything – and then immediately forgot about it.  These represent millions of missed sales opportunities that should be seized at the moment of interest.  I think of this solution as the equivalent of Shazam.  For years you would hear a song on the radio, and miss the title, or hear the wrong title, and then be forced to hum like an idiot to a teenager at HMV.  Now if you hear a song you like, you just use Shazam and it tells you what that song is.  Shazam doesn’t chase you with an ad.  Shazam says – here you go – here’s the song, and oh, if you want to buy it, just grab it on iTunes, we’ll save you the click (and take a small finder’s fee).  This is the same situation, but it is visual, and it can used to buy real physical stuff – not just bits and bytes.

Consider this technology from another direction.  With direct purchases from the screen, we could potentially avoid commercials completely and use a more powerful type of product placement.  More and more, consumers expect to be able to touch screens and have at least some part of the experience – not be completely passive .   This is a simple and logical step to provide that ability with the prospect of removing commercials but keeping the revenue flowing to purveyors of entertainment.

Shopping by Image – In the same vein as shopping by touch, using the cameras on our mobile devices to shop seems increasingly achievable.  Consumers can shop with cameras as scanners, and even by taking pictures of books, cd’s and DVD’s and more with solutions like SnapTell.  But this represents only a start.  Google Goggles (it is part of the Google App on iOS – it can be easy to miss, just select the camera button to use it) allows consumers to search based on images.  While the technology is still relatively rudimentary today, it allows users to scan text, logos, landmarks and various other items and can identify them via search.  Google has also allegedly tested out using this technology with facial recognition to allow users to identify people with mobile phone cameras so that you never have wonder who that guy is at the wedding.  While Google will probably not bring that product out any time soon for very real privacy concerns, these technologies represent the foundation for being able to recognize an outfit, a house, a car, a watch, or anything you like in whatever context you want, and then allow a link where you can buy it.  Both SnapTell and Goggles point in that direction.

This may sound far fetched, but imaging in the real world has come a long way.  Since 2003, police in the Toronto area have been using license plate recognition imaging technology to read thousands of plates on cars to search for those from stolen cars, identify wanted individuals and other useful tasks.  If imaging systems can handle tasks like this, it seems a reasonable step to take us to shopping with our cameras, but only time will tell.  Telling the difference between an old school Hudson’s Bay Point Blanket, and this stylish young gentleman’s shirt might just be harder than reading license plates.

2011.14 | Expanding Retail Business in Canada: Technical Considerations

One of the signs I’ve seen of late of an improving retail sector is expansion.  I’ve had discussions with a few colleagues on clients expanding into Canada from other countries or expanding into other provinces.  Here is a list of the most common considerations for technology when expanding into or around Canada.

Taxes - Like many other jurisdictions in the world, Canada has tax rates and types that vary by province.  Some provinces charge separate Provincial Sales Tax (PST) and Canadian Federal Sales Tax (also known as the Goods and Sales Tax or GST).  Others charge a Harmonized Sales Tax (HST).

Electrical Power - For businesses coming from Europe or Asia, the power in Canada is 120V, 60Hz, and NEMA 5 connectors are used.  Ensure that retail POS and other solutions have the correct power supplies and power cords to connect to power in Canada.  If  UPS devices are used for power protection or backup, be certain to purchase units that operate with Canadian voltages and connectors.  The same power and connector standards are used in the US and Canada.

Price Verification – Requirements for Price Verification vary by jurisdiction in Canada.  In Quebec, having electronic price verifiers in stores is a legal requirement unless there are prices shown on every item in a store.  In the rest of Canada, the Scanner Price Accuracy Voluntary Code is a voluntary pricing code of conduct that retailers who are members of the Retail Council of Canada, Canadian Association of Chain Drug Stores, and Canadian Federation of Independent Grocers adhere with – covering off a very large percentage of Canadian retailers by sales.   I’ve noted in various online forums over the years that consumers across Canada have voiced concerns about store staff’s knowledge of the voluntary code, causing some consternation among consumers, so retailers would do well to be sure store staff are aware of the rules and act on them to ensure strong consumer relations.

Weighable Items -  Weigh scales in grocery need to be certified as legal for trade by Measurements Canada under the Weights and Measures Act via an Authorized Service Provider.   Note that Canada uses the metric system, and the scales must be calibrated in kilograms.  A remote post display is required for use in Canada, even if the weight is displayed on a user screen like those on a Self-Checkout.

Language - Canada is officially a bilingual country, but is increasingly multi-lingual given many years of strong immigration- particularly in the city centres.  Retailers should expect to provide customer facing systems in both French and English, particularly in Quebec, and should have a good understanding of French in Canada.  This means that all consumer facing solutions, such as kiosks, selfcheckout systems, customer facing displays and receipts require multi-language capability.  Under Bill 101 it may also be necessary to provide back end solutions used by staff in store in French.  Some retailers also use French versions of Windows and other operating environments.  Note that not all POS versions of Windows 7 embedded provide for Multi-Language capability so Windows 7 Ultimate or Windows 7 Pro may be required for a French Windows 7 Image.   Recent years have seen increases of requests for other languages on kiosks, ATM’s, and self-checkouts across Canada in my experience – primarily for Asian languages.  Retailers serving urban populations with technology that has the capability to serve multiple languages may find themselves with a competitive advantage.

Electronic Payments - All pinpads to be used in Canada must be certified by Interac, Canada’s electronic payments Association.  All pinpads to be used in Canada should be EMV certified and capable.  As in the US, PCI compliance is also required.  Some of the most common pinpads used in Canada by Tier One retailers in Canada include the Ingenico i3070, Verifone Vx810, and Verifone SC5000, though there are many others in use.  Many Canadian retailers have also enabled NFC payment acceptance on their pinpads over the past few years as part of the effort to move to EMV and PCI compliance.  Canada has a high rate of electronic payment penetration, with many tier one retailers I’ve spoken with indicating that as much as 70-80% of tenders are either debit or credit.  Use of cheques in Canada is very limited.  Less than 1% of tenders are cheques for most retailers I’ve spoken with, and it is 0 for many.

Cash Management - Primary currency in use in Canada is the Canadian Dollar.  The most common denominiations are the $20, $10, and $5 note.  $50 and $100 notes are also available, but used less often, and some smaller retailers refuse to accept them for fear of forgery.   Coinage includes $2 (toonie), $1 (loonie), 25 cent, 10 cent, 5 cent and 1 cent.  50 cent coins exist but are in limited use.  There are various forgery safeguards on Canadian currency to protect against forgery, and Canadian notes are changing to a polymer base in 2011/2012.  Canadian retailers often use a 4 Note , 8 coin slot cash insert for cash drawers, versus the 5 note, 5 coin slot cash insert used in the US.  The use of differing coins and notes also means that cash handling solutions like self-checkouts, cash recycling , and fraud detection systems will differ to accommodate the different notes and coins.  The lack of $1 bills means far less bill usage on cash handling systems than the US.

On a more localized level:

Sales Recording Module for Restaurants – Quebec - Revenu Quebec has implemented requirements for retailers to record all sales transactions through the use of a Sales Recording Module installed between the POS and the printer.

Reusable Bags and Plastic Bag Fees – In the City of Toronto, there is a bylaw which requires a charge of 5 cents for plastic bags and others have followed suit.  Many Canadian retailers have adopted a charge across the country to drive down usage of plastic bags.  Whether as a result of this charge or not, there is a significant use of reusable bags by Canadian shoppers.  For the bag fees, retailers need to be able to add the fee and to both assisted and selfcheckout solutions – a relatively simple matter.  For reusable bags, self-checkout systems need to be enabled, and staff need to be trained to assist customers in understanding the process of using their own bags with self-checkout.

This is by no means an exahaustive list and is provided based on my experiences to date.  It is intended for informational purposes only and ideally is helpful in providing a view to the types of technical hurdles that may exist for those who plan to expand into or across Canada.  If there is any facet of technology that I have overlooked in consumer facing stores, or if I have made an incorrect statement please leave a comment, and I will be glad to adjust the article.

2011.13 | Mobile 2D Code Scanning

2D barcodes continue to enter the mainstream in North America after a much slower start than Asia and Europe.  Recent improvements in processor speed, camera availability, and software on a wide variety of smartphones means that a great swath of the population now has the capability to very easily read and use these codes.   Home Depot recently announced a wide deployment of QR codes in their stores.

2D barcodes – also known as QR (Quick Response) barcodes – come in various flavours and formats, but appear the same and are used in the same way.  Whereas the linear barcodes from stores we all know so well are composed of a series of vertical bars of black and white, 2D barcodes are generally a square with a series of squares of black and white (there are other options, however).   While traditional barcodes were scanned with a laser based barcode scanner, 2d barcodes are read with an imager – a camera.  While we discussed reading these 2D barcodes from mobile phones with a traditional POS setup in earlier posts, reading 2D barcodes with a mobile device is also an interesting prospect for retailers and other consumer facing organizations.

In order for a consumer to read these barcodes, a mobile device and software are required.  Mobile phone users can download ScanLife, NeoReader, and Microsoft Tag Reader to read these codes.  All three of them come in versions for most major mobile phone platforms including iPhone, Windows Phone, Android, Blackberry, Symbian and more.  Scanlife even offers feature phone users the capability for users to capture a code with a camera, send via MMS and receive the data link without the use of an app.  Microsoft’s app reads their own proprietary tags.

2D barcodes are appearing for consumer reading on billboards, on products, on posters, on magazine ads, in newspapers and on price tags.  They allow companies to share information such as images, demos and more via the web with consumers, and track that information as well.  The tags are also being used for reading from the phone as coupons, tickets, and payments.  Check out many real world implementations at Roger’s Blog of 2D Barcode Strategy.  I’ve seen them more and more – I have recently seen them on a poster at AMC Theatres as a link to Facebook, on a Black Eyed Peas Concert Poster, on the side of a truck advertising a business, at Pearson Airport in Toronto advertising the newly opening iStore Boutique, and many more.

While Google are attempting to usurp their place with NFC tags, it seems likely that both NFC and 2D will exist together, particularly given that NFC phones are not yet mainstream, and 2D barcodes can be shown on screens or printed with any printer, while special NFC tags carry a higher cost and are not as simply or as widely available as of yet.

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