holiday guideR E T A I L T O U C H P O I N T S

2table of contentsintroduction........................................................................................................................................................................3

omnichannel: The gifT Of Omnichannel...............................................................................................................................5

mobile commerce: celebraTing The mObile cOmmerce OppOrTuniTy..................................................................................8

mobile apps, marketing and integration: 5 besT pracTices fOr hOliday success.......................................................9

social channels: Keeping iT sOcial during The hOlidays....................................................................................................11

pricing: unwrapping a winning pricing sTraTegy..................................................................................................................14

inventory: shipping OpTiOns TOp shOpping priOriTies during The hOlidays........................................................................18

personalization: shifTs frOm welcOmed TO expecTed.......................................................................................................21

outbound marketing: spreading The cheer abOuT hOliday deals....................................................................................26

showrooming: innOvaTive sTraTegies will draw hOliday shOppers inTO sTOres..............................................................28

workforce management: efficienT wOrKfOrce managemenT cOnverTs hOliday shOpping inTO prOfiTs........................31

payment: mObile paymenT may be a gifT Of The fuTure.........................................................................................................35

about retail touchpoints.................................................................................................................................................37

3

INTRODUCTIONas predicted, consumers continue to make purchase decisions with a

new, more frugal outlook, following the recession. This trend becomes

painfully obvious as we move into the winter holiday season. in 2012,

more than one third of consumers spent less money than budgeted

on holiday gifts, according to Trendsource in its holiday shopping outcomes report. additionally, the majority of shoppers purchased

more than half of their gifts on sale.

some industry experts are expressing a more positive outlook about

the 2013 season: larry freed, ceo, ForeSee Results, noted: “Tax

breaks last year took money out of consumers’ pockets, but there has

been little talk of the impact that will have on holiday spending this year;

however, i think spending will hold steady or will increase slightly this

holiday season for the following reasons: The dip in paychecks due to

the January 1st tax implications didn’t seem to have a negative impact

on spending so far this year. additionally, the economy has somewhat

stabilized and consumers’ concern about the next financial pothole don’t

seem to be top of mind.”

additionally, greg buzek, president, IHL Group stated: “Our

economy remains one of the haves and have-nots. unfortunately,

unemployment and lack of a blockbuster item will keep growth modest.

we are predicting about 3% growth, which reflects population changes

and some modest increase in customer sentiment. Those that have jobs

are a lot less concerned with losing them this year, however, uncertainty

in health care costs going forward in 2014 has many concerned.”

retailers need to keep these economic factors in mind as they plan

2013 holiday strategies. a two-sided focus on improving both

business efficiency and customer experience will be the drivers

of success this year.

with those goals in mind, merchants are drilling down to define plans

for holiday marketing, merchandising, inventory optimization and staffing.

mobile technology and social media will play increasingly important roles

in holiday strategies as they cement their importance year-round.

4

several leading industry analysts and executives have shared their perspectives on holiday 2013:

al ferrara, partner and national director, retail and consumer products practice at bdo usa:“last year’s holiday season saw continued growth in online business

with smaller overall growth in traditional retail. retailers have made

significant capital investments in mobile strategy to capture consumers,

and we believe that a significant amount of advertising dollars will be

directed at mobile and social media sites. in addition, the cumulative

data generated from past sales, including the ability to analyze customer

purchases and trends, will enable retailers to better target customers and

identify their purchasing habits.”

nilam ganenthiran, manager in the retail practice at a.t. kearney:“we noticed three main areas retailers are focusing on:”

1. understanding the customer - by employing a suite of tactics

around the integration of pOs, social media, employees, contact

center, and loyalty.

2. developing a formal seasonal plan - that encompasses

hiring, training, labor deployment (staff up and down) to optimize

cost and maximize profitability.

3. channel integration - to seamlessly provide differentiated but

consistent experiences across all touch points.

“we’re also considering how call center can help stores, especially

during peak times,” ganenthiran added. “we’re recommending to retail

clients that customer care is not a separate entity; it’s a corporate

culture and mindset.”

This year’s retail Touchpoints holiday guide covers 11 different topic

areas including:

omnichannelmobile commercemobile apps & sitessocial channelspricinginventory

personalizationoutbound marketingshowroomingworkforce managementpayment

5Omnichannel:

OmnichannelConsumer

Analyzing TheFeature

Sponsored by

The GIfT Of OmNIChaNNelwhen consumers feel confident that they will be receiving the brand

experience they expect, no matter which channel they use to access the

brand, then they will feel more loyal to that brand and will be more likely

to buy today and in the future.

That omnichannel promise is the ultimate goal for most (should be

all) retailers today, particularly as they head into the busiest and most

competitive season of the year.

industry experts confirm this premise and encourage retailers to

continue to work toward the goal. “delivering consistent brand messages

across channels is one of the most critical strategies for achieving a

superior customer experience,” said larry freed, ceO, foresee results.

“consumers don’t separate channels — they don’t differentiate mobile

from web or in-store experiences. To them, it’s one brand, regardless of

channel. many retailers forgot this last year and still struggle, because of

their efforts to ‘optimize’ each channel independently.”

freed cited recent foresee research results: “from our research on

the top 100 brands, we know that the multichannel shopper is now the

norm, and those shoppers are troubled by inconsistent pricing, product

information and inventory information across channels. when they find

something online, but it’s not in the store, it’s breaking that consistent

brand message they expect. consumers find it frustrating if they’re

having totally different brand experiences across channels.”

sucharita mulpuru-Kodali, vp/principal analyst at forrester, noted

that mobile will be the differentiator in 2013: “most retailers want a

consistent brand experience and strive to deliver that. The difference

this year is to make sure all your promotions and pricing are available

on mobile devices.  if a retailer can pull off real-time inventory visibility in

stores for instance on black friday during the doorbusters promotions,

that could be an interesting development.  but it would also be a bear to

put that in place.”   

al ferrara, partner and national director, retail and consumer products

practice at bdO usa, added: “since retailers are competing in the same

space, all selling similar merchandise, the brand — and the consumers’

experience with the brand, which encompasses service — means that

the shopping experience is the one thing that separates them from their

competitors.”

in a recent feature report, titled: Analyzing The Omnichannel Consumer, Retail TouchPoints cited several retailers that have found success with

unique omnichannel strategies, including loehmann’s and aeropostale.

consumers are increasingly using their smartphones to check prices

in the aisles and tablets to make purchases at home. as the holidays

approach, industry observers expect that behavior to escalate.

6

Initial online efforts at Christmas Central rapidly exceeded

expectations, proving that this was a profi table move for the

company. However, keeping up with online demand and expanding

operations soon proved to be major hurdles for the retailer. Though

inventory was selling quickly, processing orders and meeting

fulfi llment requirements called for a signifi cant number of man hours.

Christmas Central was unable to focus on expanding its online

presence while preoccupied with tedious day-to-day tasks.

Christmas Central is a family-owned and operated business that was

founded in 1977, selling close-out items out of its fl agship store,

Dave’s Christmas Wonderland. In an effort to expand sales, the

company took select products online in 2001, selling on eBay. Now

offering nearly 50,000 unique products, the company has grown

into a leading online retailer of Christmas decorations

and accessories.

“We had our uncertainties about selling online, but it was an instant

success,” said Christmas Central CIO Nathan Gordon. “As we listed

more products online, we realized how hard it was to manually

manage inventory levels and further expand to new channels. At that

point, we knew we needed help.”

Christmas Central partnered with ChannelAdvisor, employing the

e-Commerce company’s Marketplaces solution designed to improve

effi ciencies and become a more competitive online retail business.

The ChannelAdvisor Marketplaces solution offered Christmas

Central the technology and tools needed to properly process online

orders and scale its e-Commerce business across multiple online

marketplaces and channels.

“With ChannelAdvisor, we gained inventory control,” continued

Gordon. “All we had to do was enter our SKUs into the platform and

ChannelAdvisor took care of everything from start to fi nish.”

With gained effi ciencies, Christmas Central also was able to focus on

the development of its overall online business. Marketplaces offered

access to new sources of demand through one integration that

made it simple for Christmas Central to begin selling on additional

marketplaces without a hefty fi nancial or time commitment.

Christmas Central Expands Across Multiple Online Marketplaces

CASE STUDY

Sponsored by

E-book Title • 6

“Our next step was to get in front of as many new shoppers as

possible, and ChannelAdvisor provided the opportunity to expand

beyond eBay to Amazon, Newegg, Sears and most recently SHOP.

COM,” said Gordon. “It only took us a few hours to get set up on

SHOP.COM, allowing us to quickly increase our online exposure

and potential.”

The dynamic Marketplaces solution helped Christmas Central

synchronize inventory across several marketplaces and expanded

the retailer’s online reach to new and varied demographics that shop

on these various sites.

RESULTS

Christmas Central’s channel expansion across these marketplaces

has generated continued sales growth. In Q4, Christmas Central

processed more than 200,000 orders and increased sales by more

than 25% year-over-year.

“We could not have scaled our business to this level without

ChannelAdvisor,” said Gordon. “We continue to see our sales

increase each month thanks to the new online exposure we’ve

gained on a variety of marketplaces. We are now connected to as

many buyers as possible.”

CASE STUDY

8mObile cOmmerce:

CelebRaTING The mObIle COmmeRCe OppORTUNITy “The rise of mobile extends the reach of retailers because consumers

will be using their free time and devices to conduct research,” said larry

freed, ceO of ForeSee Results. “whether they’re sitting on their couch,

or waiting somewhere, or on their commute on the train, the ability to

make productive use of their time during the holiday season will have a

big impact.”

Research from Google confirmed that consumers’ desire for multiscreen

experiences came to the forefront during the 2012 holiday season:

63% of shoppers said they used multiple devices to help with

their holiday purchases. consumers also said they relied on their

smartphones (65%) and tablets (66%) more frequently to shop during

the holidays.

as a result, mobile commerce experienced significant growth during the

2012 holiday season, and is expected to surge through 2013. sales via

smartphones and tablets will top the $1.5 trillion mark by the end of this

year, according to predictions from Juniper Research. by 2017, mobile

sales are expected to reach $3.2 trillion.

“any retailer that does not embrace mobile commerce will have a

tough time maintaining long-term profitability,” said al ferrara, partner

and national director of the retail and consumer products practice

at BDO USA. “Over the last two years, retailers have made significant

investments in mobile commerce, and retailers will continue to see

increasing volumes in this channel.”

it is important to note, though, that overall mobile commerce sales “vary

wildly by the specific retailer,” reported sucharita mulpuru-Kodali, vp and

principal analyst at Forrester. “some organizations already are seeing

more than 50% of sales coming from mobile. but for most, that figure is

no more than 10% to 20% — and that includes tablets.”

“any reTailer ThaT dOes nOT embrace mObile cOmmerce

will have a TOugh Time mainTaining lOng-Term

prOfiTabiliTy.”

-Al Ferrara, BDO USA.

9mObile apps, marKeTing and inTegraTiOn:

5 besT pRaCTICes fOR hOlIDay sUCCessretailers can successfully connect with consumers through their mobile

devices in a variety of ways. industry analysts and experts shared the

following best 5 practices to help organizations ensure successful

initiatives this holiday season:

1. create an optimized experience: Research from Adobe has

found that only 27% of organizations worldwide have a mobile-

optimized web site. To keep customers happy during a hectic

holiday season, mulpuru-Kodali noted that retailers should “make

sure all content is accessible across a variety of mobile devices,

even tablets.”

2. recognize the value of apps: when it comes to conversions,

it is evident that apps make an impact: The 2013 Digital Publishing Report from adobe indicated that 56% of smartphone shoppers

and 60% of tablet shoppers are likely to complete a transaction

using a mobile app during 2013.

These detailed app experiences enable retailers to integrate a

variety of tools and resources into a single experience, such as a

store locator and Qr/2d barcode scanner. resourceful tools that

help make the shopping process easier also empower retailers to

create great interactions “for their best customers and in turn,

drive engagement,” according to Julie ask, vp and principal analyst

at forrester.

“more consumers will have smartphones this holiday season, so we

can expect to see more investment in richer media technologies

such as applications,” ask said. “fingers crossed, companies will

shift their focus from squeezed pc experiences such as display ads

to more differentiated experiences.”

3. extend mobile across touch points: To create a compelling

mobile experience, retailers should not create strategies that are

geared towards marketing and commerce only, according to chris

cunnane, senior research analyst for the retail and consumer

markets branch at Aberdeen Group. because the mobile channel is “rapidly emerging as an everyday

touch point for many consumers,” the mobile channel needs

to focus on customer engagement,” cunnane said. “retailers

need to build out a deeper and richer mobile app or platform for

a dynamic customer experience. This should include elements

such as customer loyalty programs, digital coupons, social

integration, mobile marketing, mobile web for product look-up,

a recommendations engine, and real-time mobile chat. a mobile

strategy that is geared towards complete customer engagement,

rather than simply marketing or commerce, is what makes

an impact.”

10

Furthermore, Ask indicated that organizations also should

consider how to integrate these mobile tools and resources

with brick-and-mortar strategies. “Think about how mobile can

enhance the in-store experience,” Ask said. “Don’t just think of

mobile as another channel.”

4. integrate all mobile experiences: in addition to creating

a seamless transition between mobile devices and the brick-

and-mortar store, retailers also must strive to connect tablet and

smartphone experiences.

“Tablet couch commerce provides an immersive experience

while smartphone commerce is more impulse-driven,” said gary

schwartz, ceO of Impact Mobile and author of The Impulse Economy and Fast Shopper, Slow Store. “The two work together to

drive purchases.”

smartphones and tablets “are a one-two punch,” schwartz

added. “There is a path-to-purchase journey across these

separate screens that needs to be connected. going into 2014,

more retailers will understand that mobile has now expanded its

definition to include all screens: any screen that touches a tablet or

smartphone is part of the mobile journey. Tv screens, pcs, digital

out-of-home all are part of the new multi-screen journey.”

5. develop “digital velcro”: in order to keep customers

connected to messages, campaigns and offers, retailers must

create “digital velcro,” and initiate ongoing communication

throughout the browsing, consideration and buying process,

according to schwartz.

“connecting your consumer screens seamlessly throughout their

day is the most prominent challenge retailers face,” schwartz said.

but retailers can address this task by “muscling up their mobile

crm, affinity programs and intimately understanding the shopper

journey — from waking up with their phone under their pillow to

the point of checkout. The key is understanding the journey and

ending in conversion.”

11sOcial channels:

retailers can harness the power of social networks to drive ongoing

engagement, conversations and sales during the competitive

holiday season.

This year, a consistent best practice for retailers across all verticals is

to offer personalized and exclusive content across social networks,

according to adam pressman, a principal in the retail practice

at A.T. Kearney.

“during the holiday season, there’s always an influx of messages out

there, so being able to tailor interactions to specific consumers in the

social space will be very important,” pressman said. “retailers have

to provide extra value to consumers for interacting with the brand via

social. for example, promoting and sharing exclusive offers and in-store

events makes the experience special.”

executives from a.T. Kearney and aberdeen group shared a variety of

best practices to help retailers get consumers into the holiday spirit via

social media:

• promote timely events on facebook and twitter: These social networks are valuable channels to share news and

announcements with followers instantly. daily deals and short-term

sales are common during the holiday season, so these social

networks will help retailers distribute “one-to-many” messages

effectively. for example, gilt groupe consistently promotes

upcoming sales on the facebook page.

“Overall, retailers will use facebook and Twitter feeds more

aggressively in promoting hourly and flash deals,” said nilam

ganenthiran, manager in the retail practice of a.T. Kearney. “it will

be key for retailers to efficiently capitalize on the frenzy which is

created with deal hungry consumers.”

ganenthiran also advised that retailers use social networks for

specific store locations to share inventory updates regarding high-

demand products. by communicating product levels in real time,

retailers can “help save consumers a trip if the product they want is

out of stock. Think of the positive sentiment that can generate!”

• drive store visits with instagram: The image-focused social

network provides retailers with a multitude of opportunities to pique

consumer interest during the holiday season. Team members can

take photos of in-store displays, new merchandise and special

events. publishing these images in conjunction with store hours can

help drive store traffic and encourage customers to make last-

minute visits to stores.

KeepING IT sOCIal DURING The hOlIDays

12

• use pinterest to promote gift ideas: by dedicating pin

boards to must-have gifts for friends and family members, retailers

can provide consumers with a reason to visit branded pinterest

accounts. This strategy also encourages consumers to re-pin

items onto their own accounts, which will help boost social

word-of-mouth.

however, retailers must ensure that all images are connected to

product pages, so there is a more seamless connection to the

e-commerce site if consumers want to learn more about — or

purchase — a specific product. the grommet successfully

leverages Pinterest to categorize products based on their attributes.

as a result, consumers can easily navigate the site and browse

products based on their unique wants and needs.

• listen to and analyze social feedback: although being

present and communicating with consumers across social networks

is important, that is only half the battle, according to deena amato-

mccoy, who is a research analyst with the retail and consumer

practice at Aberdeen Group.

“The most important thing that retailers need to add to their

social media strategies is social media monitoring, or social

analytics,” amato-mccoy said. “while more retailers are investing

in social media as a key piece of their marketing strategies, 56%

of companies told aberdeen that they were unable to quantify

the effect of their social media initiatives. retailers that want the

‘biggest bang for their marketing bucks’ need to deploy social

media monitoring.”

To create winning social strategies, retailers should think of how they

can make consumers’ lives easier during the hectic holiday season,

pressman explained. “retailers should think of where they want to

differentiate and excel, while still keeping the customer in mind. it’s

critical for retailers to understand the customer journey and key drivers

in the moment of truth and then determine how to meet them on social

channels. One thing is for sure, we definitely won’t see generic strategies

this holiday season.”

guess? seTs sighTs On hOliday success wiTh sOlOmOguess? is a great example of a retailer leveraging the power of social,

and is primed to exploit it for the upcoming holiday season, according

to deena amato-mccoy, who is a research analyst with the retail and

consumer practice at aberdeen group. for the apparel specialty retailer,

a social, local, mobile (solomo) strategy is key. shoppers download

the guess? mobile app, which includes a loyalty program that tracks

points from previous purchases. in addition, the app features a store

locator and a Qr code scanner, which empowers shoppers to scan

merchandise and receive geo-location-based promotions.

shoppers also can link their facebook accounts to the app, which aligns

with the retailer’s crm database. with these capabilities, guess? has a

conduit to analyze and understand customer preferences and trends.

The app also has a gift-giving guide, which will be an especially helpful

resource for holiday shoppers. while i do not know specific plans,

i would anticipate these all these features would play a big role for

guess? during the upcoming holiday season.

13

14pricing:

The holiday season sets off a flurry of pricing activity as retailers

scramble to satisfy consumers who can compare prices on their

smartphones and head to the least expensive retailer for those must-

have gifts. while price-conscious consumers are an everyday challenge

for retailers, the competitive pricing game heats up around the holidays.

many are predicting that holiday spending will increase slightly or hold

steady compared to 2012, so smart pricing strategies will play a large

role in winning over consumers.

“if holiday spending mirrors the back-to-school season — the second

most anticipated shopping season — shoppers are definitely being

cautious with their discretionary income and as such, waiting for sales,

comparing and doing due diligence online through retailers’ web sites

and customer reviews before actually making purchases,” said deena

m. amato-mccoy, research analyst, retail and consumer markets, for

Aberdeen Group. “i see this trend continuing once the 2013 holiday

season starts.”

competitive holiday pricing will continue to put pressure on margins,

added al ferrara, partner and national director of the retail and

consumer products practice at BDO USA. “increases in revenues do

not always find their way to the bottom line,” he noted. “nevertheless, we

expect growth to be relatively consistent with previous years’ numbers

this holiday season.”

consumers are more informed than ever when it comes to price, which

means that retailers need to take steps to ensure a level playing field.

although the holidays become a dangerous game of markdown for

retailers, some categories, such as consumer electronics, must be

marked down in order to remain competitive.

This year, retail technology will become more sophisticated and pricing

intelligence will be part of this growing technology movement. while

some industry executives saw this as a trend starting in 2012, it has

become an imperative for 2013 and beyond.

a retailer’s ability to quickly react to a competitor’s pricing strategy will

determine success this holiday season. This can be particularly important

for market-model sKus, where differentiation through a product

offering is hard. access to timely and accurate competitive pricing

data is becoming increasingly important and should be adopted by

retailers. Those retailers who have real-time access to historical pricing

information and trends will be the ones who come out on top.

alco stores, for one, implemented pricing solutions from revionics

earlier this year, in order to gain more granular and localized pricing

strategies in 217 locations across 23 states, said ”rich wilson,

president and ceO of alcO, in an interview with Retail TouchPoints.

detailed analytics regarding in-store shopping behaviors, as well

UNwRappING a wINNING pRICING sTRaTeGy

15

as overall sentiments on product rates, markdowns and deals, are

empowering alcO executives to design and roll out regional and

localized initiatives based on the unique preferences of customers in

specific geographic areas. These insights also will help the retailer better

predict and respond to shopper demand and behavior, and determine if

and when to price-match, which can be particularly relevant during the

competitive holiday season.

The widespread price-matching trend from 2012 will continue,

according to alison paul, vice chairman and retail sector leader for

Deloitte LLP. she noted: “retailers have empowered their associates

to make on-the-spot pricing decisions to keep a sale from going out

the door, which can also help encourage shoppers to do more of their

holiday shopping while in the store, and goes a long way to build loyalty.”

efficiency is important in price matching to ease shopper frustration.

many of today’s retailers still go through tedious manual processes of

obtaining competitive prices. during the holiday season, time is money,

and merchandising, pricing and marketing teams need as much time as

they can get to execute on their plans and react to any obstacles.

Sponsored by

Data-Driven Pricing Stars In Holiday StrategiesA leading retailer that sells pet, garden and pool supplies has

experienced rapid market growth in 2012 and plans to open 10

more stores in the next several months. The company’s leadership

strongly believed that adopting effective pricing strategies and

executing them consistently should be one of the highest priorities,

which would support their growth and improve sales and profi ts

throughout the year including the holidays.

The holidays heighten price awareness, sensitivity and deal seeking

as time-strapped shoppers strive to maximize the value of every

dollar spent. Strategically and methodically identifying which items

must be competitively priced, which are the best to promote

because they incentivize shoppers to buy more and more often, and

fi ne tuning those product lists and prices to resonate with various

shopper segments, store clusters and channels is critical to driving

loyalty and having a profi table and successful holiday season.

This retailer focused on fi nding a solution which would help offer the right price, at the right time, to the right customer, then drive deep customer value and loyalty while increasing profi ts.

After an in-depth review of the company’s pricing strategy, the

leadership team came to the conclusion that pricing decisions were

being made based on a series of assumptions, traditions and pure

gut instinct and that the company’s methodology in this area had to

change. Knowing that pricing done right is a complex endeavor, the

team set out to fi nd a data-driven, science-based approach to their

pricing and promotion strategies and tactics that had a proven track

record of driving ROI.

After an industry search, the company chose Revionics® Life Cycle

Price Optimization solutions, which are offered as a Software-as-

a-Service (SaaS) and provide 24/7 online access, an easy user

interface and data analysis at the item/store level, as well as make

pricing and promotion recommendations. Another strong benefi t

is that the demand models are automatically updated weekly for

optimal accuracy and results and what-if simulations of different

strategies can be completed in real-time.

CASE STUDY

www.revionics.com

CASE STUDY

Price and value leadership is one of the most important determinants of consumer choice in retail—it should be a top priority for every retail CEO.

The company was also extremely impressed that the solution

offered accurate reporting, in-depth data analysis and best practices

for pricing strategies. In addition, company executives stated that

Revionics’ platform is a ‘dynamic learner’ and is essentially the

brains of the operation — the more data you throw at it, the smarter

it becomes.

Results: The retailer started implementing Revionics pricing recommendations quickly and has reported positive results both in-store and online. The benefi ts

achieved include:

Data-driven Pricing: The retailer now has complete visibility

to price elasticity at the item/store level. The solution helped

scientifi cally determine that out of the 400 products they originally

thought were their KVIs, only 89 products were truly KVIs. This has improved their price image while signifi cantly increasing sales and gross margin.

Pricing Consistency: Revionics’ solution integrates the voice of

the shopper with the retailer’s business rules, operational constraints

and strategies to ensure that all products are consistently priced right and align with the retailer’s price image. For

example, pet food fl avor and variant families, good-better-best gaps,

price per unit and ending numbers are now managed automatically.

The solution prioritizes price changes by performance impact to

ensure that the most impactful ones are executed fi rst in support of

in-store price change limits.

Increased Gross Profi ts: Since the implementation of Revionics’

solution, the retailer’s gross profi ts have increased by several percentage points.

Revionics helps retailers of all sizes transform big data into optimized

product, price, promotion and space allocation recommendations

that are tailored to their shoppers’ touch points and channels

including online, in-store, social and mobile. More than 31,000

retail locations across general merchandise, specialty, drug, grocery,

building materials, convenience, discount, sporting goods stores

and eCommerce sites use Revionics’ solutions and are on average

reporting a ten-fold ROI.

18

shIppING OpTIONs TOp shOppING pRIORITIes DURING The hOlIDaysinventory management can make or break a holiday season for retailers.

getting the right product to the customer at the right time must be a

strategic priority. in response, many retailers are implementing a variety

of order/pick-up/delivery options for their customers.

“if ship from store is a real strategy in your future, begin the testing if not

implementation of rfid technology for individual items,” recommended

greg buzek, president, ihl group. “This is the technology that allows for

ship-from-store to be profitable and a good experience for customers as

the inventory is far more accurate than traditional approaches.”

buzek added: “retailers, because they have to plan so far in advance

must make sure as much as possible their inventory management

is in an omnichannel state, meaning that due to delays in getting

replenishment inventory that retailers need to be able to fulfill orders

from the warehouse and even other stores if they do not have in the

store. “

also, eliminating costs associated with shipping appeals to the majority

of shoppers. during the 2012 holiday season, more than half (55%) of

consumer expected free shipping, according to google in the post-

holiday shopping study.

To that end, 51% of shoppers took advantage of free shipping and

more than 50% of transactions involved free shipping.

Other inventory tactics that will lure shoppers include “the use of mobile

devices for sales associates for ‘save the sale’ opportunities,” buzek

added. “This is a great opportunity if those inventories are synchronized

and accurate. That is going to be one of the big differences, particularly

for the mall-based stores.”

 

expected big-sellers in 2013

To date, according to buzek, “this holiday season is somewhat tricky

in that there does not appear to be that huge ‘gotta have’ item like

we have seen in the past.  before there were large electronic items

like ipads, lcd Tv’s that were big drivers. we have some new game

consoles but for many consumers they are dealing with the concept of

‘how good is good enough’? staying with electronics, consumers have

voted that hd was good enough and 3d or next levels are not mature

enough to make a decision forward. There are certain categories that

continue to do well like appliances and autos where there remains pent-

up demand.” 

invenTOry:

The Footwear Fashion Experience At Saks15,000 square feet; 3,000 high fashion women’s shoes on display;

a full service restaurant; it’s very own zip code (10022-SHOE). This

is the Saks Fifth Avenue eighth fl oor shoe department in the fl agship

New York City store.

Over the years Saks Incorporated has established itself as a

world-renowned retail icon, known for its unwavering dedication to

providing customers with an extraordinary product selection and

exceptional service. Now more than ever, the company is focused

on delivering customers the ultimate fashion discovery experience.

Saks is not just a place to shop; rather it is a place to inspire

customer confi dence and style with every shopping experience. As

their tagline says, “Saks: Style. Assured.”

For shoe lovers and fashion stars the eighth fl oor shoe department

is nirvana. Between 5,000 and 15,000 pairs of shoes arrive each

and every week. Here, those with a passion for fashion can view the

3,000 pairs of women’s footwear options on display, shop privately

in the VIP room and even have shoes repaired on site. In addition,

another 1,000 pairs of men’s and children’s shoes are available and

on display in their respective departments.

With 4,000 shoes on display throughout the store and luxury price

points that can reach $4,000 per pair, Saks believes it is imperative

that every shoe be represented on the selling fl oor at all times.

Shoes cannot be discovered or sold if they are tucked away in the

stockroom or missing from display.

To ensure the best possible footwear discovery experience for their

customers, Saks wanted to maximize the number and availability

of display shoes, but found their existing manual process was too

time intensive to do so. It also hindered their ability to provide the

extraordinary high level of service customers have come to expect.

The velocity and volume of shoes fl owing into the store was simply

making it nearly impossible to meet display compliance goals. Saks

needed a better way to inventory the shoe display and validate

compliance to back stock shoes.

IF THE SHOE FITS

By working with Tyco Retail Solutions, in late 2012 Saks launched

an innovative RFID project to address their inventory management

and merchandising challenges. The goal was to move from a 65%

compliance rate to nearly 100%. With Tyco’s TrueVUE Inventory

CASE STUDY

Sponsored by

20

CASE STUDYVisibility solution, Saks was able to tag every display shoe with an

RFID label, and easily inventory the shoes on display each day. The

application then generates a replenishment report for all back stock

shoes missing a display style on the selling fl oor. As a result, Saks

has been able to dramatically reduce the number of missing shoe

display styles and can now represent a larger percentage of the

available shoe assortment on the selling fl oor. This gives customers

more shoes to discover and explore.

RFID: NOT A FLEETING TREND

The RFID initiative to improve inventory visibility and merchandising

has drawn rave reviews and generated an overall increase in sales,

improved display compliance rates, reduced labor costs, and fully

optimize the customer experience. In short, it has proven that

RFID works.

Previously, the process to inventory the shoe department and

validate display shoes took one week and multiple store associates

to complete. Following the project, Saks associates can now

complete this critical task in just 20 minutes and do so daily to

keep up with the pace of new shipments. This has lead to improved

customer service as associates are no longer tied up with inventory

tasks and are able to spend more time showing customers the

latest in footwear fashion. In addition to reducing labor costs, display

compliance rates reached nearly 100%. As a result, Saks has seen

an increase in sales given all shoe styles and colors are accurately

represented on the selling fl oor and ready for purchase. Shoppers

aren’t just passionate about fashion, they are passionate about Saks.

“At Saks Fifth Avenue our mission is to inspire customer confi dence and style with every Saks shopping experience, one that makes people look and feel their best. Our fl agship women’s footwear department in New York City exemplifi es this commitment. With Tyco Retail Solutions we have proved the value of RFID technology for inventory management and merchandising and will continue to leverage the technology to improve sales, optimize merchandise and deliver on our mission.”

-Ed Stagman, SVP Store Operations, Saks

21persOnalizaTiOn:

peRsONalIzaTION shIfTs fROm welCOmeD TO expeCTeDas more brands and eTailers leverage personalization to attract and

engage site visitors, many consumers have come to expect offers

tailored to individual preferences. personalization has become a matter-

of-fact element for today’s connected consumer.

“we have been tracking personalization for 10 years now: customers

have clearly told retailers that they value personalization in its ability to

deliver a more convenient and tailored shopping experience,” stated

lauren freedman, president of the e-tailing group. “Today, customers

expect that all channels will be in sync and that purchase behavior

will be accessible and that browse and buy activity will be part of an

overarching experience. This becomes especially important as mobile

becomes part of more shopping experiences, as is expected in holiday

2013. customers want to be able to access everything from their order

history to wish lists to expedite the shopping experience.”

some retailers will seize the moment with holiday offerings that

provide “more tailored suggestive shopping lists developed based

on customers’ shopping patterns,” added Thomas Quinn, principal at

deloitte consulting llp. “The more innovative retailers will go a step

further and recommend gifts based on inputted factors for the intended

recipients. To build loyalty, retailers also will be incenting their customers

to buy more during the holiday season through additional discounts,

awards or prizes.”

leading retailers embrace personalization

revolve clothing harnesses e-commerce personalization as a key

way to drive education and engagement, as well as promote thought

leadership. Touting more than 600 designers, 20,000 products and

60,000 sKus, the fashion eTailer partnered with monetate to provide

millions of unique visitors with relevant products and offers more

seamlessly. using product badging, personalized banner ads and

targeted product campaigns, revOlve has increased conversions by up

to 70%.

Design Within Reach associates provide more relevant customer interactions with product suggestions based on past browsing and buying history.

22

“during this holiday season, we will maintain this same focus and

strategy of personalization techniques, with brand and customer

experience being top priority,” said grace hong, director of product

development for revOlve clothing. “Our aim is to deliver a seamless,

fun and easy holiday shopping experience across all our channels and

devices. personalized messaging will play an important role throughout

the site during this holiday, along with the core merchandising tools such

as product badging and product recommendations.  

like fashion, interior decorating includes extensive browsing as well as

product comparisons. as a result, design within reach (dwr), a multichannel furniture retailer, is focused on providing cutting-edge

tools and resources that will help guide shoppers seamlessly across the

browsing and buying journey.

“The most important gift you can give your customers during the

holidays is something we all need more of: Time,” stated mark simmons,

vp of e-commerce and digital at design within reach. The dwr

holiday strategy is focusing on four specific areas:

1. associate-shopper connection: “first, we’re making sure

everyone knows we have the smartest form of personalization by

allowing them to speak with an experienced design professional in

our studios,” said simmons, “online via chat and social media, and

over the phone. we’re increasing hours and availability over the

holidays so we can answer any and all questions quickly.”

2. gifts: “we’re introducing intelligent and relevant gift

recommendations via email based on visitors’ past behaviors.”

3. recommendations: “we’re testing recommendations to

prospects and return visitors with algorithmic personalization

technology on our e-commerce platform, marketlive.”

4. advertising: “we’ll be extending recommendations via dynamic

advertising to help us find the next modern design fan.”

personalization efforts are executed with a goal of creating “high-touch,

wonderful experiences for consumers no matter where they are,”

simmons stated. “when we think of personalization it’s often not just

about technology. rather, technology is being stitched together to deliver

upon our company objective.”

23

Tips fOr imprOving hOliday persOnalizaTiOn sTraTegies 

ü always put yourself in your customers’ shoes

ü focus on your customers’ needs and wants first:

technology is an enabler not a decider 

ü monitor all channels

ü ensure wish lists are available across all channels

ü provide consistent messaging across all touch points

ü take advantage of abandonment and retargeting,

especially as the end of the season nears

ü stay true to your strengths as a company and maximize

what you do well

ü invest and test. find a partner that offers you what you

need now and start testing

CASE STUDY

Consumers today are technologically savvy when it comes to

shopping — especially when it comes to holiday shopping. In

order to fi nd the best deal, many move between online, mobile and

in-store channels. And that comes as no surprise, as a recent SDL

survey indicated that 69% of respondents expect online, mobile,

and physical locations to offer the same pricing, discounts and sales.

While brands may be on the right track for engaging with customers

during the busy holiday season, they must recognize that the

expectation has shifted. Today’s customers demand more personal

interaction with brands.

Customers want brands to improve the dynamic between online,

mobile and in-store to meet their expectations. Successful

companies need to know more than just who their customers

are. It’s essential that they understand where they are, what to say

and how to say it to create valuable and compelling customer

experiences….even more so during a competitive holiday season.

So, what are smart brands doing during the holidays when faced

with this empowered customer? They are focusing on how to

optimize all interactions with customers to increase engagement,

revenues and loyalty.

In order for retailers to create a personal and meaningful holiday

shopping season for their customers, they must:

1. Understand customers’ interests and motivations;

2. Organize across channels, markets, languages and

teams; and

3. Create relevant messages for customers regardless

of channel.

1. Understand Customers’ Interests And Motivations During The Holiday Season — Create Meaning Through Insights

Through robust customer analytics and the ability to know how

customers are behaving — either by analyzing data from previous

holiday seasons or recent interactions, retailers are better prepared

to continue the relationship. It’s certainly not for a lack of data. It’s

the ability to identify relevant data and analyze it in ways that create

meaning and insight. For example, knowing which customers are

likely to respond to a pre-holiday sales event as opposed to those

looking for the season’s hottest new gift items — regardless of

price — will help brands interact with customers in the way each

individual prefers.

Three Ways To Create A Personal And Meaningful Holiday Shopping Season Three Ways To Create A Personal And Meaningful Holiday Shopping Season

Sponsored by

E-book Title • 4

CASE STUDY2. Organize Across Channels — Orchestrate And Align

A retailer’s ability to align the organization across channels, markets,

languages and teams is critical to providing a personalized holiday

shopping experience for customers. The purpose of orchestration

is to achieve a single view of the customer experience across

interactions. So this holiday season, make sure that internal teams

are well aligned — from in-store, social media and email — so

that you can better understand how customers interact with you

across various channels. By listening to customers, retailers

better understand their expectations, and can orchestrate the right

message, across the right channel, to the right touch point.

3. Create Relevant Messages For Customers — Deliver Contextual Experiences

There is no “one-size-fi ts-all” strategy. Every customer wants to be

treated as an individual. Therefore, retailers must create relevant

experiences for customers regardless of how or where customers

engage. And by providing rich and contextually aware experiences

across channels and to different audiences, retailers offer a more

personal journey for individual customers. The holiday season is

a time of year where people are looking to purchase personal,

meaningful gifts for family and friends. Shouldn’t your interaction

with them be just as personal and meaningful?

While managing customer experience isn’t just a one-off, holiday

season initiative, it certainly is a critical time of year to reach

customers in a personalized way using relevant messages. It’s about

using customer insights to create meaningful experiences that span

the entire customer journey. With customers spending more money

during the holidays than most other seasons combined, retailers

need to ensure that they are offering customers what they want and

getting the results that they need.

26OuTbOund marKeTing:

during the time-sensitive holiday period, communicating with customers

in real time is pivotal to success. retailers need to convey information

quickly and efficiently, not only about holiday deals but store hours,

product availability, special events, cut-off times for shipping, and other

holiday-related information. some of the challenges in this area include

deliverability, integration with social and other channels, and relevancy

of offers.

while some data released during the 2012 holiday season suggested

that shoppers were somewhat fatigued by the volume of promotions,

retailers continue to find them effective, explained sucharita mulpuru-

Kodali, vp and principal analyst at Forrester Research. “i suspect it will

be much of the same this year. mobile tends to be a significant traffic

source in Q4, and the categories that face price comparisons need to

be conscious of that, but i don’t see any huge changes this year.”

many retailers are planning to kick off their outbound holiday messaging

earlier than they did last year, but they need to navigate this area

carefully, warned Jim davidson, manager of marketing research for

Bronto Software. “in a study we conducted with rsr research, we

found 28% of brands plan to start holiday marketing efforts on or before

Oct. 1, although the data shows many brands will begin even earlier.

early bird shoppers will be thrilled, but those who wait to shop for gifts

may become overwhelmed if snowflakes show up in their inboxes too

close to labor day.”

additionally, merchants need to have their customer data updated in

real time to avoid mishaps such as emailing a customer about a deal

for an item they already purchased. “if a customer comes in to the

store or another shopping channel and buys a product, that information

needs to be captured so they will not receive a competing promotional

offer,” explained deena m. amato-mccoy research analyst, retail

and consumer markets, for Aberdeen Group. “managing the customer

database is a key component to keeping the customer happy.”

the gift of tablets

device optimization also is garnering more attention this year as tablets

and smartphones grow in popularity.

“The fact that your customer will use multiple devices to research,

shop and buy holiday gifts can no longer be ignored,” said davidson,

adding that many retailers are tailoring the design and content of their

messages for viewing on mobile devices.

spReaDING The CheeR abOUT hOlIDay Deals

27

“retailers are enhancing their email creative to be mobile friendly and

responsive to the device screen size, to maximize effectiveness and

increase engagement,” added mike hotz, director of strategic services

at Responsys.

post-cyber monday strategies also will be more concentrated this year,

davidson predicted, as there will be six fewer days between cyber

monday and christmas this year compared to 2012. “for the first time

since 2008, cyber monday will fall in december. ‘days of deals’ and

countdown promotions will need to be planned carefully.”

savvy digital marketers will focus on building long-term relationships

through a carefully planned contact strategy, rather than trying to get

as many email campaigns out as possible before christmas day, hotz

said. “They will be focused on ensuring that holiday email recipients

receive highly relevant merchandising and promotional offers. They will

also implement triggered campaigns based on customer behavior and

purchase activity.”

holt explained that sender reputation is becoming increasingly important.

“make sure you use good circulation practices, don’t over mail to non-

responders, leverage all digital channels [email, mobile, social, display,

web], provide highly relevant content to your responders and keep your

brand message consistent across all channels.”

28shOwrOOming:

INNOvaTIve sTRaTeGIes wIll DRaw hOlIDay shOppeRs INTO sTOReswhile showrooming is not a new challenge for retailers, the proliferation

of smartphones in recent years has drawn some worrisome holiday

forecasts for brick-and-mortar stores.

much has been said about using an omnichannel approach to engage

customers on mobile devices while they’re in stores, but the holiday

shopping season presents some new challenges. regardless of whether

retailers offer an integrated experience between brick-and-mortar stores

and mobile devices, shoppers will be tempted to complete purchases

using digital channels, which often offer less expensive prices, faster

shipping, swift browsing and the ability to skip the trip to the store.

“retailers must understand how consumers are are using their devices

and how they can best engage with them as opposed to singularly

concerned they’re shopping somewhere else,” explained adam

pressman, principal, A.T. Kearney retail practice. “showrooming impacts

potential messaging on mobile devices and in sites, feeds into training

and coaching for employees and how they help customers and also

plays into the views of tools and information employees need to engage

the customer.”

“multichannel retailers will be getting aggressive to combat showrooming

this holiday season,” said larry freed, ceO of foresee results. “They’ll

change their pricing strategies, but what they should focus on is

delivering a better in-store customer experience.”

last year, best buy battled showrooming by matching its prices against

the listings of rival online retailers. Jim dion, president and founder of

dionco, referred to this as a “dangerous strategy” and highlighted it as a

major factor behind the big box retailer’s losses last quarter.

29

dion said that many retailers are working with manufacturers to secure

products that cannot be showroomed with minimum advertised pricing.

when searching, consumers will find the same advertised prices for

products online as in a store, making the prospect of ordering it online

and waiting for the delivery less attractive.

however, the true “holy grail” of retail is unilateral pricing, dion noted.

“what’s causing showrooming? The many manufacturers that are

looking for growth and expansion for their products. brick-and-mortar

stores have a higher overhead and constraints that online vendors don’t

have to worry about.”

offer exclusive items in-store

another way to lure shoppers into stores is by offering exclusive items.

“brick-and-mortar retailers that provide excellent customer service and

also provide some sort of exclusive product, whether it’s merchandise

or a service, will draw in customers looking to buy special items, such

as limited-edition gifts, said deena m. amato-mccoy, research analyst,

retail and consumer markets, Aberdeen Group. “holidays can make

or break a retailer’s whole year, so they need to capitalize upon any

opportunity that will make them stand out among the clutter and noise in

the marketplace.”

smaller retailers might believe that securing an exclusive product with

large vendors is something only international chains can achieve, but

dion highlighted the Naperville Running Company as an example of

an independent retailer that was able to gain the ear of multinational

footwear vendor new balance.

Kris hartner, Owner and founder of naperville running company,

contacted new balance and told the vendor that online stores were

driving independent running stores into decline.

“Kris and his associates approached new balance about their problem

and told new balance that they needed help,” explained dion. “new

balance created a shoe exclusively for independent retailers that cannot

be offered online, period. it was specifically for independent brick-and-

mortar stores. That was one man that was able to negotiate with a very

large manufacturer in the business. independent stores have more

power than they think.”

in the midst of rising markets and new channels of communication like

social and mobile, brick-and-mortar retailers should not be quick to

discard traditional methods of salesmanship. Offering exclusive products,

providing high-quality customer service and working closely with

vendors are tried and true business practices that will still see brick-and-

mortar retailers through may more holiday seasons to come.

fOcus On cusTOmer engagemenTbrick-and-mortar retailers that ramp up their store-level customer

engagement could gain potential long-term customers who are

accustomed to the landscape of digital shopping, noted deena m.

amato-mccoy, research analyst, retail and consumer markets,

Aberdeen Group.

“shoppers are so conditioned to getting a complete shopping

experience online, from researching a product, getting answers to

questions via live chat, customer reviews, streamlined shopping and

payment options,” said amato-mccoy. “They expect those same

experiences at the store level.”

The store staff must be prepared not only with expert knowledge of the

product line but also to sell the advantages of a brick-and-mortar vendor

over a digital one.

“if you have any problem with the product you buy, you can come back

immediately,” Jim dion, president and founder of Dionco said. “if you

buy it from an online store, you have to bring it to ups and mail it back.

buying in-store might cost more but is that extra $10 of ups shipping

really worth it? The store staff needs to teach customers what they’re

getting when they buy in the store and know what the store really offers

the customer.”

30

31wOrKfOrce managemenT:

effICIeNT wORKfORCe maNaGemeNT CONveRTs hOlIDay shOppING INTO pROfITsaccessible and knowledgeable in-store associates are the frontline of

customer service excellence, and a primary defense against the brutal

competition continually pressuring brick-and-mortar retailers. during the

holiday season, as customer traffic steadily multiplies, maintaining and

delivering stellar, consistent customer service is imperative to holiday

sales and lasting reputations. but achieving this service goal can be

more costly and complicated than during other time periods.

even with the recent and incredible growth of online shopping, most

(51.1%) of u.s. consumers still prefer to shop for holiday purchases

in a physical store, according to an sdl survey, titled: Preferences On Holiday Shopping Experiences. The study found that u.s. shoppers favor

in-store over online holiday shopping primarily because they want to: 1)

examine a product prior to purchase; 2) avoid shipping costs; and 3)

take advantage of in-store discounts.

efficient workforce management tools and strategies, important every

day of the year, will be essential to converting the flood of in-store

shoppers into waves of profits during the 2013 holiday period.

“as consumers become more confident with shopping online for holiday

purchases, give them a reason to visit your store,” advised chris salles,

director of store labor for guitar center. “That reason should be more

than a showroom — it should be the people. friendly, knowledgeable

and approachable associates are the key to any successful retailer. but

during the holiday season, when you’re inundated with first-time visitors,

you’re only going to get one shot at delivering a great experience. make

it count!”

most retailers must increase staffing to provide great holiday shopping

experiences, but often wait too long to do so. as a result, “they are

never sure if they have the right number on staff, with the right availability

and the right skills needed to support a successful holiday period,”

said vince Jackson, director of retail wfm consulting for workforce

insight, a provider of strategic workforce management consulting and

implementation services. “additionally, the delay in employing holiday

help usually means retailers have missed out on the best candidates,

who are already hired elsewhere. The time to plan appropriately is

right now.”

The holiday staffing model should include skill and availability needs,

said Jackson. rather than just hiring a certain number of new people,

it is important to hire the correct roles and mix of associates. “by

understanding and differentiating sales versus non-sales activities,

retailers can best protect the customer experience and take advantage

of holiday sales opportunities. proper workforce management tools

32

make this process relatively simple. for example, with a budgeting or

forecasting tool that provides the proper configuration, retailers can plan

out their labor needs months in advance.”

as guitar center approaches the holiday season, the retailer will

adjust period planning algorithms and labor deployment rules for

holiday seasonality and anticipated changes based on historical data,

salles explained. “shifting from traditional non-holiday labor scheduling

to focused, holiday traffic-based scheduling during the 2013 holiday

season will ensure the right people are there at the right time to assist

our customers. many of our holiday customers are first-time buyers

and buying for others. This customer group requires focused attention

from our associates; we try to limit the increase of the customer-

to-associate ratio that is normal for the holiday season, while also

minimizing labor cost increases.”

Knowing when traffic/transaction spikes occur, down to 15-minute

segments, “allows us to tactically schedule our temporary associates

to best serve our customers,” said salles. Guitar Center uses a WFM solution from Ceridian Dayforce to combine historical sales analytics

by department, including basket size, items per transaction, margin

rates and more. The tool also combines traffic patterns and employee

analytics to generate department-specific demand curves, and “layers

our associates’ performance with our scheduling choices. placing our

very best associates at peak traffic times helps increase conversion

due to the nature of our department-based pOs terminals. Our

best associates know how to serve many customers simultaneously

without a service decline.”

while customer traffic and customer-to-associate levels increase during

the holidays, the practices used to address these changes, and lessons

learned, can be useful throughout the year.

“you’ll learn which associates thrive in a jam-packed environment,

when overtime pays for itself, and if your forecast adjustments held true,”

noted salles. “Other promotional and sale events during 2014, or even

a normal saturday in retail, can benefit from the wfm insights gleaned

this holiday season.”

33

7 criTical QuesTiOns TO asK when planning hOliday sTaffingas retailers prepare for appropriate holiday staffing levels they must

address several key questions. vince Jackson, director of retail

wfm consulting at workforce insights (wfi), offered 7 topics for

consideration:

1. what changes occur as you lead into the holiday season? it is critical to identify the sales and non-sales activities

that demand labor. for example:

• shipments of inventory increase early-on then diminish at some

point during holiday.

• Tasks, including price changes and floor moves/sets increase

dramatically leading into the holiday season.

• customer traffic increases substantially, necessitating additional

sales floor coverage.

2. when will these activities (including sales) take place?

you need to determine your availability needs for new staff

members.

3. what will the hours of operations be throughout the holiday season and how will that impact labor needs?

4. are there any special events planned during the holiday season and how will that impact labor needs?

5. what skills are needed to support these activities?

6. how much training time is needed to prepare staff members that take on the additional workload?

7. what is the flexibility of your current staffing, such as availability and ability absorb more hours and workload?

34

5 Tips fOr creaTing a greaT hOliday sTaff  chris salles, director of store labor for guitar center, offered the following 5 tips:

1. hire early: you’ll want to fill open full-time, part-time and seasonal

positions before holiday inventory arrives.

2. train: retail typically has high turnover. focus on associates that

have never retailed during a holiday season.

3. trust: Trust your holiday forecast and plan around it.

4. tweak: don’t be afraid to tweak the forecast as holiday selling

begins. slow reaction during this time period can be detrimental to

sales.

5. leverage time windows: don’t overestimate the traffic during

the first two weeks of december. “This lull in retail traffic can be a

very useful time to replenish from black friday weekend,” noted

salles, “de-brief the wins/losses from black friday weekend, which

acts as a concentrated primer for rest of the holiday season, and

focus training where needed before the real rush hits mid-month.”

35paymenT:

mObIle paymeNT may be a GIfT Of The fUTURewhile a number of leading retailers have implemented some forms

of mobile payment, it is a long way from saturation in the u.s. retail

marketplace. “it is the perennial case of being over optimistic in the

short-term and too pessimistic in the long-term,” noted gary schwartz,

ceO of impact mobile. he predicted: “The consumer will move to one-

click mobile check out but in the next few years it will be not at pOs.”

greg buzek, president, ihl group, concurred: “payment remains sort

of the wild-wild west. There is a great deal of chatter about mobile

payment and nfc but there are two issues that no one has solved:

1. lowering the cost of the discount rate the retailers pay; and

2. improving the speed of the transaction for the retailer (or at least not delaying it).

 

nfc and mobile payment is a vendor driven initiative not a customer

driven one. These two items must come to the table or it is a

non-starter.”

“let’s start with the noise,” said schwartz. “The past few year have been

unnaturally focused on the mobile wallet. This is an in house skirmish

with between the incumbent financial ecosystem. but isis, google wallet

have underwhelmed.”

schwartz continued: “amazon one-click, iTunes, and paypal mobile

internet check out will dominate commerce activity and capture the

immersive tablet (couch) commerce as well as the impulse check out

between home and the store.”

“i think the biggest thing we are going to see is a beginning of a

maturing of the use of mobile devices,” buzek continued. “yes, there will

be a higher proportion of stores that can finalize a transaction, however,

we will see more thought put into traffic flow, heat mapping, and how to

handle the complete customer experience. simply adding an ipad is not

customer experience. retailers are learning that.”

36

reTailers beware: mOniTOr seasOnal card raTesThe card brands make adjustments to interchange rates every april and

October in conjunction with enhancements to card product offerings,

changes in industry rules and regulations, and other considerations.

These adjustments can either be fee increases or fee decreases

depending on the update. since card brands charge interchange to

payments processors, who then charge merchants, the interchange fees

you pay are ultimately determined by your processor.

david hogan, executive director of major accounts at heartland

payment systems, suggested that retailers beware of the costs

associated with changing interchange fees.

when interchange fees change, processors can do one of

three things:

1. do nothing by charging the same rates as before;

2. pass the changes — increases or decreases — on to their clients; or

3. charge additional processing fees.

in fact, many processors take advantage of seasonal interchange rate

adjustments to discreetly increase their own fees without full disclosure,

leading operators to often mistakenly assume the increases are coming

from the card brands. for example, if visa charges an interchange rate

of 1.75%, your processor may mark that up and charge you 2.6%.

yet, disproportionately, when visa increases its rate to 1.76%, you may

see an increased rate of 2.65% from your processor. This is one of

the prime culprits of cost creep that can add significant expense to your

processing costs every year.

37

Retail TouchPoints is an online publishing network for retail executives, with

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The Retail TouchPoints network is comprised of a weekly newsletter, category-

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