Tuesday, December 18, 2007

The User Interface and Retail

I just saw an article from TechCrunch that said that the Wii is apparently the hot product for the holidays - if you can get one. In the interests of full disclosure, my family owns one, and I have to say, the user interface makes a huge difference in the experience. My son could never get all the complicated motions down necessary to play, say, a Play Station (name your version). But he's a bowling pro on the Wii - and the simplest games are the ones that are the most fun to play.

It seems like since the Wii first started gaining traction, there has been a lot more experimentation with the user interface for consumer electronics. The Wii is far more intuitive to use, the iPhone completely rethinks the way the web is navigated, thanks to the touch screen... and there are more experiments out there, like Hillcrest Lab's rethink of the mouse. Tom Cruise's glove from Minority Report aside, I think we're only beginning to scratch the surface of the user interface.

There's a retail technology point to this. As consumers adopt technology, one of the first places they start to use it is the shopping experience - something they do weekly, if not daily. If a new user interface begins to transform how consumers interact with technology, guaranteed they will start to expect the same kind of interaction from an in-store kiosk or a retailer's web site. Also, consumers are employees too - today's training methodology and POS interface will be obsolete in no time if user interfaces experience a step-level in improvement. And if that brings training time down from hours to minutes, retailers may very well be early adopters for once.

So, I'm on the alert: I think new ways of interacting with technology have the potential to be the next decade's big technology transformation with a big potential to impact retail. I'm keeping my eye out for the first signs of that transformation now - send 'em my way if you see any.

Wednesday, December 12, 2007

Pricing and the Retail Paradox

I'm going through the data from my next benchmark report, on Pricing. I have to say, I feel vindicated. We at RSR have been arguing for awhile now that price is no longer a differentiator - that technology in the hands of consumers makes for price comparisons and information transparency that makes it nearly impossible to maintain a competitive differentiation based on price. It's simply not enough anymore.

Some retailers have shifted to a product strategy, where exclusives or private label merchandise that you can't get anywhere else becomes the basis of differentiation. I would argue that this is not sustainable over time. With supply chains getting faster every day, today's product innovation is tomorrow's knock-off.

That pretty much leaves customer service as the differentiator, and a strategy that we've seen everyone from Best Buy to Wal-Mart attempt to undertake. The problem - and thus the paradox - is that retailers don't operate in a world focused on customers alone. Wall Street demands performance, and a lot of the tactics of a customer service strategy are in conflict with containing costs. So retailers have this paradox they have to unravel: how do I focus on the customer, while maintaining my efficiency and price competitiveness?

Now, this makes a great story, but is this really a question wandering through retailers' heads? The answer appears to be yes. While some retail segments are more focused on price as a differentiator than others, within those segments retailers who are outperforming their peers in same-store sales growth (a key Wall Street metric) are more focused on price than their colleagues. They haven't forgotten the need for efficiency and competitive prices even as they try to become more customer focused.

The pricing report will be available in January.

Tuesday, December 11, 2007

This Social Networking Thing

After reading Matthew Creamer's article on Ad Age on the role that social networking sites play in search engine optimization, I decided to try this whole social networking thing. My search results on Google are pretty good - I sometimes have to compete with a high school lacrosse player from Canada, but when you Google my name, you pretty much get me.

But as I spend most of my time writing about the impact of technology on retail, and I spend a lot of time telling retailers that one of the first places that consumers bring new technology is to the shopping experience, I figure I better put my money where my mouth is. So I signed up for Twitter. With this post, I've moved from my company's blog site, which is still a work in progress, to this one. And I already do a few things in other sites like Linked In, Plaxo, Pandora and Second Life. Facebook and MySpace are coming soon, I guess, along with a couple mobile sites (I just need to figure out which ones). But as I spend more time talking about "me" and "what I see" and "what I think", the more nervous I get.

I was vetting survey respondents to my most recent retail survey on pricing, and in searching on a respondent's name to figure out if he was a legitimate retailer, I found his MySpace page, which had a ton of pictures of him out with his drinking buddies. Hmmm. And while testing to see where I came up on that Google search (I know, I need to check the others too, but there are only so many hours in the day), I found this site that aggregates content about a person - again, competing with the Canadian lacrosse player, it wasn't a complete reflection of me, but it was kind of disturbing to see quotes from me that it had pulled from articles, and there were tabs for pictures (empty, phew!) and a bunch of other stuff. I also just saw on TechCrunch the company Spokeo, which basically becomes an RSS feed for keeping up with your friends, pulling in pics they load on Flickr, their Facebook and Twitter postings and a ton of other sites - all without requiring their permission (it's all basically publicly available).

I know I'm late to this game (I'll defend slightly by saying that I've spent a lot of the last 4 years on planes, which makes it hard to keep up with the online world. The wireless card alone will make a huge difference.), but I can't believe the amount of information you end up revealing about yourself the more you get roped into social networks. I consider myself a relatively private person - I'll use some of my personal experiences in my work, but I do so carefully, both because just because I'm a consumer doesn't mean I know everything about consumers, and because it's just none of other people's business!

So as I embark on this journey, I find myself approaching this from a "public persona" and a "private persona" perspective. If it's publicly available info, the info I'm putting out there is going to be work-related. If it's personal info, then I'm going to be looking for sites that are invite-only, so that I can share with my friends and family and not the whole world. But, as usual, I think of my (still learning how to read, let alone type) kids: will they ever approach "the world" with that kind of distinction? It doesn't seem like today's kids do, as myriad Facebook and MySpace faux pas demonstrate. I guess I'm going to have to amend my mother's platitude: "If you can't say something nice - and professional, like it's going to be there for the rest of your life - then don't say anything at all."

As Twitter nudges me to make a post, I have to ask myself, I wonder how that's really going to work out?