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Mobile Expected to Drive Big Business in 2013 Holiday Retail

Mobile Marketing Watch- On Thursday, the team at Baynote– a provider of personalized customer experience solutions – published the results from its first-ever 2013 Holiday Predictions Survey. The survey, conducted in partnership with the e-tailing group, found that retailers are cautiously optimistic, with 60% forecasting growth in excess of 10 percent for 2013 holiday season revenue, in line with industry forecasts. Dan Darnell, VP of marketing and product at Baynote, believes the survey results point to promising clues about how big mobile’s role will be be in the holiday retail scene this year. “We wanted to take the pulse of the retail industry as it prepares for the 2013 holiday season and gain a deeper understanding of how marketers plan to increase holiday season revenue and profitability,” Darnell says. “The inaugural survey provides a benchmark for retailers currently finalizing promotional strategies for the upcoming holiday season, and we hope that the findings are useful to retailers of all sizes.”

POS Software Trends 2013

Hospitality Technology- Any technology investment is a balancing act. Roll out a new technology and run the risk that something better (more affordable, durable, simplified, etc.) will soon be developed. Or wait for “something better” to come along at the risk of being a bit too far behind the competitive curve. For restaurants, the de facto approach has been less technology investment, more customer service, until recently. Technology capabilities — and particularly those that can positively impact the customer experience — are driving new investments. The point of sale (POS) is a central focus for restaurant innovation and investment, and Hospitality Technology’s annual “POS Software Trends” report shows that operators are looking to add a variety of new capabilities in 2013.

Five Ways C-Stores Can Use Digital Signage to Drive Sales

John Kunze, Watchfire Signs- Convenience stores are the bright spots in the retail industry. Despite the tough economic conditions of the past four years, revenue at convenience stores continues to grow, largely due to the industry’s emphasis on ease and accessibility for consumers who are pressed for time.

To meet these needs, c-stores have turned their attention to selling items beside gas and cigarettes. Given these trends, c-stores are poised to benefit even further by using digital signage more strategically to appeal to buyers looking for convenience.

There are five ways convenience store operators can use digital signage to increase sales starting today:

  1. Give your store an image boost. Customers will consistently choose a clean, updated gas station or store over an older, rundown one. Industry research has shown that the cleanliness of a c-store can influence shopper behavior. While customers will high-tail it out of a dirty store, if you make them feel comfortable and safe, customers will reward you. Digital signage helps c-store owners convey that they have clean, safe stores in a couple ways. Since digital signage can be clearly seen and reliably updated, there is no need for window signs that clutter the storefront. Also, digital signs give owners the ability to promote messages about cleanliness and safety, which will draw in customers.
  2. Drive traffic away from competitors. The c-store market is a highly competitive mix of national chains and independent operators. Owners often create niche markets to set themselves apart. The trouble is that customers have to be in the store to see those efforts. Digital signage gives c-store owners the ability to advertise what makes them unique, including amenities, food service and specialty products. The high visibility of digital signs, including LED gas price signs, also helps draw customers away from competitors. Since an LED gas price sign is visible from up to a quarter-mile away, it can help a c-store or gas station owner reach down the street to grab the attention of customers who might otherwise go to a closer competitor.
  3. Highlight products and services. C-store owners try very hard to move customers from the pump into the store, which is the real profit center of the business. Owners who implement promotions on digital signs see monthly profit increases significantly. Digital signs also give c-store owners the ability to promote perishable products, reducing wasted inventory.
  4. Advertise time-specific messages. One of the beauties of digital signage is the ability to conveniently execute daypart messages. Dayparting is the practice of dividing the day into several segments — usually morning, afternoon and evening. By dividing up the day, owners can better target messages to a particular demographic. For example, you can promote breakfast sandwiches and fresh coffee in the morning, snacks in the afternoon, and a well-lit facility at night. These messages can garner your c-store additional -- not replacement -- customers.
  5. Give customers a reason to come back. According to the latest Convenience Store News Realities of the Aisle study, 45 percent of men and 18 percent of women will shop at a c-store at least once a week. The most popular item purchased by both men and women is gasoline. Hence, introducing customers to other in-store items will increase both sales and the frequency of customer visits.

There is a broad range of digital signage products available, so look for a quality sign manufacturer. You’ll want to make sure the sign is well constructed, operates reliably in all kinds of weather conditions, and is easy to operate. Also look for a manufacturer with a strong warranty and a good support team. With this in mind, your digital signage investment should pay dividends for many years.

Consumers Turning to Online Grocery Shopping

CSNews-- A recent online survey revealed that 15% of U.S. adults have shopped for groceries online, and an additional 19% said they don't currently, but plan to do so in the future. The high cost of food may be a primary driver behind online grocery shopping, as 91% of U.S. adults indicate they are at least somewhat aware of rising food prices due to weather-related issues in 2012. In addition, 70% of U.S. adults who haven't shopped for groceries online said they would be at least somewhat likely to do so if online groceries were less expensive than buying them in the store. Eighteen percent said they would be very likely to do so.

"The combination of high food prices, busy families and easy Internet accessibility has led to an increased interest in online grocery shopping," said Jackie Warrick, senior savings advisor at "Consumers have long bought items like apparel and electronics online. Now, they're seeking out ways to further take advantage of online shopping."

For some consumers, the desire for online groceries has yet to be met. In fact, nearly four-in-10 (39 percent) of U.S. adults wish their local grocery store offered a delivery service. In January, conducted a survery asking 2,019 US Adults about their thoughts of online grocery shopping. When asked what they believed to be the positive aspects of ordering groceries online, U.S. survey respondents selected the following:

  • Saves time
  • Less likely to impulse buy because consumers aren't tempted by in-store items
  • Saves money sometimes because there are better prices
  • Easier to plan menus because shoppers can add items to their virtual "cart" throughout the week
  • Can help shoppers eat healthier because they're not tempted to buy junk food

When asked what they believed to be the negative aspects of ordering groceries online, U.S. survey respondents selected the following:

  • It's difficult to select certain items without seeing them in person, such as produce or meat
  • Consumers have to wait at home during a specific time window for the items to be delivered
  • Not every item is available
  • Can't use paper coupons
  • More expensive

Income Streams for 2013 for Your Business

Progressive Grocer-- Supermarket's customer traffic flow is a powerful resource. It provides negotiating leverage for multiple income streams. Some of these streams provide incremental income such as the "Rug Doctor Program" which has been around forever. It has two advantages: it brings traffic into the store and pays additional income to the store.

Income sources to think about:

  • Vending machines for beverages and candy is another income source,
  • Electronic media where companies pay you to be on your website,
  • Point of Sale ad incomes such as advertising on the shopping cart and floor decals,
  • Non-traditional services, like renting U-Haul trucks off your back lot,
  • Space your parking lot has potential value to others and income for your business,
  • Bill paying, money orders, lottery tickets and other financial services are another stream of income,
  • Providing postal service,
  • Rent income such as Banks, Cleaners, Music Kiosks, Fast Food companies and Coffee Shops,
  • Your in-store intercom/music system and TV system are another source of income,
  • Non-traditional products and services like cell phone cards or gift cards to other retail businesses.
It is important that whichever additional services or products you bring into your business, complement and don't distract from the mission and the brand image of your business.

Sell at the Shelf

Convenience Store News-- The history of store brands in the United States is a long one, and to date, it is without a truly happy ending. Store brands have never been able to completely shake the identity of being nothing more than cheap substitutes for their national brand counterparts. From a retailer perspective, store brands are receiving increased attention and investment, resulting in the creation of unique offerings that are more than just traditional copies of successful national brand products. Many retailers offer multi-tiered programs that cover the spectrum from value to premium, with the higher-end products serving as a differentiator to drive shopper loyalty.

In-store, at-shelf
But investment in store brand products goes beyond product development – in-store marketing also is critical for private brand success. POPAI, the global association for marketing at retail, recently announced the findings from its 2012 Shopper Engagement Study. The study found that 76 percent of buying decisions are made in-store. This is good news for private brands, and it speaks to the overall effectiveness of in-store – especially shelf-edge – marketing.

One way to assist shoppers in their pursuit of value – and help drive private label sales – is "instructional selling," which educates the shopper at the shelf edge. Private brand products could benefit from instructional selling that explains the quality and value each product provides, without having to rely solely on price to get attention.

Effective instructional selling calls for five key steps:

  1. Make the information relevant to the shopper
    Tell the shopper why the product is better than others, and why he or she would benefit from it (beyond just saving money). This is an opportunity for the retailer to use private brands as a springboard for a broader point of differentiation. Information such as health benefits or recipe ideas could be presented, along with the benefits of the store brand that will ultimately reflect on the retailer's overall brand image.
    This "halo effect" can be a significant benefit to retailers as they work at differentiating themselves from competitors in areas other than price. A strong private brand creates overall loyalty for the retailer.
  2. Make the information easy to access
    Put the information right at the shelf, using the price label or a shelf strip right where the shopper is looking. Printing brochures is fine, but team members don't always place them where the shopper is going to see them. Simplicity and consistency are the watchwords here; available space is limited, and any communication needs to be direct and easy for the shopper to understand.
  3. Point out the unique value of the product (beyond price)
    This step is connected to the first point, but should be more about the product. This type of information works best for those "tier three" products such as gourmet or organic items that are designed to elevate the brand.
    If the product is truly exemplary, while providing a value to the shopper, then be overt in pointing out those attributes. Play up the "available here only" aspect for unique products.
  4. Don't use technology if it's not adding value
    Quick-response (QR) codes have gotten a lot of press. And although these codes can add value, don't ask your shoppers to jump through hoops to scan them just because they're something new. Plain old bullet points work great, don't take as much effort to read, and don't require technology.
    However, in some cases, offering a QR code makes sense. For example, a QR code that connects shoppers to a video demonstrating how to use a product can be much more effective than printed instructions. But keep in mind that when the shopper goes through the effort of pulling out a phone and scanning a code, he or she expects a bigger benefit.
  5. Keep the information fresh and up to date
    Products change; competitors change; and shopper needs change. Product information also should change on a regular schedule to keep the message itself fresh. After six to eight weeks, shelf edge information – as with any other point-of-sale material – becomes part of the landscape and is no longer effective. Shake things up on a regular basis.
    The corollary to this is to make sure you're keeping up with external changes. If a new study comes out touting the benefits of coffee, use that information at the shelf edge. Shoppers who aren't aware of the study will appreciate the information, and those who do know of it will give you credit for being "in the know." The information helps to create a stronger bond than price alone will ever do.

Keep it simple and relevant
Retailers can accomplish each of these steps at the shelf edge in an effective manner without a significant investment; simplicity and usability are the key elements to a successful shelf edge communication program. The biggest investment lies in staying current and relevant to shoppers. Too many programs are launched and forgotten; this program can't be one of them.

PCI Compliance: Why It's Necessary

Convenience Store News-- Today, each convenience store location must be considered a self-contained, Internet-connected business. A store's technology infrastructure might include any combination of sophisticated point-of-sale (POS) and inventory management systems, credit card processing and loyalty card systems, and digital signage. All of these are usually networked applications, reaching out via broadband or dial-up Internet connections to transmit and receive information. The more connected a location is, the greater the risk of IT security threats.

Not a day goes by when you don't hear another example of customer credit card data being stolen. As security breaches and identity theft cases have grown more widespread, protecting sensitive data has become more important than ever for convenience store operators. Complying with the PCI-DSS, adopted by major payment brands including American Express, MasterCard and Visa, is mandatory for any convenience store that stores, processes or transmits credit card data.

Failure to comply with the PCI-DSS not only increases the risks to sensitive customer payment card data, but also results in fines, lawsuits, lost customers, brand damage or even loss of the ability to process credit cards. Without compliance, if a merchant has credit card information stolen, PCI-related fines can be as high as $500,000 per incident. To put this into an even greater perspective, according to the Ponemon Institute's Fifth Annual U.S. Cost of a Data Breach Study, the average cost for merchants dealing with a data breach in 2009 rose to more than $6.7 million. The cost per customer record breached was estimated at $204. These significant costs could easily put a small- or medium-sized operator out of business.

Where Generation Y Likes to Dine

Convenience Store News-- Generation Y consumers are a crucial spending force in the quick-service restaurant (QSR) industry, according to an Executive Insights report titled "Winning the Hearts (and Wallets) of QSR Consumers" by L.E.K. Consulting. The firm's survey of 1,300 U.S. consumers found that "Millennials," ages 16 to 24, have specific preferences that differ from those of the general population.

"Our research shows that many QSR brands that perform well across the general population are falling short with Gen Y," said Alan Lewis, vice president in L.E.K. Consulting's Consumer Products Practice.

Twenty percent of Millennials purchase from a QSR almost every other day, according to the report, while less than 50 percent of Baby Boomers purchase from them so frequently. Forty percent of Generation Y consumers also state that friends influence their meal and snack selections, which is twice the level of other age groups.

Chipotle Mexican Grill and Panda Express achieved the top choice conversion score -- a ranking that measures the strength of a brand's connections with what consumers are seeking -- for Generation Y in the survey. While chains such as Dunkin' Donuts, Chipotle and Chick-fil-A scored well across all generations, Generation Y showed a greater preference for chains such as Wendy's and Burger King, prioritizing tastier menu items over healthy ingredients, price or convenience, L.E.K. Consulting stated.

"Winning consumers with traditional value propositions won't be enough to sustain a QSR brand in the future, if it cannot cultivate loyalty from Gen Y today as they increase their spending power," said Jon Weber, vice president and head of L.E.K.'s Restaurant Practice. "QSRs need to think now about ways to recalibrate their offerings, and customer engagement techniques to win and keep Gen Yers’ loyalty for the long-term."

Five Sources of Produce Shrink Every Grocer Should Monitor

Progressive Grocer-- Global retail shrink in 2010 reached $107.284 billion, according to the Centre for Retail Research’s annual Global Retail Theft Barometer (GRTB) — down -5.6 percent over the previous year as retailers put nearly 10 percent more funds into security and loss prevention. In the U.S., internal error and administrative failure counted for a substantial 16.9 percent of losses, or $18.1 billion. For grocers, a healthy portion of that $18.1 billion loss can be traced back to operational errors, such as those that occur when produce scale PLU items are handled at POS. All too often, these items are not calculated accurately into the customer’s order, resulting in substantial shrink.

  • PLU Entry-Red and yellow peppers cost more than green peppers, while vine tomatoes cost more than plum tomatoes. Similarly, prices are different for organic versus regular produce. Cashiers often confuse PLU numbers for produce items that are similar to each other, particularly when they are in a rush. Proper aging of these items and cashier awareness are essential to preventing unnecessary losses. Managers can incorporate mandatory produce tests each week/month, asking employees to identify PLU’s for various fruits and vegetables. This needn’t take a lot of time and can focus on the most commonly confused items. Typically, six items per test is sufficient.

  • Weighing vs. Counting- Cashiers must know if a particular item should be entered by quantity or by weight. Apples, for example, should be weighed and navel oranges should be counted. Furthermore, managers must train cashiers to enter the proper quantity each time so that four navel oranges in a bag aren’t entered as one orange. In addition to checking for PLU accuracy, incorporate weighing vs. counting items into weekly/monthly tests.

  • Weighing by the Cashier- Cashiers are trained to be fast, but there is such a thing as being too fast. In an effort to move their line along, cashiers often remove items from the scale at the same time they press “enter” on the keypad, meaning that the item’s full weight is not on the scale when the POS system calculates the cost. While this usually happens unknowingly, it does happen quite often and the resulting losses can be dramatic. Make employees aware of these possibilities so that they can monitor both themselves and customers with a knowing eye. Show cashiers firsthand that items can register at varying prices depending on whether or not the item is placed in the center of the scale and depending upon timing when removing an item from the scale.

  • Weighing by the Customer- Just because a customer places an item on the scale does not mean they are paying their fair share. Customers will often place an item off to the side, leaving only a portion of the item to register on the scale. Whether intentional or not, self-checkout station managers must be aware of this practice and ensure that customers place items in the center of the scale at all times. Managers must also keep an eye out for customers who hold onto and slightly lift bags while weighing produce to reduce its weight.

  • Improper PLU-One of the most common forms of self-checkout fraud occurs when a customer intentionally enters the wrong PLU number for a given item. For example, the PLU numbers for bananas and pinto beans are commonly entered when purchasing other, more expensive items like meat and seafood. Don’t get stuck selling items from the olive bar at pinto bean prices.Make sure that someone with solid multitasking abilities is manning the self-checkout post. These employees need to oversee multiple registers simultaneously while keeping an eye on both physical and on-screen activity, so the ability to multitask is essential. Auditors should utilize loss prevention software to run regular queries on low-value items—items that ring up at less than a designated value (for example, items selling between zero and five cents). This data, combined with video of the transaction, will often reveal incidences of self-checkout fraud, among other things.
In a world of increasing technological complexity, both new threats and new solutions arise regularly. Grocers who consistently train their employees and monitor their stores, employees, and customers will reveal new patterns of fraud and operational shrink and will be the ones to benefit from, and despite of, these ongoing changes.

Feds soften rule to cut debit card swipe fees

Retailers have been complaing debit card fees are too high.

USA Today -- In a move that disappointed both sides of the contentious issue, the Federal Reserve Board voted Wednesday to soften a rule that will cap the fees

banks charge retailers when consumers use debit cards.

  • The Fed voted to set the cap on so-called swipe fees at 21 cents, up from the 12-cent cap it proposed late last year. That's still down from the current average debit card transaction cost of 44 cents.
  • The rule also allows financial institutions that comply with fraud prevention standards to charge a slightly higher fee. Financial institutions that meet all the requirements could impose a maximum fee of 24 cents per transaction.
  • The Fed also voted to delay implementation of the cap until Oct. 1. It was scheduled to take effect July 21.
  • The broad financial reform legislation Congress enacted last year required the Fed to impose "reasonable" limits on debit card fees. Since then, banks and credit unions have spent millions on lobbying and advertising campaigns aimed at gutting the rule.

Alternative Payments Market Expected to Double by 2015

NEW YORK -- The $62 billion alternative payments market will double in the next five years, according to a new Packaged Facts report, entitled "Alternate Payment Systems in the U.S., 2nd Edition." Alternative payments are defined as consumer-to-business and person-to-person payments that are entirely electronic and mostly conducted via the Internet or mobile phones.

Driving the market forward will be three mobile payment introductions or possible launches, said Packaged Facts:

  • Google is expected to team up with point-of-sale mobile device makers, VIVOtech and Verifone, to release a mobile payments trial in several cities, allowing this platform to be used by brick-and-mortar retailers.
  • AT&T, Verizon and T-Mobile formed the Isis partnership with Discovery Financial and Barclays bank to combine mobile payments and wireless carrier billing into a retail mobile payments solution.
  • Rumors abound that Apple will create a mobile payment platform for use on its popular iPhone. The system would mirror the existing iTunes platform and could debut later this year or sometime in 2012.

Senate Votes to Let Fed Trim Debit Card Swipe Fees

WASHINGTON (AP) - The Senate has voted to let the Federal Reserve limit the fees that stores pay banks each time a shopper swipes a debit card. It's a victory for merchants in a long-running lobbying fight with banks.

At issue is a Fed proposal that's set to take effect next month and would cap the fees at 12 cents per transaction, compared with the current average of 44 cents per swipe. Stores say the lower swipe fees will let them lower their prices.

How will this affect your business?

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