NRF Show 2010 Overview

If it is, in fact, a word, then "multifunctionality" was the defining one at the 2010 NRF Show this month.Many of the products and services being showcased by exhibitors at the National Retail Federation's annual trade show weren't brand new in terms of their driving technology or defining functionality. Instead, their newness was found in their ability to provide multiple solutions -- either for retailers, their shoppers, or both -- in one technology package.The most noteworthy example of the trend is ShopperGauge, a multi-faceted merchandising system that can track shopping behavior and on-shelf inventory in real-time, as well as present SKU-specific promotional messages.The system is being presented to the industry through a partnership between RockTenn Merchandising Displays (formerly Alliance, A RockTenn Company) and BVI Networks, which are positioning it as a critical tool both for collecting shopper insights and managing store operations.The system has three components:1. BVI's proprietary "RetailNext" analytics system, which uses installed cameras or a store's existing video network to measure shopper traffic, dwell time, at-shelf engagement and sales conversion by recording and analyzing activity.2. On-shelf technology called ePusher (supplied by Germany-based POS Tuning) that uses sensors and package-dimension data to record each product movement on the shelf, thereby providing real-time inventory levels that can reduce out of stocks, streamline the stocking process and deter theft (the last by signaling the removal of large quantities, or simply by scaring off sticky-fingered employees). The spring-loader system, which RockTenn initially is presenting as an endcap, also acts as a shelf-maintenance device by automatically moving product forward as it is removed.3. An integrated digital screen that can be programmed to air customized promotional content when a specific product is removed from the shelf. Working in tandem with the video analytics and on-shelf technology, the screen can be used to measure the effectiveness of specific creative executions in driving the purchase of merchandised product, or to present (and measure) cross-merchandising promotions or other ancillary activity.The ShopperGauge system is being using at Green Hills Market, Syracuse, NY, a forward-thinking grocery store that doubles as a testing lab for new marketing technologies. (See "The Hub: Real-Time Loyalty" in Related Articles.) It also is being tested by an undisclosed supermarket chain."We already know the products we receive and our sales figures." said Gary Hawkins, owner of Green Hills and also a marketing consultant. "But the ShopperGauge system ensures we understand in real time what's happening to the products on our shelves.""With the kind of data we're getting today, we really don't know what shoppers are doing in the store," said Jon Kramer, RockTenn's chief marketing officer, during a "Big Ideas" presentation during the show. By delivering information on in-store traffic, dwell time, conversion and other data points, ShopperGauge makes in-store marketing nearly as measurable as online advertising, he suggested. "It can literally change the way manufacturers and retailers look at their business." (See video, below.)RockTenn and BVI also plan to launch "ShopperGauge Learning Labs," a service for consumer product manufacturers to test merchandising, packaging, and shelf placement concepts in actual store environments. (Partnering retailers will receive a cut of the program's costs, in addition to data from the tests.) The service should be available in the first quarter of 2010.In other news gathered from the show:Target Corp. will "methodically" investigate how and where to expand its Channel Red in-store digital network, according to Chris Borek, the mass merchant's senior manager of in-store digital marketing. The communication vehicle currently operates in the electronics and entertainment departments chain-wide and in the OTC department of 100 stores in an ongoing pilot. (See "Target Prescribes a Wellness Channel" in Related Articles.)In keeping with Target's overall strategy to keep store design tasteful and simple, "We don't want to over-digitize stores or create visual clutter," Borek said. Therefore, the chain will only consider departments where there is a real need to present shoppers with additional product information, he said. It's also important to identify categories that produce a lot of "brand launch innovation," which can help Target generate in-store excitement, Borek said.Product launches also can prime the pump for paid advertising from national-brand partners, which Target actively seeks (now with assistance from an outside entity, Thomson's PRN).The chain's "interactive multi-channel experience team" is working hard to ensure that Channel Red programming is integrated not only with other activity in the store, but with circulars, media advertising, online and other marketing initiatives. To be effective, the content must "inform, entertain, or add value" to the shopping experience, he said.The chain welcomes co-marketing among vendors to create content that can deliver on all those requirements, Borek said. As an example, he presented a spot created for a recent DVD release of NBC Universal's Monk -- whose titular character is a germophobe -- that incorporated SC Johnson's Windex into the creative.Family Dollar's focus on opening price points "positioned us very nicely" for the economic doldrums of 2009, Howard Levine, the extreme-value chain's chief executive officer, said during a keynote panel discussion during the event. "We saw our customer -- with an average household income of $40,000 or less -- face the recession a lot sooner" than U.S. consumers in higher income brackets, he noted.The chain didn't idly reap the rewards of the downturn, however, and adjusted its product assortment to meet consumer "needs, not wants," adding more than 200 food items to the planogram while scaling back on discretionary categories such as apparel, Levine explained. "We invested more in consumer research over the last 18 months than I think we did [in the previous] 10 years.""As self-serving as it may sound," Levine said that he believes "there is a renewed focus on value" among U.S. consumers that won't go away anytime soon. "I like being in the value business," he said.Research company APT (Applied Predictive Technologies), Arlington, VA, demonstrated the smartest way for industry suppliers to make presentations: secure a spot at the podium, then hand the microphone to your client. In another "Big Ideas" presentation, Family Dollar's Brian Strickland gave an overview of the value chain's efforts to mine actionable insights from an ongoing, in-depth analysis of market basket characteristics. The work is driven by APT's trademarked "Test & Learn" methodology.One of the chain's main projects has been an "affinity analysis" of basket composition to identify potential cross-merchandising opportunities, according to Strickland, Family Dollar's divisional vice president of market research and business development. The company also is examining the impact on basket size of featuring different products in circulars (now distributed regularly for nearly all 6,600 stores); features for laundry detergent and private-label underwear may generate the same incremental lifts at the product level, but detergent may have a much greater effect on overall basket size, he explained.Family Dollar is actively seeking vendor participation in its research activity, Strickland said, noting that future initiatives include a test on the effectiveness of in-store signage.InContext Solutions, Chicago, is a year-old market research firm specializing in virtual-reality simulations. (See video, below). Chief strategy officer Rich Scamehorn said he helped launch the company after encountering the online limitations of some existing vendors while working with the technology as a consumer insights manager at General Mills. The company's key deliverable: high-quality, 3-D store environments that are conducive to online testing and relatively inexpensive to produce. (According to a 2009 Forbes article: "Average cost for a test involving 500 respondents, including three store aisles and the ability to test packaging and shelf placement for one product [costs] $15,000.")Intel Corp. and Microsoft Corp. presented a "proof of concept" display representing "the future" of in-store signage. The seven-foot-six-inch holographic display is made of glass and provides multiple touch points for viewers to interact with a variety of content, view products in "augmented reality," download promotions to a mobile phone, offer feedback, and contact friends through social networks and/or mobile phone services. A separate high-definition LCD screen can play advertising (or other content) as shoppers interact with the display's other half. Embedded facial recognition software can vary content and angle based on gender and height. Content selections and dwell time are tracked for future analysis. (See video, above.)The display isn't intended for production, but instead was created to "motivate the industry toward advance usage models" for digital P-O-P, Jose Avalos, Intel's digital signage director, told Digital Signage Today. Avalos told the magazine that the microprocessor giant will be making a strong marketing push in 2010 to help drive the industry forward.Oracle Corp., Redwood Shores, CA, demonstrated a "Retail Shopping Assistant" smartphone application that lets users scan bar codes (or enter product names) to access price, reviews and other information (supplied by Amazon.com), then share the info with others via social networks or save it to a wish list.Retail sales increased 1.7% during the November/December holiday sales period, even though foot traffic declined by 2.9%, according to information released at the show by ShopperTrak, Chicago. The holiday season began poorly, with sales sliding 0.4% and traffic dipping 6.1% in November, but rebounded in December with gains of 3.8% in sales and 0.7% in traffic. Much of the rebound came from post-holiday trips. ShopperTrak has traffic-measuring systems installed in approximately 50,000 outlets representing dozens of chains, including JCPenney, AutoZone, RadioShack, Best Buy Mobile and numerous high-end chains.Source Technologies, Charlotte, NC, demonstrated interactive kiosks with a variety of shopper-facing functionalities. The most advanced of the bunch serves as an "Ecoupon" center that lets frequent shoppers obtain or retrieve offers from their loyalty cards. (See the video above for a more detailed description.)Source recently began working with Modiv Media on the continued rollout of "Order It!" deli-service kiosks in Ahold USA stores. (See In-Store Media: Stop & Shop's Scan It!" in Related Articles.)Stratacache, Dayton, OH, showcased new Spectra PopTouch digital signs with embedded media players that were designed for shelf edges (the screens are as small as three inches) or endcaps (a la the Walmart Smart Network). The devices also serve as miniature touch-screen kiosks facilitating shopper interaction. They play default ads or other content when idle, and can be outfitted with embedded cameras or motion detectors to start when shoppers approach. The system also compiles usage data.ZBD Displays, Windsor, England, showed off its "epaper" electronic shelf-labeling system, which consists of high-definition LCD displays (with a battery life of up to five years) that can receive wireless updates individually or across an entire chain. (See video at top.) Management can be handled locally or remotely. PCC Natural Markets, Seattle, began testing the signs in the deli department of one store last fall. Overseas clients include Tesco in England, Sasa in Italy and CBA in Hungary. (See video, above.)Zoom Systems, San Francisco, showcased the "Best Buy express" kiosks it has been rolling out to airports, malls, and other alternative locations on behalf of the consumer electronics giant. (See video, above.) The self-service kiosks carry a variety of consumer electronics hardware and software product. The inventory is tracked remotely. More than 65 express kiosks have been installed since the rollout began in summer 2008. Zoom also makes self-service kiosks for Proactiv, Rosetta Stone, Apple and Macy's, among others. (See "Category Report: Cosmetics" in Related Articles.)

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