Did 2013 have to end with the somber news of a big credit card security breach? But it did! It is reported that 40 million credit cards were compromised in the security breach in stores of a major U.S. retailer Target. This is only a shade second to the earlier TJX breach in which 45 million credit cards were compromised. (After this blog was published, it was reported that the number of affected accounts in the Target breach is as high as 110 million, which would make it more that double the TJX breach!)
After any breach, and surely after the breach of such dimension, discussion on the data security issues at the retailers escalates. Earlier, the TJX breach resulted in stricter wireless PCI (Payment Card Industry) compliance requirements. The current Target breach can also trigger tightening of the compliance requirements. This breach may also prompt IT, security and compliance managers at major retailers to take a hard look at the information security aspects of the various technologies that they have deployed. Add to it the fact that retailers are aggressively deploying mobile and wireless technologies like POS, kiosks and tablets in stores. What are some of the core issues they should be looking at?
Compliance, PCI, Retail
To say that mobile technology is impacting brick-and-mortar retail is akin to proclaiming at the turn of the last century that the motorcar just might change the horse-drawn carriage business. Shoppers today are empowered by technology to gain the advantage at every turn, whether it’s using a smartphone to find the best price for the same product online, locate out-of-stock sizes or colors in the store next door, or learn what their friends or other customers had to say about a product before they buy.
Retailers have two choices.
They can pretend this isn’t happening and actively try to discourage these new consumer behaviors, like not offering in-store Wi-Fi for fear of increased showrooming (see Free Wi-Fi is a Win-Win for Retail Marketers and Customers ). Or, they can listen to their customers and do everything in their power to meet their changing needs and expectations.
Did you know that 80% of mobile consumers are influenced by in-store Wi-Fi as a factor in deciding where they shop?
By Lina Arseneault
In early 2013, IDC issued the updated version of its IDC Retail Insights report outlining the top 10 predictions for the world-wide retail industry. One of the report’s authors is retail research director Leslie Hand. She and I recently met at IDC’s Directions annual conference in Silicon Valley to discuss the recently published report.
Most of our discussion centered on the first four predictions from IDC’s top 10 predictions list.
- Omnichannel Retail Maturity Will Move from Foundation to Convergence and from Precision to Immersion
- Retailers’ Omnichannel Objectives Will Require Platform and Architecture Investments
- Retailers Will Invest in Customer Analytics, Merchandizing, and Marketing Technologies to Curate Commerce and Contextualize Communications
- Retailers Will Pivot Merchandizing and Marketing on Customer Analytics to Drive Revenue and Profit, Relevance and Reciprocity Being the Watchwords
RSR Research and AirTight Discuss the Benefits of In-store Wi-Fi
Webinar: Wi-Fi as a Competitive Retail Advantage | Date: April 30,2013 Time: 11 AM Pacific
Leslie and I agreed that consumers are forcing retailers to act faster than they traditionally have and that this type of pressure is only likely to increase. Digital and physical interactions are increasingly intertwined and consumers are demanding that retailers engage with them on these terms.
Retailers are realizing that knowing more about their shoppers can be the key to building relationships and boosting sales.
Retail Motion Infographic
80% of mobile consumers are influenced by in-store Wi-Fi as a factor in deciding where they shop
Retailers serious about meeting the customer expectations challenge head on can make continuous nurturing refinements based on retail analytics. Savvy retailers will need to make the most of their Wi-Fi networks to not only drive sales but also to build up CRM programs.
Leslie and I rounded out our conversation by touching on AirTight’s experience in working with PinkBerry, the five year old Los Angeles based Brand best known for its highly popular handcrafted yogurt bar. Central to the PinkBerry promise is the belief in the power of human connection. Accordingly, the driving force behind PinkBerry’s Wi-Fi deployment was the launch of The Pinkcard, PinkBerry’s loyalty program and mobile app; as well as requests from store customers and owners for Wi-Fi access services. The company exceeded its three-month goals in just one month.
I can think of no better way to close our this blog post than by letting (virtual) Leslie Hand touch on the new retail paradigm and the opportunities it presents.
View the YouTube video, Mobility: The New Retail Paradigm by Leslie Hand.
Note: A version of this blog was originally published as a guest post for the PurpleWifi blog.
Really interesting article in Forbes by Verne Kopytoff on the reasons retailers have recognized the value of Wi-Fi for their customers and business processes. He notes that after years of resistance, stores have conceded that the shoppers have won the war. They want Wi-Fi and they will use their smartphones to check out deals.
There is no doubt that Wi-Fi has many positive effects on the shopping experience and, I would suggest, those effects outweigh the negatives of comparison shopping online in a store. There is also the obvious benefit of making sales associates more efficient and able to serve more customers faster. Anyone who has ever gone into an Apple store near Christmas – and really who has not – has experienced just how fast one can get in and out even in a crowd.
However since retail stores have been late to this party, they need to think about the security implications of adding Wi-Fi and continuing to comply with the PCI DSS wireless scanning requirements. Kopytoff points out that several large retailers added Wi-Fi capabilities just before the holiday season, which is unusual in and of itself since retailers rarely want to disrupt their systems too close to the holidays. In haste, they may have overlooked adding true Wi-Fi security processes to protect credit card data. It will be interesting to see if any problems arise during this season of manic shopping.