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EXPERT ANALYSIS: Wireless in retail

Location-sensitive technologies and wireless devices are starting to turn mobile commerce into reality rather than just hype for retailers. The new technologies can help reach new customers, strengthen ties with existing customers, stretch advertising budgets, and facilitate vital real-time communication of information to store managers and field personnel.

There are several different location technologies involved, the best-known being Global Positioning Satellite, or “GPS,” which can locate a wireless device to an accuracy of from 50 yards all the way down to 5 feet.

‘Pull’ vs. ‘push’

Mobile commerce technology will open the doors for merchants to talk to consumers in their immediate areas. There will be two types of delivery methods for this communication. With “push” technology, messages are sent to a consumer causing their mobile device (cell phone, pager, WAP phone, wireless PDA) to ring or vibrate alerting the user that there is information in which they might be interested.

There are some definite problems with this delivery method: The consumer will be very frustrated if these messages turn out to be less than earth-shaking, and is likely to find the messages intrusive. Imagine a consumer sitting in an important client luncheon and having her wireless device trying to alert her of free fries with the purchase of a large burger at the fast food establishment across the street. Secondly, since the consumer is paying for the airtime, those messages will be viewed as a cost to her. While pertinent messages may result in welcome savings, most will be viewed angrily as “spam.”

A more acceptable method is permission-based, or “pull” technology, in which the user must go into the device and request (or “pull”) the information. It allows retailers to reach consumers at the exact moment they are interested in buying, resulting in a pre-qualified prospect being reached with a very welcomed message. Consumers are essentially telling the retailer, “Here I am. This is what I need. Where is the best place to get it?”

Used efficiently, mobile and location-sensitive technology offers retailers the advantage of always having Internet communication and processes available. Searching for data (internal/enterprise communication with remote locations and outside sales force), inventory monitoring and control, comparison shopping, using mapping services, finding movie times, checking stock quotes, and many other sources of information will always be available. As retailers add the ability for consumers to receive pertinent messages by request, while in the neighborhood, they will save more time, and perhaps more money.

A wireless pioneer

Current wireless applications are geared toward “opt-in” messages. A good example is the recent “Go Power Shopping” program ( at Palisades Center in West Nyack, N.Y. Just in time for the busy holiday shopping season, approximately 75 of 225 stores at the center began working with GeePS, Inc., a wireless ASP (, and implemented a variety of wireless technologies to help brick-and-mortar merchants develop stronger relationships with consumers through distribution of pertinent messages. The consumer offers a profile and merchants can send messages — provided they fit that profile. The better the match, the better the chance for a successful visit to that merchant.

This opt-in messaging enables communication about products, the environment, and geography. The messages should be localized and not of a general or national level. Consumers want to receive information about pertinent products — an umbrella because it's raining, gloves because it's cold. Let the environment and geography add to the marketing message, and let the technology deliver it wherever and whenever it is most likely to result in a sale.

Wireless technologies will be used in enterprise solutions as well. The store manager could review the merchandise presentations while viewing yesterday's best sellers, top sales associates, and strongest classifications. This information would be available to all appropriate parties (corporate management, sales force, and so on) in real-time through wireless devices.

As with anything new, there are some obstacles that must be overcome. Even though enterprise and customer care solutions could work well today, many retailers remain hesitant.

Another obstacle is waiting for consumers to fully embrace wireless retail. More than 500 million people now have wireless devices, with 150 million in the United States alone. The newest mobile phones will be location-enabled to comply with E-911 laws, originally designed to better facilitate emergency services. As a result, all phones sold since March 2001 must be location-enabled, which creates new commercial possibilities.

Endless possibilities

In the not-too-distant future, complete wireless transactions will take place. This could even lead to a need for fewer cashiers and free up other store-level employees to provide better customer service. A recent futuristic commercial showed a person walking through a supermarket and never having to get in line to pay. Similarly, new technologies will make it possible for a hurried consumer to enter a store, select an item (either with or without the help of a salesperson), and complete a wireless POS purchase on the front end. The transaction and recording of inventory status will simultaneously take place on the back end — with no need for human interaction. Even the short-term possibilities are limited only by the willingness of retailers to embrace the brave new world.


Jim Wells is VP of sales and marketing for GeePS, Inc., a location-sensitive Wireless Applications Service Provider (WASP) focused on brick-and-mortar merchants and malls. He has more than 30 years of retail experience in merchandising, marketing, and stores management. You can contact him at [email protected].

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