Why Retailers Resist Data

By Evan Schuman  |  Posted 2006-03-23 Print this article Print

Sharing"> By using search engines as makeshift "inventory visibility tools," McAteer argues, retailers could find search engine referrals sharply increasing their revenue by allowing local finely tuned searches. That said, the practical issues that retailers face today pose some huge obstacles to this kind of data sharing, McAteer said. Fears about sharing proprietary information in a way that direct rivals could easily access is certainly going to be a psychological barrier, he said, but its one that will likely fade as more of the industry makes the move.
The potentially biggest hurdle is that many retailers today simply cannot provide that data for Google because they cant easily access it even for themselves.
"Google is one of the best companies at organizing the worlds information," but it cant organize what retailers cant provide, he said. "Retailers cant even give us what is the stores today," McAteer said. "I have had dozens of meetings with C-level executives at retailers," and online data control "is only one portion of what they do everyday" and would not likely be a near-term priority. "Some will make it a priority," he said, but "I think they see it as something not as important to them as it should be." McAteer said most retailers see search as a good distribution channel, but they have a hard time making it a strategic priority. "Is there an ROI for it? Do I have the resources to do it internally?" he asked. "They either dont see the opportunity or they dont have the resources or both." What will ultimately motivate them? "Their competitors will do this." The corporate priority is not merely to make the data available, but to have it cleaned up internally. Many retailers, McAteer said, couldnt do this today even if they wanted to. "They can see at the corporate level when Crest moved off the shelf in Palo Alto, but they cant push the data out," he said. Googles plans also call for Web analytics for retailers and helping to identify an accurate list of synonyms and likely spelling errors for their internal searches. But McAteer isnt the only e-commerce future-predicting executive engaged in Google Gestalting. In another part of the Google galaxy sits Deep Nishar, a Google director of product management who is focusing on the handheld/smart phone/mobile environment. As PDAs and cell phones become more sophisticated in the ways of Web and SMS, they are expected to start having a significant impact on e-commerce. That isnt a reference to literally using the PDA/phone as a payment device—although that is likely to happen as well. No, its a reference to what many in e-commerce believe will be a very significant change for e-commerce in the next year or two. Its what will happen when the online world starts regularly intruding into the offline world. Envision a consumer pushing an oversized cart down the aisles of Costco, while searching for items on Costco.com. No need to try to find a rep to see if the store has a particular microwave size and color in stock or to see a demo of the product. "Is this really a good price?" the hypothetical consumer asks, seconds before clicking to one of several price-comparison Web sites. The consumers PDA/cell phone will likely have a bar code/RFID reader to make such comparisons faster and more precise. Or that consumer may be inside a crowded mega-mall during the height of holiday shopping and will use her mobile device to help determine which store to shop in based on an almost real-time inventory report. Although such a near-future view has been discussed in the offices of most of the major retailers, very few have been actively programming and designing Web pages with the mobile user in mind. Next Page: How far away is true mobile e-commerce?

Evan Schuman is the editor of CIOInsight.com's Retail industry center. He has covered retail technology issues since 1988 for Ziff-Davis, CMP Media, IDG, Penton, Lebhar-Friedman, VNU, BusinessWeek, Business 2.0 and United Press International, among others. He can be reached by e-mail at Evan.Schuman@ziffdavisenterprise.com.

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