2-D Bar Code to Hit U.S. in April

By Evan Schuman  |  Posted 2008-01-13

2-D Bar Code to Hit U.S. in April

The two-dimensional bar code is going to make its United States debut in April 2008 at several New York consumer electronic and cosmetic retailers, according to Herve Pluche, president of 2-D bar-code vendor StoreXperience.

Pluche said he has cut the first-ever 2-D deal in the United States, with a rollout scheduled at five locations in Manhattan. Asked if that rollout was definite, Pluche said that no agreement has been signed but "we do have a handshake."

The purpose of 2-D bar codes is to leverage two elements of a typical smart phone-the digital camera and a Web browser-to create a rich, two-way data exchange between retailers and consumers.

The way it works, a consumer might see a poster for a particular product-or a model wearing interesting clothes-and want more information. That shopper would aim his or her smart phone at the 2-D bar code. A small applet on the phone would interpret the bar code, launch a browser and go to a very deep link within that site.

The consumer gets details about what the model is wearing or what the product's specs are, along with a link allowing him or her to purchase the items immediately. Beyond the potential sale, the retailer or manufacturer would learn an quite a bit about that consumer transaction.

The very lengthy URL hidden in that 2-D bar code identifies the exact location of every such consumer transaction. Depending on the software being used, there is an excellent chance the consumer can be identified and associated with his or her purchase history. All of this from a tiny picture hidden unobtrusively in a corner of the poster.

However, only smart phones running BlackBerry and Symbian operating systems will be able to participate in the trial, meaning that Apple iPhone and Treo users are out of luck. Asked if the goal is to support iPhones by September, Pluche said, "Absolutely."

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The StoreXperience trial also requires customers to download a 200K rich client. Consumers who can't do that can go to a Web site and select the retailer and key in an eight-to-12-digit PUC code visible below the 2-D bar code. "But the rich client is far superior in terms of experience," Pluche said.

Pluche wouldn't say which retailer had agreed to the five locations, but did reveal that it was a chain focused in either consumer electronics or cosmetics. Pluche said he has met with 10 retailers and that all are very interested, although he wouldn't identify them.

Different Metrics for Different Folks


A slide presentation obtained by eWEEK, however, did identify Best Buy, the Gap, Nordstrom and Target as "already engaged."

Calls and e-mails to those retailers were not returned at press time.

Those slides said that all of those retailers-except for Gap-were being recruited in a "joint effort with the Microsoft Retail Group."

StoreXperience has been selected as a member of a Microsoft marketing support program that has yet to be announced, according to officials working with StoreXperience. The vendor will have a booth at the National Retail Federation's tradeshow within Microsoft Alley.

Other companies said to be involved in these talks are the Simon Property Group, French telecommunications company France Telecom and Epson.

The financial return-on-investment picture is complicated. Pluche said pricing for retailers will range widely, depending on the number of stores and average revenue. But he will insist on the retailers paying enough "to rule out companies that wouldn't be committed to the endeavor." He said for retailers that are among the largest 50 in the United States, he'd want to receive anywhere from $250,000 to $450,000 to participate in a trial.

The complicated part is that different companies being talked with have very different goals for the kinds of results they want. Best Buy and other specialty retailers, for example, are focused on delivering a strong purchase-to-visit ratio.

According to the slide presentation, Best Buy and the other specialty retailers intend to use the 2-D bar codes to "effectively compete with online shopping" and to prevent the store from "becoming a simple showroom." Whether the intent is to help their brick-and-mortar operations lose fewer sales to their online arms, or to compete more effectively against the online operations of other retailers is not clear.

The goals are different for brands and franchises such as Epson and the Gap. For them, the performance metrics are average spend per visit and creating "new upsell and cross-sell opportunities," the StoreXperience document said. They also intend to "create competitive advantage by transforming the customer experience."

For companies including Simon Property, Nordstrom, Target and France Telecom, the performance metric is simply consumer adoption and usage, along with delivering to the consumer "contextual advertisings [sic] and promotions."

After the April rollout, the company expects to have a next-phase series of rollouts in the fall, most likely in September, Pluche said.

 Retail Center Editor Evan Schuman can be reached at eschuma@earthlink.net.

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