Circuit Citys New IT Approach to Customer Service

The $10 billion retail chain is looking at virtual sales reps via wireless headphone, RFID-enhanced loyalty cards and CEO phone calls to checkout aisles. A new approach indeed.

When major customers walk into a Circuit City location, CIO Mike Jones wants to whisper customized sales pitches into their ears—literally.

Joness scenario is simple: As customers walk into the store, they receive a very light wireless headset. As they walk through the store, the device uses sensors to learn where the customer is. When the customer stops in a certain area, the headset can explain items, present audio from a TV demonstration and potentially even connect the customer live with a centralized sales assistant. In theory, that sales assistant might be 2,000 miles away—assuming no one in that store is available.

The headphone helper is just one of several non-traditional ideas that Jones is trying to push through the $10 billion retail chains corporate structure. As senior vice president and CIO, Jones knows how much of a structure the chains 1,648 U.S. and Canadian locations pose.

Jones uses the popular corporate phrase that retailers today must "surprise and delight" their customers. Many chains mouth a "surprise and delight" strategy while unveiling marketing strategies as radical and unexpected as Fourth of July clearance sales.

But Jones is trying to put mental muscle behind that phrase. Why? In many respects, the answer is long-term survival.

"The consumer marketplace today is very much a polarizing place. You have to decide where you want to play, and we are not going to win on price," he said. He reasons that radically improving customer experience is mandatory, especially when selling products that—for the most part—are also offered by their largest competitors.

/zimages/3/28571.gifThe CIO of another consumer electronics chain—Tweeters—is also looking at letting customers literally into their living rooms. To read more, click here.

For example, most retailers today are offering buy online, pick up in store programs. Jones wants to do that one better. The system will know the ZIP codes of registered users. When orders are placed, the system does a lookup and determines if there is a Circuit City within so many miles of the customer. If there is, the system can offer to have a store employee deliver the merchandise to the home, Jones said.

Putting aside the delivery charge issue, this program has several strategic benefits over a delivery from Federal Express or UPS. First, this sidesteps the inventory problem by giving the retailer a little extra time to find the product. Second, there is the branding and customer service advantage of having the product delivered by "a Circuit City-logoed shirt driving a Circuit City-logoed truck," Jones said. And there is the future potential for having that employee install the system. With that installation comes the CRM (customer relationship management)-oriented intensive knowledge of all of the other electronic components that customer owns.

Another Jones scenario: When customers are at the checkout line making a large purchase, have an alert go to the chains CEO. In theory, the CEO could phone that checkout aisle and speak with the customer, thanking him personally for the order. "Thats surprise and delight," Jones said. Can he make it happen? Jones said he is still working on it.

Next Page: RFID customer tracking.