FOR TECHNOLOGY INNOVATION, TAKE A LOOK ACROSS THE POND 2004-01-19 (2)

Michael Garry

At last week's National Retail Federation convention in New York, the big buzz on the exhibit floor was not generated by one of the many technology vendors who come to this and other retail shows every year. Instead, it came from an unusual source -- a retailer.

That retailer is Metro Group, the largest retailer in Germany and the fifth largest retailer in the world. Metro Group, through its partnership with some 40 other companies in what is called the Future Store Initiative, demonstrated many of the in-store systems it is testing in Europe in a remarkable 13,000-square-foot exhibit at the NRF show.

There at the Future Store exhibit, led by a team of tour guides, one could see first-hand such devices as the intelligent scale that automatically recognizes and weighs fresh produce, the personal shopping assistant that displays a range of product and promotional information while enabling self-scanning and checkout, and smart shelves that use RFID (radio frequency identification) technology to track inventory in real time. These and other devices have been undergoing tests in Metro's famed Future Store, an Extra supermarket in Rheinberg, Germany, since last April.

Metro also used the occasion of the NRF show to announce its very ambitious plans, not unlike Wal-Mart's, to have its top 100 suppliers put RFID tags on pallets and cases in Germany (see story, Page 41). Its chief information officer, Zygmunt Mierdorf, also told me about Metro's plans to begin installing some of the Future Store systems, notably the intelligent scale, in other German stores.

What Metro is doing here is unlike anything I've ever seen in retailing, in the food sector or elsewhere. In a very measured and methodical way, Metro has dedicated itself to advancing the cause of retail technology not only for itself but for retailing as a whole, sharing many of its results with other retailers. It is working closely with consumers to gauge their reactions to the systems and determine if there is real value in them and how to improve them. And it has partnered very shrewdly with many of the top technology vendors in the world for both funding and research in a way that will benefit all involved. While it certainly made the biggest splash at the NRF show, Metro was not the only European food retailer -- at a show, interestingly, not normally geared to food retailing -- to discuss its technology initiatives. U.K. supermarket giant Tesco, another world-class user of technology, also discussed its plans for employing RFID, primarily for entertainment and electronic products. The CIO of Tesco's chief competitor, J. Sainsbury, spoke about working with consumers to remodel a store; and Carrefour, the French retailer, spoke about its progress with data synchronization.

We Americans rightly take pride in our high-tech prowess and achievements, but, apart from Wal-Mart Stores and a handful of others, few U.S. retailers can match the commitment to innovation demonstrated by these companies across the pond. Metro especially is showing a commitment not only to its own development, but to the advancement of its partners and competitors, realizing that in technology common goals and standards are the key to success. It's something worthy of study by stateside retailers.