WIRELESS: THE NEXT GENERATION

PETER PERROTTA

It plays in the U.K. But so far, it hasn't in Peoria.

It's a wireless personal shopper. Each individual supermarket customer gets one to roam the aisles with, scanning items as they go. When the shopping trip is completed, they proceed to the checkout. One swipe of the debit card and off they go. It's the EZ-Pass of the checkout aisles, if you will.

Tom Murphy, president of Peak Tech Consulting, Colorado Springs, Colo., and former vice president of information systems, Kroger Co., Cincinnati, said Safeway U.K. uses a wireless M-commerce (or mobile commerce) device manufactured by Symbol Technologies, Holtsville, N.Y.

"This is the killer ap," Murphy said. "It's the ultimate from a customer's standpoint."

Murphy said it's the ultimate because not only does it allow supermarket operators to save on front-end labor while cutting down long checkout lines, but it allows, for the first time, operators to "engage" the customer while they shop.

"It's about engaging you in the aisle," Murphy said.

Equipped with the proper technological infrastructure (note: most operators are not even close to having it yet), the supermarket can market to you one-on-one by using mobile commerce or M-commerce.

Murphy said that the wireless personal shopping devices come equipped with the capabilities of sending you m-coupons tailored to an individual's shopping habits.

"In grocery, it's about communicating with the customer while they are in the store and before they check out," Murphy said.

As an example, Murphy said that if a customer scans a ham, an m-coupon could automatically be sent to their wireless personal shopper for cents off on a particular brand of mustard.

"The customer is identified when they check in and get the personal [wireless] shopper," Murphy said. "So if it is a valued customer, you can automatically do CRM by giving them a 10% discount," he said.

"This is a real-time promotional device," he added. "They can market you the whole way through the store."

While the wireless personal shopper is being used in Safeway stores in the U.K., the application has not taken hold in the States yet.

Industry insiders said that both Safeway, Pleasanton, Calif., and Kroger test-piloted forms of the wireless personal shopper in the United States. For now, those pilots have been shelved.

Sources said Kroger piloted the wireless personal shopper for three years in two stores in the Nashville, Tenn., area but could not get customer acceptance. At the time, Kroger officials were not looking at the device as a marketing tool, though they were testing it more for the benefits it could provide in speeding the checkout process.

Murphy said inherent differences in the architectural layouts of supermarkets in the United States and Europe go a long way in tilting consumer acceptance of the wireless shopper.

He said that in the U.K., where stores are smaller and checkout lines longer, customers are a lot more willing to try something that will get them out of the store more quickly.

In the United States, where checkout lines aren't as long to begin with, supermarket operators are more apt to increase the size of the front end or just build bigger stores when confronted with a similar problem, Murphy said.

However, that doesn't mean U.S. retailers don't have their eye on the ball when it comes to this one particular element of M-commerce.

Kmart Corp., Troy, Mich., recently announced an agreement with Symbol Technologies to implement in-store wireless and mobile computing solutions in its entire chain of more than 2,100 stores.

With Kmart's recent announcement that it is considering converting up to 1,000 existing discount stores to the supercenter format over the next 10 years, this could have significant implications in the M-commerce food-retailing arena.

"Kmart's decision to invest in a global rollout of ... wireless and mobile computing solutions will help to achieve our strategic imperatives of world-class execution and developing a customer-centric culture," said Michael Jones, divisional vice president, information technology and customer experience, Kmart. "This technology builds the infrastructure to enable every department companywide to be linked and able to better satisfy and serve our customers."

For now, Kmart is going to implement a wireless local area network (WLAN) and wireless handheld mobile computers. The system will be used for back-end applications such as receiving, inventory and label printing.

Kmart isn't the only retailer that is making use of these first-generation wireless devices. There are several others.

Murphy points out that much of the M-commerce applications are currently being used in the back end of operations and for logistics in warehouses.

However, he's also quick to point out that retailers can't run before they crawl with these applications. He notes that the needed infrastructure has to be in place before a retailer can get to the more advanced applications like the wireless personal shopper.

During a recent conference, Jeff Smith, managing partner with Accenture, spoke of a wireless shopping world where cart-wielding shoppers place items embedded with source tags into their baskets to be automatically scanned and totaled. Once the shopping trip is complete, a swipe of the debit card reader attached to the cart is made and out the door you go. What front end?

While those days may seem like an eternity away, just remember, most of us weren't logging on five years ago, either.