Data security stood yet again as a critical issue, attracting almost half the participants to its committee sessions. The interest comes at a time when major-oil companies, in the midst of divesting themselves of retail assets, try to keep marketers, operators and dealers compliant with data-protection mandates set [image-nocss] by the nation's largest credit-card companies.
"As a franchisor, you want to protect the brand [from a data breach]," said Todd Michaud, vice president of technology, Focus Brands, Atlanta, which runs restaurant brands such as Cinnabon, Carvel, Schlotzsky's Deli and Moe's Southwestern Grill. "But the [franchisee] doesn'twant to spend the money on new equipment."
Franchisee education, he went on to say, was "no magic bullet," likening the data-security message to an "overweight person being told to eat better and exercise, or face heart disease. That won't lead to action."
Michaud called for increased accountability, despite the relative complexity of some of the mandates, known primarily as Payment Card Industry or PCI standards. These rules were a big topic last year, when mandates affecting virtually all levels of merchant either went into effect or were pushed back.
In his approach to Focus Brands franchisees, Michaud concentrates on "scope reduction" or taking as many electronic connections out of the scope of the plastic-card transaction as possible. As a result, many of his recommendations are confined to the most basic transaction loop. Other "bolt-ons," or additions such as remotely monitored video cameras, would require a separate computer system.
The hope, said Michaud, may be in new "disruptive" technologies. Without naming specific examples, he said what's needed are technologies or actions that will help shift the burden of data security more evenly across consumers, merchants and their business partners.
Data security is a high priority for NACS members overall, said Gray Taylor, executive director of PCATS or the Petroleum Convenience Alliance for Technology Standards, Alexandria, Va., which is part of NACS. The concern is not only for ongoing PCI compliance, but also for potential softening of the card-swipe legislation signed into law last year. As the government writes regulation that will enforce the new law, he said a stipulation that would allow banks to recapture some lost revenue may set back what many retailers call a victory over interchange fees.
At the PCATS conference, working committee sessions were the main thrust. Here's a breakdown of that activity: Data security. Members reviewed proposed documents that suggested ways to set up a store's point-of-sale (POS) network that could potentially lead to PCI compliance. Discussion centered around proper ways to communicate to smaller chains and independent operators so they would understand the complexity without being discouraged. The group also reviewed a new oil-company online training module and discussed accountability, since the program recorded how far individual employees got in the course. POS/Backoffice. The group spent time developing a document that would continue to improve existing standards, while starting to address increasingly complex matters such as taxes, market-basket research, promotions and combos. Loyalty. Committee participants worked to enhancing current standards, with one of the efforts addressing payment rewards as a way to encourage consumers to pay in ways that were more cost effective to retailers.
Other committee work occurred in the areas of device integration and business-to-business data exchange for both merchandise and motor fuels.
This year's conference also represented the first PCATS meeting since its merger with NACS, the nation's largest convenience-store association, last fall. Taylor said the association's strengths in administration, marketing and event planning allowed PCATS to focus on its technology mission. "Each effort saves $2,000 here, $2,000 there," he said. "Soon you have $50,000 to $60,000 to spend on member benefits."
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