A year after launching its mobile app and website, BellStores has begun offering digital coupons—a technical quantum leap made possible after the company joined an app provider’s pilot test.
Already, the 54-store chain based in Massillon, Ohio, is reaping benefits. In addition to strengthened relationships with consumer packaged goods (CPG) vendors, customers have voted with their feet via increased traffic, says Jake Patton, marketing specialist for Campbell Oil, which operates BellStores.
“And they’re not just picking up a free product,” he says, pointing out that 600 customers use the app daily—a number he finds impressive. “They’re putting other items in their baskets as well.”
Through ties with software-as-a-service (SaaS) partners—think app providers, digital-coupon third parties, cloud-based security providers and even enterprise-solution providers that offer such off-premise services—the riptide of energy around mobile apps and the greater use of data standards have allowed retailers such as BellStores to dive into new technologies faster and with more punch.
Getting Tech Started
But not all retailers are like BellStores. From a tech standpoint, many are still focused on EMV (Europay Mastercard Visa), the liability changes that have forced them to upgrade in-store point-of-sale (POS) registers and budget for future pump upgrades or replacements.
However, as those eff orts conclude, the hunger for data analysis, basket building and customer affinity will undoubtedly phase in. If so, the channel may be on the threshold of a seismic shift in technology sophistication and use.
“We know path of purchase with technology has become complex,” says Kim Yansen, director of field shopper marketing for Mondelez International, Deerfield, Ill. “It’s really an anytime, anywhere [activity] where the brick-and-mortar of yesterday is not the brick-and-mortar of the future.”
To help foster that future, the snack and candy manufacturer has set up a creative project involving tech startups and retailers, grouping them with its brand teams to formulate new technology solutions. (See story on p. 188.)
Yet amid the optimism, the ball and chain of retailers’ legacy systems stand as both a barrier and a ladder to innovation. New solutions such as mobile apps or fuel-pricing services layer onto the automation a retailer already has, which can include a POS register, back-office software and home-office accounting system. Management, reporting and human-resource software may also be in place along with other office and administrative solutions. (See illustration on p. 190.)
Often, these solutions tie back to the POS, says Gregg Budoi, CFO and executive vice president of Kalibrate Technologies, Florham Park, N.J. The key is to translate the POS data up to the solution provider so the company can analyze it and deliver reports back to the retailer.
A middleman solution often comes in, according to Alvin Fortson, senior principal consultant for Impact 21 Group, Lexington, Ky. (See his column on p. 194.) That provider can take data from one source—the retailer, for instance—“massage” it and deliver it to a third party for action.
In the case of BellStores, its mobile-app provider, GasBuddy/OpenStore, Gaithersburg, Md., goes through an “onboarding” process so the chain’s POS devices can handle the digital coupons. It involves creating compatible languages between vendors as well as ties to coupon clearinghouses that settle up with the retailer, according to Tony Chidiac, vice president of retail for GasBuddy/OpenStore.
“The trouble is, not all retailers are able to provide every piece of information [needed]; they may have the transaction number and date but not the exact time,” Chidiac says. “But when the data goes back to the CPG company, they require it.”
Assisting with Automation
The translation issue runs through the entire supply chain. Team leaders at PDI, Temple, Texas, describe a similar problem they’re tackling by developing a supplier-to-retailer pricebook solution.
In describing its goal, Jim Cornette, vice president of supply chain services for PDI, says every product in a c-store has a unique set of product information, such as its description or UPC. A supplier will typically send that description update in a PDF file along with hundreds of other product descriptions to someone at the retailer’s office.
That person will have to sift through the data to find updates. Cornette and his team hope to automate that task.
In addition to data arriving in a variety of inconsistent file formats, the problem is compounded by a lack of proper information technology (IT) infrastructure within the supply chain, Cornette says. “Smaller retailers with 10 to 20 stores may not have the IT horsepower,” he says. “Or on the flip side, certain suppliers don’t have the bandwidth.”
The question for many retailers going forward is one of platform. More tech-savvy companies may have what are known as “enterprise” systems, which integrate several key solutions covering accounting, human resources, pricebook, POS, back-office and other core functions. Other retailers may use disparate tools that don’t talk to each other. Still others may use SaaS in the cloud. Worst case, some write everything by hand.
Mohammad Khawaja was one such retailer who did much of his paperwork manually before becoming automated and eventually founding his own SaaS. As CEO of CstoreOS, Waxahachie, Texas, he can now save retailers as much as five hours a day in eliminated paperwork. Though store employees must still enter in data such as sales numbers and clock-in times, his solution automates a core set of tasks critical to c-store operation such as payroll, shift reporting and inventory.
Khawaja has even implemented a social-media element that allows his retailer subscribers to notify their Facebook followers of regular year-round supplier promotions.
Integrate or Emerge
For mobile solutions to migrate into such a fragmented retail environment, a couple of scenarios may emerge: Translation middleware will proliferate, or the mobile solutions will need to either integrate into or emerge from existing platforms.
According to Drew Mize, COO of The Pinnacle Corp., Arlington, Texas, mobile solutions are simply delivery methods of established platforms. As automated systems in the c-store space evolved, so too have the tools to gather POS data, analyze and deliver reports. Taking that trajectory, he believes mobile apps will be an extension of an integrated solution.
The apps may or may not come from a single enterprise-solution provider, Mize says. Rather, enterprise solutions must allow for integration with best-in-class providers. “But whether you have two or 20 apps, how are you going to put your mobile strategy together?” he says. “You’ve got to build on top of a central platform that can support those systems.”
The end goals vary—everything from eliminating paper to engaging the customer—but Mize says the new challenge will be a convergence to mobile. “Every one of the things we provide today—from back office to loyalty to business intelligence to pricebook—will have a mobile experience,” he says. “That way, retailers can manage their entire mobile strategy from one system.”
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