Service Levels of Leading Retail web sites

by Deepak Sharma on Thursday, January 31, 2008

Keynote Competitive Research has just released the results from its U.S. Holiday Impact Study, a Web site performance monitoring study that examined the technical performance and service levels of 26 leading retail Web sites over the course of the 2007 holiday season. The retailers included, Amazon, Barnes and Noble, Wal-Mart, Best Buy, Circuit City, Sears, Raget, Victoria's Secret, Cabelas, Dell among others. To measure the service levels, Keynote used its Transaction Perspective automated testing agents to mimic the actions of a consumer using the Internet Explorer browser to interact with sites. The results were as below:

Site Reliability

(Highly Available, Low Downtime)

  Site Responsiveness

(Response time, Transactions Completed)

#1   Cabelas   #1   Victorias Secret
#2   Barnes and Noble   #2   Circuit City
#3   Best Buy   #3   Cabelas
#4   Toys R Us   #4   Best Buy
#5   Target   #5   REI
As per the report abstract, the following came out of the study:

Very few sites struggled with Load Handling throughout the entire holiday period
- Does not mean that on peak days there were not issues
- It does mean that overall the sites planned appropriately for the period load
- Only 3 of the 26 sites had any significant issue with this metric
Availability was mixed
- Top 10 sites better than 98.5%
- Top 7 above 99.0%
- Best Buy, Barnes and Nobel and Cabelas above 99.5% for the entire period (Stellar!)
- 8 sites under 97%
Outages showed similar mixed results
- Cabelas and Barnes and Noble did not report a single hour of outage
- 3 sites reported over 20 hours of peak period downtime
Dial-Up users would have had a rough season
- Keynote captured sites with Home Pages taking over 100s (one taking over 300s)
- However, once users were past Home Page and Search Results most sites provided an acceptable experience for dial-up users (24s per page on average)
Broadband performance showed similar “divide”
- Best sites averaged less than 1s per page while the bottom performers averaged over 3.5s
- Search, Home Page and Product Details were generally the slower areas of the site

New Interesting Retail Blogs, Part 3

by Deepak Sharma on Sunday, January 27, 2008

I guess it's becoming a habit to search for interesting Retail blogs. Here's three more additions to the ones I have pointed out before here and here.

Nikki Baird's Retail Tech Stories - From Nikki's brand new blog - "As consumers adopt technology, one of the first places they bring it is to the shopping experience. How do retailers, traditionally tech laggards, adapt? These are my experiences and stories from the front lines of this shifting landscape."

Retail Detail with Margaret Brennan - Margaret is a reporter with CNBC and writes on consumer spending and the retail industry.

Reuters Shop Talk - From the blog - "Working the retail beat track - who’s buying what, how much they’re paying, which retailers seem to be getting it right and which are looking to clear the shelves with discounted clearance sales."

Enforcing RFID

by Deepak Sharma on Sunday, January 20, 2008

Most of the times, some muscle is required to enforce rules and policies. Wal-Mart seems to be doing exactly that. To justify investments and contain costs of tagging RFID tags to unmarked pallets from Sams Club suppliers, Wal-Mart will charge suppliers a $2 fee for each pallet they ship to its Sam's Club distribution center in Texas that doesn't have an RFID tag.

Wal-Mart has apparently tired of its investments in radio frequency identification turning into a prolonged pilot study and is stepping up pressure on suppliers to comply with its 3-year-old inventory-technology mandate. The retailer says that beginning Jan. 30, it will charge suppliers a $2 fee for each pallet they ship to its Sam's Club distribution center in Texas that doesn't have an RFID tag. The charge is to cover Sam's Club's cost to affix tags on each pallet, says a Wal-Mart spokesman. "It's really designed as a short-term solution for those suppliers that may need a little more time to implement their own tagging solution," he says.

The retailer hasn't taken such a strong-arm approach yet with the more than 15,000 suppliers that still haven't complied with its request to tag pallets and cases headed for its Wal-Mart stores. Instead, it seems focused on turning its 700-store Sam's Club warehouse-outlet division into an example of RFID supply chain technology in action, down to requiring item-level RFID in 22 distribution centers by 2010. It makes sense: Sam's Club has far fewer suppliers than Wal-Mart stores, and customers buy products by the case, the pallet, or individual packages that are larger (like a 48-count box of granola bars) than what's typically sold in retail stores. That means fewer RFID tags, at about 20 cents a piece, which makes the cost more digestible for Sam's Club suppliers. The division contributed $41.5 billion to Wal-Mart's $344.9 billion in revenue for its 2007 fiscal year.

Immersive Retailing

by Deepak Sharma on Wednesday, January 16, 2008

ibm-logo Lot of news coming out of National Retail Federation (NRF) 97th Annual Convention & Expo which is taking place in New York. While there are many interesting topics to share with you all, I wanted to point out at Immersive Retailing technology that IBM showcased. According to this press release:

At NRF, IBM is demonstrating future innovations which could help retailers create unique consumer experiences. Through the use of 3-D technology, virtual worlds and some imagination, IBM is showing how retailing is moving beyond the walls of the store into the hands of consumers. For example, new "Immersive Retailing" technologies which immerse consumers into an experience are one example of how retailers could augment their strategies to attract and interact with customers in ways which build loyalty.

One of the "Immersive Retailing" demonstrations IBM shared with customers is the IBM Multi-Sensory Experience. Through the use of 3-D glasses, participants are treated to a fashion show from Europe complete with music and smells. For example, as a model walks down the runway her perfume will be noticeably in the air. Also, when she holds out the very expensive leather purse viewers will get a 3-D view of it you all will be able to smell the fine leather.

IBM treated customers to another "Immersive Retailing" demonstration called the IBM Cave. Meant to complement a multi-channel retailing experience, this demonstration brings the user into a virtual reality experience using a 3-D virtual world and stereoscopic goggles. These goggles react with the head movement of the user and create 360 degree view of a virtual reality room. IBM uses the technology as part of a scenario which has a consumer redesigning a room in his house into an entertainment room.

I am yet to see the demo or any video of these technologies but it sure looks to be immersive :). IBM has also released a white paper entitled “How immersive technology can revitalize the shopping experience”. According to the paper:

Immersive technology solutions—which stimulate people’s visual, auditory, olfactory and tactile senses to connect with shoppers on an emotional level to create unforgettable shopping experiences—can open up a whole new world of energizing shopping experiences. Combined with flexible, responsive business models, they have the potential to transform the way customers interact with your brand.

You can download the White paper from Experience Economist blog.

Enriching consumer experience using 2D Barcodes

by Deepak Sharma on Sunday, January 13, 2008

StorefrontBackTalk is reporting that very soon a company called StoreXperience will be the first to bring 2-D barcodes to the U.S.

Herve Pluche, president of a company called StoreXperience, said his company will be the first to bring 2-D to the U.S. and that it will debut this April at five locations in Manhattan. Asked if that rollout was definite, Pluche said that no agreement had been signed but "we do have a handshake."
He wouldn't say who the retailer was who had agreed to the five locations, but did say that it was a chain focused in either consumer electronics or cosmetics. Pluche said that he had met with 10 retailers and that all were very interested, although he wouldn't identify them.

The same article describes the usage of 2D barcodes which says:

At its most basic, a 2-D barcode uses two elements of a typical smartphone—the digital camera and a Web browser—to create a rich 2-way data exchange. The consumer might see a poster for a particular product—or a model wearing interesting clothes—and want more information. That shopper would aim her smartphone at the 2-D barcode. A small applet on the phone would interpret the barcode, launch a browser and go to a very deep link within that site.
The consumer gets instant details about what the model is wearing or what the product's specs are, along with a link to purchase the items immediately. Beyond the potential sale, the retailer or manufacturer would learn an awful lot about that consumer transaction. The very lengthy URL hidden in that 2-D barcode identifies the exact location of that consumer. Depending on the software being used, there is an excellent chance the consumer can be identified and associated with his/her purchase history. All of this from a tiny picture hidden unobtrusively in a corner of the poster.

I googled on 2D barcodes and found out that the technology has been in wide use in the East for quite some time. The 2D barcode called QR code looks something like as shown above. This code will appear on the poster or any other advertisement and contains addresses and URLs in them.

IBM Retail Integration Framework

by Deepak Sharma on Saturday, January 12, 2008

Last week IBM released IBM Retail Integration Framework, an enterprise software architecture designed to help retailers accelerate the implementation of new customer focused strategies.

the new framework, which is based on a service oriented architecture (SOA) strategy, could help retailers rapidly introduce new product assortments and provide a unique multi-channel customer experience whether a consumer is shopping online, in a store, at a kiosk or through any other sales channel including mobile devices.

Retail companies are increasingly turning to solutions based on SOA to enable them to integrate fragmented applications and processes and increase reuse across their enterprise. IBM's Retail Integration Framework combines more than 50 years of experience with thousands of retail clients and award-winning middleware to deliver a retail blueprint that can accelerate the deployment of agile business processes. The new framework features retail-specific components, templates and patterns to improve the integration of business processes including new product introduction, cross-channel selling, point of sale (POS) integration, store-to-enterprise integration and retailing business intelligence.

Since the Framework is SOA based, it allows smooth integration with existing applications and allows retailers to enjoy some new approaches integrating with new technologies.

IBM's Retail Integration Framework is designed to benefit both the consumer and the retailer. For example, through IBM's relationship with Nortel to create communications-enabled applications, a consumer can receive information from a retailer on upcoming sales or the status of an order via email, instant messaging, voicemail or virtually any other preferred method of communication. From the retailer's perspective, the information contained in the customer's alert is connected to the company's store operations, POS applications and radio frequency (RFID) inventory solutions and surveillance systems. If the consumer decides to make an additional purchase or cancel an order, the retailer is able to securely and accurately execute the request and ensure that all of the related information is instantly and consistently updated across the entire company and with its trading partners such as banks and overnight shipping services.

Collaborative Logistics

by Deepak Sharma on Monday, January 07, 2008

In this post I want to write about Collaborative Logistics. I had proposed a Mashup idea on this topic for which I submitted to Microsoft-BT Mashup competition early last year and I got 1st prize for the same. To borrow the definition of Collaborative Logistics from this article, Collaborative Logistics is achieved when two or more companies form partnerships, or work with existing supply chain partners (customers, suppliers and carriers) to optimize transportation operations by sharing truck capacity to cut the high costs of less-than-truckload shipments and empty back hauls. In my mashup idea, we are talking of SMB's who want to lower the operation costs. The Mashup I have proposed takes into consideration these SMB's need of lowering costs and optimizing inventory. The idea is to share unused capacity in Trucks. Trucks which are not full can communicate the available space to the Mashup Service which will then broadcast the same to Mashup service subscribers using SMS service. Similarly a Truck Owner can broadcast his unused space to subscribers through the Mashup service. The uniqueness of the idea was it targeting the Long Tail of SMB’s.

There is an excellent white paper on Collaborative Logistics by Kevin Lynch who was the CEO of Nistevo which was later acquired by Sterling Commerce. The article while introducing Collaborative Logistics explains how Shippers and Carriers benefit from the collaborative arrangement:

The key to understanding Collaborative Logistics lies in recognizing how costs are distributed in a logistics network. Both shippers and carriers focus a lot of attention on controlling costs to improve profitability. Following a traditional approach, each organization has the ability to increase the efficiencies and reduce the "individual costs" of only those business processes that the organization independently controls. However, they have no visibility over "hidden costs."

Here’s the big question: How is it possible to reduce costs that are hidden? And, here’s the sole answer: Collaborative Logistics. This new business process makes hidden costs visible, so companies can work together to reduce them.

An example of a hidden cost that all members of a logistics transaction pay, but none individually control, is asset repositioning.
• Shipper A requires goods be delivered at a certain place and time.
• Shipper B requires goods be picked up at a certain place and time.
• The carrier must decide how to optimally apply their asset to this situation.
• Shipper A and Shipper B do not understand how their interaction affects asset repositioning costs.
In other words, no single player controls asset repositioning costs. They are a hidden cost paid by all. By maintaining an isolated approach, members of a logistics transaction are limited in their ability to reduce overall costs.

In my mashup which used Web services from Microsoft (MapPoint, Virtual Earth) and BT (Web21C SDK), I have considered two scenarios, Subscriber mode and Publisher mode. So let's take an example of Subscriber mode:

- Contoso Hardware Shop is based in Washington, DC, USA. It needs to send a shipment of heavy duty Spanners to it’s customer in Philadelphia, PA.
- Contoso logs on to Collaborative Logistics Mashup Website using BT Web21C Authentication Service.
- Contoso provides start and end locations of it’s shipment. The start location is filled automatically based on Contoso’s past usage of the service.
- The Collaborative Logistics Mashup service provides a list of truck’s on a Map (using Microsoft MapPoint API or Virtual Earth SDK) which are in the vicinity (near Washington, DC) with their unused capacity. To provide the location of trucks on Map, it uses BT Web21C Location Service.
- Upon selecting a truck on the Map, an SMS (Using Web21C SMS Service) is sent to the Truck with Contoso’s Contact details for them to collaborate and take the process forward.

Reverse is also possible.

- Litware Truckers, Inc is a Transportation company based out of Philadelphia. It has a fleet of 17 trucks.
-Litware operates its trucks in the north eastern USA. Many times Litware’s trucks travel with unused capacity. These can be used by small businesses which needs to ship small packages and can’t afford full trucks.
-Litware has registered with Collaborative Logistics Mashup website. Truck Drivers can send SMS to Collaborative Logistics Mashup service which is received using Inbound SMS service. The SMS will contain the unused capacity in the truck.
-The Collaborative Logistics Mashup then sends an SMS (using SmsMessage Service) containing Litware truck details including Truck Location (using BT Web21C Location Service) to all registered subscribers. Subscribers have the capability to set their Presence (using BT Web21C Presence service) status to “No SMS” if they don’t wish to get SMS from Mashup service.
-Depending on the location and needs of subscribers, they can contact (call or chat) the Litware Truck for using unused capacity.


Recommended Reading:

Collaborative Logistics: Increasing Supply Chain Management Efficiency

Collaborative Logistics: Why collaborate?

7 immutable laws of collaborative logistics

Wal-Mart's new slogan a winner

by Deepak Sharma on Sunday, January 06, 2008

Seeking Alpha is proclaiming Wal-Mart's new slogan, "Save Money, Live Better" is a Winner. I agree, with Wal-Mart trumping long time rival Target in holiday sales, it sure looks like the new slogan is working.

For the first time in recent memory, Wal-Mart has won the Holiday sales battle with Target (TGT). There are two simple reasons. The new ad campaign started in time for the holidays and the success of's "site-to-store" program.

The other factor article says that worked for Wal-Mart has been it's Site-to-Store program:

In July, after my first try at the program, I posted "Wal-Mart said that "more than 50 percent of Site-to-Store orders [came] from new customers who make their first purchase at using the service." The chain also reported a 20 percent increase in the number of Site-to-Store" customers who spend an additional $60 on purchases in the store when picking up their orders."

This clearly spilled over into the holidays. I actually was one of these folks, as we ordered items for the kids on "Black Friday" and picked them up in the store 7 days later, and while there, picked up several other items. This option, for some inexplicable reason is not available at Target. The best part of the program is that I can buy thousands of items not in the stores, making my local Wal-Mart even larger.

IT in Indian Retail

by Deepak Sharma on Saturday, January 05, 2008

In the burgeoning India Retail Organized sector, IT is being taken seriously with retailers starting to leverage IT for setting up basic infrastructure for doing business. A report in Express Computer discusses how Indian Retailers although being late are adopting IT for innovations at back end as well as consumer facing end.

“It is estimated that over $2.5 billion will be spent on IT in the Indian retail sector by 2010. This will include the cost of acquiring new assets as well as looking after existing infrastructure. Over 40% of this will be spent on software and services,” said Ajay Aggarwal, Founder, Seacom.

According to Patrick Mathias, Regional Manager-Enterprise, Cisco India, “Of the total investment, approximately 4-10% is invested in IT. And within this approximately 30-40% is meant for networking infrastructure.”


The IT innovation revolution in retail is steadily taking shape in India. The process is such that it has the potential to change the way in which we purchase even the basic necessities such as groceries and vegetables. Innovation is happening not just at the backend, but also at the customer facing end. It’s taking place all over, right from where the customer enters a store to the point where he leaves. This essentially covers the whole process of buying of products, right from selecting to decision making and paying at the checkout counter.

“Innovations in the retail industry are multi pronged and are aimed at enhancing the end user experience, optimizing resources and logistics, creating a technology platform to keep pace with the dynamics of the industry and manage the unprecedented growth given the geographic spread and diversity,” said Dr. Anurag Srivastava, Vice President, Consulting Division, Wipro.

One Truth for all - Retailers, Suppliers and Carriers

by Deepak Sharma on Wednesday, January 02, 2008

Internet Retailer is reporting on how web based information systems are enabling retailers, suppliers, carriers and freight forwarders to track the shipment status at multiple points between a supplier’s warehouse and a retailer’s distribution center, and from carriers in all modes of transport.

These retail supply chain systems—from technology and services vendors including GXS Inc., GT Nexus Inc. and E2open Inc.—are helping retailers move beyond the embattled advance ship notices and into a method of receiving updates on shipment status at multiple points between a supplier’s warehouse and a retailer’s distribution center, and from carriers in all modes of transport.

Using a web-based system enables suppliers, carriers and freight forwarders to enter shipment status reports into a single, centralized system, where companies like GXS and GT Nexus synchronize data, ensuring all parties are using common product and shipping definitions and letting all parties, including retailers, access a single version of the facts. Under more conventional systems, a retailer might re-enter information from a shipper’s advance ship notice into its own shipping management application, where the information may not be the same as that kept by a carrier.


A key metric derived from carrier collaboration systems, experts say, is the ability to shorten the lead time between ordering products and receiving them in a distribution center. This helps retailers increase sales by getting products on the shelves in time for planned customer demand, and it saves inventory costs by letting them hold less safety stock to compensate for late-arriving goods.