Mood Media Corp., a global, leading in-store media specialist that uses a mix of music, visual and scent media to help its clients communicate with consumers with a view to driving incremental sales at the point-of-purchase is acquiring Muzak Holdings LLC, best known for providing piped music in elevators, for $305 million in cash.

With the acquisition of Muzak, Mood Media extends its global footprint, creating the largest in-store media provider globally, nearly five times the size of its next largest competitor. It will service a staggering 470,000 commercial locations in over 39 countries after this acquisition is completed.

Mood Media to Acquire Muzak for $305 Million

Founded in 2004, Mood has a market capitalization of about $380 million. It has a large presence in Europe, where it provides background music and digital signage services to around 117,000 locations, from Nike to Hermes stores.

Muzak provides background music to about 300,000 U.S. locations, such as restaurants, malls and hotels. It makes most of its money through multi-year contracts and reported 2010 revenue of $195 million. The company traces its roots back to the 1930s when it distributed recorded music to theaters and stores. Today, it also provides on-hold messaging and video programming, although piped music is its forte.

Mood hopes to use Muzak's U.S. footprint to introduce more digital services, such as screens that allow customers to check merchandise in stores, Mr. Abony said.

Walgreens will strengthen its multichannel presence with this purchase and gets immediate access to more than 3 millions Drugstore.com customers. It will also block other customers like Rite Aid which has had a partnership with Drugstore.com for many years now.

Walgreens to buy Drugstore.com

One of the biggest names in the online retail category for prescription drugs and health and beauty supplies is being acquired by one of nation’s largest drugstore chains.

This morning Walgreen Co., No. 68 in the Internet Retailer Top 500 Guide, announced plans to buy Drugstore.com, No. 46, in a deal valued at $429 million. Under the terms of the deal, Walgreens will pay $3.80 per share for Drugstore.com’s common stock. Walgreens expects the deal to close by the end of June.

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“Our acquisition of Drugstore.com today significantly accelerates our online strategy to leverage the best community store network in America by becoming the most convenient choice for health and daily living needs whether customers shop online or in our stores,” says Walgreens CEO Greg Wasson. “This acquisition offers a unique opportunity that will provide us immediate access to more than 3 million savvy, online loyal customers, and will allow us to move even closer to our existing customers through relationships with new vendors and partners, adding approximately 60,000 products to our already strong online offering.”

TechCrunch today covered Beetailer whose software allows online retailers to import their web store onto Facebook while providing tools for promoting the store and detailed analytics about how well it is doing. Beetailer claims that it has over a thousand stores, reaching millions of fans are already using their system.

Beetailer Helps Online Retailers Set Up Shop On Facebook

Beetailer’s software connects with existing e-commerce platform, such as Magento and Shopify, and will import and sync online catalogs including, prices, images, sizes, colors and even whether products are in stock. The online storefront will populate on the retailer’s Facebook page and will essentially allow Facebook users to browse and add products to a shopping cart within the social network. When a user clicks to checkout and actually purchase the products, Beetailer will lead the user to the e-retailer’s website so the shopper will checkout via the retailer’s preferred payment process.

But in addition to accessing the social network’s vast userbase, retailers can also leverage Facebook’s social graph to engage consumers. Beetailer allows retailers to launch time-limited, Facebook-specific promotions, including prizes and discounts for fans who like, comment, and bring other friends to the store.

Additionally, Beetailer provides retailers with analytics to measure the results of each
promotion. Beetailer’s data will include traffic, demographic data, most visited products, most visited categories, number of checkout and more.

Interesting parallel drawn between Maslow’s Theory and maturing Indian Retail industry.

Indian retail evolution is mirroring Maslow's Theory of need hierarchy

Maslow's theory maintains that a person does not feel a higher need until the needs of the current level have been satisfied. This is exactly what happened in the Indian retail scenario. All of us were so used to our local dingy kirana [Local Mom and Pop stores] shops that we didn't feel a higher need, until Indians started travelling abroad and saw the high end retail environment. That, accompanied by our liberalising economy, was the harbinger of modern trade in the Indian retail industry.

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Once the lower need of safety & security was met, particularly for the urban consumer, just like Maslow's theory says, the consumer in India was ready to move to the next need. That of "Love & Belonging". To fulfill this need, the retail trade responded quickly. There was this phase where almost every retailer had a "loyalty programme" of some sort or the other. Lifestyle, Shopper's Stop, Westside, Pantaloons, you name them and they had it.

Wal-Mart, Target, Sears et al are lobbying legislators to change sales-tax laws in more than a dozen states including Texas and California that will force Internet Retailers to collect Sales Taxes from companies like Amazon. 

Retailers Push Amazon on Taxes

The big-box stores are backing a coalition called the Alliance for Main Street Fairness, which is leading efforts to change sales-tax laws in more than a dozen states including Texas and California.

Until now, the group has been largely associated with mom-and-pop stores, spotlighting stories of small toy shops and booksellers who argue Internet merchants that aren't legally required to collect sales taxes enjoy an unfair advantage with shoppers.

Amazon has feverishly fought efforts to compel it to collect sales taxes. The Seattle-based online retailer says it complies with the law. Under a 1992 U.S. Supreme Court ruling, only merchants who have a physical presence, such as stores, in a state have to collect sales taxes. Amazon currently gathers those taxes in just five states: Kansas, Kentucky, North Dakota, its home base of Washington, and New York.

But retailers pushed for passage of a new law in Illinois last week that forces Amazon to collect sales taxes if it employs marketing affiliates in the state—a measure similar to a New York law that retailers want to replicate nationally—and their drumbeat may soon spur federal action.

Chico’s FAS Inc, a women's specialty retailer has has selected PTC’s FlexPLM for all its brands: Chicos, White House|Black Market and Soma Intimates. Establishing a single PLM platform will enable Chico’s to reduce material costs, cycle times and product development costs. FlexPLM will manage Chico’s brands’ suppliers, materials and a fast-paced global apparel calendar so that Chico’s can make better sourcing decisions and achieve greater efficiency in its costs and inventory.

Chico’s FAS Inc. Selects PTC Windchill® FlexPLM® for Enterprise PLM

“When evaluating PLM vendors, we wanted software that was not only going to help us drive productivity and reduce costs, but we wanted a solution that was going to be easy to use,” said Krissy Blakeway, senior vice president of Chico’s design and product development.  “As the technology leader, PTC was the unanimous choice of our user community. We believe that as we move forward and standardize on Windchill FlexPLM, our ability to be first to market with the latest fashion will be enhanced.”

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“PTC fully understands the retail industry pain points and we work closely with our customers to not only help them overcome those existing challenges, but to look ahead, anticipate needs and innovate,” said Kathleen Mitford, vice president, market strategy, PTC. “Chico’s FAS Inc. is already a leader and by standardizing on Windchill, the company will be able to continue to expand its position by realizing the benefits of margin improvement, cycle reduction time and personal productivity gains.”

Interview of Chris Allan, Quantum Retail Technology’s Chief Strategy Officer with P.J. Jakovljevic in Technology Evaluation Centers where he talks about Quantum’s Q Platform, competitive landscape and what wakes them up at night.

Quantum Retail: Challenging the “Enterprise Apps Establishment” and Retailers’ Mindset – Part 2

PJ: What is your killer value proposition that other retail software “usual suspects” (e.g., Oracle, SAP, SAS, JDA, etc.) fail to provide? In other words, what are the pain points that only you can cure for your customers (and with what typical benefits)?

CA: The Q Platform (explained in Part 1) actually solves the problems that these other vendors mainly talk about solving–and delivers on the business case every time, with proven, measurable results. Quantum has developed the concept of managing by Merchandising Strategy–determining the role of the product within the customer offering, such as being an image item, loss leader, traffic driver, etc. (see Part 1 for more details).

Users are not asked to select from an overwhelming number of forecasting algorithms and replenishment algorithms, and to set a slew of tricky parameters up around each of those algorithms for every stock-keeping unit (SKU) in every store. Q takes the chosen Merchandising Strategy and understands the objectives of the product from both a financial and a merchandising perspective and ensures that every inventory decision that is made is aligned with achieving those objectives.

The way that customers buy product changes over time and Q adjusts automatically to react to those changes, ensuring that alignment is maintained throughout the products’ lifecycle. This is very different from having to actively maintain the ordering, allocation, and replenishment configurations for every SKU in every store and manually ensure that the system is set up correctly (which is the value prop of our aforementioned competitors).

In the process of understanding items Q considers over 30 dimensions of product behavior including average sales, maximum sales, demand, days between sales, lost sales, days between stock-outs, current inventory, last stock-out, weeks of supply, percent in stock, etc. Beyond these typical sales and inventory metrics, Q also understands the following:

• When the issues happened, e.g. an out-of-stock on Monday has different gravity than out-of-stock on Saturday
• Variations in contributing factors such as lead times, lifecycle, and customer service level
• Variability and uniqueness in sales such as volatility, lumpiness, lost sales, demand vs. sales
• Finally, and perhaps most importantly, profitability metrics such as gross margin return on inventory investment (GMROI)

These capabilities have led to retailers being able to have a high degree of automation with Q using exception management to highlight only those areas where users should be spending time in the system. Typical results achieved and verified (by Quantum’s customers that were mentioned in Part 1) are as follows:

• A 2.2 percent full-price sales increase (in fast fashion)
• A 5.6 percent sales increase (in general merchandise)
• A 4 percent increase in gross margin
• An 11 percent inventory reduction
• A 40 percent reduction in overstocks

When something is as fun and easy as scanning a barcode and getting your medicines ordered, people will use it. Walgreens seems to be recognizing just that.

Walgreens: Mobile is key component of multichannel loyalty strategy

Walgreens is seeing much success in using mobile as a means of driving loyalty among its customers by providing choice, control and convenience via the channel.

In fact, Walgreens found that an astounding number of consumers are accessing its mobile application and more than half of prescription refills being done via mobile are being done through the scan feature. Additionally, the company said that the number of prescription text alert subscribers has surpassed one million.

“Mobile is a key component in our multichannel strategy, which is helping to create more loyal customers,” said Jim Cohn, spokesman for Walgreens, Deerfield, IL. “People want choice, control and convenience – and mobile is one of the channels through which we’re offering customers more reasons to come to us.

“We’ve gotten significant traction with our mobile applications, which really are like having a drugstore in the palm of your hands,” he said. “More people are using our refill scan technology because it adds another level of convenience and it’s time-saving technology our customers truly value.

What’s more exciting than innovative technologies? It’s the innovative implementations. Clinique, a manufacturer of skincare, cosmetics, toiletries and fragrances, owned by the Estée Lauder has done just that. Clinique is launching Clinique Smart Bar which is a touch screen counter that is based on Microsoft Surface unit.

Clinique installs Microsoft Surface

The new digital interface enables shoppers to place specially tagged Clinique products on the Clinique Smart Bar. The shoppers can then access product information, and Clinique.com’s best in class user reviews and how-to videos, before adding their products to a virtual browsing basket.
The application allows shoppers to print out a barcode and present it at the nearby express service counter for quick checkout.
Shoppers can also share the virtual browsing basket directly to their Facebook or via e-mail.
“Today’s consumer has more tools and devices than ever before to communicate, connect and learn. From the explosion of smartphones to Google to Facebook, our consumers are looking beyond a one-dimensional experience,” said Ricardo Quintero, Clinique’s senior vice president, global general manager, Market Development.

A picture speaks thousand words so here is how the Clinique Smart Bar looks.

Picture source - Microsoft Surface Blog

Microsoft has launched Microsoft Dynamics AX for Retail R2 in Germany at the ongoing Euroshop 2011. The new version of Dynamics AX for Retail includes point-of-sale, store management, supply chain, merchandising and financials capabilities.

Microsoft Brings Retailers a Complete End-to-End Solution With Microsoft Dynamics AX for Retail R2 at EuroShop 2011

This solution, the next iteration of Microsoft Dynamics AX for Retail, offers midsize and enterprise specialty retailers point-of-sale, store management, supply chain, merchandising and financials capabilities to deliver business productivity, enterprise agility and customer service in a single, integrated end-to-end retail solution. It provides visibility from point-of-sale devices to the supply chain and the business insight needed to enable a real-time response to customer demand and build customer loyalty.

I was planning to blog about this for last few days. IBM is testing a new biometrics technology which uses mini-cameras placed in a mannequin’s eye or placed somewhere in a store.

Biometrics Take on a New Style

There are two tests going on in Milan, one for a fashion company’s flagship store and the other, in an electronics store. The clients have sworn I.B.M. to secrecy for fear of customer backlash, although I.B.M. promises that the data is collected only in aggregated form and cannot be traced to any individuals.

“We started with fashion because it is a creative and innovative industry, but it’s clear that people have to be educated so they know their privacy will not be compromised,” said Enrico Bozzi, the manager of I.B.M. Forum Milano, the department that developed the technology. “It is a question of changing people’s perception.”

The application of biometrics and results IBM gathered are quite interesting.

I.B.M.’s applications are different. At the pilot in the Milan fashion store, for example, the client noticed that almost all Asian customers enter the store through one particular door, even though five are available.

“We thought it was a mistake, but we checked it out and it was right and it continues to happen,” Mr. Bozzi said. “We don’t know why yet but, in the meantime, the store is considering positioning products by that door that are known to appeal particularly to Asian shoppers.”

Once shoppers can be tracked, the next step could be advertisements selected to match biometric triggers: A customer walks into a shop and a piped-in voice asks if the jacket she bought last time has been satisfactory and would she like to see something similar from a new line. (Tom Cruise’s character received the same treatment in the 2002 movie “Minority Report.”)