IBM’s data unit Coremetrics has released its real time online retail benchmark study which shows online sales jumped 24.3% this Black Friday. This follows the growth of 39.3% increase in online sales on Thanksgiving day. Mobile traffic increased to 14.3 percent on Black Friday 2011 compared to 5.6 percent in 2010. The sales on mobile devices surged to 9.8 percent from 3.2 percent year over year.

Record Online Thanksgiving Day Shopping Paves Way for Strong Black Friday Retail Sales, Reports IBM

U.S. shoppers took advantage of early sales this holiday driving a 39.3 percent increase in online Thanksgiving day spending while setting the stage for 24.3 percent online growth on Black Friday compared to the same period last year, according to cloud-based analytics findings by IBM.

As part of IBM's Smarter Commerce initiative, IBM's online retail benchmark study reveals the following trends as of 12:00 am PST:

• Consumer Spending Increases: Strong Thanksgiving shopping carried over into Black Friday with online sales increasing 24.3 percent annually.
• The Mobile Bargain Hunter: Black Friday witnessed the arrival of the mobile deal seeker who embraced their devices as a research tool for in-store and online bargains. Mobile traffic increased to 14.3 percent on Black Friday 2011 compared to 5.6 percent in 2010.
• Mobile Sales: Sales on mobile devices surged to 9.8 percent from 3.2 percent year over year.
• The Apple Shopper: Mobile shopping was led by Apple, with the iPhone and iPad ranking one and two for consumers shopping on mobile devices (5.4 percent and 4.8 percent respectively). Android came in third at 4.1 percent. Collectively iPhone and iPad accounted for 10.2 percent of all online retail traffic on Black Friday.
• The iPad Factor: Shoppers using the iPad led to more retail purchases more often per visit than other mobile devices with conversion rates reaching 4.6 percent compared to 2.8 percent for overall mobile devices.
• Surgical Shopping Goes Mobile: Mobile shoppers demonstrated a laser focus that surpassed that of other online shoppers with a 41.3 percent bounce rate on mobile devices versus online shopping rates of 33.1 percent.
• The Social Influence: Shoppers referred from Social Networks generated 0.53 percent of all online sales on Black Friday. Facebook led the pack, accounting for 75 percent of all traffic from social networks.
• Social Media Chatter: Boosted by a 110 percent increase in discussion volume compared to 2010, top discussion topics on social media sites immediately before Friday showed a focus on the part of consumers to share tips on how to avoid the rush. Topics included out-of-stock concerns, waiting times and parking, and a spike in positive sentiment around Cyber-Monday sales.

"This year marked Thanksgiving's emergence as the first big spending day of the 2011 holiday season with a record number of consumers shifting their focus from turkey to tablets and the search for the best deals," said John Squire, Chief Strategy Officer, IBM Smarter Commerce. "This momentum continued into Black Friday where the big winners were those retailers that delivered a smarter commerce experience with compelling, relevant deals that people could easily access from their channel of choice."

Online Retail Categories

• Department stores once again offered a vast array of compelling deals and promotions that caught the attention of consumers. As a result, department stores sales were up 59.0 percent from this time last year.
• Home goods also reported a 48.8 percent increase in sales from Black Friday 2010, an indication that many consumers are shifting their attention toward the home this holiday season.
• Apparel sales were also strong this holiday with Black Friday numbers showing an increase of 47.2 percent over 2010.
• Health and Beauty sales were strong as consumers showed a desire to pamper themselves this year. On Black Friday, online sales were up 34.2 percent year over year.

Today's news is based on finding from the IBM Coremetrics fourth annual Black Friday Benchmark which tracks more than a million transactions a day, analyzing terabytes of raw data from 500 retailers nationwide. With this data IBM helps retailers better understand and respond to their customers – across the organization – improving sourcing, inventory management, marketing, sales, and services programs.

Get the detailed report here.

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.”)

A welcome news for many Retailers, IBM will now offer Windows Embedded for Point of Service as a pre-installed operating system option for its IBM AnyPlace kiosk, SelfCheckout and SurePOS 700, 500 and 300 point-of-sale products. The following analyst view sums it up well.

While unusual, Garf said the deal makes sense for both parties. “For IBM, it gives their hardware prospects and clients more choice for their operating system,” he said. “For Microsoft, given the leadership role IBM plays in hardware, it provides a great channel. Their go-to-market strategy is mostly through channel partners. It’s a win-win.”

Retailers can also benefit from the deal, Garf said. “From a retail perspective, especially when dealing with hundreds or thousands of stores multiplied by the amount of devices in each store, you want simplicity and a hardened technology that won’t break,” he said. “[Windows Embedded-based POS offers] resiliency and simplicity, and being a standards-based technology makes it easier to deploy. From a total cost of ownership standpoint, it makes sense for retailers as well.”

Garf said the partnership demonstrates the open nature of both technologies. “It underlines what both companies have been talking about for a while – standards-based open technology,” he said.

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.

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.