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3 O'Clock High: What's Cool on the Internet is Creepy in Person


"What button do I press to yell at a manager?"

I may be getting old. It's possible that I'm just one of those guys who doesn't mellow with age but instead becomes prone to angry rants; particularly about matters technological or related to the "punk kids with their ridiculous hair and unfounded pomposity."

On the one hand, it's an honor to follow the path blazed by people like Herb "Just turn on your television" Greenberg. I'm proud and only a little enraged to follow in such giant and, of course, angry footsteps.

The downside, as I'm discovering, is that reading columns like THIS ONE, on the technological initiatives in retail being displayed at the National Retail Federation convention, have stopped amusing me in a Follies of Man way and started making me viscerally angry.

"In 2006, the nation's biggest retailers want to make you feel like you're in a small-town store, where everybody knows your name and shirt size" the article begins, shooting a monster bolt of ice water into my veins, before adding the cannonball chaser "Don't you want to shop where everybody knows your name- and your size, and what wines you bought for the past year?"

The article giddily runs through initiatives such as:

  • "Automated Phone Trees" using voice recognition software to communicate with customers. The retailer can choose from a menu of voices including one "with a classy accent".
  • Customer loyalty cards which the NRF had on display in a demo wine store. Shoppers returning to the stores could be welcomed with messages like "Hello, Dan. How did you like that bottle of pinot grigio you bought last week?". Shoppers returning to the store on 14 consecutive days could have a disembodied but classy voice lovingly suggest concern for the customer before suggesting available low-priced bulk alternatives.
  • Finger print-scanning services enabling customers to check-out using only their finger. Security concerns? Not to worry, folks, the information is "automatically encrypted" which, as we all know, works every time (50% of the time).

The companies buying this stuff are, in short, trying to make their stores more like shopping on the Internet. They want as much as possible to be automated and they really, really want something like Amazon's (AMZN) customer data book recommendation system (which offers returning customers products they might like "based on prior purchases").

Here's the thing; what's cool on the Internet is entirely creepy in person. People going to stores have already stated their personal preference to shop at real brick and mortar stores with real sales-people who really talk to you (even if you have to wait). Making their shopping experience like shopping on the Internet, even if such a thing were possible, would be delivering the one thing retailers can be assured a customer wasn't' looking for when they got in their car and came to your store.

Even if the technology worked, and it doesn't judging by every automated customer service phone call I've ever made, it wouldn't be equivalent to the experience of Internet shopping. There's a social component to shopping. You can't capture it in a spread sheet but, at this point in the Internet evolution when shopping on line is easy and safe, people are going to the stores at least in part to get away from the Internet.

Both as an investor and a shopper I tend to run away from a retailer when I start seeing intrusive, generally pointless, technology in the stores. Retailers absolutely need the tech in back but once they start trying to fake customer service it's a pretty good sign that the retailer is running out of ideas. Great retail remains an art on the customer end. When management starts turning to science to win shoppers over it's a bad sign.

No positions in stocks mentioned.

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