RETAIL NEWS FLASH September 01, 2014
Table of Contents Sales & Marketing ................................................................................................................. 3 Merger and Restructuring ...................................................................................................... 6 Financial Performance ........................................................................................................... 9 Online and Ecommerce Operation ....................................................................................... 12
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Sales & Marketing Amazon Starts Selling Physical Books in Brazil August 22, 2014 | Kantar Retail IQ http://www.kantarretailiq.com/ContentIndex/NewsDetails.aspx?id=632789 Amazon has started selling physical books in Brazil, two years after it entered the market in its traditional method of e-books and Kindles. The new service will make available more than 150,000 titles in Portuguese. Amazon started selling e-books in Brazil in 2012 with 13,000 titles, and currently has 35,000 titles available. This indicates that Amazon is continuing with its developmental pathway of initially launching e-books & Kindles and then physical books before entering other categories like electronics.
Will Walmart be the loser in dollar store mergers? August 19, 2014 | Forbes http://www.forbes.com/sites/lauraheller/2014/08/18/dollar-general-for-family-dollar-revealswalmarts-weakness/ Anyone looking for further evidence that the U.S. shopper is pressured financially and that Walmart’s biggest competition are dollar stores, need look no further than the current bidding war for deep-discount chain Family Dollar. Dollar General DG -0.33% announced this morning it made an offer to acquireFamily Dollar Stores FDO 0% for $78.50 per share in cash, in a transaction valued at $9.7 billion. That’s $1.2 billion more than Dollar Tree DLTR -0.61%’s previous offer to acquire the chain in a deal valued at $8.5 billion. What’s driving this? Fear, on the part of Dollar General and the need for retailers to bulk up their presence in this most important retail channel. Dollar Tree’s bid to acquire Family Dollar made sense. This was a channel ripe for consolidation and Family Dollar was the weakest of the chains in the sector. But the two combined would create an $18 billion powerhouse of a retailer, and that makes for a dangerous competitor, not just to Dollar General butWalmart, as well. Walmart and Dollar General are arguably fiercer direct competitors than Walmart and Target TGT 0.46%. In a recent pricing survey Dollar General beat Walmart, and their small format stores are the model on which Walmart is banking for future growth. Make no mistake, the deep-discount retail channel is among the most important today with small stores that serve an ever-poorer U.S. consumer. These inexpensive to build stores are conveniently located to the urban, suburban and rural poor. A group that is growing in spite of an economic recovery.
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Dollar General’s stated reasons for its interest in Family Dollar revolve around the need for size. The merger would “solidify (Dollar General’s) position as the leading small-box discount retailer,” said the company in a statement. “The transaction would create the preeminent small-box retailer in the United States based on store locations, delivering convenience and everyday low prices to customers through nearly 20,000 stores in 46 states with sales exceeding $28 billion and over 160,000 employees.”
How footwear e-retailer Inkkas turns live chats into sales August 18, 2014 |
When footwear e-retailer Inkkas started in 2012 selling shoes made with traditional South American textiles, the market was new, says founder Dan Ben-Nun. But the response was immediate. That first year, the company did $1 million in sales. This year, Inkkas expects to hit $3 million. But as its order volume grew, so did the number of consumers asking questions, such as how the shoes fit, and what is the retailer’s return policy. “We were spending an enormous amount of time answering e-mails,” Ben-Nun says. So a little more a year ago, Inkkas began working with LivePerson Inc., which sells live chat technology. Two dedicated Inkkas employees handle the live chat inquiries in the North American and European markets during normal business hours. After hours, consumers can submit questions that the company addresses via e-mail the following business day. The technology has paid off. The average order value for a consumer who uses live chat on the site is double that of a consumer who does not use the tool. Moreover, 44% of the consumers who use live chat make a purchase on the site on the same visit after engaging with an employee over live chat. Ben-Nun estimates the return on investment to be 10 to 20 times what the company spends on the technology each month. LivePerson prices its technology on a per-engagement basis, meaning the retailer pays only when consumers use the live chat platform to chat with an employee. The cost varies, but Ben-Nun estimates Inkkas pays around $300 per month for live chat. The company started as a direct-to-consumer business, but the interest from retailers wanting to sell the product started almost immediately. Now, about 60% of its sales are wholesale to such retailers as Journeys, Hollister, Free People, Urban Outfitter and Nordstrom Inc.
Genco Marketplace racks up B2B and retail sales August 19, 2014 | Internet Retailer http://www.internetretailer.com/2014/08/19/genco-marketplace-racks-b2b-and-retail-sales As multichannel and web-only retailers make it easier to return products, Genco Marketplace is posting strong growth in processing sales of those items to other merchants and consumers, CEO Laurie Barkman says. Genco Marketplace, which buys and sells excess consumer products online andoffline, is growing at a fast clip along as multichannel retail operations make it easier for consumers to return
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merchandise bought on the webor in stores, CEO Laurie Barkman says. “The customer-friendly side of the retail business is increasing the returns of merchandise, so the opportunities for liquidation are greater,” she says. Genco Marketplace, a unit of Pittsburgh-based inventory management and logistics services company Genco, last year did about $3 billion in gross merchandise sales volume, a figure that is growing at about 20% per year, Barkman says. “We are a marketplace for surplus inventory,” she says. Genco is a privately held company and doesn’t report complete financial figures. Genco Marketplace buys and sells merchandise through three channels: •
Its team of direct sales reps buys and sells full truckloads of goods, including products returned from retailers’ customers as well as other excess merchandise that merchants no longer want to try to sell or stock;
•
GencoMarketplace.com, a business-to-business marketplace where it sells, through online auctions as well as at fixed prices, cartons and pallets of merchandise acquired from merchants in categories including apparel, baby products, consumer electronics, toys, auto parts, jewelry and home furnishings;
•
NoBetterDeal.com, where it sells single items to consumers as well as businesses. Businesses that register for a reseller program can buy merchandise at a 12% discount from the site’s retail prices. Genco Marketplace relaunched NoBetterDeal.com in May on a redesigned e-commerce platform, providing such improvements as faster checkout and more complete product descriptions with more information on the condition of merchandise.
Genco Marketplace, which doesn’t publicize the names of its individual sellers and buyers, acquires products from major multichannel retail chains and specialty retailers. It sells that merchandise in bulk to liquidators that resell to merchants, and it sells in various quantities directly to merchants including sellers on eBay.com and other online marketplaces, regional discount store chains, flea markets and pawn shops. Product categories that have been particularly strong of late in driving growth include consumer electronics, computers, sporting goods, cosmetics , personal care items, and baby products like strollers and diapers, Barkman says. In May, Genco Marketplace relaunched NoBetterDeal.com on a responsive web platform, making it “more mobile friendly” with a new complementary mobile site that is being used by about half of NoBetterDeal’s customers, Barkman says. The company completed the web relaunched in-house with assistance from Pittsburgh-based digital design and development firm Agency 1903. A responsive web platform is designed so that web content renders well on multiple devices, including smartphones, tablets and desktops. Genco Marketplace is also upgrading GencoMarketplace.com. In May, Genco introduced on that site the acceptance of credit card payments via the MasterCard, Visa and Discover networks, with buyers allowed to use credit cards to purchase up to $6,000 in goods per day. The company plans to further upgrade the site this fall, improving the site search function and make the site easier to shop overall, Barkman says. The Genco parent company also operates a network of 140 warehouse centerss throughout the United States, providing a range of logistics services including shipping, warehousing, and repairing and refurbishing merchandise and equipment. In addition to consumer products companies, its logistics customers include healthcare organizations, industrial products companies and federal government agencies.
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Merger and Restructuring Burger King to buy Tim Hortons for $11B, move to Canada August 26, 2014 | Fierce Retail http://www.fierceretail.com/story/burger-king-buy-tim-hortons-raises-questions-taxinversion/2014-08-26 Burger King (NYSE:BKW) agreed to purchase Canadian coffee and doughnut chain Tim Hortons for $11.4 billion, creating the third-largest fast-food chain in the world. The company also announced that the new headquarters would be located in Canada. Berkshire Hathaway, run by CEO Warren Buffet, has contributed $3 billion of preferred equity financing to the transaction, reported Forbes. Berkshire will function simply as a financing source and will not participate in management or operation of the company after the merger. The combined food chains, which bring in $23 billion in annual revenues, will both be able to expand their international footprints. Brazilian private equity firm 3G Capital, which acquired Burger King in 2010, will retain a 51 percent majority stake in the new company. However, the brands will remain independent. The movement of headquarters to Canada could be greatly advantageous to the brand. Canada's corporate tax rate is 26.5 percent, compared with 40 percent in the United States. The company's decision, known as tax inversion, drew quick condemnation from some lawmakers, with increasing pressure on Congress and the Obama Administration to act, reported the Wall Street Journal. "Burger King is a household name, and this will focus the public's attention on this issue in a way that earlier inversions did not," Rep. Chris Van Hollen (D-Md.), the top Democrat on the House Budget Committee told the Wall Street Journal. He predicted that the majority-Democrat Senate would try to pass anti-inversion legislation soon, meaning Democrats would continue to push for a similar vote in the GOP-run House. Many Republicans also want tax inversion laws to change, but in a way that makes the United States more attractive for big businesses. This news comes only weeks after Walgreens purchased the remaining shares of European brand Alliance Boots and contemplated moving its headquarters to Switzerland, ultimately deciding to keep the United States as its home base.
Amazon acquires Twitch for $1B August 25, 2014 | Fierce Retail http://www.fierceretail.com/story/amazon-talks-acquire-twitch-1b/2014-08-25 Amazon (NASDAQ:AMZN) will buy the video game streaming site Twitch for $970 million in cash, giving Amazon a leg up in the advertising pool shared by competitors such as Netflix and YouTube.
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It was reported in May that Google (NASDAQ:GOOG) was in talks to acquire the company for $1 billion, but that deal never materialized, reported Re/code. Twitch is a platform for making and discussing the recordings players make of their gaming experiences. The site, which is an offshoot of Justin.tv, had 50 million unique viewers in July. Justin.tv announced its coming shutdown earlier this month. "We chose Amazon because they believe in our community, they share our values and long-term vision, and they want to help us get there faster. We're keeping most everything the same: our office, our employees, our brand, and most importantly our independence. But with Amazon's support we'll have the resources to bring you an even better Twitch," Twitch CEO Emmett Shear wrote in his blog. Amazon has been working to create a successful platform for streaming movies, TV shows and original series, all in efforts to compete with Netflix, which recently reported strong second quarter results as it moves past the 50 million subscribers mark. Bringing a video game streaming site into the Amazon fold could launch the mega retailer into a new echelon of consumer engagement, namely the market of free user-generated content already utilized by websites such as YouTube. Video game footage is among the most popular content on YouTube, the world's No. 1 video website, reported Reuters. Twitch allows some popular broadcasters to participate in a "partner" program, meaning they share in some of the ad revenue generated by advertisements that display against their videos and sometimes charge for paid subscriptions. This partnership may fit well into the Amazon Prime platform, which already includes access to streaming content. Amazon has made a big push into expansion and new ventures. Although sales in the second quarter increased by about 25 percent, the retailer posted a net loss of $126 million because of new research programs and project funding.
EBay considering PayPal spinoff August 21, 2014 | Reuters http://www.reuters.com/article/2014/08/21/us-ebay-divestiture-idUSKBN0GL1LY20140821 EBay Inc is considering a spinoff of PayPal, its fast-growing payments unit, as soon as next year, tech news website The Information reported, citing sources. Shares of the online retailer jumped nearly 4 percent to $55.48 at midday. EBay told potential candidates for the position of PayPal chief executive officer, a post that David Marcus vacated in June, about a possible spinoff of the payments unit, the website reported. Marcus is now a Facebook Inc executive. A PayPal spinoff would mark an about-face for the company. EBay CEO John Donahoe has resisted demands by activist investor Carl Icahn to hive off the payments service, saying PayPal was integral to eBay's business - and vice versa - and a split would not make sense.
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"The board will continue to assess all alternatives to create that long-term value and to enhance the growth and competitive positions of both eBay and PayPal. This position has not changed," eBay spokeswoman Amanda Miller said. Whether eBay has decided to spin off all or part of PayPal, and what structure that could take, remained unclear, The Information reported. Icahn eventually backed off from his demand in April, saying that while he supported a PayPal split in the near future, now was not the time. Some investors, however, feel an independent PayPal can grow by attracting online retailers wary of rival eBay.
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Financial Performance Best Buy's quarter boosted by online August 26, 2014 | Fierce Retail http://www.fierceretail.com/story/best-buys-quarter-boosted-online-looking-toward-newreleases/2014-08-26 Best Buy (NYSE:BBY) reported a better-than-expected second quarter, with $8.9 billion in sales. The sales increase has been attributed to the Renew Blue cost reduction initiatives and online sales, and the company hopes that innovators in the electronics industry will speed up the release of new products to help drive profits. The retailer continues to see a shift in consumer behavior as more shoppers purchase online. "As a result, traffic to our brick-and-mortar stores continued to decline, yet our in-store conversion and online traffic continued to increase due to the execution of our Renew Blue strategy, which is in direct alignment with this shift," said Hubert Joly, president and CEO of Best Buy. The Renew Blue strategy is designed to grow business, enhance the in-store customer experience, and leverage omnichannel capabilities. Best Buy's Renew Blue is part of Joly's turnaround program. It has cut operational costs by approximately $765 million and clipped the workforce by roughly 2,000 employees. "Looking ahead, our goal is to continue to create a differentiated multichannel customer experience, such that every interaction customers have with us, regardless of channel, makes them a promoter of the Best Buy brand," Joly said. "In support of this, we will be intensifying our investments in customer-facing initiatives across both channels in the back half of the year." Sharon McCollam, Best Buy's executive VP, CAO and CFO, also commented on the quarterly sales, saying industry-wide numbers were continuing to decline in many of the electronics categories. "We are also seeing ongoing softness in the mobile phone category ahead of highly anticipated new product launches," McCollam said. "Therefore, absent any change in these declining industry trends and with limited visibility to new product launch quantities, we continue to expect comparable sales to decline in the low-single digits in both the third and fourth quarters." Domestic revenue declined 2.4 percent from last year to $7.59 billion, due in large part to less favorable economics and the new credit card agreement. However, online revenue increased 22 percent to $581 million with help from the national rollout of Best Buy's ship-from-store capability and a higher average order value.
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Staples to close 140 stores, focus on e-commerce August 20, 2014 | Fierce Retail http://www.fierceretail.com/story/staples-close-140-stores-focus-e-commerce/2014-08-20 Staples (NASDAQ:SPLS) announced it will close 140 stores this year as part of a turnaround plan. The company reported an underperforming second quarter in which net income dropped 20 percent to $82 million. To keep up with Web-based rivals, Staples outlined plans in March to close as many as 225 North American stores through 2015 and to reduce costs by as much as $500 million reported Bloomberg. According to the company's quarterly reports, sales fell 2 percent in Q2, down to $5.2 billion. The total sales growth was negatively impacted by foreign exchange rates and store closures in North America over the past year. Comparable store sales were down 5 percent, reflecting a decline in customer traffic and a decline in average store order size, versus the year prior. "We're accelerating growth in our delivery businesses as customers turn to Staples for more products beyond office supplies," said Ron Sargent, chairman and CEO, Staples. "At the same time, we have more work to do to stabilize our retail business, and we're taking action to improve customer traffic, reduce expenses and close underperforming stores." The company noted a decline in operating income due in part to investments made to fuel ecommerce growth and to support strategic reinvention. This number was partially offset by progress in reducing expenses in Staples' retail stores—during the quarter, the company closed 80 brick-andmortar stores in North America. The bright spot in the second quarter was e-commerce. Staples.com grew sales 8 percent, due to customer acquisition, improved customer conversion and an expanded assortment beyond office supplies. Also, there was double digit growth for in-store Staples.com kiosks and an enhanced omnichannel experience with the launch of the buy online and pick-up in-store program. Staples recently redesigned its websites to better integrate online, mobile and tablet. It also opened a test lab in Seattle to test e-commerce, search and personalized shopping initiatives.
Home Depot promotes Craig Menear to CEO August 21, 2014 | Fierce Retail http://www.fierceretail.com/story/home-depot-promotes-craig-menear-ceo/2014-08-21 Home Depot (NYSE:HD) announced Craig Menear, president for U.S. retail, will succeed Frank Blake as CEO this year. The move comes a few days after the home improvement chain reported a better than predicted profit for the second quarter. Menear joined Home Depot in 1997 and has 34 years of retail experience. Before being named president in February, he served as executive VP of merchandising. He also spent time working for Ikea, reported Bloomberg.
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Blake, who has been CEO since 2007, will remain chairman and Menear will take the helm Nov. 1. Blake took over as CEO from Robert Nardelli, who was criticized for receiving excessive pay during a period when the company had lost market share to Lowe's. Blake navigated the retailer through the U.S. housing crash by slowing new store growth and focusing on increasing sales in existing locations. Home Depot has boosted profit for five straight years as the recovering U.S. housing market has encouraged shoppers to spend again on renovations. In fact, the retailer ended the last fiscal year with comp sales up 4.9 percent in the fourth quarter of 2013. It was the strongest comp sales growth in 14 years. The company has also seen a substantial rise year-over-year in online sales, up 3 percent in the first quarter of 2014. E-commerce now accounts for 4.2 percent of the retailer's overall sales.
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Online and Ecommerce Operation Macy’s expects a holiday boost from buy online, pickup in store August 13, 2014 | Internet Retailer http://www.internetretailer.com/2014/08/13/macys-expects-holiday-boost-buy-online-pickupstore The option is now available in all 675 full-line Macy’s stores, and customers like it, the retailer says. Macy’s Inc. disclosed today that its customers can now pick up online orders in all of its full-line stores, and that the positive shopper reaction to the recent rollout suggests the service could boost its store sales this holiday season. “We haven’t even marketed this capability, and we’re already finding many customers like this option,” chief financial officer Karen Hoguet told analysts today in discussing the company’s second quarter earnings. “And once in the store these customers are often buying other items as well.” She said it is premature to predict how many shoppers will use the service. “Hopefully, as the fall season moves on we’ll understand better how it’s being used and it’s potential,” she said. “We’re excited by what we’ve seen so far and expect to be a help in the holiday season.” Macy’s announced in February plans to roll out buy to all its 675 full-line department stores, following a successful test in Washington, DC. The option already was offered by Macy’s Inc. subsidiary Bloomingdale’s. Excluded are some Macy’s specialty and furniture stores and Bloomingdale’s outlet locations. Macy’s, No. 8 in the 2014 Top 500, has stopped reporting its online sales, saying that what it calls its “omnichannel” initiatives—such as buy online, pickup in store—make it hard to distinguish online from offline sales. But Hoguet emphasized that the company will continue to invest in technologies designed to tie the web to its stores. She said the company has invested in computer systems that link its bricks-and-mortar and online assets; is building a new e-commerce distribution center in Tulsa, OK; and “testing like crazy” digital technologies in stores. While she did not elaborate, one example of a digital technology Macy’s has been trying out is theShopBeacon service from Shopkick that detects a customer with a Macy’s mobile app when she enters a store, enabling the retailer to send her in-store offers. “You can assume omnichannel and technology investment will be an ongoing part of our capital budget and expense,” Hoguet added. For its fiscal second quarter ended Aug. 2, Macy’s reported: •
Total sales increased 3.3% to $6.267 billion from $6.066 billion in the same period a year ago. The company did not break out its online sales.
•
Comparable-store sales increased 3.4%. When including store departments operated under license by outside suppliers, such as athletic shoe brand Finish Line Inc., same-store sales increased 4.0%.
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•
Net income increased 3.9% to $292 million from $281 million.
For the first two quarters of its fiscal year, Macy’s reported: •
Sales increased 0.7% to $12.546 billion from $12.453 billion.
•
Same-store sales were up 0.8%, 1.5% when including departments licensed to third parties.
•
Net income increased 3.6% from $498 million to $516 million.
Macy’s got credit for working to tie together its stores and the web in a recent Interbrand survey that moved Macy’s up to No. 16 from No. 40 in brand value among North American retailers, largely on the strength of the company’s cross-channel initiatives.
Supervalu becomes latest data breach victim August 15, 2014 | Fierce Retail http://www.fierceretail.com/story/supervalu-becomes-latest-data-breach-victim/2014-08-15 Supervalu (NYSE:SVU) is the latest retailer to experience a data breach, announcing today that cybercriminals had accessed payment card transactions at some of its stores. The Minneapolis-based company said it had "experienced a criminal intrusion" into the portion of its computer network that processes credit and debit card payments for some of its stores. There was no confirmation that any cardholder data was in fact stolen and no evidence that the data was misused, according to the company. The event occurred between June 22 and July 17 at 180 Supervalu stores and stand-alone liquor stores. Affected banners include Cub Foods, Farm Fresh, Hornbacher's, Shop 'n Save and Shoppers Food & Pharmacy. The company believes that the intrusion did not affect any of Supervalu's owned or licensed Save-ALot stores, or any of the independent grocery stores supplied by the company through its Independent Business network—other than the franchised Cub Foods. Some stores owned and operated by Albertson's and New Albertson's, including Jewel-Osco stores, suffered a related data breach. Supervalu said it took immediate steps to secure the affected part of its network. An investigation supported by third-party data forensics experts is ongoing as efforts to understand the nature and scope of the incident persist. Supervalu believes the intrusion has been contained. "The safety of our customers' personal information is a top priority for us," said President and CEO Sam Duncan. "The intrusion was identified by our internal team, it was quickly contained, and we have had no evidence of any misuse of any customer data."
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In-store shoppers can use QR codes and texts to initiate mobile live chats August 14, 2014 |
Mobile technology provider TouchCommerce unveils TouchStore, which connects store shoppers carrying smartphones to live chat agents prepared to educate shoppers on products and promotions. Many top retailer executives in mobile commerce and other mobile shopping experts believe retailers overall have yet to fully exploit location as a factor in marketing and selling to shoppers using smartphones. M-commerce technology provider TouchCommerce has just debuted a new tool designed to help retail chains exploit location and enhance shopping for consumers with smartphones in stores. Dubbed TouchStore, the new mobile tool enables retailers and consumer brand manufacturers running promotions in retail stores to strategically place signs with QR codes and/or text message short codes and quick explanations of the live chat functionality and how it relates to a current product or promotion. A customer can use a bar code scanner app, or a bar code scanner built into a retailer's app, to scan a QR code, which then links the customer to a live chat agent on that retailer's or brand's mobile web site or responsive design site. A customer also can send a text message to a retailer's short code to be linked to live chat. Agents, either provided by TouchCommerce or those working for a retailer or brand and trained by TouchCommerce, answer customer questions about a product or promotion. The goal is that adding expert help will increase in-store conversion and sales, says George Skaff, chief marketing officer at TouchCommerce. He adds that weekly chat analytics reports can help retailers and brands identify issues and consumer sentiment, and make changes when necessary. TouchStore can enable self-service for store shoppers during busy periods, provide instant gratification that is key for mobile shoppers, help reduce showrooming by keeping customers focused on that retailer's products, and better understand rapidly growing cross-channel shopping, Skaff says. Costs for the in-store live chat system vary depending on how many TouchCommerce modules a retailer or brand implements, and on whether a client needs chat agents from the vendor. Modules focus on live chat, content, product guides, customer surveys and other functions. Traffic volume also affects costs. Skaff says a typical multi-module implementation starts around $50,000. "Mobile engagements are driving omnichannel growth across online and offline shopping environments," says Clare Price, vice president of research at online and mobile marketing research firm Demand Metric. "Solution providers that are enabling brands to embrace the mobile platform and modernize interactions with in-store shoppers will be at the forefront of the omnichannel retail customer experience."
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India to be launch pad for Amazon's plan to deliver packages using drones Aug 20, 2014 | Economic Times http://articles.economictimes.indiatimes.com/2014-08-20/news/53028827_1_prime-air-dronesoutdoors-amazon India, not US, will be the launch-pad for Amazon's plan to deliver packages using drones, or unmanned aerial vehicles, according to two people aware of the development. The US-based e-tailer will debut its drone delivery service with trials in Mumbai and Bangalore, cities where it has warehouses, the sources said on condition of anonymity. Last December, Amazon showcased its Prime Air drone to the world with much fanfare. Since then, questions have been raised about the plausibility of such an idea, but the company appears to be keen on making headway. "It could be as early as Diwali," said one of the sources. Amazon said in a statement that it does "not comment on what we may or may not do in the future". Amazon's Prime Air is an octocopter, a drone fitted with eight rotors. Most recently, Amazon had said it is developing vehicles that weigh less than 25 kg and travel at over 80 kmph. The drone will carry a payload of up to 2.26 kg, which covers 86% of products sold on Amazon. Top-selling products such as mobiles and books will likely be delivered within 90 minutes-3 hours for select customers. "With regard to consumer acceptance, the good news is that people are not very familiar with the concept (of drones) and won't start with a bias against it," said Kartik Hosanagar, associate professor of Internet commerce at The Wharton School of the University of Pennsylvania. Seattle-based Amazon, founded by billionaire entrepreneur Jeff Bezos, is challenging Flipkart for leadership of India's online retail market, which is estimated by Crisil to be worth Rs 50,000 crore by 2016. If Amazon usesdrones to deliver even one package, it will be a huge publicity coup for the USbased firm, helping it upstage Flipkart just when sales will spike because of the festival season. India is an attractive test bed for Amazon because the country still hasn't woken up to the need for rules that will govern the use of unmanned aerial vehicles (UAVs). In the US, on the other hand, companies such as Amazon are not allowed to fly drones outdoors. The Directorate General of Civil Aviation said it was not aware of any such plan by Amazon. Drone operators in India said they don't obtain permits from DGCA for purposes such as aerial photography, surveying sites and wild life protection. While the feasibility of operating drones in India exists, it is not without challenges. "Many companies in India have thought about this. But all are worried about the safety aspect," said Pritam Ashutosh Sahu of Bangalore-based Edall Systems, which builds drones and also trains students on the technology. Sahu said the drone has to be tested for flying within cities, and that losing communication with the drone is a very real possibility. "It can crash into a building, or might attract untoward attention," said the 28-year-old graduate of aeronautical engineering from Anna University.
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Kohl's pushing e-commerce initiatives August 15, 2014 | Fierce Retail http://www.fierceretail.com/story/kohls-pushing-e-commerce-initiatives/2014-08-15 In the retailer's second quarter financial conference call, Kohl's (NYSE:KSS) mapped out future ecommerce plans, which include a buy online, pick up in-store program. The company is also working to improve its mobile app in an effort to increase online sales by 20 percent, reported Internet Retailer. Kohl's reported sales of $4.24 billion in the second quarter, up 1.1 percent from the same period last year. The chain did not release any e-commerce figures. However, last year's Web sales amounted to roughly $1.76 billion, up 23.1 percent from 2012. "I'm especially pleased but not surprised by the renewed momentum in our e-commerce business," Kevin Mansell, CEO, president and chairman of Kohl's, toldSeekingAlpha. "Last year, our e-commerce sales were affected by the re-platform from July through October. July sales this year returned to rates that we have not seen since updating our platform last summer. They ran up over 30 percent." In an effort to drive more sales to Kohl's 1,160 stores, the company will also test a buy online, pick up in-store program in 100 locations this fall. "Once successful, the pilot will be rolled out to all stores nationwide," Mansell said, adding that the program is meant to give customers another reason to make a visit that they otherwise might not have made. Mansell also said the retailer will use 800 stores to fulfill online orders, making them e-commerce warehouses. "We think this will improve shipping times and provide additional e-fulfillment capacity during the peak holiday season," he said. Mansell also predicts an increase in Web traffic through mobile, so the company is working to improve the Khol's app and make it easier for customers to check out. In spring, Mansell was rumored to be planning a management shake-up as the retailer struggled to boost sales and reorganize the business. The e-commerce initiative began earlier this year when the retailer announced that online issues led to a surge in unexpected expenses.
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