STORES Magazine - October 2008 - (Page S14)

CIO COUNCIL RECAP Retail Leaders Assess State of the Industry, Eye Future Trends NRF’s CIO Council met August 10 in Broomfield, Colo., in conjunction with NRFtech 2008: IT Leadership Summit. Council chairman Jeff Marshall, senior vice president and CIO for Kohl’s, led an active discussion with 40 other retail CIOs. Following are highlights from that meeting. IT spending Although retail sales have been sluggish in 2008, IT spending is holding steady — and in some cases, increasing — in spite of the economy. A quick show of hands indicated that the budgets of more than three-quarters of the CIOs in attendance have held steady or increased. Those findings are corroborated by the 2008 NRF & AMR Research IT Budget Benchmarking Study. This is the fifth year for the study, which is sponsored by NRF’s CIO Council. According to the survey: • Companies are spending 1.5 percent of revenue on IT. • On average, retailers plan to spend about 8 percent more on IT in 2008 than they did in 2007. • The strengthening of cross-channel strategies, combined with high energy costs, is causing retailers to review warehouse management and transportation management systems. • Many participants indicated that they have negotiated some very favorable deals with solution providers. As one CIO said, “The good news is that companies are getting smarter and the price for a lot of software and investments is going down.” On the flip side, he said, companies can expect to pay more for software maintenance. Three-quarters of CIOs in attendance said IT spending is even with or up from 2007. actions for goods and other enhanced services, such as loyalty programs and coupons. Near field communications (NFC) has gained some acceptance in Asia and Europe, but widespread adoption in the United States appears to be years away. Still, savvy retailers are looking at mobile retailing as a way to differentiate themselves from the competition. Struggle for compliance The discussion then moved to the topic of data security and PCI compliance. Globally, there have been numerous instances of hackers accessing computer systems, stealing cardholder data and using this data to commit credit card fraud. In several cases, they have targeted retailers’ computer systems used to process or store credit card data or those of third parties that process payments on behalf of merchants. To say that retailers are frustrated with the PCI Data Security Standard would be an understatement. As the conversation began to focus on other methods of breach prevention, the overwhelming opinion of the group was that if Visa and MasterCard would stop requiring retailers to store full credit card numbers, it would be taking away a great deal of incentive for hackers to attempt a breach in the first place. In fact, many retailers are taking this approach and not storing credit card numbers past settlement as a means to reduce the scope of PCI compliance. NRF plans to continue to address this issue with the banks and credit card industry. WWW.STORES.ORG Mobile retailing Having consumers use their cell phones or PDAs as an alternative payment method shows great promise for the future: Hardware and software standards need to be developed, however. Clearly nearing a “tipping point,” near field communications-enabled mobile commerce promises a new, ubiquitous retail channel. Embedded into mobile phones and other devices, this technology could offer consumers convenience, security and simplified transS14 STORES / OCTOBER 2008 http://WWW.STORES.ORG

Table of Contents Feed for the Digital Edition of STORES Magazine - October 2008

STORES Magazine - October 2008 Contents Executive Editor's Page President's Page Force of a Different Collar What Shoppers Think Bagging the Competition 10 Things You May Have Missed Numbers Worth Counting Full Price/Markdown Retail People Favorite 50 Sticky Strategies for Retention Concept2Watch Kiosks Online Business Intelligence RFID NRFtech Wrap-up E-Commerce Credit Warehouse Systems Logistics Selling Tools Supply Chain LOEB Retail Letter Arts Update Point of View NRF News Retail Crossword Retail Industry Calendar Last Laugh

STORES Magazine - October 2008

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