Prada's Smart Tags Too Clever?

By Associated Press - Also by this reporter Page 1 of 1  

01:36 PM Oct. 27, 2002 PST  

The most striking thing about the new Prada store in Manhattan's SoHo 
neighborhood isn't the round glass elevator or the sloping wood floor 
that displays $500 shoes.  

Nor is it the see-through raincoats in cages or the clear dressing 
room doors, made of liquid crystal panels that darken for privacy 
when shoppers step inside.

The real magic in the fashion house's 17,000-square-foot store is 
the technology behind the scenes innovations that other retailers 
are also looking to adopt.

Using a technology called radio frequency identification that 
embeds data in clothing tags, Prada sales associates armed with 
handheld computers can find out a lot on the spot. What sizes of 
that blouse are still in stock? What materials are in it?  

Prada shoppers eventually will be able to create "virtual closets" 
and store information about what they tried on and bought in password-
protected Internet accounts. They will also be able to opt for customer 
cards that detail past purchases and contain notes sales associates 
may have made on their preferences. Such cards would be readable 
either by associates' handhelds or at cash registers.  

Although designed to improve the shopping experience and make stores 
more efficient, such technologies also carry risks for consumers 
concerned about privacy; unless merchants set clear policies on the 
sharing of customer information.  

The Prada store in SoHo, which opened nearly a year ago, is the first 
of a string of so-called "epicenters" the Italian fashion company plans, 
with Tokyo and Los Angeles stores scheduled to open next year.  

Prada's use of "smart tags" on the sales floor -- other retailers use 
them to track merchandise in warehouses -- puts it at the forefront of 
a movement among merchants to expand their use of technology. 

Internet kiosks in some Barnes & Noble and Gap stores enable 
shoppers to research products or order merchandise not on the 
premises. And Nordstrom is experimenting with storing customer 
information.  

At least one other major retailer is trying out a different sort of 
tech tool. Vocera Communications Systems is testing WiFi wireless 
technology at a Target store in Rogers, Minnesota. It bundles the 
functions of a walkie-talkie, phone and pager into a 1.6-ounce badge. 
Store associates wear them around their necks and operate them hands 
free with voice commands.  

In the Prada store's dressing rooms, customers can hang clothes in 
one lucite box and accessories, like handbags and belts, in another. 
An image is captured from their radio-frequency tags and projected 
on a plasma screen beside the closet in the dressing room.  

By pushing buttons on the screens, customers can mix and match 
outfits, and find out more details about the clothing.  

When a reporter wanted to try on a $540 tapered wool jacket recently, 
the sales associate took her to a dressing room and deftly showed her 
how to get information about the garment's fabric and other details 
by pressing buttons on the screen.  

Screens in dressing rooms will eventually be linked to the Web, enabling 
consumers to create "virtual closets." Just when such features will be 
available, Prada spokeswoman Katherine Ross wouldn't say. Integrating 
the technology at the Prada SoHo store hasn't always been easy.  

As recently as July, sales associates still had trouble with the 
wireless tag scanners. And many shoppers interviewed during a recent 
visit were unaware of the radio frequency identification technology 
and how it works.  

Eric Wong, 24, of New York, said that although he was impressed 
with the store's tech features he has a "better shopping experience" 
at Barney's, which carries Prada and has a more intimate feel.  

"Overall, it seems that the technology wasn't used to enhance the 
consumer experience, but help the sales people on the floor," said 
Mitch Kates, a principal with Kurt Salmon Associates, a retail 
consulting firm. "The technology is cool, but it can also be 
intimidating." 

One loyal Prada shopper, Shawn Rubino of Rye, New York, was 
impressed by streaming videos embedded in tables in the store and 
said she was "excited about the technology." But she was concerned 
about the potential "invasion of privacy" from some of Prada's tech 
plans.  

Ross, the company spokeswoman, said Prada has no plans to share 
any information with outside parties.  

How Prada uses its technology to learn more about its customers 
remains key, said analyst Kate Delhagen of Forrester Research. While 
other companies store information online, at Prada "store clerks will 
have access to it," she noted.  

Nordstrom has moved into similar territory by teaming up with Blue 
Martini Software to roll out customer relations software in its stores. 
The intention is to help sales representatives better track customers' 
purchases and tastes by storing individual shoppers' information in a 
central database.  

While the software is expected to make sales associates more efficient, 
the larger potential for Nordstrom is in cross-selling and pushing sales 
of related items, like hosiery with shoes.  

That could be a big turnoff to customers who don't want clerks to know 
too much about them.  

"The main problem is that you set yourself up for more sales people to 
pitch you products," said Richard Smith, an Internet privacy consultant.  
"And if they see you spending a lot of money, they'll be hovering more."

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Source: Wired News - http://www.wired.com/news/technology/0,1282,56042,00.html


Cheers, Steve..

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