E-receipts next on retail front

XML-based receipts, viewed via browser, could give merchants new shopper data

NEW YORK

Get ready for the next frontier in retail customer research, one that is also being billed as a way to drive new consumers to e-commerce Web sites.

Within a year to 18 months, both online and in-store shoppers may be able to opt for digital receipts. Based on the XML content-tagging language, the receipts can be viewed through browsers under a standard announced last week and backed by Visa International Inc., Office Depot Inc. and several high-tech vendors led by NCR Corp.

Supporters said widespread adoption of the standard would mean consumers no longer need worry about losing receipts, since they would have a record for warranty that was always available. The digital receipts could also benefit businesses that want to better manage and track employee purchases made with corporate procurement cards.

"Conceptually, I think it's a great idea. If you can eliminate paper, that's good for society and (improves) efficiency and accuracy," said George Chernenko, director of data centers at Toys R Us Inc. in Montvale, N.J. "But practically, there's a lot to be worked out."

The Digital Receipt Alliance, which includes Visa, Office Depot, America Online Inc., Microsoft Corp. and Hewlett-Packard Co.'s VeriFone division, submitted the proposed standard for digital receipts to the National Retail Federation's technology standards body.

The XML-based receipts would contain transaction data, hyperlinks to a retailer's and product manufacturer's Web sites and, potentially, targeted discount offers and promotions. They could be delivered via e-mail or over the Internet for purchases made either online or in brick-and-mortar stores.

Jim Greene, a senior product manager at Dayton, Ohio-based NCR, predicted that digital receipts will become available within a year to 18 months and gain a foothold once a few major retailers in different shopping segments adopt them.

He said retailers stand to gain numerous benefits, including the capture of receipt data, a digital platform for communication and a linking mechanism for small applications, such as rebates and warranty information. "It's a great innovation for retailers that have brick-and-mortar operations that want to reach the online consumer," Greene said.

Raymond Burke, a business school professor at Indiana University who studies retailing, said he can envision a retailer using the information gathered to offer consumers profiles of the nutritional merits of their diets or advice on wardrobe planning. He further predicted that digital receipt databases will be better than those used in retailers' frequent-shopper programs, because they will track both in-store and online purchases "so you get a richer picture of consumer behavior," he said.

"It's also going to be better because this database is going to be private, so the consumer will be more willing to augment it with personal information like financial goals or lifestyle information or what they're interested in shopping for, without fear of being inundated with unwanted promotional messages," Burke added.

George Grant, a consultant at Musicland Stores Corp. who works for Minneapolis-based Wireless Network Solutions Inc., said the digital receipts could "break the ice" for brick-and-mortar shoppers by getting them to test the Internet to check out retailers' receipts and associated coupons and promotions.

"They have a reason to go online, and they're right on your Web site," Grant said.

The prospect of digital receipts is extremely appealing to Brian Hume, president of Martec International Inc., a retail consultancy in Atlanta. Hume, who hails from Great Britain, said his wife gave him an expensive watch for his birthday, but she left the receipt for the watch, which was purchased in the U.S., in England. When the watchband broke nine months later, he returned it to the store and didn't have the receipt. "I'd find (digital receipts) very useful," Hume said, adding that he would also use them to help reconcile business expenses.

However, one analyst questioned consumer need. "That seems like a solution looking for a problem. We've never had consumers complain about the lack of digital receipts," said Nicole Vanderbilt, an analyst at Jupiter Communications Inc. in New York. "I'm skeptical of the value for the consumers, but I see the clear value for retailers."

Copyright © 2000 IDG Communications, Inc.

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