Along the way came the Internet, which sparked the consumerization of information technology. E-commerce systems with their corresponding transaction engines evolved separately from brick-and-mortar POS. Even today, consumer-facing mobile apps are evolving separately from traditional e-commerce platforms. The problem is that these many siloed systems, certainly effective in their own channel, have put huge strains on the ability of a business to effectively respond to the ever-changing retail landscape. The result is a duplication of costs from system acquisition to maintenance and support. Perhaps more important is the intangible cost of displaying an inconsistent customer experience across these channels.

Fortunately, retailers and solution providers are working together to address these problems. Both have recognized internal and external issues surrounding isolated transaction systems. That’s why NRF, in partnership with Demandware and the University of Arizona, recently conducted original research on trends in POS which indicates that retail IT leaders are looking at how they can bring together these disparate transaction systems. One example found in the report explains that today’s e-commerce engines – featuring flexibility and extensive functionality that goes beyond core transaction support – are poised to lead the next evolution of the “cash register.”

Learn more by reading the new “Digitizing the Store” study. And, after reading the study, contact me to learn how you can get involved with NRF’s technology leadership community, including the CIO Council and ARTS.

Dorsey says a receipt is not just a piece of paper or an email – it’s a powerful communication tool that should be used to add value and keep customers coming back whether it’s online or in the store.

“What can we build into this canvas that’s actually valuable, that’s independent of the product you just sold?” Dorsey asked as this morning on the final day of Retail’s BIG Show.

Dorsey described Square’s Square Wallet as a receipt in the form of an application. Customers who walk into a Square Wallet merchant can be greeted by name, get VIP service and pay without ever taking their phone out of their pocket.

“That’s what great technology allows,” Dorsey said. “It allows for experience. It allows for the mechanical aspects of what we do every day to completely disappear.”

Dorsey was joined onstage by HSNi CEO Mindy Grossman, who moderated a question-and-answer session on Square’s recent “Let’s Talk” campaign. Watch the video below for more about Dorsey’s philosophy on technology and how retail is revitalizing cities across America.

At Retail’s BIG Show this morning, a panel of retailers acknowledged the importance of offering a great mobile web experience. Executives from Sephora, Sears Holding Company and Century 21 Department Stores said most of their mobile traffic is coming from web browsers – after all, that’s where search, email and social links point – but emphasized the increasing value of using apps and loyalty programs to develop deeper customer relationships.

Sears Holding Company’s Division VP and GM Andy Chu (left) with Century 21 Department Stores Director of Process Improvement and Communications Sandi Riffle and Sephora’s Director of Mobile and Digital Store Marketing Johnna Marcus.

On encouraging in-store mobile use:

Sephora’s Johnna Marcus said the brand encourages customers to use mobile devices in stores and has moved beyond concerns about showrooming. During the holidays, 30% of Sephora shoppers were using their phones in stores – often to read product ratings and reviews or use the digital version of Sephora’s loyalty card. Marcus thinks mobile helps combine the best of web and in-store shopping experiences, especially in the world of beauty. Customers can research, sort, filter and make lists on their phones … then touch, see and smell products in stores.

On sustaining engagement:

Sears Holding Corporation’s Andy Chu reminded retailers that getting customers to download an app is the easy part. Sears uses a combination of marketing techniques – social media, retargeting, store signage – to drive downloads. The real challenge is getting customers to use the app on a regular basis. It’s critical to have a clear strategy for providing strong value and enhanced experiences.

On the importance of relevancy and utility:

Though Century 21 Department Stores have had a loyalty program for more than four years, the retailer is just entering the mobile space with an app launching this month. Century 21’s Sandi Riffle said the app is designed with their audience in mind. International tourists will find the app’s visual cues and icons easy to use even if they don’t speak English fluently. And the app’s core features are intended to make the shopping experience faster, easier and more meaningful.

As Chu explained, focusing on solving customer problems is key. “At the end of the day, it’s all just omnichannel.” And mobile technology is uniquely positioned to improve shopping experiences in store, online and on the go.

“We are writing to start off the New Year to urge immediate action on legislation to create marketplace fairness and make the 2013 holiday shopping season the last where Main Street businesses must compete at a government-created price disadvantage,” NRF and others said in the letter to House Judiciary Committee Chairman Bob Goodlatte, R-Va.

The letter said the U.S. Supreme Court’s recent decision not to hear a challenge to New York State’s law “highlights the need for Congressional action” and applauded Goodlatte’s “Principles on Internet Sales Tax” that were released last September. The group urged Goodlatte to “turn these principles into legislative language and make this issue a top priority for the Judiciary Committee in 2014.”

The letter comes at an important time for the business community and marks an opportunity to draw a line in the sand with Congress on this critically important issue. With the Senate’s broad, bipartisan passage of the Marketplace Fairness Act last spring, Goodlatte’s principles and the Supreme Court decision, the time is ripe to build on the momentum of 2013, and ratchet up the pressure on Congress to finally address the sales tax disparity that distorts the free market, hurts local communities and places neighborhood retailers and Main Street merchants at a competitive disadvantage.

NRF and our industry allies will continue to press for a level playing field for all retailers no matter the channel in which they sell or operate. NRF firmly believes that it is up to Congress to pass federal legislation that would finally permit states to require all sellers to collect sales taxes on all sales. These sales taxes are already owed, so there’s no reason they shouldn’t be collected. That legislation, be it the Senate-passed Marketplace Fairness Act or another vehicle from the House, should become law as soon as possible so it can be effective before the next holiday shopping season. A sale is a sale and fair is fair, and it’s time for Congress to set this right.

As the Super Bowl for the retail industry, all bets were off this weekend when many retailers opened their doors on Thanksgiving Day. NRF President and CEO Matthew Shay on Black Friday told CNBC that when all is said and done, “the consumer is the real winner.” Some retailers touted free $100 gift cards with the purchase of an iPad Air while others gave in-store shoppers a chance to win a Nexus 7 tablet or one of 10 weekend getaways. Discounts and special deals like these were a powerful combination for retailers this past weekend.

In addition to what Shay and Prosper’s Consumer Insights Director Pam Goodfellow said during NRF’s annual media briefing, here are a few of our top takeaways from the weekend:

More people were shopping, but were spending less. Discounts and low prices, combined with the fact that 53 percent of Americans started their shopping in early November, were contributing factors to shopping over the holiday weekend. Spending dropped 3 percent to $57 billion, at an average $407. But with the number of shoppers up 1 percent and Thanksgiving Day in-store traffic growing 27 percent over last year, retailers are still calling the weekend a win.

Why the uncertainty? NRF’s forecast that holiday sales will increase 3.9 percent to $602.1 billion holds strong. But Americans still aren’t sure about the staying power of the economic recovery. Family income hasn’t grown in quite some time, and next year’s added health care costs mean consumers are keeping a close eye on holiday budgets.

Millennial power. NRF’s survey of consumers found young adults 18-34 spent an average $460 over the weekend, the highest of any age group. As in years past, they showed up eager to take advantage of retailers’ Thanksgiving deals: 49 percent were at stores by midnight on Thanksgiving, with eight in 10 shopping on Thanksgiving Day and 58 percent on Black Friday. And 31 percent shopped online on Cyber Monday using mobile devices. Retailers are smart to target and engage these shoppers.

Thanksgiving weekend goes digital. Consumers want to shop when they want, where they want and how they want, regardless of the channel, and retailers are responding. Walmart saw 400 million page views on its web site on Thanksgiving Day, including customers who used smartphones, tablets and computers. And NRF found similar excitement among weekend shoppers: nearly 44 percent of what consumers spent between Thursday and Sunday was spent online, up from 42 percent last year. The average amount spent online also increased, up 3 percent at $178 over the weekend.

Cyber Monday continues to grow. Retailers were touting “cyber” deals as early as November 20, even leaking information about their own upcoming deals, and Cyber Monday was bigger than ever. More than 131 million consumers shopped online on Cyber Monday, up from 129 million last year, according to numbers from NRF and our Shop.org division. Sites like CyberMonday.com worked overtime to attract holiday shoppers, and retailers ramped up efforts to perfect their mobile sites and apps to make sure they had the capacity to handle expected traffic. In just one example, eBags founder Peter Cobb told me his company’s sales were up 21 percent over last year by 3 p.m. on the big day.

The most telling Cyber Monday consumer statistic might be in the numbers for mobile. More than 25 million Cyber Monday shoppers – nearly one in five – shopped using their smartphones or tablets, up 22 percent over last year. As NRF Senior Vice President and Shop.org Executive Director Vicki Cantrell told Bloomberg, it’s this influx of mobile that has the retail industry’s attention during the holidays and year-round.

NRF recently released the preliminary results of its Thanksgiving weekend shopping survey. What were your top takeaways from that survey regarding  planned shopping on Thanksgiving, Black Friday and the holiday weekend?

I’ve been asked on multiple occasions if the holiday “creep” – retailers’ early promotions and early bird shopping habits among consumers – is pulling consumers away from the shopping extravaganza that is Black Friday (and now Thanksgiving) weekend. As of early November, more than three out of five holiday shoppers (61 percent) were planning to shop that weekend, down a few points from a year ago (65 percent) – so the “creep” may be shifting some of those Black Friday sales earlier. I think it’s important to remember, though, that a lot of retailers have yet to announce their specific deals, promotions and discounts for the weekend, so there’s still plenty of time for shoppers to get excited about shopping that weekend. And, we’ve estimated that about 33 million consumers plan to shop on Thanksgiving Day while 97 million are planning to visit stores and websites on Black Friday – that’s still a lot of shoppers.

Prosper Insights & Analytics Consumer Insights Director Pam Goodfellow

For the seventh consecutive year, gift cards came in as the most-requested gift item, according to NRF. The survey also found spending on gift cards is expected to reach an all-time high this holiday season. Why do you think consumers gravitate towards gift cards each year for holiday gifts?

To recipients, gift cards are simply the perfect gift: you never have to exchange them for a new size/color or worry about receiving duplicates (because that’s OK, too!). Of course, gift cards allow recipients to ultimately choose their own gifts, whether they are more practical or more on the extravagant side. And for gift card givers, they are an easy purchase: buyers don’t have to worry about retailers selling out of cards, carrying packages in and out of stores, or wrapping and shipping large packages across the country. Gift cards also make the perfect last-minute gift, with many retailers and websites allowing shoppers to send virtual gift cards to recipients’ email or social media accounts.

Consumers still have feelings of uncertainty with the state of the U.S. economy. But there seems to be some relief coming from prices at the gas pump. Do you think the decrease in gas prices will comfort consumers to spend more on holiday gifts? Or do you see “cautious conservatism” being a factor during the winter holidays like the back-to-school season?

Cautious conservatism and budget-conscious will continue to be major buzzwords among shoppers this holiday season. Although some of the “pain at the pump” has eased for consumers, they are still uncertain about the direction of the economy, the outlook for employment, and uncertainty in Washington, D.C.; these overarching concerns will keep budgets tight this season. Plus, shoppers have done an excellent job honing smart shopping strategies (price comparisons, couponing, sale shopping, etc.) over the years, so they’re still going to be on the lookout for the best possible deals and not spend any money that they don’t have to. And from what I’ve seen already from retailers this holiday season, there will be plenty of deals out there for shoppers to choose from.

Mobile retailing continues to grow, and Shop.org recently found that Americans are now using the Internet more from their mobile devices than their laptops and desktops. What trends do you expect to see over the coming weeks from mobile-using holiday shoppers?

Mobile devices like tablets and smartphones are the new shopping buddies for consumers when they’re at the stores. Expect to see a lot of shoppers scanning barcodes to find the best prices, using QR codes to get more information and product reviews – and I think we’ll see many consumers out and about over Black Friday weekend keeping tabs on retailers’ deals by the hour by checking out retailers’ websites and apps. We’ve definitely entered the era of the “SmartConsumer.”

What other trends are you noticing or looking for based on other Prosper Insights and Analytics holiday surveys?

One of the most interesting trends we’ve been tracking is spending by generation. And while Millennials are the “hot” consumer segment right now, these youngsters will be the smallest spenders this holiday season (planning to spend, on average, $601 on gifts, décor, cards, food, and flowers) compared with Gen X-ers ($847), Boomers ($738), and members of the silent generation ($688). So while Millennials present exciting long-term selling potential for retailers, Gen X-ers and Boomers still represent 67 percent of total planned gift spending this holiday season – and are segments that retailers cannot afford to ignore this year.

The Vancouver-based retailer is a leader in online custom menswear and a model of innovation. How does it work? The company’s website guides men through the measurement process and delivers hand-tailored suits to their doors in four weeks. Because Indochino cuts out the middleman and overhead, it’s able to deliver a high-quality product efficiently and affordably.

Ahead of his appearance at Retail’s BIG Show in January, we spoke with Indochino co-founder and CEO Kyle Vucko to learn more about what’s driving the company’s success, what makes him a retail rule-breaker and what’s next for the young brand.

We’re closing in on the holiday season and the end of 2013. Tell us about the year you’ve had and any milestones for Indochino.

Kyle Vucko, Co-Founder and CEO, Indochino

It’s been a big growth year for the company, and one that’s laid a foundation for even more significant expansion in 2014. We closed a Series B funding with Highland Capital Partners, which not only brought in $13 million in investment capital, but also Tom Stemberg, the founder of Staples and an investor and board member at lululemon, to the board. We continued to grow our executive retail and apparel DNA by hiring a COO who had previously run e-commerce for Bare Escentuals, and a CFO. We also had our 15^th pop-up retail store, followed by the first instance of running two stores concurrently, which was an exciting milestone.

Technology is central to your brand, from lasers to predictive measurements. Could you lift the curtain and give us a glimpse of how it all works?

We look to technology to accomplish our goal, creating a great shopping experience for guys. Technology helps us solve the problems facing our customers—using tech like predictive measurements to get measurements accurately and easily, the algorithmic grading of patterns to create a custom garment cost-effectively, and responsive design to offer a great shopping experience wherever the customer may be. We spend a lot of time on the technology because it helps us offer even better products and services to our guys.

Indochino’s “traveling tailor” pop-up stores combine some traditional retail concepts with your original digital model. What’s the most surprising thing you’ve learned since launching the traveling tailor?

The most surprising thing about Traveling Tailor was its conception in the first place! We didn’t set out to create a physical store when we launched in 2007, because we assumed e-commerce would be the only channel we needed. When we did the first pop-up in November of 2011 we were one of the first online companies to do so, and people thought we were crazy. But we’d been listening to our guys for a couple of years, and had learned that there were still those who wanted the personalized experience of shopping in-store. So the challenge became how to create the best in-store experience for them. Since launch, I’ve been pleasantly surprised by how successful the stores have been, as that isn’t always the case with pop-ups.

At Retail’s BIG Show, you’re billed as one of “retail’s rule-breakers.” What makes you a rule-breaker and how did that lead you to where you are today?

I didn’t set out to break the rules. I just wanted to help guys get dressed. That meant an online company that could offer accessible custom clothing to men, but because it hadn’t been done before, traditional fashion rules weren’t as relevant. We had to learn to solve problems as they arose, and rather than looking to rules for guidance we looked to our customers and what they were telling us.

Creating a company that was centered on the customer and their needs meant disregarding a lot of the rules, and that continues to be a guiding principle for how we evolve.

What’s the best business advice you’ve ever received that you would pass on to other young entrepreneurs?

Surround yourself with good advisors and try to learn from the best, but don’t be afraid to go your own way.

What’s next for Indochino? A women’s line? Stores?

We want to continue to evolve the business in our goal of creating the best shopping experience for guys. That focus meant we started with the creation of a company that sold custom clothing online, grew to include great mobile shopping and ultimately launched a tech-enabled retail experience. What’s next will depend on what our customers want—we show up how and where we think we can help guys get dressed, and look and feel great. I’m excited to see where they will take us next.

OpenSky, STORY and LittleBlackBag.com all have unique aspects of retail innovation. With the Fast Track theme in mind, here are a few quick takeaways from each speaker.

• John Caplan shared a few stats about the shopping website, OpenSky, that has over 35,000 products and is 3 million members strong. The website is similar to what a customer would see on social media. Brands share Facebook-like posts of their products and members follow updates that spark their interest. Of course, more followers can equal more sales for merchants. Caplan said merchants who post more often sell six times more than those who post infrequently. The average member is worth 27 times more to a brand than a Facebook fan or follower, according to Caplan, and 80 percent of these connections cross-category shop. But don’t let the numbers fool you— OpenSky thrives as more than a social community. It’s a movement democratizing commerce by connecting small businesses and shoppers who crave quality and diversity. It’s no surprise OpenSky made Fast Company’s Most Innovative list last year.
  

  Little Black Bag CEO Dan Murillo (right), talks retail innovation with STORY Founder Rachel Shechtman and OpenSky Founder and CEO John Caplan.

• Some may have heard Rachel Shechtman’s story before. But that’s the beauty of STORY – it changes so often that there’s always something different to discover. Like OpenSky, Shechtman built STORY from a concept that already exists and made it uniquely hers. The retailer takes a magazine’s point of view, changes every eight weeks like a gallery, and sells merchandise like a store. Content, community and commerce are the foundation of her vision. One might say this fourth generation entrepreneur was raised to think innovatively. Perhaps that’s why she called the square footage metric sales “archaic” and replaced it with her own measurement. Using heat map technology, Shechtman measures “experience by square foot” at her New York store. Seventy-five percent of STORY’s square feet can be experiential displays or events at a given time, not something you can buy, she added. Content and community, driving commerce.

• Dan Murillo concluded with the origin of LittleBlackBag.com. The online retailer is loosely based on a Japanese tradition known as the “Lucky Bag sale”, where retailers sell mystery bags of products. Customers buy these bags and trade the items inside with friends. The concept took off in the U.S., due in large part to the elements engrained in the brand. Using social media, online fire sales and gamification, LittleBlackBag.com is driven by what Murillo calls entertainment commerce. SneakPeeq, Poshmark and Lolly Wolly Doodle are all unique styles that bring the shop, swap and ship ideas to life. But the fundamentals driving people to buy – the scarcity of products, discovery, friendly competition, feeling of accomplishment, and discussions that happen after purchase – are not new to consumers. But making these all successful within online retail is.

During the question and answer session, Shechtman contended that younger generations consider the Internet a utility over a technology. Thus, it’s important for retailers to ensure their physical and digital presence work seamlessly. This just might be the next big innovation in retail.

At Saks, which in recent years has invested heavily in creating a seamless omnichannel structure, asset protection partnered with IT and became central in the leadership of a new state-of-the-art tech roll out so extensive that Liberatore described it as “replacing the nervous system of the human body.”

“Asset protection took the lead and became drivers of the [omnichannel] program. IT and asset protection worked as equals, so we were able to minimize the risk early on,” said Caccioppoli of Saks Fifth Avenue. “We must embrace it,” he continued. “We have to grab hold of this opportunity to help direct where it goes and how to be successful doing it.”

Much like Saks’ dedication to its customer experience, at Disney Stores, the emphasis is on creating magical shopping experiences for customers regardless of when, how or where they shop. And though the company didn’t have streamlined technology on the back end, they’ve found solutions that work for stores and others.

For those retailers embracing omnichannel, McAnnally pointed out some key things to consider:

Mobile point of sale (POS) considerations

• What types of transactions and discounts will you allow on the device?
• How will you name your devices to differentiate mobile from standard POS systems?
• How will you protect the physical device?
• If you’re allowing returns on a mobile device, will they be visible from a central returns database?

But mobile POS is just the beginning. Other considerations include questions around e-receipts, buy in-store/ship to home, returns of online products to store and e-commerce and mobile app integrations. To deliver a true omnichannel experience, retailers are finding ways to bring departments and technology together.

At Disney, the organization worked to bring their systems together not just on the back end, but physically, by bringing its e-commerce and store team together in the same office to ensure everyone is running the same promotions and providing a singular fabulous experience. With customers expectations higher than ever, loss prevention leaders will be integral in ensuring omnichannel is done right.

Whether tweeting, sharing brand reviews online, or browsing apps, the shopper is using the smartphone as a primary instrument of change. It’s the bridge between every channel. So how can retailers leverage this consumer technology? To start, it’s important to note that we’re not just talking about mobile retail. We’re talking about customers accessing their smartphones in stores and the need for retailers to be addressing customers’ mobile needs whether they’re in line at the grocery store, laying on their couch or standing in front of a TV display and comparing prices. Is your mobile team currently under your web division? Paul recommends considering moving your mobile team to your stores division.

Belk Chairman and CEO Thomas Belk, Jr., followed up bluntly: “We haven’t mastered omnichannel.” Belk offered an honest account of the retailer’s journey into the digital revolution, one that many retailers in the audience undoubtedly identified with. Just a few years ago, Belk said, the Southern chain was way behind in the digital world, but the numbers convinced them: online-only shoppers were spending $100 a year, in-store shoppers were spending $350 a year, and those who shopped both online and in stores spent $1,064 a year. The decision to change was easy. So Belk invested millions in a plan to improve branding, refine service, remodel stores, build expansions, and enhance technology, all while clarifying its position as a modern, Southern-style retailer.

Just catching up in terms of technology was huge, said Belk, who highlighted four phases of the upgrade that included accelerating sales in e-commerce; investing in mobile; updating infrastructure and merchandise systems (a real “OMG” moment, Belk said); and creating a roadmap to omnichannel, which included replatforming e-commerce, replacing POS systems, expanding mobile, integrating data and establishing enterprise inventory.

Belk also had to decide not just how to catch up, but where it wanted to win. The retailer decided upon delivering modern Southern style and hospitality, both in stores and in the digital world. One example was getting involved with local communities to spread its  “Southern State of Mind” philosophy across multiple channels. The company launched a mobile mammography center that has its own blog, Facebook presence and Twitter hashtag. This omnichannel approach to outreach led the retailer to leverage in-store events, too, such as bra fittings.

Belk’s honesty continued with five observations, not all lessons learned, but honest admissions and tips that any retailer — whether ahead of the curve in the digital revolution or still catching up — could appreciate.