January 15, 2007 07:00 ET

IBM and Business Partners Deliver Customer-Focused Innovations and Insights to Retailers at NRF 2007

NEW YORK, NY -- (MARKET WIRE) -- January 15, 2007 -- NRF Annual Convention & EXPO 2007 -- IBM (NYSE: IBM) and its comprehensive ecosystem of retail-focused Business Partners demonstrated the latest in customer-centric innovations today at the National Retail Federation (NRF) 96th Annual Convention and Expo. As part of the convention, IBM announced a number of new strategic client engagements, innovative datacenter technologies and insightful reports and surveys focused on consumers buying habits.

The announcements include details on IBM's work with Sears and Circuit City in the exciting new virtual world of Second Life. Also, on the heels of the 2006 holiday shopping season, IBM released two new pieces of research, which look at consumer buying habits and the strategies retailers need to pursue to take advantage of disruptive changes. IBM also detailed a new client engagement at Kroger which leverages the IBM Store-Integration-Framework. Finally, the company revealed datacenter technologies designed to help retailers improve security, systems management and serviceability.

"IBM has worked with retailers for over 50 years to deliver innovations that have transformed the industry," said Karen Lowe, General Manager, IBM Retail Industry. "We have a deep understanding of today's polarized retail marketplace and the sophisticated consumers who inhabit it. IBM, together with our network of nearly 2,000 retail industry Business Partners, creates solutions that deliver value to customer-focused retailers."

Connecting to Consumers Virtually

IBM has announced it has teamed with Circuit City Stores and Sears to introduce virtual worlds and 3-D environments into the multi-channel retailing environment. Taking place on the IBM "island" in the virtual world of Second Life, these experiments explore the application of the technology to gain customer insight and improve shopping experiences. Connecting the virtual world with the real world can create a richer, more immersive experience for customers. This work is part of an IBM-led initiative to collaborate with clients and partners to solve business problems in new ways.

The prototype store from Sears is a showcase of basic features of what might be possible in using virtual worlds to transform consumer experiences. The initial store allows consumers to experiment with changing the color of the cabinets and countertops in a virtual kitchen, explore 3-D versions of various home theater set-ups and learn how to organize their garage by virtually customizing storage accessories.

IBM and Circuit City experiments include an interactive home theater setup, where customers can easily recreate their own home environment, and figure out the optimal size television to purchase based on room dimensions. The companies are also researching the potential to add other features in customer service.

New Consumer Insight and Research

IBM also announced two new pieces of research focused on helping retailers navigate the unprecedented diversity and fragmentation in today's marketplace. First, IBM released the results of a national survey of 1,000 consumers which showed that consumers were more informed and focused during the 2006 holiday shopping season. In conjunction with this research, IBM released a new study, titled "Turning shoppers into advocates: The customer-focused retail enterprise," suggesting retailers turn their traditional business models around by putting consumers at the center of strategies and operations.

While price remained a key factor with seven in ten consumers during the 2006 holiday shopping season, influences such as the internet, peer recommendations and instant feedback via text messaging emerged as key factors consumers weighed when deciding where they shopped and what they bought. In fact, 53 percent of consumers used the internet to compare product features and prices across retail outlets.

Also, friends and family continued to influence buying decisions, with 24 percent of consumers identifying them as a factor. Interestingly, one in 10 consumers reached out to friends and family via text message as they shopped to get input or share information on products.

Integration through Open Standards

IBM announced it has engaged with supermarket client, Kroger to deploy new technology initiatives throughout its network of more than 2,470 supermarkets across the country. The solution will leverage IBM's Store Integration Framework, a store-centric framework which leverages Java™ 2 Enterprise Edition (J2EE)-based architectures as well as an infrastructure built on open standards. The framework provides a complete, flexible and robust retail-optimized infrastructure to enhance store-centered processes and connect them with the enterprise.

The solution will include IBM Store Integrator and IBM Data Integration Facility and will leverage Kroger's previous investment in IBM's SurePOS 700 point-of-sale (POS) solution and IBM SurePOS™ ACE for 4690 OS software. This network of 30,000+ POS systems is being proactively monitored using IBM's Tivoli Manager for Retail software.

IBM's Store Integration Framework made strong gains in 2006 and is the leading retail store infrastructure platform. The framework is the retail implementation of IBM's Services Oriented Architecture (SOA), and has been implemented with 38 clients at more than 7,000 stores, with committed rollouts at 25,000 stores. Also, 66 leading Independent Software Vendors and Business Partners have been validated on IBM's Store Integration Framework, with a pipeline of dozens more.

New Datacenter Technologies and Business Partner Milestone

IBM also announced a comprehensive series of offerings based on datacenter technologies that are designed to help retailers improve security, systems management and serviceability. The hardware and software enhancements are the latest efforts by IBM to help simplify and automate retail environments, which can enable retailers to lower costs, streamline operations, and protect existing investments. The new technologies include upgrades to IBM's flagship 4690 point-of-sale (POS) operating system, new advanced systems management software, and serviceability enhancements to the SurePOS 500 series of POS systems.

IBM's Retail Store Solutions Division also recognized the 25th anniversary of its Retail Solutions Business Partner program. Since it launched in 1982, the program has grown to over 1,000 members today that sell more than half of IBM POS and Kiosk solutions.

About IBM at NRF 2007

IBM's booth in the main hall convention floor is #1319. IBM is also featuring a number of Business Partners in the IBM Partner Pavilion booth #3055. The company will demonstrate a number of new solutions and technologies for retailers. Some of the innovations include: the IBM's Loss Prevention Solution with Smart Surveillance technology, smart shelf technologies like electronic shelf labels and signs, self service solutions including kiosk and self checkout and the bridging of virtual and real-world shopping experiences in Second Life.

For more information on IBM's activities at NRF 2007, please access the company's online Press Kit at

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