Technology Forces Businesses to Open Up

Study Shows Increasing Acceptance of Social Nets and Video

The Wall Street Journal - March 27, 2008 –

Technology is forcing companies to be more transparent in order to stay competitive.

Just ask Joel Toledano. His company, Krillion, makes technology that helps consumers answer the question, “Who carries this product near me and is it in stock?” The technology shows current inventory at retail stores, so a shopper looking for a Panasonic camcorder would know whether her local Best Buy or Circuit City store carries the model she wants. Founded in February 2006, the Internet search engine start-up directs customers to the local stores of retailers Circuit City and Home Depot, manufacturers such as Panasonic, and shopping sites such as TheFind. (Krillion collects commissions for purchases made after sending consumers to retailers’ Web sites and it collects licensing fees from manufacturers for displaying the local stores which carry their products.)

Playing off some consumers’ need for instant gratification and dislike of shipping costs, retailers and manufacturers want to offer consumers a way to buy their products online and pick-up at local stores. “Consumers are ruthless,” Toledano tells the Business Technology Blog, adding that some customers may shift brand or store preferences if they’ve got to have something right away.

Manufacturers don’t want consumers to choose another brand because their product wasn’t available and retailers want consumers to make purchases only at their stores, says the Krillion co-founder and CEO. That means manufacturers and retailers must be just as transparent as their rivals in displaying what products their local store stocks.

Retailers also benefit if this transparency persuades shoppers to visit stores in person. In-store visits help drive up a customer’s total purchase. For instance, Circuit City found that the average customer who shops online and picks up the product in the store buys $154 more when they visit the store. In Wal-Mart’s case, 40% of its online purchases are picked up in their stores and those customers spend $60 more in the store.

Right now, Krillion offers in-store product information about televisions, camcorders and game consoles among other product categories. It will soon offer product data about home theaters and global positioning system devices.

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