Vampire Power

Recently AT&T began selling the Zero Charger that shuts itself off when a device is not connected.  This made me wonder how significant vampire power is, so I did some quick math…

Taking the new iPhone 4 as an example, I assumed that the typical iPhone charger spends 4 hours a day charging an phone, 8 hours a day plugged into a fully charged phone, and 12 hours a day with no phone plugged in.  The iPhone charger uses 0.4 Watts per Hour when no phone is plugged in, and 2.24 Watts per Hour when plugged into a fully charged phone.  Apple sold 3 million iPhone 4’s in their first month.  That equates to 25 Gigawatts Hours per year, which is approximately $3Million dollars of wasted electricity.  And that’s for just 1 month of sales of one SKU!

Apple sells it’s charger for $29 vs $19 for the Zero Charger from AT&T, so clearly it would be possible for Apple, HTC, RIM, etc… to bundle smart chargers with their new products and save a SIGNIFICANT amount of electricity.  What if Best Buy mandated that after some date they would only sell mobile products that were bundled with smart chargers?

Even lower hanging fruit are all the chargers that retailers use inside their own stores.  In the United States alone, there are almost 500,000 cell phones available for demonstration.  The overwhelming majority of those are connected to merchandising systems (many of which I helped invent) that also permanently connect the phones to an inefficient charger.  Best Buy and Walmart could save a dramatic amount of energy just by using smart chargers in their own stores and/or mandating that vendors use smart chargers in their products.

That’s certainly the most popular question, and a surprisingly difficult one to answer.

When someone asks how you like the new lawnmower you just bought, there is an implied context to the answer (the questioner has a lawn that needs mowing).

The challenge with the iPad is that it doesn’t have a single purpose, so you need to answer how you like it for a particular use-case.

So here are my early impressions…

As your primary browser at home – After one week of forcing myself to use it, I’d still far prefer to be on my laptop.  I think I actually prefer the laptop form-factor on my couch, but even if I preferred the slate form-factor the iPad browser isn’t up to snuff to be a primary browser.  Lack of flash support aside, I need background rendering of multiple tabs, I need to be able to open multiple tabs w/o switching to them, I need faster rendering, i need easier bookmark syncing w/ Firefox, and better password syncing/management.  Frankly, I think a primary browser needs plug-ins.

Mobile Safari is my favorite handheld browser, it’s just not up to being a primary browser.  It’s like taking the worlds greatest golf cart and trying to use it on the freeway.  Apple could fix a lot of this with future software upgrades.

I do like browsing with my fingers.  I’ve owned tablet PC’s for many years, but I’ve always owned stylus only models.  I have a new Lenovo X201T on order that will be my first multi-touch enabled tablet, so it will be interesting to see if I use the touch screen on it.

Home Browser score: D.

As an eBook Reader – It’s more enjoyable to read than my Kindle is.  The screen is beautiful, I like turning pages with my fingers (except while eating lunch). The larger screen, backlit display, and color all add to the reading experience.   The iBooks store has a long way to go (availability of titles is very limited), but the Kindle app on the iPad is an excellent experience.

I expected the iBooks version of books to be better than the Amazon versions because I assumed the books would be in color and feel “richer.”   So far, the titles available on booth platforms look the same on both, it turns out the Amazon books can be in color (it just won’t be visible when reading on Kindle hardware), and I’ve yet to find a title that makes you want to own the iBook version over the Amazon version.

So right now, I’m mainly buying books from Amazon, and reading them on the Kindle app on the iPad.  It’s great because the same books are also available on my Kindle hardware, Laptop, and IPhone.  Thanks to whispersync, if I read a few pages on my kindle, when I pick up the iPad and launch the kindle app it syncs to the last page I read.  Ironically for now you can read your Kindle books on the iPad, iPhone, iPod, and Mac (along with Windows and Kindles), while iBooks can only be read on the iPad.

Using the iPad as a ebook reader does have some trade offs vs. Kindle hardware.  Buying Amazon books on the Ipad isn’t a great experience (did I mention the iPad needs a better browser?).  When I buy books on my laptop, they automatically are immediately delivered to my kindle, on the iPad I have to launch the Kindle app and sync before I can see the new books.  On the kindle I can buy books on the device while the iPad Kindle app doesn’t support in-app purchases.  My Kindle battery lasts a week (2 if I turn off wireless); the IPad needs to be charged every night.  The kindle can be read in bright sunlight, the iPad can’t.  The Kindle is smaller and easier to carry with you.  I never hesitated to take my kindle when I go out (just in case I have some downtime).  I don’t think I’ll carry the iPad with me unless I plan to use it.  I’m fearful of breaking the iPad, and when I do it will be expensive and annoying to repair.  I’ve owned Kindles since launch in November 2007.  In that time, I’ve abused the heck of of them, and  I’ve had two problems; both were arguably my fault.  Both times, Amazon over-nighted me a replacement (they even shipped the replacement to my hotel).  When you break your iPad, you’ll go online to make an appointment at the genius bar 1-2 weeks out, wait for 15-30 minutes when you get there, and then pay a minimum $200 (probably more for the iPad).

The bottom line is that if I had to recommend a device exclusively for reading, I’d still suggest a Kindle.  But the iPad is very good (with some advantages) and because it can do so much more than read books, it’s probably the better choice for most people.

ebook Reader Score:  B

As a multi-media viewer - It pretty much rocks as a media player.    Music and Video are great.  You’d rather have your music on something smaller like an iPod or an IPhone, but if you’re carrying the iPad anyway, it might as well have your music.  It’s fun to watch video content, it would be great for kids in the car (way better than a portable DVD player). It will rock on the plane.  The iPad is also a great photo viewer.  The Photo app is pretty strong, the screen is great.

It even makes for a decent (albeit overpriced) photo frame.  The desk accessories have a way to go, but I have no doubt they will get there.

It’s not perfect of course.  I wish it could accept 1080i video files (and scale them down to play), so I didn’t have to re-encode everything in handbreak before I put it on the iPad.  I wish I could use a windows app to tag photos with events and faces (this is a Mac only feature).

I wish it had a disc mode so I could move images on and off without being synced to iTunes.  I really wish I could sync photo’s to the cloud (even if I had to use mobileme).  It could support more media types, and sync with media media managers other than itunes, but it’s an Apple product so that is not realistic.

I have my work portfolio and videos on the iPad and will use it a lot with customers (too bad all my client meetings this week and next seem to be with Microsoft).

Multimedia Viewer Score:  A-

As a Business Meeting Device – For checking your e-mail or a web-page during a meeting (that is losing your attention) it’s great.  For managing your calendar to schedule follow-up meetings, it’s perfect.  For looking up a fact you need in an excel spreadsheet, a PDF, on a web-site, or from a useful reference app (Anayltics HD, Wolfram Alpha, Roambi, Dictionary) it’s very helpful. 

For taking meeting notes it’s pretty good.  I use Evernote and the IPad version is terrific.  Although, I’d love to be able to sort/organize my notes on the App.

Some salespeople may even use this as their presentation tool, using the VGA adaptor to run a projector, although at 1024 x 768 it’s a bit low res.

Meetings could have been the killer app for the iPad if Apple didn’t have a stylus phobia.  If I could take ink notes on this thing and have that ink converted to searchable text in the background (i.e. Tablet PC with OneNote), it would simply rock.

Business Meeting Score:  B

As a gadget – It’s well built, well designed, fun to use, and fun to own.  There are going to be a ton of interesting apps for this thing.  Some of the early apps are very well done, some are pretty rough; it isn’t a surprise given that developers didn’t have access to devices until launch day.   Alias Sketechbook is cool, although it’s really not a practical drawing tool given that you can’t rest your hand on the screen while drawing with a stylus; it’s not going to replace sketching on a Tablet PC with the windows version of Sketchbook.  Evernote is by far my most used app for now.

I’m really eager to see MindManager (or another mind mapper) done for the iPad.  I need a vector based diagramming tool; OmniGraffle is available but it’s $50 and has bad reviews, so I’m waiting for an update or an alternative.  Salesforce.com will be great in an HD version.  It’s surprising that Apples own Remote application isn’t available in a Universal or HD version yet.

I expect it to be a good platform for social gaming, but the titles aren’t hear yet.  The screen is big enough for real time strategy games.  Two people can sit around the screen for head to head board games or cards.

On the downside, ITunes weaknesses are really highlighted with the iPad.  Managing the apps you own is a real pain (keeping versions straight, tracking HD vs non-HD versions, organizing apps, etc…).

The iPad really needs universal docs storage.  It’s shocking that the OS doesn’t natively sync some file storage with the cloud (mobileme) that all apps have access to.

It’s not intended to be anyone’s only computing device, but for those that asked it’s a non-starter.  Lack of a file system and the need to sync with iTunes mean this is a shuttle not a mother ship.

I expected text entry to be better than it is.  The portrait still requires hunting and pecking but your fingers have to travel further than they do on the iPhone.  In landscape you can touch type, but I haven’t mastered it, and the ergonomics are wrong, with the screen in the same plane as the keyboard.   I wouldn’t be willing to type much more text on the iPad than I’d be willing to do on on an iPhone.  That limits the usefulness of the iWorks apps.

Most people are going to want the 3G version.  The Wifi only experience is dicey once you leave your home or office.  Having to login every time you want to access a network is too much effort for a quick e-mail check.  I own a 4G to WiFi router, and that works but is another gadget to carry.  Only the 3G version supports GPS (although many location services work on the iPad using Wi-Fi estimates).    I pre-ordered a 3G on the announcement day, so I’ll be able to compare the two.

Gadget Score:  A

Conclusion – Early adaptors, jump on in… the water is fine.  You’ll find enough useful things to do with it to not feel bad about your investment.  If you need a practical tool for a particular purpose, it’s doubtful the iPad is your best choice. 

I don’t think the iPad is a game changer.  It’s an interesting platform that is primarily a mashup of existing Apple products.  It’s a capable hardware platform that Apple could develop some unique new capabilities for, but so was the AppleTV so it’s not a given that Apple will do so.

As for me, I’ll happily be using an iPad to show off photo’s, watch media, and play with new apps.

CES is the largest trade show in the US, it’s hosted in Las Vegas every January and it focuses on the Consumer Electronics industry.  A number of blogs do a great job covering the products introduced at the show.  Engadget is a great place to start.  Here is a nicely organized photo library from the show.

My interests at CES are more about what retail designers and in-store marketers can learn from the show.

I try to focus on two key things.

1.  What new products are being launched this year, and how will we introduce shoppers to them in-store?

2.  What tools and techniques are brands using in their own booths to capture attendee attention and deliver product knowledge that we can apply to in-store use?

New Products

3DTV – Without question the main story at this years CES is the introduction of 3D technologies to home theater and gaming systems.  Most TV manufacturers had a least one demo.  This was well timed given Avatar had just hit theaters and was setting all box office records. 

The rapid evolution of TV technology is a real paradigm shift for consumers.  Many consumers owned the same NTSC TV set for 10+ years and never had a compelling reason to upgrade.  Then less than a year after investing in their first HDTV, they may find that they now want a 3DTV.  Most of the 3DTV’s for consumers are based on active shutter technologies which means viewers will need to wear special glasses.  The early research suggest that there is a market for these new products.  DisplaySearch predicts that over 1.2M 3DTV’s will be sold this year, and NPD suggests that about a third of shoppers were interested in the new technology.  CEA conducted their own 3DTV research “3DTV: Is it for Real?” which is well worth the read if you’re a CEA member.

But this technology is going to create a number of retail challenges in stores.  If we run 3D content on TV’s, those TV’s are going to look defective and unappealing to shoppers who aren’t wearing glasses.  How do we tell those shoppers that 3DTVs are also the very best 2D TV’s?  Where will we get 3DTV content samples?  What will the brand interoperability be?  Will shoppers know if their existing BluRay player, HDMI AV Receiver, and cables are compatible?  Will shoppers have hygiene or vanity concerns about trying on 3D glasses in public?  Will the glasses be stolen?  Will they break?  Will the batteries in the glasses last?  How will shoppers know to hit the “on” button on the glasses?  Will retailers existing video distribution infrastructures support 3D?

As is often the case, most of these challenges haven’t been fully considered as the technology is being rushed to the market.  SonyStyle stores now have pre-released demos in most stores (and more often than not you’ll find the Sony power button broken on the glasses).  Best Buy expects to have 3DTV demo’s in several hundred stores this month and 1,000 by the end of the year.  

Undoubtedly, the first demo’s will be stand-alone vignettes probably from a single OEM brand.  But pretty quickly this is going to trickle down to all sorts of retail infrastructure and customer experience decisions.

SETTOP BOXES – There was also no shortage of boxes to add all kinds of downloadable content and new features to your TV.  Boxee probably got the most ink for their announcement that D-Link would be making a Boxee branded devices (Boxee Box). 

Unfortunately, consumers generally can’t tell from the typical retailers fact tags, what these things do, and why they would want one.  Many of these features are built into versions of the latest BluRay players already on the shelves but very few consumers are savvy enough to compare features like “Vudu” vs. “Pandora.”  Even Apple struggles to properly position AppleTV, it’s own offering in the space.

These products all suffer from what I call the “Tivo Problem.”  Early in the lifecyle of personal video recorders, consumers didn’t know they needed one.  Millions of shoppers would walk by the Tivo and ReplayTV boxes on the shelf and never have a clue what was offered within, but go to a friends house that already owns one, and instantly you want one!  So how do we create that same experience in store?  Live demos are certainly one way, but frankly many of these products are too complicated to learn in the 30 seconds a shopper is likely to give you, so I’m a big fan of using video to show simulated ownership experiences.  Show vignettes of consumers happily using these things in their home, and you’ll create demand.  The first OEM to get a really good Vendor Provided Display in BestBuy is going to win a lot of marketshare.

E-BOOKS – The Amazon Kindle, Sony Reader, and Barnes and Nobel Nook got some serious competition at CES in the form of about 1,000 different cheap devices being made by seemingly every factory in Asia.  Then later in the month, Steve Jobs gave millions of consumers permission to want one when Apple announced the IPad (which includes an eBook use-case).

I’m curious to see how these guys get merchandised at retail stores, because to me the real benefit isn’t the device itself, it’s the content I can get for the device and the use-cases they enable.  Will retailers just focus on the networking and display features of these devices, or will they tell the story that buying an IPad means never having to take out the Newspaper Recycling again?  Will the in-store signage feature pictures of hardware or of John Gresham? 

There definitely is going to be some complicated stories to tell in the store: with the Kindle you get your books wirelessly, with the iPad you get them wireless if you pay or are on free-wifi, and with the Sony Pocket Edition you need to download books on your PC and sync it with a USB cable.  What authors are available for each platform, what are the price points?  Touch Screen?  Backlit vs. Reflective?  Etc…

Shoppers are clearly going to want to see the screens and evaluate the form factors in the store, with all the live-sell merchandising and loss prevention challenges that implies.  I hope retailers don’t put these things inside of product jail (a glass display case), or try to re-use a merchandising system that was designed for an MP3 player.

WIRELESS CHARGING – Because I help so many retailers merchandise handheld devices (and because keeping the batteries on those devices charged for live demos is such a pain), lots of people are asking me about the new wireless power products.  And certainly Powermat and others are getting some good traction and shopper awareness. 

The problem is that so far all of these near field induction power solutions are proprietary and aftermarket. You need to add an adaptor to your IPhone in order to charge it on the Powermat.  The charger option for the Palm Pre can’t charge any 3rd party accessories, etc… So selling these products to consumers makes perfect sense.  Although I’ll bet return rates are high, because few retailers really explain the whole adaptor requirement very well.

But using this technology to more easily demonstrate handheld devices in the store doesn’t make much sense yet.  Today retailers use inexpensive charging adaptors (i.e. SmartCables) to charge each device.  SmartCables are much less expensive than Wireless Charging Adaptors and unlike the consumer adaptors no one has any incentive to steal SmartCables.  So I don’t think any of the current systems really replace a retailers need for a good SmartCable solution. 

However, if an industry standard were to emerge and if wireless device manufacturers pre-built the technology into their devices that was compatible with that standard, then we’d have a whole new ball game and could eliminate the need for retailers to buy and use SmartCables.  One such effort is called Qi (pronouced “Chee”).  Unfortunately there are a number of competing standards and financial interests at the moment, so this is going to take a while to play out.

The elephant in the room on all induction power solutions may be how Un-Green they are.  The energy transfer loss of these technologies is huge, some solutions require 10X the power of a direct coupled solution.

Merchandising Techniques

Show Me Don’t Tell Me – Many exhibitors did a good job of building displays into their booth to visual communicate an abstract concept.  Tell a consumer that a product has “Motion Tracking” and they probably won’t internalize the benefit, but show them a camera staying focused on a train engine as it runs circles around a track, and they will instantly want a camera with that feature.

Some of my co-workers call these sort of displays the OMSI Style (named after our local science museum that does a great job with these illustrative displays). 

Don’t tell me you are more energy efficient, brighter, cooler, smarter, better, etc…  Show me that you are, and why that’s better for me.

Get my Attention – You are in one of the most excessive cities in the world, at the largest trade show in the US, and giant TV’s are a dime a dozen, so how do you stand out from the crowd?  Exhibitors have to come up with something visually unique and novel to surprise you and capture your attention.  Getting your attention amongst all the visual clutter is first critical step to having a conversation with you, and retailers face the same challenge every time a shopper walks in the door.  So how do the best of class CES exhibitors do it? 

Well most do it by throwing a ton of money at the problem and surprising you with a scale you wouldn’t expect.  “Hey the ceiling in here is made up of 100 65” LCD’s!”  And these kind of featured displays can be very effective.  They certainly worked for LG, Samsung, Kodak and others at CES.  The problem is that in a retail store where a customer might visit 12-50 times a year, the same $1M featured display that might easily catch their attention on the first visit, will not be so surprising or attention capturing on the 50th visit.  So in a retail store it’s usually better to use something other than extravagant investment to engage shoppers.

Microsoft used some inexpensive light projectors to put moving geometric patterns on fabric walls in their booth.  It cost a fraction of the Samsung display above, but both were equally effective and cutting through the visual clutter and capturing your attention.  The difference is that you can afford to change the Microsoft one every month to keep it fresh in your store.  You can’t do that with the cool but expensive Samsung approach.

Conclusion

It definitely felt like a more energetic show in 2010 than it did in 2009.  That’s probably partly because the economy is showing some signs of turning around, and partly because CEA consolidated exhibitors into a smaller footprint to feel busier.  There were a lot of good ideas at the show worth learning from, and it’s certainly going to be a busy and interesting year for CE Retailers!

I hope this recap is useful for those of you that didn’t attend, and I’d love  to hear what most caught the attention of those that did go.

Let me start by saying that Apple has the best dollars per square foot metrics in all of retail.  They don’t need to apologize about their stores to anyone.  Further, there are many elements of their experience that I love,  including their signature architecture, genius bar, useful fact tags, category signage with decision tree suggestions, window displays and wireless CRM.

That being said, here are some areas that could be improved…

Accessory shopping. Apple does a great job merchandising their own product (and editing their assortment) but their merchandising for third party product is pretty weak.  First the adjacencies are very poor(accessories are merchandised far from the primary product).  Once you get to the accessories display, the signage and wayfinding is non-existent.  Cases for iPhone, iPhone 3G, iTouch 1.0, and iTouch 2.0 all look alike, and Apple leaves shoppers trying to find the small print on the individual SKU’s packaging to tell which are which (and of course the packaging has no consistent standards across brands).  Once you find something you might want to buy, you can’t try it!  Am I really supposed to buy $400 headphones without auditioning them?  How good is this printer?  Which Bluetooth car speaker is the loudest?  What features should I care about in this category (you teach me exactly how to shop for a laptop but give me no advice on buying external storage for example).

Where do I go to  pay? The wireless POS system apple uses is great, but it can be really confusing to figure out how to buy something.  Not every employee has a terminal, some have a cash drawer, some don’t.  Some can take gift cards, some can’t.  Do I just line up behind any name badge and wait until my turn to learn if they are a walking cash register or not?!?  Is this the line to pay or for the Genius bar?   Watch people shop these stores, and you’ll see lots of prospective shoppers bounce around trying to buy (and in some cases, you’ll watch them give up and walk-out).

Nothing to discover. I can visit a Best Buy store every week, and each time find some new product that wasn’t there the week before.   Apple’s assortment is much more static and predictable.  It’s very rare for me to walk into an Apple Store and accidentally discover some exciting new product.  I need a reason to visit your stores more frequently.

Multi-Channel? Come on Apple, you’re a leading technology company, but I can’t check the inventory of my local store online?  I can’t pay with my iTunes account using my iPhone in the store?  I can’t build a wishlist anywhere.  Can I use the website to reprint a receipt from the store?  Separate operations for online and physical stores is so last century.

Apple stores are an exclusive club, and I’m not a member. These stores really are a victim of their own success.  Zealous Apple customers  love to “hang out” in the store and talk to employees, which is great, but new customers have to interrupt the ad-hoc user group to get help.   There’s a whole Apple vocabulary that I don’t know.  The store culture is just not inviting to the uninitiated.  If you don’t believe me, try sending your Mom into the store, and see how long it takes her before she has the courage to engage an employee.

Scale? As an investor, I also worry that the completely labor dependent sales assisted environment is scalable.  What would your stores have to look like if you ever to enjoy 20% – 30% of the personal computer marketshare?  Could you keep hiring the quality of people you rely on now?  You’re customer experience doesn’t seem to translate very well from 200 Apple stores, to 800 Best Buy stores for example.

Retailing is really hard, and I can easily imagine the internal debates about the compromises involved in fixing any of the above.  I know it’s not fun to get criticism, but looking at your stores through critical eyes is how you get better.  I first hired Envirosell to study one of my stores in 1994, now they’ve been tearing apart my customer experiences for over 15 years.  I hate the experience, but I keep going back because they make me better.  Apple does a great job, but you’ve got to keep innovating or someone will do it for you!

The confusion comes from the fact that the 2011 date is an estimate for when a touch screen table top computer might be available as a consumer purchase, versus the (apparently) immediate availability for select business partners.

AT&T has a concept store design which blends it’s traditional wireless offerings with AT&T Broadband services in what AT&T calls its “Experience” stores. On Thursday April 17th, the first five experience stores were retrofitted with the MS Surface to help consumers make wireless phone purchases. I visited the San Bruno, CA store on the go-live day.

The basic layout of the Experience Stores is pretty straight forward. The two long perimeter walls are the primary wireless phone merchandising area. All phones are real samples (not dummy phones) tethered to the wall with a coiled cord. The phones are charged overnight, so most of the phones are functional during the day. The wall features a long backlit lightbox feature as an AT&T branding element, and the long walls are broken up by portrait mounted digital signage, and touch screen kiosks approximately every 12 feet.

A false back-wall features 3 flat panel TV’s and a seating area used to demonstrate broadband products (and doubles as a waiting area / spouse parking area). Behind the false wall is the customer service area, which does a nice job of segregating disgruntled customers with billing disputes from potential new customers. The corners of the store have 42″ monitors mounted which serve as a wait-time-management feature (showing customers their spot in line) so they can safely browse while waiting for an associate.

The open floor space in the store features “project” tables which demonstrate specific wireless phone applications, such as digital music, video conferencing, games, and wireless data for laptops.

Of course, AT&T is also the exclusive US providers of the Apple IPhone, so the stores features a 6 foot wall display for that product, as well as a 4 foot freestanding display. Both displays are clearly designed by Apple, and are very much in brand for Apple, but a bit incongruent with the rest of the store.

A concierge desk is placed by the front door with a greeter who helps customers get oriented to the store, and/or puts customers in the virtual queue for a sales associate.

The stores are designed by Callison, and won a VM+SD Award for best new retail channel.

The five existing experience stores that were retrofitted with the MS Surface display include:

New York City
381 Madison Ave.
New York, NY 10017

New York City
350 Park Ave.
New York, NY 10022

Atlanta
3429 Lenox Road NE
Atlanta, GA 30326

San Antonio
13127 San Pedro Ave.
San Antonio, TX 78216

San Francisco
1206 El Camino Real
San Bruno, CA 94066

I visited the San Bruno location on the afternoon of April 17th. This store had six MS Surface units which replaced several of the “Project Tables” as well as a couple of round glass display cases.

The exterior of the store had been dressed for the launch. Vinyl graphics were applied to exterior pillars, a sign hung over the door, and window signs were installed. The store had clearly been hosting press all morning. Video lights were still set up around one of the Surface Tables to facilitate filming. There was quite a bit of extra staff in the store, with one dedicated employee doing demos on each of the six surface tables.

AT&T and Microsoft clearly intended to make a media event out of the launch. It is interesting that AT&T would do such a big event around adding a new infrastructure element to the store, rather than about a product for sale in the store. Granted, it’s much easier to make a splash in five concept stores than in 1000+ mainline stores, but on a per-store basis it feels like AT&T is making more of an effort to promote the arrival of Surface, than they did the arrival of the IPhone. Maybe AT&T just conceded that Apple Stores rather than AT&T stores would receive all of the media attention from the product launch? It’s pretty clear that both Microsoft and AT&T are getting a nice news cycle out of this surprise launch. The big question is if Surface will be compelling enough to convert mobile phone browsers into buyers and get deployed to many stores, or if Surface will remain a gee-wiz element in flagship stores only.

Each surface table has 8 mobile phones (4 on each side), and one accessory (such as a blue-tooth headset). The sales associates say that the selected handsets are the most popular models, but the handsets due seem to vary from table to table. The accessories are not related to the software on the surface at all, and are non-functional. They are simply attached to the Surface fixture via a thin steel cable on a retractor.

Each handset is attached to a plastic puck with a strip of very high bond adhesive, and a set of zip ties. The puck rests in a magnetic cradle on the side of the Surface fixture. The puck is attached to the fixture via a coiled cord which provides an electronic alarm if removed. The pucks on the Surface tables are different than those used in the rest of the store. However, the electronic alarm is the same system used throughout the store (Invue, formerly Alpha). The bottom of the puck has a sticker attached to it with a unique pictograph (a series of dots) printed with IR reflective ink. So when the handset is rested on the surface of the table, the sticker is facing straight down, and makes it easy for the MS Surface to recognize what product is resting on it. While Microsoft has talked about Surface using cameras to recognize common objects placed on the table, that isn’t what’s happening in this implementation. Here, an IR sensitive CCD is being used to detect the customers touch and a handful of stickers on the back of the handset pucks. The Surface doesn’t have the ability to recognize a customers phone if it is placed on the table, for example. Also if the stickers are applied to the wrong handset, the Surface will have no way to know.

All four corners of the screen have a simple user interface control. The entire display can rotate 180 degrees, so that it’s always facing right side up, no mater which side of the table the user is standing on. There is no facility for more than one shopper at a time to use the Surface. The UI lets shoppers see rate plans, accessories, and a coverage map. When a handset is placed on the Surface, the UI makes it easy to see the features, accessories, or rate-plans specific to that handset. When two handsets are placed on the Surface, a cool side-by-side comparison is made of the two handsets. The comparison shows features common to both handsets in bold, and grays out features that one handset has and the other does not. The most visually interesting features is the scrollable and zoomable coverage map that can show potential coverage for voice calls and separately for 3G data service.

Of course, because Apple is exclusively responsible for all the displays in the AT&T store that feature IPhones, the IPhone is not included on any of the Surface tables, which is a shame.

Like any brand new product, not everything is perfect on day one. Several of the sales associates said they met Microsoft programmers who where up late into the night, working on a final build of the software to install for the launch. Several glitches are still evident. While you can scale most of the UI elements, they act like pictures rather than live text, so when you scale them, the fonts get jaggy and illegible. When you put two phones on the surface, the software often gets confused about whither it should show the side by side comparison or the product info for a single phone. Often you have to reposition the phones to make it work. There are no personalization features, so you can’t see anything about your account history or add personalization features to your existing phone or account. Despite the face that these kind of one-to-one experiences where heavily emphasized in earlier Surface demos. There are some elements of the UI that seem to be buttons but do not work. Finally, and perhaps most significantly, not all the coiled cords tethering the handsets are the same length. Some seem too short to easily let you put the phone on the Surface, and many of the cables get tangled with each other after just a bit of use.

These flaws aside, the customers in the store getting demos seemed generally wowed by the MS Surface. I didn’t observe any shoppers go from the Surface directly to the cash register, but today was a lot more about introducing a new gadget than it was about signing up new AT&T customers. Time will tell if sales people will continue to drive customers to the tables, if the tables will be intuitive for self-service when they aren’t permanently staffed by a demonstrator, and if the information presented ultimately drives incremental sales.

My own research does consistently show that side by side comparison is a highly desirable feature amongst consumers shopping for a handset. So if the kinks get worked out of surface, this is a feature that could add real value. I’m not sure the other content is rich enough yet, that it will cause shoppers to purchase more network services than they were otherwise intending. Hopefully, the content will continue to mature and improve.

An interesting sub-plot is why/how AT&T became the first partner to get the MS Surface. Back in May of 2007, Microsoft announced Surface and said that the first three partners would be: Harrah’s Entertainment, Starwood Hotels & Resorts Worldwide, and T-Mobile USA. Not only was there no mention of AT&T, but T-Mobile is a direct competitor of AT&T’s. Then in November of 2007, Microsoft announced that the first deployments would be delayed until Spring 2008. Now of course, it is Spring 2008 and Microsoft has delivered on it’s promise to go live, but not with any of it’s original partners. It I were T-Mobile and I had made any kind of investment in development of this new technology, I’d certainly be upset. Particularly since the T-Mobile brand had been used in countless demos of a mobile phone application, and now AT&T is seemingly getting the same user interface that used to be branded T-Mobile. That raises another interesting question, who owns that look and feel? Microsoft or AT&T? If AT&T doesn’t own it, will they be upset if down the road Verizon or T-Mobile have an identical experience?

Here’s my flickr set from the store.

Here’s a short YouTube video of the experience (do a search on YouTube to find countless other demos).

I always get a kick out of the fact that Europe has the largest retail show in the world with over 100,000 attendees and over 1900 booths and they call it EuroShop, while in the US we have a retail show with 15,000 attendees and over 900 booths and we call it GlobalShop.

The big German trade shows are very different than US ones. In the US we tend to have convention centers with a few giant exhibit halls and many exhibits per hall, while the German centers tend to have many more smaller halls with a more manageable number of exhibits in each hall. I prefer the smaller halls because it’s easier to make sure I see everything, and it’s easier to organize the halls by type of business.

I was particularly interested in the Shop Fitting halls. It does seem that European consumers will give a preference to higher quality designed stores, and so the basic fixturing systems on display at Euroshop are a bit nicer/better designed than their US counterparts. It’s always fun to visit the Exhibit Design, Retail Design, and Lighting halls to get a some great inspiration for your own designs (even if much of what you see isn’t necessarily cost effective or practical).

As with every other show in the world, there is now a large digital signage pavilion at the show. Although there are some great digital signage deployments in Europe, it does seem that the largest Digital Signage Software Vendors in the U.S. have a bit more mature software solutions than those exhibiting at Euroshop. Of course there are some large vendors with a presence in both markets like SCALA. Also, there are dedicated digital signage shows in Europe, and it’s certainly possible that those shows draw more mature software vendors than the ones that choose to exhibit at Euroshop.

If you are retail merchant and have a chance to attend Euroshop, I highly recommend you take it. I always come back with a notebook full of new ideas, and a recharged battery. As much as I enjoy the show, I also really like getting to visit the European retailers that I don’t get to shop often.

For German consumer electronics retailers that’s mainly MediaMarkt and Saturn (same ownership). This year I went to Dusseldorf via London so got to visit Curry’s Digital, and the overwhelming number of shops on Tottenham Court Road as well. Not to mention what feels like 1000 different mobile phone stores (aka “handy” stores) between the two cities.

January 7-10, 2008, in Las Vegas, Nevada. I didn’t realize this until after the fact, but this year marked the 25^th anniversary of my first visit to CES. CES has changed a lot in 25 years and sadly I don’t think it’s what it once was. Back in the 80’s, tens of thousands of independent retailers represented a large portion of the consumer electronics distribution channel. Manufacturers needed a show like CES to introduce new products to dealers, and decide what to carry for the coming year. You could actually see exhibitors taking orders from retailers in their booths. Today, a handful of national retailers represent the bulk of the market, and they expect private visits from the manufacturers to sell their lines. The cost of exhibiting at CES (or any show) has continued to rise, and with the consolidation of the market and the emergence of the internet, the value of exhibiting has shrunk. Today, the main job of CES is to generate industry buzz and serve as a press opportunity for the Consumer Electronics industry. Small, innovative companies have very little chance of elevating their message above the noise. As often as not, Mac World, successfully steals the entire news cycle from CES anyway.

Checkout my favorite consumer gadget and retail technology from the show, after the break.

So it’s not a shock that CES 2008 wasn’t very exciting. As a consumer electronics geek, I saw very little that I had to have. Sure, TV’s are getting better and better, and the stars this year were the super thin OLED based panels. I didn’t see one I want though, because there are no affordable ones in the large sizes that most people have gotten used to in their homes, and frankly a 0.5” thick TV doesn’t look much different mounted to a wall than a 1” thick LCD does. What did I buy as a result of CES? Logitech finally offered an upgrade to the classic Harmony 880 universal remote, called the Harmony One. The 880 was a perfect mix of all the hard buttons you’d find on a PVR remote, with a decent touch screen and easy programmability. It had some really annoying flaws (bad buttons, and flawed battery recharging), which the Harmony One finally fixes. I bought two, one for my living room and one for my bedroom. They activity based, so when you pick it up you see menu choices like “Watch TV, Listen to Apple TV, etc…”

The other thing I always look for at CES, as how manufacturers merchandise and demonstrate their products on the show floor. In theory, you’d expect an exhibitor who spends six or seven digits to exhibit at CES to have really thought the very best way to merchandise their new products, but in most cases they do a worse job than you can expect to see in a live store. I think the challenge is that the exhibits are usually outsourced to exhibit firms that are great at exhibits, but that don’t have any specific experience with product merchandising. It’s a shame that more brands don’t engage their own visual merchants to help with exhibit design; many brands have great visual merchants working for them.

In any case, there wasn’t a lot interesting from a visual merchandising perspective. The most common trend in booths was to use digital picture frames as shelf talking’s to give you the specs about new TV’s. It’s a reasonable idea for many product categories, but it’s kind of sad to use a 2-3 generation old LCD panel to try and sell a state of the art video display. I’d like to see more manufacturers cook their marketing message into high quality content that plays on the TV’s. Manufacturers also need to think about putting these super thin units on articulating arms or pivots, so shoppers can swing them around and see how thin they truly are.

Probably the best retail merchandising oriented demo at the show was in the Microsoft booth for their Surface product. For those that aren’t familiar Surface is Microsoft’s effort to commercialize an experience that was first demonstrated by Jeff Hunn of NYU at the TED conference. It’s a touch sensitive table with a built in video display that can sense multiple touches at once, and even recognize objects placed on the surface of the table. The envision Surface being used in a variety of retail and customer service environments. Today it uses a rear projector, and an IR based CCD to recognize touch. They are faking the object recognition for the moment, using pictographs with IR ink. Frankly, Microsoft has a long way to go on the hardware. They announced a set of initial retail customers that would deploy Surface, but almost a year later none of those customers are on the verge of live pilots, much less deployments. What Microsoft really got right however, is the great demo’s they invented for Surface. Some customer experience folks at Microsoft clearly put a lot of thought into how a multi-touch interface could change how people shop, and the fake relatively scripted experiences they came up with to demo on Surface are all very innovative. Microsoft seems to have added a Surface demo to a lot of their trade show booths, so I highly recommend anyone interested in retail take the time to watch the demos and play with a unit.

My own employer, MTI, exhibits at CES. We generally get a great booth location (this year between LG and Microsoft) because we are the 37^th most senior exhibitor at the show. Our booth really isn’t of interest to the average CES attendee, but because many of our biggest CE retail clients attend the show, it makes sense for us to have a booth. If you can forgive the amateur talent in some of the vignettes (me), you can watch a walk-through of our booth on YouTube.