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StorefrontBacktalk: Retail IT Lessons in the Path of Sandy

November 12, 2012

Through a special arrangement, presented here for discussion is a summary of a current article from StorefrontBacktalk, a site tracking retail technology, e-commerce and mobile commerce.

As Superstorm Sandy blew its devastating winds through much of the Eastern U.S., retailers had to deal with it just like everyone else. But few seemed to have anticipated the more than eight days of outages along with the gas shortages, closed roads, lack of food and water, plus the dead phone lines, lack of broadband access and dead cell towers.

With global weirding (the term for the many strange weather patterns caused by global warming), there's a fine chance these week-plus outages may be something that has to be planned for. With that in mind, let's look at what some chains discovered when they could only exist via emergency generator.

When Best Buy went on emergency generators, it kept the lights on and the POS functioning, but not the network. That means it could process credit-card transactions but not debit. Gift cards, returns, product lookups and special orders were all either impossible or severely limited. What if this outage was caused by a simple blizzard, perhaps in the middle of December? Want to give up returns, special orders and all debit card transactions for eight days in the middle of the holiday rush?

The local Target was able to handle some debit card transactions, but it couldn't put out all displays and related activities. Why? When various circuits were given to the emergency generator, the backroom/stockroom wasn't on the list. It was pitch black in there, so nobody could get stuff out.

Apparently, the paperwork and permissions required to use flashlights and batteries on the selling floor to restock products is more daunting than the decision that marketing displays could wait until the power was fully restored.

In disaster recovery plans, have you sketched out which rooms will need power for an extended outage? Have you provided for power for the networks? What about auxiliary network access?

Starbucks in the region acted as small emergency shelters, providing — sometimes — Wi-Fi access along with a warm place to sit and coffee to function. But when many Starbucks had to shut down due to power outages, the website continued to broadcast those locations as open. It also didn't provide emergency hours or which locations still had functioning Wi-Fi.

With phone lines out for huge areas, customers would have greatly appreciated seeing the most updated store information, even if it was a few hours old. Yes, that would be a lot of business during the storm. And stores full of very appreciative customers. That generates the type of loyalty that no promotion can buy.

Discussion Questions:

What IT or backend lessons did Sandy provide for retailers? For instance, what are the most and least important areas at retail that require power during emergencies? What other disaster recovery shortfalls would you add to those mentioned in the article?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

Generally, how prepared are retailers from an IT perspective for extended blackouts?

Comments:

The lessons for retailers are the same as lessons for home owners. Have a plan that assumes the worst. Safety functions first. And remember, employees may need to be home taking care of their families, so business is second. Run tests and teach all staff what to do. Also, empower store management to make some calls -- like letting employees use flashlights. You can plan for 90% of emergencies but there will always be need for common sense and problem solving.

Alison Chaltas, EVP, GfK

While it may be true that Starbucks wasn't as active as they could have been in updating the condition of their stores, in our Sandy-crippled community and neighboring towns, the local Starbucks were a great refuge. The welcoming atmosphere, of course, is already engrained in the Starbucks culture, so beyond a little extra concern expressed on the part of associates it was pretty much business as usual -- although business was brisk from 5:30 AM onward.

In contrast, I attempted to work at two McD's Cafes. Although WiFi was free and usable, there was no accommodation to plug in laptops and phones for recharging -- a critical need at times like these. In one, the temperature was set at about 62 degrees. (Having come from freezing homes, that's not exactly enticing.)

It quickly became common practice for merchants and restaurants throughout New Jersey to lay out power strips for patrons to use. Often, you would see them on folding tables outside of stores. (Some homeowners fortunate enough to have uninterrupted power offered power strips on their porches for their neighbors.)

For retailers able to remain open and help, the important things were the small things -- extended hours; pumping the heat up a couple of degrees; offering a kind word and maybe free hot chocolate and a snack.

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Rick Moss, President, Founder, RetailWire LLC

A key lesson is communications. With mobile technology there is almost no reason not to update the Facebook page or even website with information for consumers during and immediately after a disaster. Simply put, the more shoppers know about the store and its services, the more likely they will visit.

Retailers also have to know when they should remain close and let resources go to others that are providing the more basic necessities. I'm sure that jewelers and others felt they needed to get back in business ASAP after a disaster, but unless they were offering support to first responders, it would be more beneficial to their long-term growth to stay closed a few days.

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Ron Margulis, Managing Director, RAM Communications

I read Rick's response with great interest. I live in a hurricane area, Florida. Yet we for the most part have not had this extensive damage and devastation in years. Yes, there was Andrew in the '90s. But Andrew was compact. The horrible devastation was limited to a compact area south of Miami. Never can I remember the wide swath Sandy laid on the upper mid Atlantic region.

We have to learn from this as we dig out and return to what the new normal will become. My company gets most of our work through a work order platform housed and backed up in the New York area. They were out for the better part of a week. Our workload was down considerably; but our people were still going to be paid. Our emergency plan remains operable because we have our team spread out geographically. Yes, some will work longer hours to assist those who do not have power. But somehow it will even out over time.

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Ed Rosenbaum, CEO, The Customer Service Rainmaker, Rainmaker Solutions

Having grown up with hurricanes in south Alabama, I can definitely say that we learned something new with each new hurricane. My father was a doctor with patients in trouble as well as patients in the hospital needing attention. When we got hurricane alerts, the strategy began. We needed a car in a hopefully safe place within walking distance. We needed spare gas, we bought a generator.

Get the picture? Each business must look at their objectives and set a plan in place with backup plans. With a storm, nothing is certain. Kudos to those retailers who thought ahead and I hope they will all debrief after Sandy to amend the plan. We did that for the 18 years I lived at home and long after.

Lee Kent, Let's meet share and succeed in Retail, YourRetailAuthority

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