STARTUP TO WATCH
StoreXperience: A Mobile Bridge Between Bricks, Clicks

Retailers in Japan and South Korea have been using image capture technology for several years now, and with the growing base of smartphones, companies in the U.S. are rolling out a wide range of new mobile applications, including some that use interactive digital symbols captured in photos to provide customers with product information, prices and incentives on the spot.

At the National Retail Federation's annual convention in mid-January, StoreXperience introduced an interactive mobile e-tail platform called "Easy Shopping." Combining DataMatrix digital photo scanning technology and Microsoft's (Nasdaq: MSFT) Dynamics CRM application suite, Easy Shopping is designed to capture product identification codes from interactive barcode-like symbols and combine it with information about their location, shopping habits and preferences.

"Over the past 10 years, the emergence of e-commerce has impacted traditional retail , and set a new model for customer expectations and experience. This retail shift has arguably hurt traditional retail, and consumers are simply not buying as much in-store as online purchases continue to rise," Hervé Pluche, StoreXperience founder and president, told CRM Buyer. "But it doesn't have to be an us-versus-them mentality -- online and in-store do not have to be conflicting channels, and more and more, retailers -- and shoppers -- see it all as part of a holistic shopping experience."

Decision Influencer

StoreXperience's Easy Shopping "creates interactivity between the consumer and the retailer/brand at the point of sale (i.e. in the store) using the consumer's mobile phone, and bridging the online and offline experiences," Pluche elaborated. "The service is designed to inform and influence the consumer before a purchasing decision is made, in a period where consumers are highly receptive."

Pluche and Francois Silvain -- the company's other founder -- are both experienced software entrepreneurs. Silvain started his career as a software engineer in the telecom industry and later became CTO of Spartacom, whose technology was subsequently sold to Microsoft.

Pluche launched and managed two successful startups in the CRM market space: Sevina Technologies and Neocase Software. During his tenure at Neocase, the company's revenues increased 300 percent and the organization grew from a small Paris startup to one with offices in San Francisco, Boston and Paris that employs more than 40 professionals.

"StoreXperience is not a technology company in the pure sense of the word but a service company using advanced technologies built by best-of-breed partners," Pluche explained. "The company leverages a wide range of technologies -- from DataMatrix bar code readers to advanced sales and marketing engines like Microsoft Dynamics CRM -- to create mobility, on-demand solutions and business intelligence. This enables the company to focus on consumer experience and the advanced functionalities offered to stores and brands."

Infantile Market

While the present is as ripe a time as ever to launch mobile marketing solutions, the challenges are still substantial. "The mobile e-commerce industry has been incubating for over a decade and there have been many proselytizers touting how mobile devices will change how we shop; I must say I am one of them," commented Chip Arndt, cofounder and executive vice president for business development for MerchantAdvantage.

"E-commerce market participants and observers have been touting the promise of cross-selling and targeted marketing/promotions via smart cards and mobile devices for some time now, but what is the reality? How many well-designed and effective mobile marketing and promotions are out there and what effect are they having on retailers' sales?"

"The reality is that this market is still in its infancy; however, it holds a great deal of promise and is now more technically feasible than any time in the past," responded Pete Gombert, founder and CEO of media buying and selling portal Balihoo.

"Assuming that the technology is flawless, simple to use, scalable, and stable -- a big assumption -- the major problem remains adoption. In this instance StoreXperience is going to have to gain a great deal of adoption in three key constituencies -- the manufacturer, the retailer and the consumer, not to mention the handset manufacturer potentially.

"History has shown that gaining that adoption as a technology provider to these constituencies is very challenging and is fraught with typical network effect pitfalls," Gombert continued. "Changing consumer behavior is a massive challenge that can only be achieved at scale if the perceived value of the solution is dramatic."

Mobile Marketing Today

The most prevalent mobile marketing companies today are focused on helping businesses reach potential customers on their mobile devices through coupon programs and companies such as Cellfire, Arndt noted.

"I believe companies that create loyalty programs and work with the customer to help them stay more efficient will win the day," he continued. These include Bcode.com, which delivers updates on tickets, airline flights, Broadway shows and other events to your phone as a text message.

"I love this service as I have all of the information on my mobile device and don't have to write things down, or better yet, the mobile device information backs me up if I lose the information. These are just two cross-promotional methods to supplement my 'buying' and both methods are value add," he noted.

A Successful Launch

For its part, StoreXperience is working at building pilot programs with several leading retailers and brands, though the founders could not mention their names until officially announced. The company and Easy Shopping also generated strong interest and good reviews during its launch at the NRF's annual convention this past January.

StoreXperience's mobile e-commerce technology was used by the NRF Foundation to conduct a silent auction for charity. "We also teamed with Microsoft to turn the Javits Center into a mock retail-floor, letting the 13,000-plus attendees download the StoreXperience application and hunt for giveaways using their mobile phone," Pluche added.

Ninety-five percent of senior executives that stopped at StoreXperience's booth at the NRF "BIG Show" stated that they would like to see Easy Shopping in use at their companies. "The market is ready and itching for this type of solution and approach," Pluche commented.

So what makes Store Xperience a startup to watch?

"It is clear to me that mobile devices are the future of commerce, offering consumers the best of both worlds: the power of the Internet combined with the satisfaction of in-store shopping. StoreXperience harnesses the advances in mobile technologies and on-demand enterprise solutions to create an amazing opportunity for stores and brands to redefine consumer in-store experience in a way that is beneficial for everyone," Pluche concluded.