Breaking News in the Industry: December 16, 2016

Couple sentenced to prison, probation for shoplifting ring

A Salem, Oregon, man was sentenced to three years and eight months in prison and his wife was sentenced to probation for their role in a multi-thousand dollar shoplifting ring. Michael Rascon, 40, and Maria Rojas, 35, were arrested in May on charges of unlawful racketeering, money laundering, attempted organized retail theft and first-degree theft by receiving. The couple each pleaded guilty to racketeering and four counts of first-degree theft and were sentenced Monday.

The Northwest Organized Retail Crime Alliance investigated the couple, who officials thought were buying and selling stolen beauty products and clothing. The alliance is made up of Meyer, Safeway/Albertsons and Target Organized Retail Crime Units. KOIN 6 News reported Rascon and Rojas were “selling stolen items online, buying stolen merchandise and even had ‘shopping lists’ of things that they wanted stolen so they could turn around and sell.”

Undercover investigators made seven purchases, totaling more than $11,000, from the couple with a retail value of more than $37,000, according to a news release. After the purchases, investigators notified Salem Police Department of their findings. Detectives served a search warrant in the 100 block of Connecticut Avenue SE, Birr said. A large amount of new retail items still in their original packaging was located at the residence.

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“They were directing people to shoplift specific things for them,” Salem police Lt. Steve Birr said after the couple’s arrest. Rascon is also listed on Oregon Department of Motor Vehicles list of sanction dealers. He was fined $17,500 for seven counts of acting as a vehicle dealer without a current dealer certificate.

Following his sentencing Monday, Rascon was transported to into the custody of the Oregon Department of Corrections. Rojas was ordered to report to Marion County Parole and Probation and participate in the Family Alternative Sentencing Pilot Program, a program designed to divert parents of minor children away from prison by enabling them to serve their sentence in the community under supervision. The couple was ordered to pay an undetermined amount of restitution for their thefts.  [Source: Statesman Journal]

Could Amazon Go eliminate shoplifters? Customers “just walk out”

Amazon Go is a new idea in retailing, now being tested at a store in Seattle, that eliminates the need for customers to go through a checkout line. The so-called “just walk out” experience depends on “the world’s most advanced shopping technology.” Customers simply enter a retail store, choose the goods they want, and leave. The checkout process is automated: The selected goods are charged to the customer’s account automatically.

Solving shoplifting
Most of the information I have read about the system emphasizes its benefits in terms of customer convenience. However, another huge benefit would be to essentially “solve” the problem of shoplifting. Anyone – criminal or not – who enters the store, takes items and leaves will be charged for the goods.
Shoplifting has been a huge and intractable cost for retailers for decades. Solving it is no small feat, and the potential money savings could help to pay for wider use of Amazon Go technology. After all, the high costs of the system are cited as one obstacle to wider implementation.

Amazon Go smart phone app
The Amazon Go system involves a smart phone app that identifies the customer as he or she walks into the store (presumably through a turnstile). In addition, there are computerized systems in place that automatically identify which customers pick up which items from the store shelves, and keep a running, real-time tally of who buys what. No need for check-out lines; it’s all automatic. Customers only need an Amazon account, a supported smartphone, and the free Amazon Go app.

Currently, the first Amazon Go store is being tested in Seattle; Amazon employees are using the store now in a Beta program, and it will be opened to the public in 2017. Goods include ready-to-eat food items, as well as grocery essentials ranging from bread and milk to artisan cheeses and locally made chocolate.

Future of Amazon Go


How fast might the technology become more widespread? The Wall Street Journal earlier reported that Amazon envisioned opening more than 2,000 physical stores in the United States, although the company denies the report, perhaps in the interest of lowering expectations.

Amazon describes the technologies involved as “computer vision, deep learning algorithms and sensor fusion.” Suffice it to say the 1,800-square-foot store relies on cameras and microphones, as well as infrared, pressure and load sensors on the store shelves. Surveillance cameras track customers through the store, as does computerized analysis of the sounds they make as they move about. In effect, the store has a continuous awareness of where everything and everyone are at any moment, and movements are analyzed to determine what items are being purchased. The system also relies heavily on Amazon’s cloud computing service.

Eliminating retail shrinkage
Shoplifting accounts for some 38 percent of shrinkage in the retail community. It appears Amazon Go would eliminate most, if not all, of those losses, which could contribute substantially to any return-on-investment evaluation when deciding whether to expand the concept to a wider audience. Customers would likely also be willing to pay a premium for the convenience of not waiting in line, and automated processes tend to lower labor costs. The retail market depends on physical security technologies to fight shoplifting, and is also embracing a variety of those technologies, especially video surveillance, to boost the level of customer service. Amazon Go is a showcase for how far technologies have come, and it also suggests other ways innovation could be used in the physical security market and beyond. By automating the checkout process, while also eliminating shoplifting and adding customer convenience, the concept of Amazon Go might just be a winner. That is, assuming customers wouldn’t rather just shop online and have goods delivered. [Source: Source Security]

 

Pedestrian struck by car after shoplifting

A man was struck by a car in downtown Duluth after shoplifting on Tuesday, police said. The Duluth Police Department responded to a pedestrian being struck by a vehicle at First Street and First Avenue East at 4:35 p.m. Tuesday, according to police spokesman Ron Tinsley. The 30-year-old man was transported to a local hospital with unknown injuries.

The man crossed the road while fleeing a business where he had shoplifted, and he didn’t cross at the intersection or within a designated crosswalk, Tinsley said. He was cited for failing to use a crosswalk and theft. The 63-year-old driver wasn’t impaired or distracted, according to Tinsley.  [Source: Deluth News Tribune]

 

 

Woman sentenced to years behind bars for burglary, shoplifting

A Fayette County, West Virginia, woman will spend time in prison for burglary and shoplifting. Rebecca Webb was sentenced Tuesday to 2-40 years in prison for two counts of burglary and third offense shoplifting, both felonies, according to Fayette County Prosecutor Larry Harrah.

Harrah said Webb burglarized homes in the Glen Jean and Mount Hope areas of Fayette County from May to September of this year. In October, co-defendant Brian Vanover was sentenced to 1-10 years in prison for his role in the May burglary.  [Source: WV Metro]

 

How sporting giants Nike and Adidas are pushing the future of retail

The future of retail features a basketball court. This fall, the world’s two largest athletic-gear makers—Nike and Adidas—opened massive multi-floor stores in Manhattan as a way to champion a more immersive retail experience to promote the sports brands in a way that cannot be delivered by department stores and specialty sports retailers. Those features include customization of jerseys and shoes, athletic consultation services, and same-day delivery service in New York City. “Consumers just expect more,” Heidi O’Neill, Nike’s president of global direct to consumer, told Fortune at the company’s new 55,000-square foot store in SoHo. “They expect more immersive experiences at retail like you are seeing here.”

The new SoHo store from Nike is the second major retail space the company has opened on the island of Manhattan. The first was the Niketown store in Midtown, just south of Central Park. A third is planned on the trendy Fifth Avenue, where Nike this month signed a lease to take over a seven-floor, 69,214-square-foot space. Adidas, meanwhile, already operates a large store in SoHo but debuted a new, roughly 45,000-square-foot store on Fifth Avenue this month. Smaller rival Under Armour is also planning a big, splashy New York City push as it plans to open a flagship store in a space that once housed the famed FAO Schwarz toy store.

How Nike Is Doing It
Nike is placing a big bet on mobile integration and shoppers can book one-on-one appointments using a dedicated mobile app. Stores will feature massive digital screens that customers can use to learn more about when products will launch, as well as get info about in-store events. Shoppers can get customized items delivered quickly to their homes or hotels. Even the fitting rooms are swanky: adaptive lighting can show a shopper what gear would look like in a yoga studio or for a night run. The SoHo store is built to boast three sports trial zones. There’s a treadmill surrounded by two cameras that can capture data about a runner’s stride—and then make a suggestion on what shoes might be best. Video screens depict scenes in Central Park or the downtown neighborhood Battery Park. On other floors, there is a soccer trial zone for testing cleats and a half court for shooting hoops.

O’Neill said Nike will continue to experiment with major retail experiences in big cities, but won’t apply the same approach that the company took in SoHo. “We wanted these sports to feel right for this market,” O’Neill said. “Basketball for New York City says ‘we get you New York.’ The running community here is also strong.” The sneaker wall at the SoHo store is the largest at any retail location in the world—O’Neill said that reflects the important sneaker-driven culture and style that New Yorkers embrace. For Nike, the SoHo store is part of a broader push to boost direct-to-consumer revenue to $16 billion by the end of fiscal 2020. That business—which includes sales at Nike stores and the online business—has been outpacing the overall sales growth of late. The reason why it is important for Nike and other athletic purveyors to take control of their own retail experience is because traffic at key wholesale partners, notably department stores, has slowed. And a number of specialty sports sellers, most notably Sports Authority, have gone bankrupt—resulting in the loss of major physical retail shelf space.

The Midtown Manhattan Stadium Adidas Built
When you walk into Adidas’ Fifth Avenue store, it feels like you are entering the tunnel of a football stadium. There are also locker rooms instead of dressing rooms and stands that can be used for seating to watch live games. Adidas also built four customization stations so shoppers can create their own apparel and footwear designs.

“If this store was four floors of product, people would come the first time and then not come again,” said Mark King, president of Adidas Group North America. “The challenge is that when you come here three months from now, it needs to be constantly changing.” King said the store is more fluid—especially the bottom floor which can change to promote new products, host celebrity events or other new initiatives that Adidas might tout. By making the retail store a destination, it plays into the “experience” that shoppers are expecting today if they are to be lured to a brick-and-mortar store.

Executives at Adidas have placed a bigger bet on six global cities—including New York and Los Angeles in the United States—where the company will double down on marketing and retail experiences with the hope that by building a strong brand experience in metropolitan areas, the trends would then fan out to other regions. Building a massive new New York store plays into that strategy. “When you take a city like New York, which sets trends in almost everything, and you create energy here—within literally hours the whole country knows about it,” King said. “You then capitalize on it through retail partnerships in other regions of the country.”

Adidas is also planning to control 60% of the brand’s global retail space by 2020—up sharply by about 30% today. Building new stores, as well as store-within-a-store experiences in department and specialty stores, will help the company achieve that goal. When Adidas controls the retail space, King says it generates higher sales per square foot—better for both the brand and retailers. The new Nike SoHo store is 55,000 square feet and has trial zones to test running, soccer and basketball gear.  [Source: Fortune]

 

 

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