Proven logistics arrive for Ecometry e-tailers
February 9, 2011
MB Foster's founder Birket Foster attends the top retail technology conference each year to investigate new solutions. (His 2011 NRF report is online at the company website.) Retail, focused on catalog and Web sales, has been good to the HP 3000. But about 70 companies using the 3000 still remain on the customer rolls for Ecometry, a part of the Escalate group that RedPrairie bought this month.
Foster says that RedPrairie's strengths are in the logistical middle of the retail tech sandwich. Back-end systems and the customer-facing tech have been included in the new Ecometry software. In particular, the Blue Martini solution brings web interfaces to sales. Web was handled by third parties for years until Ecometry became Escalate, then bought Blue Martini.
What's worth watching, for those 3000 sites still not migrated as well as the hundreds who've made the move, is what RedPrairie will do with its purchase, Foster says. "The question is, what's RedPrairie doing with this acquisition? Did they buy this just to get the Ecometry customer base? You need to have some kind of logistics to bring goods into the store -- sofas, plates, wine, all the different things Ecometry customers sell. Even if you don't have a store, you need logistics for your goods. RedPrairie knows how to do logistics pretty well, both inbound and outbound."
One key technologist to watch: Michael Julson, Ecometry's CTO. Foster said that where Julson lands in the RedPrairie executive team, after being a VP at Ecometry, will determine how much change Ecometry's sites can expect. The customers still using the 3000 have been marking time for more than five years now, stable with features of the previous decade. Foster said changing software is no casual matter for retailers, especially smaller brands.
Even if just a part of a retailer's business flows through Ecometry, once the economy slowed "it's a big investment to make a move [off the 3000] like this," Foster said. "There are new pieces and parts that are an advantage in the new version of Ecometry." After a handful of sales of a Unix version of the 3000 app, Ecometry has made its living in the Windows environment.
"What RedPrairie bought was the middle," Foster adds. "That's the stores, the warehouses, the people driving sales through websites." As an example of buying the middle, Systemax purchased the intellectual property for Circuit City (a former 3000 shop.) The retail stores are gone, but the re-launched circuitcity.comsells the same kinds of products.
The RedPrairie deal means "that if you're on the HP 3000, you've moved another generation farther away from Smith-Gardner," which invented Ecometry's predecessor MACS, "the third generation of ownership."
"While they'll recognize that the origin of all this was the HP 3000, I think you'll find further de-emphasis of the platform by RedPrairie," Foster said. "You've only got 60 or so on that and over 300 on the Escalate Retail versions of what used to be Ecometry's package. Already, you need to buy your own Veritax services if you run a 3000. Ecometry no longer keeps an account open for local and state sales taxes. So the price probably goes up to stay where you are."
The six months of assessment means "there won't be any announcement at the Ecometry show [in April], but I think they'll be an announcement at the RedPrairie RedShift user conference [May 11-16]." RedPrairie announced the finalization of the Ecometry deal this month; the acquisition was first unveiled in 2010.
Ecometry's last user conference may be this year, he added. Ecometry users have been more ardent in attending shows than other Escalate customers. In 2008, a combined conference couldn't draw "big-ticket" brands, due to the economy's downturn. Escalate sessions got canceled, Foster said, and Ecometry advice remained. Now the Ecometry users have their own meeting, once again. Whether the 3000 sites will continue to have their own version on support remains to be seen.