ETD: 841Americans Will Deck the Halls to the Tune of $8 billion; January and Wal-Mart's RFID Initiative; Password Security Issues

[E-Tailer's Digest]

  E-Tailer's Digest --- Everything for the  Retailer
  Issue #0841            December 9, 2004
  George Matyjewicz, Moderator         mailto:georgem at gapent.com
  Published by:  GAP Enterprises, Ltd.  http://www.etailersdigest.com
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  CONTENTS

  [1]  Greetings
  [2]  Americans Will 'Deck the Halls' to the Tune of $8 billion
  [3]  January and Wal-Mart's RFID Initiative
  [4]  Password Security Issues

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  [1]  Greetings.
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Hi All:

Pam Danziger reports on how folks are spending their money this year on 
Holiday decorations.  Here in NYC, as I'm sure they do all over the world, 
the newscasts are featuring homes with Christmas lighting.  Even if you 
don't celebrate Christmas, you do have to admire the decorations.  In 
Atlanta they have two places where you drive through to see the exciting 
Holiday lights.  In Florida they have the decorated boats making their way 
through the inland waterway, which is always exciting.  What happens in 
your area?

January is almost here, which is the deadline Wal-Mart set for suppliers to 
be ready with RFID.  Are they dreaming, backing down or will it 
happen?  What do you think?

Security is a major issue for all of us - both personally and at work.  If 
you ever had your identity stolen, you can appreciate the problems.  And 
the "phishers" are out their trying to grab yours right now.  With 
organizations, it may be worse.  They have to deal with human nature and 
people who are too busy with other things than to worry about the security 
of their passwords.  Unfortunately, many of us have multiple passwords, 
which are very difficult to remember.  What do you do?  Write them on 
post-its?  Record them on your machine?  Encode them in your PDA?

16 days until Christmas - 2+ weeks!    Are you ready? What are you doing 
this year to increase business?

Tell us about your business which will remain  for posterity at 
our  "Members: Who Are You?" site.   Anything to do with the retail world, 
i.e., supplier, retailer, consulting, 
etc.  http://etailersdigest.com/resources/members/index.htm And we have a 
form there for you to tell us about you.  As I said when I first proposed 
this idea, we have "known" each other for a long time, yet we often don't 
know anything about each other.   So, tell us who you are and what you do.

Now, let's get to everything for the retailer.

Sincerely


George Matyjewicz, PhD
Chief Global Strategist, GAP Enterprises, Ltd.
mailto:georgem at gapent.com
http://www.etailersdigest.com

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  [2]  Americans Will 'Deck the Halls' to the Tune of $8 billion
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Inflatables are the hot new outdoor decoration this holiday season; indoors 
the trend toward multiple Christmas trees encourages decorators to explore 
new color schemes

'Black Friday,' the day after Thanksgiving, not only ushers in the official 
start of the holiday shopping season.  It also is the date when people turn 
on their annual outdoor Christmas lighting displays, according to research 
from Unity Marketing.

This year Americans will spend $7,966 million on Christmas and Hanukah 
decorations, up 5 percent from the $7,587 million spent last 
year.  Christmas is the pinnacle of the annual decorating season.  About 
two-thirds of American households will purchase new decorations this 
holiday season.

New holiday decorating concepts give people a reason to buy each 
season.  This year the hot new decorations for outside are lighted 
inflatables that depict various Christmas-themed and licensed characters as 
oversized vinyl balloons.

For inside, the new looks are traditional ornaments rendered in new 
jewel-toned colors.  While traditional Christmas red and green still 
dominates, decorators are experimenting with different color schemes, such 
as burgundy, blue, sage green, purple, pastels, and pinks, on one of their 
multiple Christmas trees.

Many families today are going for multiple trees, with an old-fashioned 
family tree in the den, but more fashion-forward decorative trees in the 
living room, dining room, foyer, and other public spaces.  And more 
families are spreading the holiday cheer to the bedroom too, with personal 
trees placed in each bedroom.

Ultimately there is only one reason why people decorate their home for the 
holidays:  Decorations gives an emotional lift and stimulate a mood for 
celebration.  People today are expressing a growing desire to use seasonal 
decorations to create a mood to enhance their enjoyment of different 
holidays. This represents a bright marketing opportunity for companies that 
bring innovation and creativity to enhance people's holiday celebrations.

To learn more about consumers' passion for decorations and how marketers 
and retailers can maximize their opportunities to sell to this market, 
Unity Marketing conducted a survey among 1,000 U.S. households that 
decorate their home for different holidays.  Included in the survey were 
questions about their decorating plans for the coming Christmas 2004 
season.  Highlights follow.

Majority of households will buy new Christmas decorations for the 2004 season

Over two-thirds of the decorating households will purchase new decorations 
for the Christmas 2004 season. They expect to spend $115 buying decorations 
this year, about the same as last year.

Decorating gets you in the mood to celebrate, while favorite decorations 
bring back memories

People decorate for the holidays to get them in the mood for a happy, 
memorable celebration.  Nearly three-fourths of decorators agree with the 
statement, "Decorating my home gets me in the mood for celebrating and 
having fun."

While decorating looks into the future, it is also nostalgic.  Bringing out 
decorations from yesteryear rekindles fond memories.  Nearly 70 percent of 
decorators agree, "I love to bring out my favorite decorations from years 
gone by; they are like old 'friends' and bring back wonderful memories."

Christmas decorations shoppers will turn first to discount department stores

Nearly all decorations shoppers (89 percent) expect to shop at discount 
department stores for new holiday decorations.  Trailing far behind in 
second place are craft and hobby stores, where 49 percent of shoppers 
expect to look for new decorations.

Candles are top inside decoration for Christmas 2004

Number one on decorators' indoors decorations shopping list are candles and 
accessories, followed by: 2) paper and party decorations; 3) garlands, 
roping, swags, ribbons; 4) live poinsettia plants; and 5) collectible 
Christmas tree ornaments.  Christmas lights, the most purchased indoor 
decoration last year, didn't make the top of the planned purchase list, 
suggesting that lights are an impulse item.

About one-third of Christmas decorators expect to buy a live Christmas tree 
this year; 11 percent will purchase an artificial tree.

Outside Christmas lights will brighten this year's celebrations

More than half of the decorators plan on purchasing more regular or 
miniature outdoor Christmas lights this year; 40 percent plan to buy the 
new icicle or special feature outdoor lights.  Ribbons and bows are also at 
the top of the outdoor decorators' shopping list.

Traditional Christmas Red and Green is favorite decorating color

Nearly 70 percent of decorators plan to decorate with traditional Christmas 
red and green.  Gold will be the top metallic accent color, while white and 
silver will also be popular.  Burgundy red will be chosen by one-third of 
decorators.

Unity Marketing's new study, Seasonal Decorating Report, 2004:  The Who, 
What, Where, How Much, and Why of Holiday and Seasonal Home Decorating, 
studies the decorating and purchase behavior of consumers.  It reveals 
details about which holidays they decorate their homes and what kind of 
decorations they use.  It also provides detail data about purchases for 11 
major decorating holidays, as well as party decorating.  Attitudes about 
why people decorate for their home are also included.   For more 
information about the study, visit Unity Marketing Online. 
http://www.unitymarketingonline.com/ or call  717-336-1600

Pam Danziger,
President
Unity Marketing Online

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  [3]  January and Wal-Mart's RFID Initiative
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Wal-Mart mandated that by January 2005 its top 100 suppliers must apply 
passive radio frequency identification (RFID) tags based on EPCglobal 
standards to cases and pallets headed for three specific distribution 
centers in Texas. But that deadline was never meant to be hard and fast.

"We challenged suppliers to see how much they could tag," says Gus 
Whitcomb, a spokesperson for Wal-Mart. "Could they hit the 100% mark? They 
were then asked to come back to us with a tagging plan, indicating what 
they reasonably thought they could do, given the way their supply chain 
works and the availability of technology at the moment."

"From the beginning, Wal-Mart has taken a stance that allowed time for 
companies to educate themselves," says Erik Michielsen, director of RFID 
and ubiquitous networks at ABI Research. "Wal-Mart understands that there 
are still issues remaining -- hardware supply, standards, and the learning 
curve with the technology -- and that it's going to take time. They want to 
give room for companies to get a better handle on RFID, allow [Electronic 
Product Code] standards be resolved, and let the hardware and software 
companies roll out more available, capable, and interoperable products."

Negotiations between Wal-Mart and its top 100 suppliers bear this out. A 
recent study of RFID deployment practices conducted by the ARC Advisory 
Group found that suppliers negotiated a wide range of agreements with the 
retail behemoth. "One large supplier will be shipping over 700 stock 
keeping units starting on January 1. But many other companies -- even very 
large companies -- will be shipping less than a dozen."

Wal-Mart has also granted deferments to its deadline, based on extenuating 
circumstances. "One company that we talked to had a good reason for not 
starting on January 1, and so they will not begin RFID tagging until 
mid-2005," says Steven Banker, service director for supply chain management 
at the ARC.

"Wal-Mart didn't expect this battle to be won by January 1, 2005," says 
Michielsen. "What it did was create an incentive structure that pushed its 
partners in the market to better understand the technology while standards 
were being developed and innovation was taking place. Wal-Mart's goal is to 
get companies to integrate this technology into their changing business 
processes."

"In January, we are expecting an aggregate of 65% of all cases and pallets 
from the 136 suppliers -- because two have gotten extensions -- headed to 
those three distribution centers," says Whitcomb. "We are working with the 
suppliers to increase that because we would love to get it to 100% in the 
long run. But the reality is that some suppliers are going to be doing 
100%. Others have complications brought on by how their distribution center 
system works, and they will be tagging less."

The increased flexibility shown by Wal-Mart with suppliers allows companies 
to better frame the task at hand. Wal-Mart is trying to get commitment from 
its suppliers while also outlining long-term goals.

"A lot has happened in 2004, but more needs to happen before companies can 
push out seamless RFID solutions integrated through the enterprise," says 
Michielsen. "More time is needed to allow integration service organizations 
to staff up RFID teams -- organizations like Accenture, Deloitte, and IBM."

Article at...
http://www.frontlinetoday.com/frontline/article/articleDetail.jsp?id=135278

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  [4]  Password Security Issues
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In this morning's Wall Street Journal, Scott Thurm and Mylene Mangalindan 
report on how people are recording their passwords on post-it notes 
attached to their computers.

The problem seems to be the number of passwords in use by each person in 
each organization.

Security experts have long recommended that computer users choose 
hard-to-break passwords and change them frequently in order to frustrate 
hackers. Now, those recommendations are being newly forced on millions of 
U.S. workers in the name of preventing financial fraud under the 
Sarbanes-Oxley corporate-reform act.

The law, enacted in 2002 in the wake of accounting scandals at Enron Corp. 
and elsewhere, created an oversight body for audit firms, stiffened 
penalties for fraud, and required auditors to certify that firms have 
adopted adequate "internal controls" to prevent fraud.

No matter that Sarbanes-Oxley doesn't actually require changing passwords: 
In the name of those "internal controls," auditors and consultants are 
prodding companies to require that employees pick tougher passwords, and 
change them more frequently.

Roughly three-fourths of computer users memorize their passwords, according 
to a study done for the computer-security concern Symantec Corp. But 
memorizing several wholly new passwords is mind-numbing, so some employees 
make only trivial changes to old passwords -- adding the numeral "1" to the 
original string, for example. That tactic, security experts say, doesn't 
make a new password any more difficult to crack than the old one was.

Some break another security taboo, by writing down passwords. The Symantec 
study, done earlier this year before password-change requirements had been 
imposed at many companies, found that 16% of users write passwords in a 
notebook, hand-held computer or on sticky notes.

As a result, some computer-security experts say the frequent password 
changes will just lead to different, potentially bigger, security threats. 
"It is not sensible to force people to change to a unique password every 
six months. You're inviting disaster," says Allen Gwinn, senior director of 
technology at the Cox School of Business at Southern Methodist University, 
who has spoken about security issues at trade shows.

"Better to have a password that's two years old that someone can remember 
than a password that's just been changed that's been written down that 
somebody can find," Mr. Gwinn says. He stores his passwords in a 
cellphone-organizer, protected by an encryption program he wrote himself.

The Sarbanes-Oxley law doesn't mandate periodic password changes. Nor do 
the Securities and Exchange Commission rules implementing the law. Nor does 
the "guidance" issued by the Public Company Accounting Oversight Board, the 
nonprofit corporation that Sarbanes-Oxley created to regulate audit firms. 
Nonetheless, password changes have become a standard feature of management 
strategies to demonstrate compliance with the law.

One impetus appears to be the IT Governance Institute, a Rolling Meadows, 
Ill., nonprofit that brings together tech executives from big companies 
with representatives of major audit firms. The institute's "control 
objectives" for Sarbanes-Oxley list regular password changes as an 
"illustrative control" to prevent tampering with corporate financial systems.

Major audit firms then took up the cause. Deloitte & Touche USA LLP, for 
example, recommends that companies require employees to change passwords at 
least once every three months, and more often if the process can be 
automated. Ted DeZabala, national leader of Deloitte's security-services 
group, says the company has long urged periodic password changes, and used 
the Sarbanes-Oxley law to drive home the point.

By now, with the first Sarbanes-Oxley reports due to be filed in March, the 
practice is approaching ubiquity. "In all the companies I've seen, that is 
something they have adopted," says Marios Damianides, the international 
president of the IT Governance Institute and a partner with Ernst & Young 
LLP in New York.


Details at...
http://online.wsj.com/article/0,,SB110255403000595158,00.html?mod=todays_us_page_one

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