Mediaboss Marketing

By Jane Genova - March 15, 2012 | Tickers: BKS, CHRS, JCP, JWN | 0 Comments

Jane is a member of The Motley Fool Blog Network -- entries represent the personal opinions of our bloggers and are not formally edited.

No surprise, Barnes & Nobles (NYSE: BKS) stock pricehas beenrising since it hired a tech-savvy chief financial officer. Former cable television finance big Michael Huseby will lead the book chain into its digital future. When announced Monday, the stock, which had nose-dived 7.5% in 2012, rose 1.6% to $13.61. On Tuesday, it closed at $14.38. Not only is Huseby expected to unlock Nooks value, but he's also the guy in charge of how resources are allocated. Down the road, shareholders might well anticipatesome M&A to help push the company ahead of competitors Amazon and Apple, possibly the introduction of more and more devices, and maybe shuttering a lot of the brick and mortar that outside oflarge metro areas.

Barnes & Noble is not the only company to receive a thumbs-up by thestock marketbecause of a digital move. The other parts of retail which got smart earlyabout digital and didnt get complacent also have been darlings among analysts. At the top of the list are:

Last August, the L2 Digital IQ Index for specialty retailers ranked all three as Genius in their digital competence.Check out that term "Digital IQ" in the Index. Remember how, since the mid 1990s, Emotional IQ has been such a key factor in assessing human capital for hiring and promotions? High Digital IQ, or unusual mastery of leveraging digital,seemstobea keypart of what analysts look at indetermining the value of a retail organization.

But measuring Digital IQ entails more thansizing up theecommerce facilitated by the retailer's website. Bright colors. Two daily deals.Coupons downloaded to mobile.Free shipping. Nice, but ecommerce 1.0. In essence,high Digital IQ isabout how competent retailers have become in accommodating customer preferences continually being made possible by technology.According to L2Think Tank, 79% of those with smartphones use them for shopping. In the aisles they can scan barcodes and find out the prices at nearby competitors.So what is being done to keep shoppers from leaving the store without buying?Can brand loyalty as established by the three geniusesdo the trick?

Nordstrom pulls out all the stops on that front. For example, THE NEW YORK TIMES reports, ithas devices positioned around the brick and mortar so that sales associates can electronically check out customers wherever they are. Those who want an e-receipt instead of a paper one get it. Eventually it will probably be possible for customers to check out right in the dressing room. No more gathering up the clothes and hunting for a cash register. That will not onlyadd to convenience, butit saves time, the most valuable commodity in shoppers' lives.

Digital IQ also figures into how retail monetizes its social networks such as Facebook. Very few have made them actual platforms for transacting sales.Other aspects involve that pre-digital ingredient creativity onlyfocusing it on technology. Charming Shoppes (NASDAQ: CHRS) added a new wrinkle to the familiar website feature which allows shoppers to mix and match clothes and accessories. Now shoppers can, as with Google+, have their friendshang outonline with them and give their opinions about the selections.

But what about retailers not aggressively developing digital competence? To analysts that could be a sign, maybe even on a subconscious level,of something off or missing. That creates or adds touncertainty. No analyst likes uncertainty. Take J.C. Penney (NYSE: JCP)for example.When Apple and Target veteran Ron Johnson became chief executive officer, the stock rose to 43.18. Its now at 37.63 and is bound to go lower, warn the shorts like Shmulik Karpf, an economist at the Tel-Aviv Stock Exchange. Some have cut EPS estimates from those early February days of about 50-cents to 2-cents for 1Q and 2Q.

Most of Johnsons focus, at least inwhat he's telling investors and the media,has been on pricing reforms. The one digital piece which made news was his ending the high-profile ecommerce partnership CLAD with ESQUIRE.The fashions featured were cool, the antithesis of what J.C. Penney had become known as: dowdy. The current jcpenney.com website lacks excitement.Just on digital, Macy's could eatPenney's lunch and dinner.

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Retail + Digital = Higher Stock Price