Evan Schuman's StorefrontBacktalk

When San Francisco area online gift basket merchant Gourmet Gifts create a custom arrangement, the selection of items and positioning reflects that particular artist’s creativity. Unfortunately, it’s not always what the client had in mind. Site owner Debbie Quintana started toying with streaming video in March and discovered that its realtime transmissions allowed for the item to be displayed, rotated and then continuously changed as the client—on the phone—revealed what worked and what didn’t.

The overwhelming majority of retailers today that use streaming video use it as a toy, a fun thing that looks cool on the site but doesn’t have much practical purpose. (A rare major vendor exception was a Staples two-way streaming video kiosk trial in Canada last summer.) What is so powerful about what Gourmet Gifts is doing is that truly recreates the one-on-one interaction that would exist in a traditional in-store gift basket shop.

It’s often said that smaller retailers often figure out practical ways of using technology because they need the capabilities. And the lack of overhead allows for very quicky and low-cost experimentation. In Quintana’s case, she financed the streaming video trial out of her pocket for $200. It costs Wal-Mart 1,000 times that much to just think about a trial. (If a memo is actually written, you’re going to break seven figures easy.)

But can it scale? Even if you assume that most customers won’t need to use the service for every purchase, there would still need to be a camera setup for every several call center reps. And having to physically get the idea and tweak it while the customer is on the phone, that sounds challenging for a large chain.

And yet, there is something powerful about the idea. Could it reduce returns? Allow for a retailer to cut back on people verifying a package’s contents? Attract customers who crave the personal attention? Perhaps increase sales because of the perceived lower risk?

On the down side, such an arrangement would make outsourcing and telecommuting more difficult as the worker would need to have hands-on access to all products to be shipped. Also, color reproduction on lower-end cameras is highly inaccurate, especially when it’s paired with a low-end consumer monitor, potentially causing an increase in returns due to color mismatch.

Either way, it’s good to see some retailers trying to figure out the practical side of streaming video. If a retail CIO needs to be shamed into investment, how about this: Want to be out-teched by a gift basket store?