Collecting Information About Retail Customer Behavior Inside Retail Stores Makes Sense

Stephanie Clifford and Quentin Hardy authored an article, Attention Shoppers: Store is Tracking Your Cell, which was published on July 15, 2013 in the online edition of The New York Times. We’re interested in this topic, meaning technology to track the behavior of retail customers within a store. As far back as 2002 we had some involvement with ISVs developing solutions for the Radio Frequency Identification (RFID) market. These ISVs were working on very similar technology.

The systems Ms. Clifford and Mr. Hardy describe work within a different computing paradigm: namely WiFi management within a building. By tracking cellphone WiFi usage, ISVs have built methods to compile visit logs for individual customers. We agree with the article authors, the public concern about invasion of privacy issues around the collection of this information is certainly inconsistent with public attitudes about tracking cookies on websites. But there is an important difference. Some website visitor notices about the use of tracking cookies include a warning of a loss of functionality if cookies are not enabled in browsers. Bottom line: “If you visit our site and don’t use cookies, you won’t get the benefit of what we offer”. Perhaps reailers who want to use the technology described in the article should include similar language.

ISVs with technology brick and mortar retailers can use to compile this type of information have a near term opportunity to cash in. There are network and business intelligence components to the technology. We think it will take sometime before retailers can demonstrate relationships between store visits, shelf life for products, and likely buyer behavior. But the starting point, meaning systems to collect the information, appears to be in place.

Of course, there is a side benefit for retailers who choose to implement this technology. They will be able to pinpoint retail customers checking store prices for items against online competitors.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2013 All Rights Reserved

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