Retailers Bring Online-Style Tracking to Stores
It's second nature to any website manager - track customers via cookies while they're on your site because it will yield valuable information which will help you to maximise conversions and revenue.So it makes sense for bricks-and-mortar retailers to apply this mantra to their stores. The problem is, the technology hasn't been in place to do this accurately and cost effectively. But all that is beginning to change.The game-changer has been the introduction of in store wifi. When a consumer logs on, software is available which can track their movements in store. Questions such as 'which direction do customers go when they first work into store?', 'what routes do they take round the store?', and 'which parts do they linger in and for how long?' can now be answered on the basis of empirical data rather than anecdotal observations. This data can be used to inform decisions on store layout, department size and store signage.But tracking customers based on wifi logons alone is the tip of the iceberg. Some companies in the US are allowing even more sophisticated monitoring which is delivering ever more detailed data.Take US-based RetailNext. They combine video footage with advanced wifi tracking. The video, from cameras in store, can be used not only to understand how people navigate the store, but also to differentiate men from women, adults from children - so retailers can build a detailed profile of the behaviour of different types of customer.Their wifi tracking can track any mobile set to scan for available networks, not just those that logon to the store's wifi network - widening the pool of data. And because mobiles send out unique identification codes when they search for networks, they can analyse the behaviour of repeat customers discretely - and understand the length of time between store visits.But perhaps the service offered by New York based Nomi represents the ultimate destination for this sort of technology. Nomi's service tracks customers in store using wifi but can also individually recognise the individual using that phone. When a shopper has volunteered some information - either by downloading a retailer's app or supplying their email address when they login to the retailer's wifi - Nomi can pull up a profile of that shopper and deliver appropriate information to their phone.So that shopper may be served an offer when they walk back in the store, which may relate to the details of their previous visit - for example, someone who lingered in the shoe department but didn't purchase may be served a discount coupon for shoes.Of course, this is all very sophisticated and exciting for bricks-and-mortar retail marketers but it's only likely to get off the ground if consumers play ball - and the early signals are distinctly mixed.On the negative side, US retailer Nordstrum, which ran a wifi tracking test between Autumn 2012 and the Spring of this year, brought it to a close because of consumer reaction to being tracked in store. Consumers are largely ambivalent towards being tracked anonymously via cookies online but being physically tracked in stores is something different. The argument that it's anonymous because their mobile is being tracked rather than them doesn't seem to wash - at least, not in Nordstrum's case.On the flip side, Seattle based company Placed has registered over 500,000 downloads of its app that asks consumers to share their in-store locations in return for cash rewards and gift cards. Perhaps then, the argument is not about tracking per se, but consumer consent and offering something in return for the personal data the consumer is volunteering.Certainly, services like these enable bricks-and-mortar retailers to strike back against their online only rivals. And they offer yet another example of why bricks-and-mortar retailers should embrace mobile rather than see it as their enemy.