Tracking Customer Behavior in the Real World - The UpStream

Tracking Customer Behavior in the Real World

posted Sunday Nov 27, 2011 by Scott Ertz

Tracking Customer Behavior in the Real World

We all know the Internet changed the way retailers interact with their customers. Most importantly, it gave retailers the ability to learn about how their customers shopped to help target marketing or even determine product mix. Brick and mortar retail, however, has never really had this luxury. Sure, they have tried "give us your email and we'll send you a coupon" promotions to help track behavior, as well as in-store credit cards to keep track of purchase trends, but nothing is quite like the good old cookie. That is until now.

A company out of Portsmouth, England, named Path Intelligence, has developed a new way to track people in physical retail almost the same way as online, only they don't use cookies; they use your wireless phone. No personal information is able to be recorded, of course, but just like a digital cookie, it is able to follow the anonymous you through the store to see where you go and what you look at. It can even be used in a full mall to see what types of stores customers are spending a lot of time in and which stores are being skipped all together.

Right now the technology is being tested for US consumption in 2 US malls. Hit the break to find out where and why the management believes the data is important.

The malls are owned and operated by Forest City, a mall management company with locations all over the country. For now they are trying it out in only 2 locations: Promenade Temecula in Temecula, California and Short Pump Town Center in Richmond, Virginia. The technology is in place now and will be tested through the end of the year. Management is being very open about what is happening, though. They have signs all around the mall, like the one above, encouraging people to ask questions.

The number one concern here has been identity security. VP of Marketing, Jane Lisey, said,

Before agreeing to test this technology it was essential to determine and guarantee that the personal information of our shoppers would be completely anonymous to all parties.

Clearly they felt it was a safe technology to go with. It certainly stores less personal information that the face-recognizing smart kiosks (I'm sorry: Experience Centers) that we have seen lately. Not everyone is as convinced these are any better, though. Mark Rasch, director of cybersecurity at CSC, thinks there is still a huge problem. He writes,

Although this mall technology might not identify specific individuals, it raises a bunch of privacy red flags. First, the instant the consumer identifies himself or herself anywhere in the mall (say, by using a credit or debit card to buy something), it is a trivial task to cross reference the cell phone data with the payment data and realize that the person hanging around outside the Victoria's Secret dressing room was your 70-year-old neighbor.

While his concerns are valid, I'm not so sure that "the person hanging around outside the Victoria's Secret dressing room" is really at the mall to spend money.

So, what do you think? Is this anonymous tracking an invasion of privacy or just a way for brick and mortar stores to compete with their online rivals? Let us know in the comments section.

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