The Art of Gleaning Retail Store Shopper Insights at NRF 2017

Retail has always been a tricky business about knowing your customers and their exacting needs. It has always been about how best to use the rented or owned real estate (sometimes in highly priced locations), and how best to return that investment in retail space via an effective turnover of merchandize at appropriate profit margins. Retailers need to localize their assortments based on geography and other customer data, and predict the impact of assortments, price, promotions, and space in shaping customer demand.

New technology advancements have been both a blessing and a curse. While the retailers can use video, Wi-Fi connectivity, radiofrequency identification (RFID), and a plethora of Internet of Things (IOT) devices to glean how customers behave outside the store, at the store entry, and inside the store, on the other hand, the informed and always-on connected shopper is now in charge. The same technology has enabled the once clueless consumers to now have more information than ever before entering the store, and to be empowered to control most aspects of their experience.


Figure 1. Tyco Retail Solutions Booth at NRF 2017

The National Retail Federation (NRF)’s Retail’s BIG Show in early 2017 saw a plethora of innovations in the retail store shopper insights to help retailers capture the hearts, minds, and wallets of today’s discerning consumers (see figure 1). More than 30,000 of the attendees got the recipe to the secret sauce of getting and keeping customers: it all revolves around personalized and seamless experiences—always easier said than done.

Attract and Know Thy Shopper

For a smooth in-store shopping experience, retailers need to determine optimal customer-to-staff ratios, to ease navigation with optimized fixture placement, and to optimize fitting rooms using useful and relevant shopper and staff data (i.e., fitting room analytics). At all times, retailers need to understand what, where, and how their store associates are servicing customers in all stores. As an example, in collaboration with Accenture’s Kurt Salmon Digital group, Tyco Retail Solutions demonstrated how retailers could optimize the customer experience and gain real-time insights into fitting room inventory, customer preferences, and potential goods loss situations in this crucial area of the store. This level of insight can be used to help improve customer service and increase shopper conversion, as well as better manage the so-called “inventory shrink.” Such technology, with remote access to in-store environments and data, can even replace or supplement field visits of corporate staff (planners and field managers).

Inspiring and engaging retailers must provide their merchandise and messages appropriately by knowing shopper demographics, and they must drive their loyalty strategies through an understanding of new vs. repeat shoppers, visit durations, and other important stats. They need to determine the store layout and design by identifying shopper activity and flow, and then optimize display and product placement by understanding customers’ in-store dwells and engagement.

Before that even happens, retailers should be able to drive their brand excitement and visits by measuring how effective their window arrangements are. At NRF 2017, Tyco Retail also showed a new ShopperTrak behavior application developed in partnership with Float, helping retailers understand the stop-and-draw power of a particular interactive window display. When placed in-store, the interactive display can also gather insights on dwell time, traffic direction, product interaction, and many other factors that drive shopper conversion.

A storefront interactive display allows retailers to maximize the storefront area and capture customer attention, e.g., by advertising current store specials and brands. Mounted on Tyco’s Sensormatic Synergy detection system, the display demonstrated streaming video, along with targeted customer content powered by Microsoft Cognitive Services, which via face recognition can determine the shopper’s gender and age. The relevant customized display is then based upon shopper gender and age demographics, and provides a germane shopping experience as customers enter the store.

Always Connected Shoppers and Retailers

Given the rise of mobility, many retailers have been using in-store Wi-Fi infrastructures to leverage shopper smartphones and other Wi-Fi–enabled devices. These connectivity capabilities can help them glean the busy and idle time trends, visit durations, pass-by traffic and capture rates, zone and shopper path analytics, mobile browsing data, and customer loyalty asset collection. Retailers could then do onsite promotion (coupons) or similar communication via a captive online portal, and leverage in-store web browsing behavior to improve inventory management.

To drive in-store engagement, retailers must now be able to leverage multichannel shopper data, and optimize the entire shopper journey through offline and/or online data mapping. They should be able to provide real-time personal recommendations and offers to increase engagement through mobile devices and apps. Many retailers are also attempting to increase loyalty program enrollments and engagement through their Guest Wi-Fi login page.

The Wi-Fi capabilities can naturally be quite enhanced and complemented by video and face recognition capabilities for more precise traffic counting, dwell counting, engagement measurement, and demographics. Video is the only technology that can provide full detailed and near-complete paths of customers through a shopping environment. In addition to its traditional use for loss prevention purposes, qualitative understanding of shoppers’ in-store behavior is enabled through video observation.

Again, as a concrete example at NRF 2017, Tyco Retail presented its Sensormatic cloud-enabled loss prevention analytics to provide retailers with new security insights gleaned by leveraging facial biometrics for repeat offender facial recognition. Forensic video analytics can be configured to alert in live monitoring, as email notification to a mobile device, or used as forensic searches after the event has occurred.

The IOT In-Store Customer Engagement Enablers

Retailers have long been using the RFID tags for security and loss prevention purposes, especially of valuable items. There are now portable and lower footprint RFID sensors with a wide variety of form-factor options. Thus, RFID has become a popular inventory management and asset-tracking technology—all the way from manufacturing to store shelves. It is now used for more precise and accurate near-real-time item location tracking via auto identification, with no manual action needed. As a snazzy example, Tyco Retail demonstrated robotic inventory visibility at its booth with the K3 robot from Knightscope, along with RAIN RFID sensors, automating inventory cycle counting using RFID technology (see figure 2).


Figure 2. Robotic RFID Inventory Visibility

More recently, Bluetooth low energy (BLE) sensors such as beacons (a.k.a., iBeacons) are being increasingly used for proximity-based messaging (due to their mobile app exposure), shopper engagement, personalized communication and notifications, and segmentation of customers (vs. the staffing needs). Beacons have helped provide shopper path analytics and employee measurements, and with some video technology help, beacons can even perform a shopper’s in-store interaction analysis. The IoT-enabled software solutions can provide real-time in-store visibility and predictive analytics to help drive sales, improve operations, and deliver a differentiated brand experience.

A number of retail software companies are able to offer some of the aforementioned video, IOT, and similar technology capabilities. Think of RetailNext, Brickstream, Cheerfy, iinside, Euclid Analytics, MiiPharos, Monolith, Nomi, Nearbuy Systems, Proximus.io, Retail Solutions, Swarm Mobile, Synquera, Walkbase, Scopix, and others. Even the point-of-sales (POS) hardware and software providers such as Fujistu, NCR, NEC, Toshiba, etc., are making a play at in-store shopper analytics and similar solutions.

Tyco Retail Paves the Way

But Tyco Retail Solutions has possibly the broadest portfolio of analytics-based loss prevention, inventory intelligence, and shopper traffic insights within its Sensormatic, ShopperTrak, and TrueVUE brands, in part via a number of acquisitions. Tyco Retail’s IoT ecosystem includes RFID technology, sensors, security systems, video analytics, device management, and managed services. As part of this connected ecosystem, the vendor can even offer new store-based cloud analytics and managed services offerings tailored to specific retailer needs. Deployed at more than 1,800 stores, Tyco’s TrueVUE RFID-based solutions enable retailers to confidently present accurate real-time in-stock positions to meet omnichannel customer expectations.

Tyco has recently added Zebra Technologies products to its growing portfolio of third-party solutions, which it can sell, integrate, and support. Tyco integrates Zebra’s RFD8500 and MC3190-Z mobile RFID readers with its TrueVUE Inventory Intelligence software. As a result, Tyco is recognized as an Advanced RFID Specialist, a Solution Partner, and an Independent Software Vendor (ISV) in Zebra’s new integrated PartnerConnect program. At NRF 2017, inventory accuracy and availability advancements from Tyco Retail, Zebra, and BlueBird Retail Solutions showcased rapid and frequent cycle counting activity and analytics using a new lightweight mobile sled reader that supports iOS and Android devices.

In addition, a secure mobile self-checkout innovation from the Tyco Garage (an advanced engineering organization within Tyco), in collaboration with Shopic, showcased a new application enabling store customers to easily purchase items via their mobile device and safely detach security tags from a convenient self-service kiosk. The new modular, self-detaching, and multi-sensor EAS/RFID tags enable this nifty capability, which is not exactly as elegant as the upcoming Amazon Go contactless stores, but not unimpressive either.

ShopperTrak Global Shopper Index vs. SAP Consumer Insights

ShopperTrak, a recently acquired Tyco Retail Solutions business unit, announced its Global Shopper Index, which provides shopper visit data on an international scale (see figure 3). Visibility into worldwide data allows retailers and shopping centers to recognize evolving shopping trends and benchmark their performance on a local, regional, national, and global scale.


Figure 3. ShopperTrak Global Traffic Index at NRF 2017

Additionally, ShopperTrak expanded its Market Intelligence offering, adding luxury and outlet categories to the benchmarking solution. Armed with North America–specific shopper visit data, Market Intelligence users should be able to create customized markets by grouping ZIP codes that align with their trade areas. As online and in-store sales become blurred, same-store sales data is no longer the meaningful comparison it once represented. Traffic data is still however essential to determining how stores are performing individually—in different regions, nationally, and globally.

There are a number of ways to measure what customers do online and on their mobile device, and these touch points have blended into the overall consumer experience. SAP seems to have found a way to discern useful shopper traffic insights (i.e., big data), without necessarily using (expensive) physical IoT devices and other in-store technology that Tyco or RetailNext use. Namely, SAP’s Digital Consumer Insight service (formerly known as the SAP Customer Insights 365 subscription offering), uses the anonymized data from major mobile telecommunications providers. The proof of concept was done in the Mexico City metro area about two years ago, but now SAP offers it for all major US metro areas too.

The anonymized customer big data in some cities have been to put through the SAP HANA in-memory database platform for SAP Digital to get all of the demographic stats per ZIP code (e.g., house income, house ownership, age, education level, quality schools, hospitals locations, etc.), which then retailers can subscribe to, to arrive at answers to important questions, such as:

  • Where to open new stores? (That is, are there schools, sports facilities, cemeteries, hospitals, etc., nearby?)
  • What assortments to offer?
  • Who’s visiting their retail stores each hour?
  • Is a campaign driving the desired foot traffic?
  • Are people being targeted the ones actually getting the message, etc.

In this way, retailers can find out not only who is generally visiting a location, but also where they are coming from. This big data can help them optimize advertising placement to maximize campaign effectiveness. The data also makes it simple to benchmark one store location against another, compare two potential new locations, or see how well they stack up against the competition. The so-called “catchment” data analysis can determine the most common home locations of people that pass through a certain location, in order to coordinate effective advertising and marketing plans (e.g., mailing coupons to those areas). But this approach is not very helpful for the concrete Customer X who just walked into the store—this is where the aforementioned sophisticated real-life video and sensor technology comes in handy.

How It All Might Work in Omnichannel Commerce

While some very private (if not paranoid) persons might not find this personalization approach too attractive, many other shoppers will view the personalized in-store experience as a significant opportunity for retailers to create emotional connections and demonstrate real-time relevance throughout the entire in-store interaction. But how should all these data sources and sensors work in tandem with integrated omnichannel retail software solutions including POS, distributed order management (DOM), digital commerce, and customer relationship management (CRM)/clienteling? As an example, Aptos and its innovation partner Formula 3 Group (F3G) showcased the following innovations during NRF 2017, designed to foster persistent personalization throughout the in-store experience:

  • Personalized Digital Signs and Displays—RFID, beacons, and CRM software can come together to deliver interactive and personalized content to shoppers as they navigate the store, with each display responding to their real-time behaviors as well as their profile and their history with the brand.
  • Interactive Product Kiosks—As shoppers interact with merchandise displays, digital monitors present detailed product information in real time, including size/color options, inventory availability, and promotional offers, all tailored to the items the shopper is evaluating (see figure 4).
  • Clienteling on the Apple Watch—As a known customer walks into the store, sales associates can receive alerts on their wrist that tell them who walked in, their purchase history, their preferences, and more—empowering associates to offer a customized experience to each shopper.


Figure 4. F3G Interactive Display at NRF 2017

Collectively, all of the above innovations allow retailers to deploy more persistent personalization throughout the store, whether shoppers are assisted by store associates, are using their smartphones, or interacting with merchandise displays. Those retailers that can get the proper balance of their shoppers’ insight without prying too much on their privacy will certainly have an advantage over their competitors.


Original Article