This week has seen a great deal of coverage around the practice of measuring and analyzing shopper behavior in stores, commonly referred to as in-store analytics. As with any new technology category, there has been a great deal of confusion about what it does and does not do and how information is used. This FAQ will help you understand some of these questions.
Q. What is in-store analytics?
A. In-store analytics is the ability for retailers to use software platforms that can help them understand what shoppers do in their stores. Retailers use this information to improve their stores so to better meet their customers' needs.
Q. Is RetailNext the only provider in the in-store analytics space?
A. No. There are a number of vendors who provide some form of in-store analytics using a variety of technological approaches.
Q. Does the RetailNext platform depend on smart phone tracking?
A. No. RetailNext uses multiple data sources including in-store video, such as that provided by security cameras. Smart phone tracking not among them today. There may be some confusion because RetailNext offers tracking using Wi-Fi-enabled employee tags, which are designated signalling tags that employees carry while they're working so that retailers can tell where they are in the store. There is no customer equivalent of this technology in use on the RetailNext platform.
Q. Which retailers use this kind of technology?
A. Retailers in all major segments including specialty, big box, fast moving consumer goods, and department stores are using the platform. None of them uses RetailNext to track shopper smart phones. Nordstrom is not and has never been a user of the RetailNext platform.
Q. What can retailers tell about individual shoppers using in-store analytics?
A. All individuals in stores are anonymous to the analytics. In other words, the platform can tell how many people came to the store but not who they were. Your personal identity is never visible in the store.
Q. How is this information used?
A. Retailers use aggregated statistics on shopper behavior to determine the changes in their stores that will allow them to better service their customers. For example, retailers often use in-store analytics to match staffing levels to expected customer traffic, discover their most effective store layouts, and determine which displays are most popular with shoppers. All statistics are used in aggregate and all shoppers are anonymous. Retailers have the ability to control which managers get access to this information and do not sell it to third parties.
Q. How does Wi-Fi detection work?
A. Although RetailNext does not offer Wi-Fi tracking of shoppers today, the following is a high-level explanation of how this technique works. When users set their smart phones to discover nearby Wi-Fi networks, the phone actively and regularly sends out signals announcing its presence to potential Wi-Fi networks. Wi-Fi detection platforms simply include receivers that pick up these broadcast signals and triangulate on them to know roughly where the broadcasting phone is located. This technique makes it possible to identify a given phone or tablet specifically but not to determine anything about the identity of that device's owner or user. The detection platform is not able to “look inside” the phone's content, communication, or usage in any way whatsoever.
Q. I saw a news report that implies that RetailNext provides smart phone tracking today. Is that report incorrect?
A. Any news report that states or implies that RetailNext tracks smart phones today is incorrect in that assertion.