More In Store for Shoppers through Internet of Things

Analysing the movement of shoppers in stores is surging ahead, as new technologies combine with the Internet of Things to enable bricks-and-mortar retailers to refine shopping experiences.

In-store tracking technologies come have a long way since the rudimentary light sensors across doorways once used to count store traffic.   The ubiquity of smartphones is spurring far more sophisticated approaches.

Some newer systems employ sensors that track customers via the pings their smartphones emit in search of a Wi-Fi network. Others flash a code to smartphone cameras via LED lighting.  Some can even pinpoint a shopper’s specific location by sensing disruptions in the store’s geomagnetic field.

The Other 5 W’s

So, what are retailers doing with this enhanced footfall information?  Like any data, the true value comes from the analysis, insights and strategies it enables.

For example, a clothing retailer can analyse how long customers linger in front of particular racks, whether they move to the changing rooms, or whether they move on.  That can help them refine their inventories by size and style.

A grocery retailer can analyse shopper pathways to better co-locate products to increase up-sale.   (Or, per the classic “milk and bread” play, move commonly bought products to the opposite ends of the store to increase the number of shelves passed by each customer.)

A car retailer could correlate the number of people inspecting makes of vehicles in the showroom with eventual sales, to help them better target their sales promotions and placement of vehicles on the showroom floor.

Making it personal

The marketing opportunities from footfall analysis increase significantly when stores are able to persuade clients to share personal information.   In fact, the free Wi-Fi services many shoppers take advantage of at malls may already be providing such information.

Have you ever read through the terms and conditions for such Wi-Fi services?  (No, me neither!)  They typically permit the service to view each shopper’s online search history, and track their location. Tech-savvy retailers can use that data to send tailored ads and offers to potential customers’ phones.

If a customer is browsing an online store like Amazon, while in a physical store, the service may even offer a discount on an instant in-store purchase.

Fast-growing market

With smartphone ownership continuing to rise, estimates are that the market for mobile tracking technology will increase 5X between now and 2021, to $23B.

At IBM, we’re adding to this wave by applying advanced analytics technologies and Watson artificial intelligence, to help retailers continuously optimise the in-store experiences they provide.

And this is just the beginning.  A recently published patent by our strategic partner, Apple, involves precisely mapping and navigating indoor environments, not just via smartphones, but also smart glasses and other devices.


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