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Retailers Can Finally Get a 360-Degree View of Consumer Behavior

Brick-and-mortar retailers are facing rapidly escalating customer expectations. Digital-savvy shoppers are accustomed to the conveniences of e-commerce, with everything from recommendations and reviews to flash sales and special offers only a click away—to say nothing of wide-ranging personalization options and virtually limitless inventory.

To keep up, retailers need to upgrade the customer experience—and that requires a quantum leap in data-driven insights. “It all starts with knowing what’s in your store and where it is in your store, in real time, because you can’t make useful recommendations without that knowledge,” says Daniel Gutwein, Director of Retail Sensors at Intel.

Retailers also need a clear view into customer behavior. That means tracking customers’ movement through the store, as well as their interaction with products. And all this data needs to be provided in a way that is affordable, flexible and easy for retailers to use.

But these goals—getting the right data at the right time, while gleaning the right insights—have been mostly unattainable. Unlike online retailers—who can easily measure shopper behavior through cookies, IP addresses and the like—brick-and-mortar retailers have struggled mightily to gain real-time insights about in-store customer behavior.

Now, for the first time, retailers can accurately track customer-inventory interaction in stores. Thanks to solutions from RetailNext and Intel that combine RFID location tracking, multi-camera video analytics and intelligent beacons, retailers finally have an opportunity to reach the comprehensive data-driven solution that stores have been searching for — by tracking the movement of every product, customer and store associate. Leadership of both companies realized the fusion of these technologies, which create a cohesive portrait of store activity and customer preferences, provides a flexible, scalable solution even more valuable than the sum of its parts.

A Holistic View for Retail Insights

While online retailers have been analyzing customer behavior for years, only recently have brick-and-mortar retailers been able to observe the movement of shoppers and associates with any level of precision. “Just the notion of being able to measure shopper and associate activity throughout the entire store is a fairly new phenomenon,” says Bridget Johns, Head of Marketing and Customer Experience at RetailNext.

RetailNext pioneered the technology allowing retailers to follow movement from one camera to another, which helped stores track activity across the full floor plan. However, important questions lingered: “You didn’t know if they were shoppers or associates, which skewed the data,” Johns explained. So in 2016, the company introduced beacons for associates’ name tags, enabling the system to distinguish workers from customers.

Today these technologies have been combined with Intel’s Responsive Retail Sensor, which uses sophisticated RFID tracking to pinpoint the location of every item in the store. By pairing this inventory tracking with customer tracking, retailers move to the next level of insight.

RFID tags can identify, for example, what items are being picked up versus those that are being sold. “If you have a high-touch, low-conversion item that’s occupying a prime piece of real estate on your sales floor, as opposed to a low-touch, high-conversion item somewhere in the back corner of the store, you may find it’s something that needs to be moved,” says George Loranger, Product Marketing Manager/Retail Solutions at Intel. “If you overlay this with some of the data that RetailNext’s video analytics and beacons glean, where they understand shoppers’ most prevalent paths through the store, you can do some experimentation to see if you get more conversion of that item by overlaying RFID data with customer data in the store.”

Combining these technologies into the holistic Full Path solution allows the retailer to tie merchandise flow to associates and shoppers, adds Johns. “If you can start to understand that lots of people come in and take the green dress to the dressing room but no one buys it, you can turn that information into action,” she explains. “Is it the price? Is it the fit? Or, if another product that very few try on always gets purchased, can you move it to a better sight line so you can move through inventory more efficiently?”

Another important benefit: optimizing the time of sales associates. “They’re not having to wander around with a wand to check where everything is supposed to be,” says Loranger. “They can spend more time interacting with the customer, giving them more time to upsell.”

In future-use cases, these solutions will also up the ante when it comes to personalization, as retailers begin to connect their CRM database and loyalty programs to the mix, so they can potentially provide personalized offers based on shopper behavior, or associates can serve up better options.

Beyond the Point Solutions of the Past

The issue has never been that brick-and-mortar retailers don’t have data. They have plenty of it, explains Loranger, but the point solutions of the past didn’t allow them to do what they needed to do with it. “These different islands of technology have, until now, not offered a comprehensive, holistic picture that can deliver real-time insight,” he explains. Analyzing transaction logs, for example, suffered from inaccuracies and may have taken days or weeks to report back.

They also haven’t scaled due to prohibitive costs and excessive installation complexity. In fact, the need for a simple, cost-effective RFID system is exactly what drove Intel to develop its solution. “This is essentially a plug-and-play distributed sensor network,” Loranger says. “It’s all automatically configured to start reading tags and delivering insights immediately.”

The next iteration of this, he adds, is knowing what you have in the store all the time, in real time, as well as how customers interact with specific products. With this data, retailers can determine whether they have the right product mix; what products are being considered; and what’s being sold. “The insights you get just from that customer interaction in the store and the movement of product can help you improve store layout, feature different products and start to optimize supply chain efforts,” says Loranger.

A Catalyst for Retail Change

As the technologies have evolved and customer demands have increased, gleaning insights from inventory interaction has become almost tablestakes for retailers, says Johns. “That may sound pretty dramatic, but we believe that if retailers aren’t transforming the way they need to inspire their shoppers, they will just go somewhere else,” she explains. “Shoppers are miles ahead of retailers in terms of expectations, while at the same time are exceptionally uninspired when they’re in the store.” The Intel/RetailNext partnership, she adds, is the catalyst to counteract that.

“We're trying to move the industry to adopt a compelling solution that resonates with retailers, that provides best-in-class insights to develop the stores of the future,” says Loranger. “The ultimate brick-and-mortar customer experience is to find what you’re looking for and complete the transaction.” The companies are working together, he says, to go beyond simple inventory accuracy to find what else helps connect traffic and behavior in the store and deliver on the promise of meeting today’s shopper expectations.