Nobody can question that location-based services are hot these days–especially in the retail space.

Retail in general is under increasing competition and pressure to maintain its revenues and profitability, especially physical retailers who are threatened by online businesses, ranging from one person outfits to global giants.

Physical retailers big and small are all facing the same phenomenon: smartphone users walking around their stores (inside and out). Google and Nielson recently reported that shopping queries are two times as likely to be in store. So people are actively on their smartphones in stores. The significance of this statistic to retail is that there is a huge opportunity here to optimize dollars, be it marketing funds or operational savings–all of which can be enabled by location-based services.

iStock retail

Cisco’s location based services using the Mobility Services Engine and the Connected Mobile Experiences solutions is market leading and generates a lot of interest among customers and I get the privilege of speaking with many retail business executives on a global basis.

In retail, the two big rocks are revenue and loyalty.  The Cisco Connected Mobile Experiences (CMX) solution helps line of business leaders reach those goals by aligning with the mobility trend. Armed with the location-based services of CMX, you can captivate your customers by creating personalized, context-based engagement to boost loyalty, while generating location analytics data on customer movement patterns and behavior for optimizing operational costs.

From my discussions with leading retailers, I’ve noticed that location-based services use cases in the industry follow three main themes:

1. Operational Effectiveness

Knowing how many people are in your store at various times can assist with staff planning and scheduling – ensuring that you don’t waste expensive resources when they are not needed and that you don’t lose valuable customers due to service delays when they are in the store.

Knowing when certain customers or VIP’s enter your store can ensure that you offer the level of service you wish to deliver to the customers you care most about – for example, the customer who spends 20k per month in your store is probably someone you want to dedicate a resource towards, so being automatically notified when they are enter your store is probably a very important to keep up the relationship with high quality customer service.

Understanding how your store is laid out and how people use the store gives huge insights into the use of your valuable real estate – is the premium display area not getting the level of footfall you expect, or do customers linger in the part of the store with the least profitable products? Being able to understand these trends and make adjustments  can have a direct bottom line impact.

2. Promotional Effectiveness

Understanding if a particular promotion in the store is working or is getting customer attention can be hugely valuable – for example, are there more people going to the promoted area of the store during the promotion that in the period beforehand? Or, are customers dwelling longer in the sale areas than the other areas?

Location analytics data can also be valuable for joint promotions. Being able to show the brand owner the increase in numbers of customers or dwell time at their promotions delivers insights, as well as justifying any pricing or other promotional incentives, can help strengthen your partnership and drive home the value proposition of your collaboration.

Being able to adjust and understand the effectiveness of the impacts of promotional efforts can increase the benefits of promotions and hence the revenues they generate.

Naturally for some retailers, locational analytics offers the opportunity to effective price digital promotions or digital signage – knowing how long and how many people spend time at or near a digital sign throughout the course of a day or even week enables more effective pricing of the advertising being shown.  Being able to show quantifiable evidence why an item should be 3x the price on Saturday afternoon compared to Monday afternoon, for example, could completely change the promotion scheme.

3. Customer engagement

The final theme is using location-based services to engage customers to deliver greater services and superior experiences thereby providing them with opportunities to increase their spend.

Imagine a loyal customer entering the store and automatically bringing up their shopping list, stored on their app from last week’s shopping trip. What if the store could automatically navigate the person to find their products within the store. Then, imagine being able to push select promotions over the Wi-Fi network to the customer’s smartphone based upon who they are, what they have bought before and where they are in the store. Now that’s highly personalized location based promotions. Not only does it present the opportunity to increase the size of their shopping cart, but probably also some additional revenue form the brands wishing to be promoted.

As this world of location services in retail becomes more and more developed, Cisco will remain at the forefront with our Connected Mobile Experiences solution enabling all of these scenarios and more. Further details can be found here – Cisco CMX.


Brendan O'Brien

Director Global Product Marketing

Connected Mobile Experiences