As a shopper enters a store, the retailer uses Wi-Fi to track her movements, interests, and shopping habits, providing a treasure trove of insight valuable to merchandising and product development alike.
And as advances in Wi-Fi promise increasing location precision and beacons promise pinpoint location based services, the future appears to be smooth sailing, right?
Well, not exactly.
Tracking the position of mobile devices accurately and correlating to personal data has been one of the most sought after Big Data objectives. And not just for retailers — the potential wealth of business value from data has drawn piqued interest across nearly all industries.
Yet in the real world, issues arise from both technology challenges and privacy concerns alike.
Technology challenges include:
- Typical Wi-Fi accuracies in the 7-to-10 meter range (though Angle of Arrival and improved location analytics promise dramatic improvements)
- Infrequent mobile device probing to conserve battery power
- Interference from metal shelves & fixtures, water in products (and people!)
Privacy qualms speak to the heart of transformation in the Internet of Everything (IoE) age. IoE, after all, is the explosion of network connections among people, process, data, and things — and promises to be one of the most impactful periods of change in our history. And the people element is in some ways the whole point — to make our lives better, healthier, more efficient, and so forth. But the people issues will be just as challenging as those that arise around technology.
Recently, this was highlighted with an announcement from Apple concerning the iPhone operating system. iOS 8 will generate random MAC addresses, effectively cloaking a user in anonymity. That means that retailers, marketers, and others hoping to track a single phone will be thwarted as each phone plays a shell game with constantly changing addresses.
Such strategies underscore the public’s growing fears around digital privacy, and I believe that other device makers will follow Apple’s lead. Moreover, beacons such as those powered by Bluetooth Low Energy (BLE) are poised to proliferate, but pose their own challenges for retailers in that they can expose detailed shopper behavior to competitors (through crowdsourcing) and are susceptible to rogue usage. For example, a competing retailer’s app could capitalize on beacons to push competitive offers, or the competitor could even place a rogue beacon in the store!
For retailers who would like to continue benefitting from consumer data generated by mobile devices, a new approach is required. Fortunately, I believe there is a win-win based on simple, old-fashioned people values such as trust, transparency, and honesty.
By offering a strong value proposition for the shopper to opt into the store Wi-Fi, the retailer can overcome the privacy challenges and track mobile devices much more precisely — mobile devices support very accurate location services, through a variety of means including magnetic signature; multisensory fusion (including video, audio and other sensors); and Bluetooth LE. And store Wi-Fi can also combat crowdsourcing and placement of rogue BLE beacons.
So, how can retailers create this value proposition to opt in?
Some ideas include:
- Offers and savings that come exclusively through the device
- Information on current queue lengths and routes to the shortest check-out line.
- Voice-operated mobile virtual assistant for hands-free shopping
- Useful services such as “wayfinding” to guide the shopping experience
- Product information and remote-expert support
- Personalized advice on:
- Diet and nutrition goals support
- Health guidance, such as gluten free products, diabetic friendly items
The point is that in an age when privacy concerns are mounting, retailers and others will need to think long and hard about their value proposition, and how best to educate consumers as to its benefits.
I believe that many of the shopper-tracking challenges retailers face — on the technical and people fronts — will be overcome. That is because the benefits of sharing data are great for retailers and shoppers.
After all, the goal is not to create walled gardens of information, but great experiences for shoppers and hyper-informed retailers who know their customers like never before. This creates a value proposition for Wi-Fi opt-in that is tough to turn down.
So, say goodbye to mobile espionage, and welcome a new era of shopper symbiosis.