Viewpoints

2010: An In-Store Customer Tracking Odyssey

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Last week was a prolific period for mulling the use of tracking technologies. The New York Times reported on a new city study about Manhattan traffic patterns based on information from GPS devices in taxis. The findings: Wednesdays are the most congested, Sundays have the highest-speed traffic, and on weekdays cars are moving about 13% faster than before. Who knew?

More relevant to food retailing, last week Food Lion discussed an interesting in-store measurement experiment that uses video analysis technology. The company is tracking shopper traffic patterns in two test stores using some 120 ceiling cameras — along with select in-store customer interviews — and the results are compared to sales and loyalty data. The goal is to capture a new level of information about aggregate shopper in-store behavior. For example, did shoppers interact with an endcap? Did they go into the aisle after viewing the endcap? Did they ultimately make the transaction they intended to?

Food Lion's isn't an isolated initiative. The industry has been on a journey to improve measurements of the in-store shopping experience. Probably the highest profile case was the PRISM initiative of a few years ago, which attempted to measure “the store as a medium” by tracking shopper behavior through infrared sensors, among other means. That project was a collaboration between The Nielsen Co. and a number of retailers and suppliers, and was spearheaded by the In-Store Marketing Institute, Skokie, Ill.

Ultimately that initiative unraveled, but not because of faulty technology. Instead, it was a victim of the recession, and, according to Peter Hoyt, the In-Store Marketing Institute's executive director, of concerns by retailers such as Wal-Mart, which was increasingly hesitant about the plan to syndicate and share information.

Food Lion's new program is an example of how retailers have learned from that lesson, Hoyt added.

“Many retailers tend to be more secretive about information, so it makes sense that they would want to create their own proprietary measurements using third-party partners, as in the case of Food Lion” he said.

Privacy of a different sort is also important for retailers to consider. They'll need to ensure consumers aren't repulsed by tracking technologies. In the Food Lion case, a sign posted in each store lets shoppers know that Food Lion is conducting market research that uses video cameras. However, that may not be enough to avoid concerns by some shoppers, as Julie Gallagher, SN Center Store editor, wrote in a recent Total Access Blog post. Retailers will need to remain sensitive to shopper concerns and have information at the ready.

Overall, Food Lion's efforts, and related explorations of shopper measurements by other chains, are worthwhile initiatives because they have the potential to drive improvements for consumers. That, after all, should be the goal for all retailers and suppliers, if not for taxi cab drivers.

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Contributors

David Orgel

David Orgel is executive director, content & user engagement, of Supermarket News (SN) and its website, SupermarketNews.com. Orgel delivers his opinions on industry trends through a bi-weekly...

Carol Angrisani

Carol Angrisani is an associate editor at Supermarket News. Along with covering the packaged goods beat, she also manages SN’s annual private-label and ethnic marketing supplements. Carol...
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