Retail Business Intelligence Engine Tracks Shopper Trends By Smartphone IDs

February 12, 2013 by Dave Haynes


The ability to understand what consumers are doing in retail environments has been the domain these past few years of video-driven analytics that use overhead cameras to generate heat-maps of where shoppers go and where they don’t.

Companies like Intel, via its video analytics technology, can also generate data on things like gender, dwell time and what visual cues – like digital signage – gain the most attention.

Now there’s a start-up using mobile phone signals to generate analytics on shopping patterns. Advertising Age has a piece about a start-up called Nomi, which has $3 million in seed funding, that purports how it can track  presence, time spent in stores and what grabbed attention.

It’s not the first to do so, but the Salesforce CRM pedigree of the founders (include that company’s former Chief Technical Architect) has made people take serious notice.

Reports Ad Age:

Nomi’s technology gathers mobile-device IDs as people enter merchant locations through the merchant’s WiFi network or via small sensors that track a mobile device’s radio signals down to a one- to three-meter proximity. Nomi then uses machine learning to identify spatial relationships by crunching data on consumer footpaths.

The system is already tracking such information at stores in New York City, such as teensy cupcake purveyor Baked By Melissa or modern-furniture merchant BoConcept.

Baked By Melissa uses Nomi data to run A/B tests on its window displays, where it promotes bite-size cupcake flavors such as Chocolate Graham and Pink Velvet. The idea is to determine which displays result in higher window-conversion rates.

Quick-serve salad restaurant Sweetgreen is using Nomi to track how long it takes customers’ orders to arrive. “Time spent in-store vs. the number of seats is a very interesting metric,” said Jonathan Neman, founder and CEO of Sweetgreen, which has been using Nomi for nearly five months and has begun implementing it in all 16 of its Mid-Atlantic stores.

New York-based Nomi is still small—its team numbers 15—but it’s focused on attracting large national chains and building staff to develop an upcoming offering that will tie consumer interactions in bricks-and-mortar locations to e-commerce, loyalty-card information and other data.

And the privacy implications? While the company stresses the unique device IDs it tracks are never tied to personally identifiable information, the system operates with little—if any—notification to consumers. There’s no notification on consumers’ phones that the tracking is occurring; rather, they are automatically opted in to being tracked. Stores can post notice, which Mr. Neman is considering for Sweetgreen.

Nomi competes with a handful of firms using a variety of technologies to track people in-store, including RetailNext, which tracks consumer movement via data derived through video cameras, WiFi devices and other sources.

Another mobile device tracking firm, Path Intelligence, attracted the ire of Senator Chuck Schumer of New York when it was deployed at malls in 2011. Mr. Schumer sent a letter to the tracking firm suggesting it should require consent from device owners before tracking them. Malls in the U.S. that had tried the technology reportedly ceased using it as a result.

Note: Path Intelligence is the company that has a partnership with digital signage software provider ComQi.

Whether mobile device ID data are considered personally-identifiable is subject to debate. However, the Children’s Online Privacy Protection Act does require that mobile application providers obtain parental consent when mobile apps aimed at kids under 13 track persistent device identifiers such as IP addresses and mobile device IDs.

Nomi’s founders come with customer-relationship management and social-media marketing backgrounds. CEO Marc Ferrentino served as chief technical architect for Salesforce. Chief Revenue Officer Wesley Barrow and President Corey Capasso both hail from social-marketing-analytics firm Buddy Media, which was acquired by Salesforce last year.

The company is working on an opt-in only system called Engage that will allow consumers to identify themselves in exchange for deals. “It will give you the entire closed-loop experience,” said Mr. Ferrentino, connecting digital interactions “with the footpath in the physical world.”

So why should you care if you run a digital screen network in retail, or sell that stuff?

Because these sorts of systems – whether video, wifi or cell phone IDs – are generating real-time or trended business intelligence that’s actionable. If you know what shoppers are doing with more than just a snapshot in time from normal research, you can tune everything from in-store messaging and promotional campaigns to where and when to place staff on the sales floor.


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