Are Shopping Malls Watching Consumers? The Answer May Surprise You
Surveillance cameras are everywhere. Especially in big cities, you can barely go a block without being captured on video. When you are at an ATM, crossing the street, waiting at a bus stop or boarding the subway, if you get that feeling that somebody is watching you, you’re probably right. Now retailers at shopping malls are also watching, but for a whole different reason.
The Cookie Trail
Unlike public surveillance that is in place to increase public safety, shopping malls are using multiple technologies, including surveillance cameras to enhance the in-person shopping experience. In the same way that you leave a trail of cookies when hopping from website to website, new shopping mall technology is designed to create a physical cookie trail for the same purpose as online retailers – to better target ads, promotions, and increase traffic.
Millennials Prefer Bots to People
IBM did a study tracking millennial shopping behaviors and found that a clear majority, 65% of them, prefer shopping with virtual assistants and talking to chatbots as opposed to actual customer service personnel. Having grown up with technology, being watched and tracked to better understand trends and shopping habits is nothing new to millennials.
Despite preferring to skip the personal touch from a live customer service rep, millennials want high quality automated customer service. That’s where new technology is helping traditional retail replicate some of the convenience and intuitiveness of online retail customer service.
Shopping Mall Technology to Watch Out For
What shopping mall owners and individual retailers are doing goes well beyond watching who is coming and going via surveillance cameras. There are several new technologies that are using beacons and sensor technology to track shopper movements and provide a wealth of data for analysis.
Shoppermotion by Cloudera – This technology developed abroad is designed to utilize the Internet of Things (IoT) to aggregate better data to provide a seamless online/offline shopping experience. Beacons communicate with sensors that are installed in Shoppermotion-enabled ceilings where users are tracked through shopping carts and their Smartphones, taking note of how they navigate the store and where they linger longest. IKEA is already using this technology in some of its stores, and Cloudera says that one of its clients saw an increase of 9% in sales and was able to increase the amount of time shoppers lingered in certain areas based on real-time data provided by Shoppermotion.
Geofencing with Pinpoint – Instead of simply counting the amount of traffic that goes in and out of stores, geofencing technology creates an invisible fence around a certain area that enables real-time data tracking using mobile devices. Based on location, when consumers enter a geofenced area, they are offered discounts and promotions to download the store app. Once downloaded data from the device are used to target ads and promotions in real-time.
Zebra for Retailers – This technology uses RFID (Radio Frequency ID) tags, sensors, video, and mobile technology to create a full profile of each shopper which will help retailers know their shoppers and the demand for their products better. Zebra aims to get into the fine details of shopper behaviors, determining why a shopper picks up an item and then puts it back; why did they choose not to purchase or what helps them decide to purchase: Location of item, price, quality, etc? Zebra technology will also be used in warehouses and distribution centers to prevent insider theft and to track products that go missing.
Implications for CRE Overall
By 2025, the IoT is expected to nearly triple its share of the market from around $4 billion dollars today to over $11 billion in less than a decade. For CRE overall, the implication is that practically all CRE, not just retail will need to be equipped to enable real-time tracking.
As retailers continue to try to catch up with Amazon, utilizing technology to attract millions of customers around the world, that same technology is going to be applied to CRE as a whole. Expect this technology to be used as a basis for site selection based on shopping trends and matching tenants with assets based on advanced industrial warehousing needs.
By Micah McCullough, CCIM, SIOR