Retail Customer Experience: Indoor Mapping Gives Power to Retailers

Discussion
Dec 18, 2012

Through a special arrangement, presented here for discussion is a summary of a current article from Retail Customer Experience, a daily news portal devoted to helping retailers differentiates the shopping experience.

While outdoor GPS mapping is nothing new to the many users of Garmin’s or iPhones and the like, indoor navigation maps are still in their infancy. For retailers, the concept of a mobile-based in-store map is an enticing tool that could satisfy savvy smartphone shoppers and save brick-and-mortars from going out of style.

Recently, the Portland, OR-based Meridian announced that its "glowing blue dot" feature was slated for use at Macy’s 150,000 square-foot flagship store in New York City. Meridian’s turn-by-turn navigation system at Macy’s was one of three beta-test locations. The department store chain is the first major retailer to implement the indoor navigation feature.

Not only does the indoor navigation system offer shoppers a utility to get around and find stuff in stores, but retailers can also send targeted offers to them based on where they are standing. Jeff Hardison, Meridian’s VP of marketing and business, said that on average retailers can expect a 30-minute engagement time with shoppers using the app, with one in three shoppers clicking on the ads.

The system can also be embedded directly into a retailer’s smartphone app. Said Mr. Hardison, "We simply improve the app."

Shoppers are given an option on whether or not they want to use the location service and have their movements tracked.

"We use an opt-in process," Mr. Hardison explained. "Shoppers agree to share their location in order to get the utility, and once they agree to share we ask if they want to receive push notifications. We made sure we perfected the system for opt-in to make customers feel that they are agreeing to and knowing what they are getting into."

The tracking ability gives detailed analytics to retailers, as well as a look at shopper traffic that can help them design store layout and product merchandising, Mr. Hardison said.

While other start-ups and internet behemoth Google are entering the indoor mapping world, mobile strategist and analyst Bruce Krulwich of Grizzly Analytics believes the industry will be large enough to house the competition.

"I think that within 2-to-3 years we will see indoor mapping and location services as big as outdoor is now," he said. "All major mobile companies are working on this. But they are looking at mass market, not the retail side of it. They are not quite as accurate as ones tied into the retail experience. Even if Google comes up with one, there is still room for more retail-oriented companies to bring more accuracy."

What would be most and least appealing about in-store GPS navigation for retailers as well as shoppers? Do turn-by-turn directions to merchandise provide enough of an incentive for consumers to embrace such technologies?

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31 Comments on "Retail Customer Experience: Indoor Mapping Gives Power to Retailers"

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Dr. Stephen Needel
BrainTrust

Gee—how tough can this be? How many stores in the world are so big and so poorly laid out with bad signage that I can’t find my way without an app?

While this may help the “lost” shopper, it will reduce the impact of merchandising for those using the app, focusing them on their phones rather than the store itself.

Max Goldberg
BrainTrust

For shoppers, indoor navigation would offer the ability to quickly find the items they are seeking. Retailers would be able to track how consumers traverse their stores and would be able to push offers to consumers and track the immediate effectiveness of each offer.

If retailers don’t go crazy with pushing offers to consumers, this could be a win-win proposition.

Paul R. Schottmiller
Guest
Paul R. Schottmiller
4 years 11 months ago

“Where is ___” is still a top question asked in retail stores so there is value in making the answer to that question easier to get than finding an associate.

Making it easy to use is key. I think a Siri-like interface would help with usability so the shopper doesn’t have to repeatedly stop and check the map.

Dave Wendland
BrainTrust

Technology will not be embraced if it doesn’t deliver significant value or improve an overall shopping experience. The best-in-breed solutions will likely need to deliver more than a “location service” within the store, instead helping customer navigate the store by “need.”

With a primary focus for our company in the retail healthcare space, I envision technology in our market segment creating solutions that are presented with the shopper in mind. Imagine if a shopper could identify that a recent sports injury has caused them pain in their arm. The navigation system would then guide then to pain relief, braces/support, ice packs, and rehabilitation aids. This, in my opinion, delivers on the promise of making shopping more meaningful.

Ken Lonyai
BrainTrust

Indoor positioning is a natural evolution of mobile and a no-brainer. It’s coming and will become as much a part of the mobile user’s innate tool set as GPS. The idea of every retailer, brand, and start-up using it to make pitches at every turn (literally) is where the technology has the possibility to stumble. It’s going to need to be used in reasonable doses in order not to feel invasive or overbearing to users. Opt-in will be a necessity.

Mark Heckman
BrainTrust

For certain channels of retailing — particularly retailers with larger footprint stores — I do believe that in-store mapping will not only work, but could evolve to being part of the routine shopping experience. But first there are some problems that need to be solved. First and foremost, while there are technologies and companies in existence today that facilitate connecting to the shopper in-store with maps and locations of products and sale items, the mapping process that digitally reflects the exact layouts and exact product locations is still a significant task.

Secondly, maintaining the integrity of digital renditions of each store becomes more than a full time job. Shoppers will not adapt to a system that frustrates them with inaccurate information.

Certainly there are workarounds and compromises for those barriers, but ultimately if a shopper is going to using their mobile phone in-store, as a shopping device, the information they receive must be 100% accurate. And, in the case of chasing “blue light” specials within the store, the deals must be very compelling and perhaps eventually even personalized to their past shopping preferences.

Cathy Hotka
BrainTrust

What a turnaround. For decades, retailers talked about the importance of keeping shoppers in the store for as long as possible. An app like this turns that idea on its head. For guys who think surgical precision is an important shopping trait, this app will be a huge hit.

Ed Rosenbaum
BrainTrust

This will be an asset to both the retailer and the most important person, the shopper.

Adrian Weidmann
BrainTrust

Tying together several different capabilities into a single seamless application would further leverage existing technology and enhance the value to the savvy digitally connected shopper. Examples could include integration of SKUFinder and Object Recognition applications.

The challenge for retailers in order to scale this across hundreds of stores is their accurate understanding of each store planogram and product location across the enterprise. The first time a shopper is looking for a particular dress and she gets led to men’s suits, the application will be forgotten. Maybe retailers will have to increase their liability insurance to cover themselves as more shoppers will be walking into things as they stare down at their device?!

Zel Bianco
BrainTrust

In-store navigation is a great idea for retailers—being able to follow shoppers’ movements is a big deal for store planning as well as discovering in-store shopping habits.

Regarding shoppers, the turn-by-turn directions is a great incentive (imagine not having to search through a store or mall for the particular product you are looking for, but going directly to it?). There needs to be more of an incentive than just directions for some shoppers to give up their privacy, such as in-store specials or discounts for users of the navigation system.

This will take some time to work out the benefits for all, but in the end this technology will be another great tool for retailers.

Nikki Baird
BrainTrust

I think this is an example of a great trade-off between shopper utility and service on the one hand, and retailer ability to gather information about shopper behavior on the other. If you just put out tracking of consumers without offering something in it for them, I guarantee there would be a backlash—in fact, just around this time last year there was a backlash over exactly that.

In order for this to work, I think there needs to be a few things: one, no lack of customer service in the assumption that the map will cover that; two, respect for consumer battery life and privacy; and three, a focus on delivering something that is directly valuable to the customer in exchange. If retailers do that, then we’ve finally got the ability to crack open the store with the same degree of precision analytics and insights that we get out of online. THAT would be a huge win for everyone.

Dan Raftery
BrainTrust

This could be huge for retailers, but I think simpler is better here. Turn-by-turn navigation is over-engineering the solution. Aisle number, proximity to front, back middle and shelf number, if possible, would be great. This could increment the market basket item count by preventing shoppers from leaving without the things they could not find. Now if we could figure out how to eliminate out-of-stocks….

Warren Thayer
BrainTrust

This would be great to help you find stuff in stores, since it’s just about impossible to find a store clerk. I’m RetailWire’s official Luddite, but even I like this. I’d love turn by turn directions, especially at big box stores. Only downside is the small but vocal group of people who will fear a dark and dastardly plot to turn them into robots or Stepford Wives, regardless of any opt-outs, safety features, etc.

Tim S
Guest
4 years 11 months ago

Great, more distracted shoppers running their carts into my Achilles tendon or walking/bumping into me because they cannot take a minute to figure out where they need to go. Displays falling due to collisions. I see (hope) this as a short-lived novelty.

David Zahn
Guest

I completely “get” the benefit of as a shopper, but am a little concerned that the merchandising efforts (displays, signage, store layout, etc.) that are designed to “interrupt” the normal traffic flow will cease to be effective. I understand this is “progress” and aids the shopper. Just means that we have to adapt. As for tracking shoppers—that seems less viable IF they are being directed where to go and not roaming in the store as they choose without the benefit of being directed.

Ed Dennis
Guest
Ed Dennis
4 years 11 months ago

This is way overblown! Department stores for years had have areas (men’s, women’s, kids, cosmetics, etc.). I have not encountered many lost adults in department stores (named because products are organized into departments or areas). Furthermore, my grocer places a legend on every shopping cart that tells you the isle on which a product is located.

Just because we can, doesn’t mean we should! Besides, if every consumer enters a store to buy only one item then the retailer severely diminishes the possibility of selling the consumer anything else! Can you see the word shopping being removed from the dictionary? This is such a bad idea that it will never provide meaningful value to retailers. Why would anyone pay to reduce customers time in store? If consumers are so intent on saving time, they will go to Amazon! For goodness sake guys, build the experience, make it more fun?

Frank Riso
BrainTrust

Communication with the consumer while in the store is the goal of every retailer and to be able to do this electronically is a bigger plus. However, unless the retailer is able to provide a “real” value add to the consumer, it will not last beyond “where is the baking soda located?”

Each retailer will need to understand their customers and then define the value they add to in-store GPS navigation.

Al McClain
Guest
Al McClain
4 years 11 months ago

Sounds like an idea whose time has come. The two downsides I see are: 1. Retailers showing restraint – some will not be able to do it, just like they can’t send a reasonable volume of e-mails. 2. At what point do we reach a situation where shoppers can’t function without their PDA’s?
Oh, sorry, point # 2 has already happened.

Lee Kent
BrainTrust

I just keep thinking about the huge expense not to mention upkeep of this kind of endeavor vs the payoff. I do believe this is a no brainer for big boxes, airports, Las Vegas Casinos, etc. i’m not so sure about other retailers. Think about it. What is the number one question asked of store employees? “Where’s the nearest restroom”. With that in mind, I can definitely see mapping the shoppers location with key locales that they may want to find, especially in a hurry. That level of mapping would require far less upkeep and could even be a service provided by malls and shopping centers to attract retailers. I can tell you that the requirement to carry an app for every store I shop in is not an option!

paul clifford
Guest
paul clifford
4 years 11 months ago

This is a test so that similar applications can be implemented.

If you allow the app to help you find stuff in stores
It will send personalized ads
To help you spend more

What a deal!

This will work for the consumer that will permit GPS directions on how to “navigate” the store and who wants less or no interaction with other humans in exchange for having their cell phone plastered with mail (advertisements).

Herb Sorensen
BrainTrust
This is NOT the “First Indoor-Positioning iPhone App in the Retail Industry.” It is twenty years late to the game of tracking shoppers electronically, which began with VideoCart in the early ’90s. We introduced RFID and other tracking methods in 2001, strictly for research purposes. Catalina Mobile evolved over that same period, moving to the iPhone a couple years ago. In addition, I have personally experimented with at least a dozen tracking methods—none of which even come close to the accuracy of the latest RFID/UWB methods. Over the dozen years I have been involved, and recognized that I wasn’t “the first” in this arena, I have repeatedly seen these claims of “first” from people who are apparently ignorant of the history. That doesn’t trouble me nearly as much as their ignorance of how shoppers actually behave. Most think an in-store navigation device is just the thing to accelerate communication and sales with the shopper. People no more need navigational assistance in the store than you need your in-car GPS to get to the office, or other places you regularly visit. Having said all this, I DO expect smart phones to revolutionize self-service retailing. And all this “mud on the wall”… Read more »
Martin Mehalchin
BrainTrust

There’s a potential big data angle to this as well. We’re using tablet based tools to capture pathing data for our retail clients. Retailers who implement in-store navigation for their shoppers should design or choose a system that will give them the pathing data of shoppers using the app in an actionable form.

Jonathan Marek
Guest
I love this idea, but why don’t we take it further. I was in a Top 5 big box store this past weekend looking for folding chairs. First, I had to find them in the store, then when there were fewer than I wanted on shelf, I had to find an associate (not easy). I asked him if they had any in the back, and he looked it up on a handheld device. That showed him there weren’t any in stock but gave a list of nearby locations that had them, along with an inventory count by store (which isn’t on their website). He said we could call the nearby stores to hold them, but only same day… and we didn’t have time to get them until the next day, so we’d have to call then. How many ways can you think of to improve that experience? Why can’t I see where the chairs are on my device? Why couldn’t I know the inventory in advance? Or at least, why couldn’t I look up the back-room and nearby-store inventory on my own device without having to track down a human? Why couldn’t I say “hey, I’ll buy the chairs at… Read more »
Vahe Katros
Guest
What would be the most appealing? Here is a scenario: 1. I am a Macy’s shopper, I am on the web, I see an item and I select that I want to look at that item when I visit.2. Over time, the system compiles the items I want to look at when I visit – when I have time to shop, I request that the system provides me with a turn by turn map (I am thinking of the Macy’s ad: These boots are made for shopping by Nancy Sinatra—as the shopper fills their basket—can you imagine the shopper envy over the productivity?!)3. My turn-by-turn map is integrated with the merchandising system so I know that all the items are in stock—yes! 4. I am in the store, I follow the least path map, perhaps I choose the favorites path to browse where others have gone.5. And the killer social application—merge your map with friends maps and choose the best path to optimize the trip. 6. Of course there is the curated browse, which is the path selected for you by a personal shopper—maybe celebrity browsing.7. Awards for the fastest/most productive black Friday shopper?8. And for Home Depot—the project oriented… Read more »
Michael Baker
Guest
Michael Baker
4 years 11 months ago

I think this technology would be very valuable in supermarkets where the customer is not really browsing/recreation shopping, but trying to find specific items. Cutting the amount of time he/she spends in the supermarket would improve the experience without reducing the transaction amount.

It could also be valuable in a home improvement or office supplies store. I’m not so sure about department stores, which tend to be arranged by brands rather than by product.

Vahe Katros
Guest

One more thing, the ‘Path-based Suggestive Selling Tool (PSST!)

Scenario: The system sees that your shopping path will be nearly adjacent and take you by something that is in-stock and perfect for you based on your opting into the “open closet’ or perhaps it’s perfect for a friend who, the system reminds you, is having an important anniversary next week.

Ralph Jacobson
BrainTrust

We have been thinking about absolutely every aspect of this application mentioned in this article since we started attaching mini-kiosk-type devices to shopping carts in the late 1980s. (We’d probably call them “tablets” today, LOL). Again, we have a great example of an idea whose technology has finally arrived. The shoppers are obviously now ready to adopt it and the technological capabilities respond to the challenges and sales opportunities shoppers face.

This is great stuff, and now that a huge, complex and expensive physical infrastructure is no longer required inside every store, I believe the time has come for this application.

Matthew Keylock
Guest
Matthew Keylock
4 years 11 months ago

Shopping while holding a phone is still not that easy today (in my opinion). Some shopping carts make this easier, but more change is needed to make the phone accessible throughout the trip. This will likely be a combination of technology innovation and physical developments in the cart/basket/store.

There is also a need to connect up the digital experience for the consumer too. For this to work well, capabilities like shopping list apps need to be connected to my offers, my personal prices, my store’s layout, product availability, my recipes, substitutions, payments and so on.

For retailers I think part of the challenge is choosing when to do this. There may be lots of potential in the data but in reality this kind of tracking data is still hard to use (due to accuracy and scale issues). Getting things slightly wrong can create big issues for customers (e.g. Apple maps!).

It also may create yet another silo of data and fragmented insight that confuses the business or just takes focus away from retail basics or other more valuable innovation.

Chandan Agarwala
Guest
Chandan Agarwala
4 years 11 months ago

Shoppers are expected to see value in the offering, only when they are able to search the application for the location of a desired product category, or brand. Otherwise, they may perceive the application to be a channel for spreading promotions by the retailer. While rolling out the application, customer satisfaction of retailers should be ensured. Otherwise, as the novelty will wear off, many may choose to stay away from the application.

Alexander Rink
Guest
4 years 11 months ago

As a stereotypical male shopper, I would love to have some sort of guidance system to provide me with a more efficient shopping experience!

For retailers, on the other hand, there are both pros and cons. On the positive side, they can reduce customer frustration in situations when shoppers are unable to find the product they are looking for (or an employee to help them). Furthermore, they have the opportunity to highlight specific promotions that they know they are competitively priced on right in the app, depending on the shopper’s location within the store.

On the other hand, retailers may lose some of the serendipitous exposure to other products in the store—with shoppers no longer having to look for products or browse, loss-leader products may become just losses.

At the end of the day, I think it is a net positive, as it provides shoppers with the ability to self-select whether they would like to use the app or not, thereby enabling them to tailor their shopping experience to their liking.

Dave King
Guest
Dave King
4 years 11 months ago

These apps will be great for big-box stores (especially in Home Centers) where shoppers often have difficulty finding store personnel (or getting their attention) to help locate products.

The apps will also help new employees learn the layout and location of products in stores.

Accurate, up-to-date and consistent Planograms, Store-to-Planogram Record, and Store Map files are a must-have.

Anxious to see the “products most searched for” that these apps will record—perhaps some eye-openers that lead to new in-store merchandising strategies and tactics.

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