Big-data analytic solutions can provide brick-and-mortar stores with the same kinds of insight online tools provide to e-tailers. Physical stores gather data from loyalty cards, in-store cameras, smartphones, and even smart carts. Now, Synqera, a retail technology startup, has added facial recognition technology to the arsenal.
Saint Petersburg, Russia-based Synqera delivers customized marketing content for customers at the moment of decision. In July, according to a press release, it began piloting “intelligent retail technology" that leverages big-data and real-time customer response in partnership with Ulybka Radugi, one of Russia's largest cosmetics chains.
Synqera sells software for checkout devices or computers that can personalize marketing messages based on a customer’s gender, age, and mood, measured by facial recognition. How does it work? Synqera gathers data about customers from sources like loyalty cards and combines it with real-time information -- like the items in a shopper's cart and the shopper's facial expressions.
It then applies analytics to create a personalized promotion on the spot, which can be delivered in the store on video displays, or outside the store on the customer’s smartphone or mobile device.
One promotion does not fit all, and the company maintains that knowing a customer's history and buying preferences can help retailers tailor promotions and increase the odds of making a sale.
The company considers facial recognition an important part of the process. Say a customer isn’t smiling. The system can access her purchase history and suggest an appropriate purchase as a pick-me-up, possibly with a special deal on the item. Another possible tailored response is "a funny picture on the checkout screen."
A recent Guardian article stated, “Today's shoppers crave personalization -- they want to feel as though the shopping experience has been created with them in mind. For that reason, video should feature a call to action that prompts shoppers to give their personal details.”
But is a blanket statement like that really accurate? The Guardian article cites a 2012 Accenture study, claiming the study "found that 49% of consumers in the U.S. and U.K. are happy to offer data in return for a relevant shopping experience, so stores should use video to prompt signing up for membership, a loyalty card or a mailing list."
What the study actually states is that 49 percent of consumers in the US and UK "are receptive to their favorite stores or brands using their tracking data to inform their future purchases and make them aware of product availability."
That's not quite the same thing, is it? And one way or another, the reality is that stores still need to be sensitive to the privacy concerns of the other 51 percent.
Ekaterina Savchenko, Head of Marketing of Synqera, tried to address those concerns in an email interview. She told me that Synqera doesn’t handle customer data, which remains in the hands of the retailer, and that customers have to opt in to allow the retailer to access the personal data from their loyalty cards. She explained:
No card -- no personal data. We may still see the facial expression and predict gender and approx(imate) age of the customer through the device's cameras and use it like triggers for content targeting -- equal to the data on the weather forecast in the moment of purchase -- but we never match this data with customer personal details. Please note that online stores do the same for years: (they) target ads based on the demographics and shopping history of the customer.
Savchenko confirmed that customers have to opt-in to participate in the solution's email, text, and mobile app functions.
While in-store facial recognition may make some people feel creepy -- as if they are being stalked -- it’s not all that different from training a salesperson to pay attention to a customer’s taste and the physical cues of her behavior for a personalized sales pitch. If you’re the kind of person who likes to be greeted by name and offered something that your history indicates you would like, then you may not mind personalized communication on a computer screen. In time, the practice may become as common as those ubiquitous purchase suggestions from Amazon.
Do personalized offers make you smile? Or do you value privacy over customized shopping experiences?
I do llike personalized offers it shows the retailer is thinking about me! However, I have heard that facial recognition can loose its accuracy over time based on aging etc.How would they address this issue?
@Norren Though I admit to being absent-minded myself, I would recognize what I usually buy and what I don't. So something unusual would make me think, "Was I planning to buy this for a particular reason?" But I think such an app would be most effective with husbands whose wives usually do the shopping. They're the type of men you are apt to see on weekends in supermarkets with their phones either glued to their ears or held in front of their eyes as they check on what they're supposed to buy because they don't know what the usual thing is.
@Louis, definintely, they have to not just think of ways that may increase sales but of what the customers' reactions may be. The assumption at work here seems to be that if they don't mind the tradeoff of discounts for data collection in loyalty cards, they won't mind this either, particularly as it is supposed to offer them what they would be interested in buying.
@SaneIT that would be devious. It would also have rather a gaslighting effect on some of us, as we would think, "I don't remember writing that down, but it's here, so I must have. I must be losing my mind." People may just go back to scribbling a list of items on the back of an envelope the way I do then to avoid such mind games.
It depends on the product, if it is something I am interested in then yes otherwise it is spam. But I think this could be a very interesting slant to analytics, Ariella. How do marketing tools ( which are ultimately used for their Analytical value) affect the customer ?
I don't think many companies take the time to consider this.
That's true. There was an ad a couple years ago that featured a guy at the supermarket looking at his phone for a grocery list and things kept popping into his list. At first it looked like maybe a spouse was adding to the list then it started getting junk food item after junk food item and the commercial cuts to two kids laughing as they edit the shopping list from a laptop. I could see an app doing something like this or adding brand names for sponsored products.
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