Real information about customer behavior in the store using indoor positioning

Location data enriches traditional retail data in an unprecedented way. In addition to current door counters and cashier transactions, there is actually lack of recorded detailed information on customer behavior. This changes when a tracking device is placed in a shopping cart or basket, the amount and value of data to be analyzed explosively increases.

The Finnish start-up company Iiwari Tracking Solutions brings high-precision positioning to stores, which provides information on the location of both the customer and the products. Used indoor positioning technology enables the real-time data collection of the number and behavior of customers in a store: where customers go, how long they stay within a certain aisle or category, what do they buy and how do they react to campaigns. Enriching the data collected by the checkout system with location data opens up a whole new chapter in the ability to evaluate store performance.

Does in-store campaigns have an impact on customer behavior? Now it will be found out

As multiple studies show about 70% of the customers purchase decisions are made at the store.

Positioning information is valuable to the store owner when the data reveals the real-time location of products and customers. If the analysis shows that a shelf space or product category is not attracting customers, the reasons can be determined. The shelf space for the product might be insufficient or there might be too much of it, the price image may be incorrect, or the selection may need to be changed compared to the real number of visitors in the category. When a retailer has a data-based understanding of customer movement in a store, the store can be developed based on data and the impact of changes can be measured reliably.

With the new service, suppliers receive vital information about the competitiveness of their own products on the store shelf. Based on the data it is known exactly how many customers have visited the category. When this information is compared with the information obtained from the checkout system on what has actually been sold from the product category it is easier to make decisions whether to take some products out or add them. The understanding grows, such as how the appearance or placement of a product impacts the customer and does the marketing campaign have effect. For example with new product launches the brand has little transparency on what happens in the store; whether the product image appeals to customers, whether the location at the shelf is right, etc. especially in a large scale and in multiple stores. Now, the exact location of shopping baskets and carts allows this analysis to be made based on mass data and it is unique. Attractiveness, the importance of layout reform and price changes, and location-based advertising materialize into data that is generated just when a customer encounters a product and makes a purchase decision.

The average basket size grows

The indoor location service developed by Iiwari will be deployed to ten retail stores in Finland during October 2020. Tracking devices and tablets will be installed to the shopping carts and baskets. Tablets show the customer targeted ads of the products they are currently close to and enable product location search.

The effectiveness of location-based advertising is huge. At the 2019 Iiwari’s Shopping Cart pilot revealed that the average shopping basket of customers who used the shopping cart with tablets increased by 15%. Accuracy on location is important when targeting advertising:  the advertisement must be shown when the customers true position is next to the product. If the advertisements are shown on the wrong aisle the  advertisements will become more likely distractive.

Turning the shopping cart into a smarter one is only the one step of the possibilities of indoor positioning in retail.

– Store owners can choose the services needed from Iiwari. Electronic shelf labels, employee locations regarding safety and locations of commonly used assets, precise product coordinates in stores, targeted advertising for the desired product and indoor positioning in the store’s own application are opportunities that will revolutionize retail digitalization, efficiency and customer behavior, says Ville Kolehmainen, CEO of Iiwari.

How will the store and customers benefit from the new opportunities?

One measurable advantage for the store owner is the faster collecting process of the online orders which now have due to Covid-19 increased dramatically. Collecting products on behalf of customers is an increasingly popular service, which, however, increases costs, i.e. takes off time from employees who are away from other tasks.

Iiwari’s indoor positioning service enhances collection by knowing the locations of both the Collector and the products. The application tells the collector what is the nearest product to be collected and thus the collection is faster. There can be several orders in collection at the same time and the collection time is halved – the cost for collecting decreases per basket.

The products are easy to find

Once the coordinates of the products are known, the store’s own employees, collectors and customers can easily find the product they are looking for. For example, on a tablet attached to a shopping cart, a customer can tap the name of the product they are looking for and display the exact location on the store map. Customer satisfaction increases and the shopping experience is pleasant when the products are easy to find.

When UWB enters widely to mobile devices during 2021, the retail chain can also utilize location information in its mobile applications and offer product route guidance and targeted advertising directly to the customer’s own device.

Electronic shelf labels have already entered a few pioneering stores. Here, too, Iiwari’s technology goes a step further, with shelf labels telling the exact location of the product.

Location information of employees and collectively used equipment

The store employee can carry the location badge with him/her in the store, for example in a keychain, so he/she can be easily reached if necessary. The tablet attached to the shopping cart, the digital screens of the store or retailers application may have “blue dots” indicating the location of the closest employee available. In the event of an evacuation, the location system is a security measure to ensure that everyone is safely out of the building.

When the location of cleaning equipment or forklift is in realtime known the time is saved from looking for it. Indoor positioning as a part of stores digital fingerprint is essential part of customer and employee safety and satisfaction.

Easy installation and competitive price

Iiwari uses Ultra Wide Band (UWB) technology based on radio signals in its patented indoor positioning solution. Technology is coming to mobile phones as well.

Iiwari offers turn-key service with a SaaS model. The delivery includes the necessary UWB network, base stations and positioning devices. The system is mostly wireless, so installation is quick and easy.

– I have been working for the past 10 years with multiple commercially available indoor positioning methods. Positioning based on Iiwari’s UWB technology is the only system available for retail that meets the strict requirements of accuracy, reliability, scalability and cost structure. We are constantly seeing more positive opportunities in indoor positioning. With the help of location data, retail is entering a new digital era, where efficiency and customer satisfaction is on level never seen before, Kolehmainen says.

Stay tuned and feel free to contact me with any questions by email [email protected] or phone +358 50 352 6458.