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Retailers count on UWB RFID
to track employees, customers

1/19/09 | John R. Johnson | email

Retailers have struggled for years to capture an accurate count of the number of customers in their stores. They've had some success using video-based technology, but those systems couldn't distinguish between customers and employees.

"By developing FloorTrak, we're able to provide...the most accurate and reliable traffic data available - ultimately increasing store performance and improving the bottom line."
Bill Martin, ShopperTrak

Now, retailers are utilizing ultra-wideband (UWB) RFID technology to do just that. An auto parts retailer and a purveyor of specialty apparel items are now able to effectively isolate employee counts from customer counts, providing precise analysis of the impact of employee activity in the store. The system was unveiled by ShopperTrak at last week's annual National Retail Federation show in New York City. ShopperTrak, which calls the system FloorTrak, is relying on RFID technology from Time Domain Corp.

The system is being piloted at nine retail locations in Chicago, Atlanta and Detroit. About 45 associates at the apparel pilot are outfitted with thin, active PLUS real-time location system (RTLS) tags that are placed on lanyards or behind nametags. The auto parts store, which began its pilot in August and is expanding the project to about 20 percent of its stores, is tracking the movement and behavior of more than 125 employees.

The retailers have requested anonymity, as they believe the technology provides them with a distinct competitive advantage. For example, by obtaining this level of traffic data, FloorTrak allows retailers to improve operational efficiencies by separating customer activity from employee activity in key areas of the store, comparing actual fitting room customer traffic and store conversion rate to other stores, and determining the effectiveness of in-store strategy changes, including visual merchandising, signage and reconfiguration. In addition, retailers can schedule labor more efficiently, identify staff compliance with store directives, and analyze new store concepts.

The auto parts retailer is using the technology to track when employees go outside to help customers who have questions about possible repair items. That represents an ideal selling opportunity for the retailer. "Their business problem is that they encourage employees to go into the parking lot and help them diagnose different issues with their car," says Greg Clawson, vice president of worldwide sales and marketing for Time Domain. "This helps them know how many customers they are seeing during a day, and to help gauge employee behaviors. It might be cold out, for example, and employees don't want to go outside."

The apparel retailer is using the technology specifically to gauge employee interaction with customers around fitting rooms, where customer counts are normally difficult to obtain due to high employee traffic. Retailers emphasize that the likelihood of a sale increases enormously if the customer tries on a selection, and this system enables the retailer to better understand customer behavior and volume at the fitting area, allowing them to provide the best possible fitting room experience - ultimately increasing conversion rate and return trips to each store.

"Customer traffic data has evolved to become a key metric retailers rely on to become more efficient and to maximize conversion rate in their stores," Bill Martin, co-founder of ShopperTrak, said in a release. "By developing FloorTrak, we're able to provide our retail clients with the most accurate and reliable traffic data available - ultimately increasing store performance and improving the bottom line."

The FloorTrak™ system combines ShopperTrak's Orbit 5™ sensor with Time Domain's (UWB) PLUS™ reader. FloorTrak™ is positioned above each entrance or pass-through area. When a tagged employee moves through the coverage zone, their unique tag ID is transmitted to the Orbit sensor. The device utilizes two on-board video sensors with high speed processing components to unobtrusively track customers' movements in a retail environment. Previous efforts using passive and active RFID were either too costly or failed to produce read rates higher than 90 percent, the minimum standard that the retail industry is looking for.

Clawson says that UWB RFID technology is ready to be rolled out into a number of retail applications. He says Time Domain will announce more customers in the second quarter, and that UWB technology has a strong future in retail, where one retailer at the NRF show suggested tying the technology into customer loyalty cards. That application would call for customers to opt-in to the technology, which would be placed on their customer loyalty card or token.

"When we launched publicly at NRF the interest level was very high from lots of different customers," says Clawson. "With customer loyalty cards, retailers would know who their top customers are and who buys the most. When they enter the store, a manager would get a notification that a top customer just came into the store. There are a lot of ways to use this to help increase the shopping experience."

Clawson doesn't expect to encounter customer resentment of the system for loyalty cards, especially if they are educated about the system by the retailer. The power levels emitted from the UWB tags are much lower than cell phones and even pacemakers. "If this is built around an incentive for the customer, it shouldn't be a problem," says Clawson. "When you enter a store, you already have the assumption that you are being watched. We're not talking about tracking you in your home. This is for use at a retail store where you're already being watched."

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