DENVER — Surveillance cameras aren’t just for shoplifters anymore. New technology is turning cameras and smartphones into tracking devices that are capable of following a customer’s movements inside a store right down to where they’re looking.
“You’re getting very close to unlocking total opening of all privacy information on an individual,” said John T. Soma, executive direcotr of the Privacy Foundation at the University of Denver.
Soma says the privacy concerns come with software that has the ability to collect large amounts of data. He says if all customers knew what many stores are doing, they’d be concerned.
“It’s a violation of privacy in my mind,” Soma said.
The tracking technology is commonly referred to as retail analytics. Companies like Euclid Analytics, Nomi and RetailNext, offer the ability for stores to follow their customers’ shopping patterns in order to improve store layouts and increase profits.
The latest software can even capture your precise location inside a store by pinging off your phone’s Wi-Fi signal. The tracking works even if you never connect to the the store’s Wi-Fi network.
It’s hard to know how many stores track their customers because most keep the information private. RetailNext does disclose some of its thousands of clients. They include companies like Verizon, Gordman’s, Family Dollar, MontBlanc, The Art of Shaving, Brookstone, and Cache.
RetailNext wouldn’t speak to Fox31 Denver directly for this story, but a former representative addressed privacy concerns during an interview with Fox News in July.
“All of these data are really anonymous,” said Tim Callan, former Retail Next Chief Marketing Officer. “Our system and other systems are gathering data points in terms of saying this many people came to this part of the store at this time and this is how long they stayed, but we don’t know who you are individually.”
However, privacy experts like Soma say they should be required to notify customers in the store and allow them to opt-in instead.
Nordstrom did notify shoppers this summer when they began a pilot program that tracked their phones. The company then discontinued the program because of a negative response from those customers.
Still, Callan maintains that the tracking benefits customers in several ways.
“Let’s say, if there weren’t enough staffing or if an item were hard to find because it was in a counter-intuitive place,” Callan said. “That’s the kind of thing the retailer can uncover.”
Soma says customers can certainly see benefits, but he’s concerned about what might happen to all that data in the long run.
“It’s the things matching photo, location, cell phone, possibly credit card upon purchase, that’s where you get nasty things that can develop,” he said.
Since most stores use your own cell phone’s Wi-Fi to track you, one simple way to put a stop to it is by turning off your Wi-Fi signal. But a small but growing group of consumers are doing the exact opposite. Some are hoping to cash in on the practice.
Craig Callison II downloaded something called Panel App to his smartphone. It’s an app that tracks his movements and where he shops.
Callison can use those points to buy gift cards, or enter sweepstakes. He’s earned a about $15 dollars at various stores so far.
“Being able to be rewarded for just doing my daily activities is kind of cool,” Callison said.
To use the app, Craig has to turn his Wi-Fi on, so that a company called Placed, can verify his movements. The company then sell the data to undisclosed stores, online retailers and app developers.
“That’s the perfect model for privacy,” Soma said.
Soma favors the Panel App approach because, unlike other tracking, it only follows shoppers who opt-in.
“That is something I would not do, but as long as there is notice, effective notice, and effective consent, that is fine,” Soma said.
Craig says he agreed to be tracked because he knows there’s already a chance he’s being tracked anyway.
“At least now I know that I can get something from it,” he said with a laugh.