Mulling over whether or not to buy, say, a new handbag for yourself or your significant other, you wander off to browse. Then when you return, the price has fallen. You snap it up amid a fevered frenzy of shopping.
You’d be silly not to, right?
But would you feel more uneasy about the deal knowing that the shop has tracked you on your journey around the store using your smartphone?
How Does It Work?
Walk down a main high street. Your phone could get pinged with offers from Gap, Urban Outfitters, and Hamleys. Macys might remind you there’s a sale on. Very thoughtful.
Right now, you have to download an app to receive such notifications, but you’re still being traced around shops.
Many retailers offer free Wi-Fi access to their customers, including department stores and restaurant chains, while giving secure Wi-Fi to their own employees. Smartphones, if Wi-Fi is turned on, send out probe requests in order to locate networks in the area to connect to. It’s a handy way of potentially saving your data usage.
This request contains an identifier specific to your device, known as the Media Access Control (MAC) address. Your PC has one too, and this is how you can find it. Shops can collate information from these MAC addresses and use them to either send appropriate advertising to your phone or locate you in the store and the nearby area.
Mannequins and MACs
You and your phone’s location is established using beacons, discreet chips located around the store to push and receive signals. Some have even been used in mannequins to help you find exactly what said dummy is wearing. “Research shows that customers already use their smartphones while shopping in store, but until now, the retail industry hasn’t realised the full potential of this,” said Jonathan Berlin, co-founder of the Iconeme app. “[Beacons in mannequins combine] consumer desire to be connected on the go, with the bricks and mortar store.” That beacon can send offers to you from a 50m radius.
If you’re in the shop, however, beacons can assess the signal strength from your device in order to get a solid estimate of your location. If you’re between beacons, the pair can pinpoint you more accurately.
How long do you spend in a store? How long down each aisle? What route do you use around the store?
In theory, this could make your shopping experience much easier, or even reward loyalty. But it’s a two-way street. Any initial scepticism could be warranted.
How Is This Information Being Used?
Through this, retailers can get a better understanding of their customers and their needs; notably, how long you’re looking at a product, at a display, at, perhaps, the length of the queues. It’s all in order to obtain the only thing big name shops are really after: your hard-earned cash.
A money off promotion or 3-for-2 deal is often enough to push you into purchasing an item. It might be just the thing to force you into making a positive decision. Retailers know this. That’s why the major brand names that typically cost you more per unit (but look good thanks to multi-colored signs that boast about special offers) are at eye height.
This is just the very simple psychology of shopping.
In his 1984 book, Influence, Robert Cialdini notes the persuasiveness of “the principle of scarcity, which states that people are highly motivated by the thought that they might lose out on something. Call it the Eternal Teenager Principle: if someone tells you that you can’t have it – boy, do you want it.” If a shop detects a high number of people in one department, or looking at a specific brand or product, a discount combines with this scarcity tactic to make you want that item more.
We’re subject to this even more when it comes to luxury items.
“Oscar Wilde famously noted that he could resist everything except temptation. In reality, people differ substantially in their ability to display self-control and these differences explain individual variability in impulsive shopping,” Tomas Chamorro-Premuzic, University College London’s business psychology professor, writes. “It should also be noted that since narcissism levels have been rising over the past decades and narcissistic people spend more effort and money cultivating their look and accumulating material possessions, it is unsurprising that impulsive consumption is on the rise.”
Impulse buying is also the reason essentials — notably bread and milk — are typically at the back of stores: it forces you into walking past other products before getting to what you really need. Black Friday is further testament to the power of supposedly-good offers, as is the (admittedly-questionable) success of Amazon Prime Day.
That means shops get your money and in exchange, you get discounts. Fair enough. It’s even better if your weekly trip to the supermarket means retailers can improve the flow of customers into their premises.
Sadly, it’s not just your money you’re surrendering…
Isn’t This a Privacy Nightmare?
Yes. Yes, it is.
It’s even more of a concern when you take into account stores that also use smart CCTV with facial recognition capabilities, allowing them to specifically target ads at shoppers. Women might see adverts for perfume, while men could be pointed towards shaving products. A video may tell you about the negative impact of humans on the environment when CCTV spots a litterer.
“If you are an angry man of 30, and it is Friday evening, [an enabled device at the till] may offer you a bottle of whiskey,” says Ekaterina Savchenko, head of marketing at Realeyes, a London-based company that registers customers’ happiness levels.
Techniques to assess videos have progressed so far, motion magnification could be implemented by surveillance services in future; it’s no surprise that facial recognition, the likes of which Facebook uses day-to-day, is being rolled out to shops too.
Does the Government Allow This?
While this new technology threatens the privacy of shoppers across the USA, in the UK, the Information Commissioner’s Office (ICO) is especially interested in so-called “Wi-Fi Analytics.”
“When this type of technology is used to generate aggregate statistics about daily visitor numbers or to generate an alert if an area is overcrowded, it can be done in a privacy-friendly manner,” says Ico’s group manager for technology, Simon Rice. But he further warns, “Even if the identification of individuals is not the intended purpose, the implications of intelligent video analytics for privacy, data protection, and other human rights are still significant.”
You can be tracked at your place of work, at home, and of course, online. And though there’s been many questions raised about CCTV already, retailers are getting even smarter in their ability to track you.
The ICO, therefore, has advised stores using beacons to, at the very least, tell their customers about the technology: this is what fashion retailer, Nordstrom was criticized for doing when they launched the system.
Furthermore, the Ico’s list of recommendations includes: “Organisations should consider converting the MAC address into an alternative format that suits the specified purposes and remove the identifiable elements. Retaining the MAC address in its original form can present an unnecessary privacy risk. You should delete the original data once it is no longer required.”
This would mean that data could be collated, but that couldn’t be traced to an individual. Essentially, the retailer would be getting a more interactive version of anonymous feedback.
What Can You Do About It?
— Batman 66 Labels (@BatLabels) April 28, 2016
Aside from expressing your concerns in writing, there’s little you can do about CCTV and facial recognition software (though at the moment, you’re safe in the knowledge that few places actually use the latter).
However, there’s something very simple you can do to combat the collection of MAC addresses: turn off your Wi-Fi.
Sure, that’s an annoying hassle each time you go out, and it’ll mean you won’t be able to connect to McDonald’s internet, for instance. That’s all you can do, though. Fortunately, using up data from your service provider doesn’t give a beacon access to your location.
It’s not absolute either: the only definite way of making sure you’re not being tracked is by turning your smartphone off entirely — but let’s face it, no one does that these days…
Are you worried about how this infringes on your privacy? Or are you happy to exchange this for better services? Let us know below.