I Spy a Better Buy | Adweek I Spy a Better Buy | Adweek
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I Spy a Better Buy

Retailers are using surveillance cameras as a marketing tool. Some privacy advocates don't like the looks of it

Bradley Photos: Chris Gaede

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The Creamery, a café in the heart of San Francisco’s SoMa district, always has a long line at the counter on sunny weekends. Work-weary hipsters abandon their nearby condos and cubicles for breakfast on the patio—all under the watchful gaze of owner Ivor Bradley. A gregarious Irishman with a management background at Whole Foods and Four Seasons hotels, he knows all the regulars and likes to stay on top of the details of his business.

Even when he’s nowhere near the premises, he keeps an eye on customers and staff by way of his smartphone, watching streaming footage via the café’s security cameras. “The mobile video lets me stand above the action,” he says. “It lets me read the crowd no matter where I am.”

It sounds a bit like Big Brother—before he tells the morning OJ story. While monitoring the breakfast rush, Bradley had noticed how people reaching the front of the line would frequently and awkwardly lean across the counter display and cut off other customers to grab a cup of fresh orange juice. Again and again it happened, but no one complained, and the busy staff didn’t notice. When Bradley himself had helped out at the counter, even he never noticed. Yet it was so clear on his smartphone screen. “The camera saw what I didn’t,” he says.

Bradley saw dramatic results after moving the juice closer to the counter. “Sales of the fresh OJ shot up 100 percent,” he says. “Plus the line moved noticeably faster.”

Take that simple fix and its nearly instant results, then multiply them across many stores, and it becomes clear why more retailers—from small boutiques to Walmart—are scrutinizing footage from security cameras to improve their marketing. Such analytics are part of a booming industry called video surveillance as a service (or VSaaS), which is expected to grow from $474 million as of 2011 to some $2.4 billion by 2017, according to MarketsandMarkets, a global market research company.

As security cameras and software have become more sophisticated, more retailers are using them to study shoppers’ movements. Thanks to technology like the Prism Skylabs software Bradley uses at The Creamery, managers don’t have to watch hours of footage. Instead, they receive written and video reports.

“Security cameras are now able to expose a wealth of sales and marketing data,” says Daniel Burrus, CEO of Burrus Research Associates, a consultancy that monitors technological advancements. Now, data can reveal slowdowns in traffic, where lines form, where and how people linger, which products are hottest, and which aisles are browsed the most and for how long.

Facial-recognition technology and other experimental tracking methods tend to grab the headlines, but most people don’t realize that surveillance cameras have been used in marketing for years. Marshal Cohen, chief retail analyst of The NPD Group, recalls earlier in his career watching security video to learn which way shoppers turned after leaving an escalator. Finding that they tended to veer left, he knew where to place displays.

It was a slow, tedious and costly process, but all that’s changed. Now, cloud technology and other digital innovations give retailers cheaper, faster and easier ways to use their security footage to interpret subtle shopping patterns. T-Mobile says it uses surveillance data to evaluate the design of its retail outlets. The Famous Footwear chain draws on security footage to help managers place promotions in the optimal spot. And American Apparel employs surveillance analytics to arrange colorful clothing displays to capture the most shopper attention.

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