Consumer tracking system to understand customer flow

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An honorable member of the Coffee Shop Has Just Posted the Following:

Companies can spend milion$$$ on SAP CRM system but this is alittle too much...

In-store surveillance systems raise privacy fears in Hong Kong

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Hong Kong shoppers are being secretly monitored by a state-of-the-art, heat-sensitive, in-store surveillance system to find out what they buy, when they buy it and how they move around stores.

Privacy campaigners say the new technology - pioneered in the US and now being used in stores in the city and on the mainland - violates shoppers' rights.

However, one company selling the so-called in-store analytics system is adamant its products are less intrusive than conventional security systems.

Tim Callan, chief marketing officer of RetailNext, said the system ensured better privacy than standard in-store surveillance cameras because shopper's faces are not identified.

Privacy advocates disagree, saying such technology siphons off customer data without their knowledge. Customers cannot opt-out and shoppers have no say in how their data is used.

Hi-tech cameras work with multiple lenses positioned to cover the entire floor space. Within minutes, the video footage is converted into a computer file format containing data on customer movements, broken down by sex.

The system can determine the most heavily trafficked areas of a store by creating a multi-coloured heat-map.

The programme assesses what customers are doing and looking at, so stores can rearrange fixtures and fittings in order to entice shoppers to spend more.

RetailNext confirmed at least one of its systems was being used by a Hong Kong retailer, but declined to identify the company, citing client confidentiality.

Nick Pickles, director of privacy at the London-based campaign group Big Brother Watch, said the new developments were "very worrying".

Locally, the Privacy Commissioner's office said it would have to further investigate the practice before it could determine whether RetailNext's technology breached Hong Kong's personal data laws.

The Sunday Morning Post contacted several major Hong Kong retailers, asking if they were aware of these monitoring technologies, and whether or not they intended to use them.

A Chow Tai Fook spokeswoman confirmed the jeweller was looking into a "hi-tech system to study shopper habits".

"We are aware of this kind of real-time in-store analytics engine. We are also studying a similar technology for a more advanced system to study customer behaviour," said a spokeswoman.

A spokeswoman for A. S. Watson said it did not use the system but was aware of these "special technologies", adding that its group of companies had no plans to use such a system in-store.

Lane Crawford, Sa Sa and Sogo were also contacted by the Post, but declined to comment.

Guidelines on CCTV Surveillance Practices issued by the Privacy Commissioner's office said retailers "should explicitly inform the people affected [that they] are subject to surveillance" and should "state the reasons for collection".

However, it also states in-store surveillance can be "necessary" for "legitimate functions", leaving the non-binding guidelines open to interpretation.

Lawmaker Charles Mok, an information technology expert, said retailers needed to be open and transparent about their snooping practices.

"Customers must have the right to know that they are being monitored in the stores, and their actions are being tracked and such information is used for analysis," he said.

RetailNext said its technology was nothing new in the retail industry. "The vision behind in-store analytics is to provide the same kind of capabilities to understand what's happening inside brick-and-mortar stores that the e-commerce world have used and enjoyed for more than a decade," RetailNext's Callan said.

Retailers are able to increase customer spending and reduce in-store thefts each by 10 per cent, making the technology an attractive investment.

Callan said the cost of the system depended on the number of stores and the floor space.
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