Retailers Tracking Every Move Shoppers Make

A female customer in her mid 30s stays in the vegetable section longer than any other section. She waits 49 seconds before she picks up a head of lettuce. Then she moves to the household products section and quickly puts toothpaste in her cart. She stays in the store for 8 minutes and 40 seconds. Her total comes to 26,110 won.

All of that purchase information is listed on a screen at the retailer’s headquarters.

This could become reality sooner than expected. Radio Frequency Identification (RFID)-enabled shopping carts, which have been recently developed in Korea, are expected to enable retailers such as large discounters to have easy access to customers’ purchase information.

Retailers can see shoppers’ movements every second-

At Home Plus Super Express store (large supermarket) run by Samsung Tesco in Seocho-gu, Seocho-dong, Seoul at 11:00 a.m. on July 28, the company unveiled an RFID-enabled cart which shows exactly how a customer moves in the store.

It is the world’s first RFID technology system which offers analysis of a customer’s pattern of movement in the store, the company said. Wal-Mart, the world’s largest retailer, uses RFID only for the goods supply process.

When carts or shopping baskets with RFID tags attached move in a store, readers installed in every corner in racks read them.

The system allows the retailer to understand exactly how a customer moves and how long he or she stays in the store, even down to the second.

When a customer presents a Home Plus mileage card at the checkout, his or her age, pattern of movement and the list of purchased products are shown on the screen.

The analysis of the information will enable the retailer to rearrange racks in popular sections and display items most favored by customers. As a result, customers can easily find what they want and finish shopping earlier than before.

Indeed, Samsung’s pilot test of the RFID movement analysis system at the Seocho store between June 30 and July 14 showed that a customer stays in the store for on average eight minutes, shorter than the retailer’s original expectation of 20 minutes.

Also, many shoppers were found to go straight to the checkout in the middle of the store, defying the retailer’s expectations.

Many Challenges Are Ahead-

When RFID tags are attached to all products in the future, the purchases will be tallied up by simply passing through the checkout with the cart,

But much needs to be done before this can be made into a reality.

First, RFID has a higher chance of malfunctioning when it is near metal or high humidity. What’s worse, chips used for RFID tags are expensive. Even though the price has declined significantly, one chip still costs 400-500 won.

Kang Ho-min, the director of EAN Korea, said, “Over the past one to two years, the country’s RFID technology has made great progress to the point it is now as good as that of advanced countries,” adding, ”Some areas of logistics are expected to use RFID technology within two to three years.”

Jin-Suk Huh jameshuh@donga.com