Indoor Location Tracking to reach $5BN by 2018

Online has for many years been spoilt with the wealth of information available to understand visitor behaviour, one of the really interesting developments was in-page analytics. What this allows you to do is understand user behaviour and how they journey through your site, a few small tweaks with positioning, size, colour and let’s see what that does to user behaviour. It’s not perfect, for example if a link appears more than once on a page you get the same metric but it really is a powerful tool to play around with the layout of a site and see the effects.

Now retailers have long invested in macro and micro space planning and planograms to plan and measure to some degree the effectiveness of a store layout, which would predominantly be done by measuring sales volumes in different layouts. Retailers have also invested in technology, predominantly camera based, to track footfall and movement around a store. this tends to be cumbersome and not particularly light on budget. According to a research report by ABI the market is now really starting to hot up and will be worth $5BN by 2018.

“In the last six to twelve months there has been a shift in retailers being slightly aware of this to now where they are starting to make moves to actually implement this,” said Patrick Connolly, London-based senior analyst at ABI Research.

“What we are starting to see now is companies doing indoor mapping and building basic services like shopping lists around it,” he said.

“The next six to 18 months, we are going to start to see big retailers deploying those indoor location technologies on top of that and enabling new services such as customer analytics for their own internal use or in-store navigation and ultimately moving to hyperlocal in-store advertising.”

There are a few competing technologies with WiFi, Bluetooth and Phone Sensors. We personally think WiFi will win out on this, and that is where we have placed our bet with our own indoor location tracking features. It is worth saying that sensors that track phone signals for 2G/3G are more accurate in the placement of location but are also very expensive and means you are building a totally separate technology platform. That said, in certain circumstances this may well be worth the investment.

The main reason we think this, is that at the same time as retailers are looking to gain more insight into customer behaviour using these technologies, they have an equally important need to enable guest WiFi. Firstly because people demand it and secondly because if integrated digital strategies such as m-commerce are going to work then you need your customers connected to a fast and reliable connection.

If you are already investing in Wi-Fi and can also leverage this for indoor location tracking, then you’re getting much more ROI on limited budgets. Mix in what we are doing with social wifi  and this starts to be an unbelievably compelling business case.

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