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IBM's New 'Presence Zones' Help Retailers Transform In-Store Experience

Jan 9 2014, 9:36am CST | by

 
 
 

At the National Retail Federation event next week, IBM will showcase a new technology that merges in-store, online, and mobile shopping into a single customer experience.  The technology helps retailers give shoppers a 360 degree experience that connects every touch point to deliver smarter, more personalized promotions. To learn more about this new technology, I talked with Craig Hayman, the General Manager of Industry Solutions for IBM and leader for IBM’s Smarter Commerce initiative. Click here to view a video on Presence Zones.

 What are “Presence Zones”?

 According to Hayman, Presence Zones transform the in-store experience by using intelligent location-based sensors that help retailers engage shoppers with real-time promotions as they move through the store.  The goal is to integrate the physical and digital experience and create a seamless journey that benefits both the customer and the retailer.  As the customer moves through the store, IBM’s new technology allows the retailer to extend relevant and timely offers based on their time spent browsing different aisles and products.

The technology utilizes the retailer’s WiFi network in tandem with the customer’s mobile device to deliver the location-based service.  Once a customer opts in to participate, their location and patterns of travel are tracked in the store with targeted real-time information – such as a new promotion or more detailed product information – delivered at various points based on the products they are browsing.

Is there an example of how this would work?

As an example, consider a new mom shopping specifically in the newborn clothing section at a major retail chain or department store. The retailer could craft specific messages – whether it’s a promotion, an advertisement, or education – tailored to the new mom’s needs. They could provide contextual information regarding the top pieces of clothing every newborn needs, or provide a coupon to drive repeat visits as the child grows.  As the mom moves to the grocery area, that message could then be tailored in real-time to focus on a newborn’s dietary needs, again based on the knowledge that the woman is a new mom.

Taking that example one step further, let’s say the father is about to leave his favorite home goods store after comparison shopping on his mobile device for a new crib (something that happens more frequently according to IBM, which saw mobile traffic soar by 40 percent over the recent holiday season).   Assuming he has opted to participate, Presence Zones knows both the aisle and products he’s been browsing based on his physical location.  It also knows that he participates in the rewards program and immediately delivers a 15 percent discount to his smartphone, winning the in-store sale while rewarding his brand loyalty.

How is customer privacy handled?

This was one of the most important issues when the technology was first developed in IBM labs, said Hayman, who underscored that the entire experience begins and ends with the customer’s decision to participate in the service.

Every customer has to opt in, and further, IBM doesn’t receive, store, or share any personal data, which is considered proprietary between the retailer and the customer.   The customer can opt-in or opt=out of the service in a few ways, including through the retailer’s mobile app or website.  Alternatively, they can just shut off the WiFi signal on their mobile device.

How are customer preferences managed?

Using the above examples, Hayman outlined a few important goals during the shoppers’ journey.  One is ensuring the customer is willing to participate.  Without consent, no personal data is exchanged and the customer goes about their day.  Another is the ability to reward loyalty by delivering a tailored and connected shopping experience through a mutual exchange of information.  The retailer understands more about the customer, and in turn, the customer receives a much more personalized and targeted promotion.  In addition, and enabled by that deeper understanding of in-store traffic, the retailer is able to direct sales associates for better face-to-face service or optimize the physical location of new in-store promotions.

Hayman indicated that through significant analysis, IBM has learned that people prefer very different levels of engagement. Some might want notifications, others might want email, and others might prefer in-depth and engaging discussions with a particular retailer. IBM’s analytics enable retailers to help discover customer preferences so that they can approach customers in a customized and appropriate manner. Hayman likened this capability to looking at a diamond and seeing the different facets of the stone. Likewise, IBM’s technology enables the retailer to integrate different facets of the customer’s behavior to better predict their engagement preferences. In the long-run, this should lead to a better customer experience that translates into greater loyalty.

 What is the next step for the roll-out of Presence Zones?

 While the company has not yet made a formal announcement, Hayman indicated that IBM Presence Zones are currently in several pilot tests with retailers to measure efficacy. They will also be displaying the new technology at the NRF conference, so feel free to stop the IBM booth to take a look.

 Join the discussion: @KimWhitler

Source: Forbes

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