Retailers to Track Customers Using Wi-Fi Signals in Wireless Devices


December 3, 2013

Retail WIFI

Personal privacy appears to be disappearing with the advancement of technology. In fact, everyone leaves a trail from the websites they visit to the security cameras in public places. However, the trail is starting to become deeper with retailers tracking their shoppers. For example, Nordstrom began tracking shoppers in its stores last year, using the Wi-Fi signals within their smartphones.

The company posted signs to alert customers about the tracking, however, the signs generated enough complaints for the program to end in May. While many customers dislike the idea, Nordstrom isn’t the only retailer that would prefer to track shoppers. Many retailers believe tracking customers in physical stores is the same as online stores that track shoppers to pitch relevant ads.

According to Stillman Bradish, co-founder of The Wireless Registry, Wi-Fi tracking doesn’t collect personally identifiable information. In addition, many privacy experts claim that people already release details of their lives online, including their favorite locations to shop. However, consumers would like to have control over the voluntary sharing they do. When retailers track their movements in a store, the customer has very little control.

How Does the Tracking Work?

Smartphones, tablets, and various Wi-Fi or Bluetooth enabled devices include a MAC (Media Access Control) address, which is a 12-digit code to help routers transmit data to the correct recipient. When Wi-Fi is turned on, looking for networks to join, the device is detectable by local routers, including the routers in a retail building.

With this tracking method, the company is able to learn what promotions are effective, who visits their store often, what aisles a specific customer visits, and how long people are standing in line at the cash register. The information is gathered and uploaded to third-party companies for conducting data analytics.

Often, this type of tracking is happening without the customer’s knowledge. This tracking doesn’t even leave cookies or connections that the customer can monitor. While the information gathered could offer more relevant ads to consumers, it could also be used by third-parties to prove a person was located at a specific place during a certain time.

Of course, privacy conscious users would like to believe they’re able to easily avoid tracking by turning off/disabling the Wi-Fi during shopping trips. According to some reports, smartphones may continue to be traceable even when the Wi-Fi is disabled.

Code of Conduct for Retail Tracking

Last month, FPF and seven major location analytics companies proposed an agreement to a code of conduct, including in-store signs posted to alert shoppers about the tracking technology. The use and sharing of the data will also be limited, as companies cannot collect or use data in an adverse manner for healthcare, employment, or insurance purposes. It’s important to recognize the opportunity for law enforcement agencies to use this data. When a company begins to collect this type of information, it’s appealing for law enforcement to use.

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